Friday roundup: Trump tariff construction cost hikes, Beckham lawsuit tossed, Elon Musk inserts himself into headlines yet again

Lots of news to report this week, and that’s even without items that I can’t read because of Tronc Troncing:

Friday roundup: Untangling NYCFC’s stadium plan, fighting over the Crew’s future, and what to do with a luxury suite

Sorry for the radio silence the last couple of days — it was a combination of not much super-urgent breaking news and a busy work schedule on my end — but let’s remedy that with a heaping helping of Friday links:

  • Part of that busy schedule was wrapping up work on my Village Voice article trying to unravel NYCFC’s latest stadium plan, and while the upshot remains what it was a month ago — this is a Rube Goldberg–style proposal with so many moving parts that it’s hard to say yet if it would involve public subsidies — it also involves city parks land that isn’t really parkland but is really controlled by another city agency that isn’t really a city agency and denies having control over it … go read it, you’ll either be entertained or confused or both!
  • The state of Maryland has luxury suites at the Baltimore Ravens and Orioles stadiums, and Gov. Larry Hogan mostly uses them for family members and political cronies. This should come as a surprise to no one, but it’s a reminder that getting government use of a suite as part of a stadium deal is less a public benefit than a, what do you call those things?
  • Based on questions asked at a Monday hearing, The Stranger concludes that most King County council members aren’t opposed to the Seattle Mariners‘ demand for $180 million in future county upgrade spending on Safeco Field, in exchange for the team signing a new lease. That could still change, obviously, but only if all of you readers turn toward Seattle and shout this post in unison. Three, two, one, go!
  • MLS commissioner Don Garber says talks are “ongoing” with the city of Columbus about replacing the Crew if they move to Austin, and by “with the city of Columbus” he apparently means the local business council the Columbus Partnership. And even their CEO, Alex Fischer, doesn’t sound too in the mood to talk, noting that Garber has called for a new downtown stadium in Columbus while not requiring the same of Austin: “I find it extremely ironic that the commissioner wants a downtown stadium at the same time that the McKalla site is the equivalent of building a stadium in Buckeye Lake.” MLS deputy commissioner Mark Abbott retorted that Fischer’s remarks are “certainly a strange way to demonstrate an interest in working with us.” The lines of communication are open!
  • The owners of Nashville S.C. would have to pay $200,000 a year in city rent on their new stadium, which is … something, at least. Except, reports the Tennessean, “Parking revenue collected from non-soccer events at the new MLS stadium, such as concerts or football games, would go toward the annual base rent and could potentially cover the entire amount.” So maybe not really something.
  • Glendale has extended its arena management deal with AEG through 2026, which will mean continuing to pay $5.6 million annual management fees, but also collecting about $1.6 million a year in shared arena revenues. That’s not good, but it is significantly better than the lease that had the city paying the owners of the Arizona Coyotes more than $7 million a year after revenue shares, so yay Glendale for tearing up that lease and bidding out the contract to at least cut their losses.
  • Here’s Austin’s lead negotiator with Crew owner Anthony Precourt over a new stadium, Chris Dunlavey of Brailsford and Dunlavey. on whether the deal is fair to taxpayers: “All around, I don’t know how it could get characterized as favorable to [Precourt Sports Ventures]. I think the city of Austin has negotiated this to as favorable for a city as PSV could stand to do.” Uh, Chris, you do know that “good for the public” and “as least awful for the public as we could get” aren’t the same thing, right?
  • Former U.S. senator Barbara Boxer has thrown her weight behind Inglewood residents opposing a new Los Angeles Clippers arena because it could cause gentrification and displacement. Which, not all arenas do, but in hot urban areas like L.A. it doesn’t take much to cause gentrification and displacement, so I can certainly see why there’s concern.
  • An otherwise unidentified group calling itself Protect Oakland’s Shoreline Economy has issued flyers opposing the A’s building a stadium at Howard Terminal because, among other things, it could displace homeless encampments to make way for parking lots. This is getting David Beckham–level silly, but also it’s getting harder and harder not to feel like the A’s owners should just give in and build a stadium at the Coliseum site, since at least nobody seems to mind if they do that. Yet.

Friday roundup: Bad spring training math, Beckham’s curse, and the opening of Megatron’s Butthole

No time for quips today, just the news:

  • A study by Arizona State University found that spring-training baseball was worth $373 million to the Arizona economy in 2018. I can’t find the actual report itself, but it looks like they came up with this number by interviewing a sample of out-of-town visitors at spring training games about how much they were spending on their trips — which would be a perfectly good methodology if not for the fact that lots of people travel to Arizona and then think “I’ll go see a baseball game while I’m there,” instead of traveling there just for baseball and thinking, “Sure, I’ll check out that big canyon, too.” Which is why when spring-training games have been canceled for labor conflicts, the observed impact on local economies has been pretty much zero. I wonder if the people who wrote this Arizona State report are actual economists, at least.
  • Nashville is getting an MLS franchise because it promised to build a soccer stadium, but it still might change its mind and not build a soccer stadium, and this is going to be great fun to watch if it does. (Not if you’re a Nashville MLS fan, I guess. But [insert requisite jibe about anything being more fun to watch than MLS soccer].)
  • MLB commissioner Rob Manfred said last week that he hopes MLB expands by two more teams during his lifetime (or during his tenure as commissioner — he wasn’t exactly clear), specifically mentioning “Portland, Las Vegas, Charlotte, Nashville in the United States, certainly Montreal, maybe Vancouver, in Canada. We think there’s places in Mexico we could go over the long haul.” That got people in those cities all excited, which is presumably the point in saying such things — of course, none of those cities have MLB-ready stadiums (unless you count Olympic Stadium in Montreal), so prepare for a stadium arms race sometime before Manfred dies.
  • Megatron’s Butthole is now fully operational.
  • The estimated cost of renovating Key Arena has risen from $600 million to $700 million, but the city won’t have to pay any of that because their deal with the developers says those guys have to pay any cost overruns. Kids, when signing your next arena deal, do that.
  • A Florida man was arrested for setting fire to golf carts at the golf course where David Beckham wants to build his soccer stadium, but police say it was just arson and has nothing to do with the stadium proposal. Except insomuch as David Beckham is cursed, okay? If construction on this place ever begins, I fully expect it to be interrupted by all its milk cows going dry.

Friday roundup: The news media are collectively losing their goddamn minds edition

It’s a full slate this week, so let’s do this!

As mayoral election threatens Nashville soccer, hockey subsidies, Predators’ mascot weighs in with key endorsement

When MLS announced that it was awarding one of two new expansion teams to Nashville S.C. last December, it seemed like the city had gotten the nod mostly because it had promised more than $75 million in subsidies for a new stadium. As it turns out, though, neither is now entirely certain — the public funds or the expansion franchise — thanks to, well, let’s let VenuesNow magazine tell it:

Former Mayor Megan Barry championed the stadium project but resigned in March after pleading guilty to a felony theft charge connected to her affair with a former police bodyguard. Mayor David Briley, who took over for Barry, faces a special election May 24, and other candidates have called into question the wisdom of Briley continuing on the stadium path.

Mayoral candidates have questioned allowing the team to take over space next to the stadium for development while Nashville taxpayers shoulder financial risk, candidate Ralph Bristol told local daily newspaper The Tennessean. One, Carol Swain, doesn’t believe the city can afford to fund the stadium, which the team plans to pay off with $25 million up front and $9 million a year over 30 years (ticket taxes are expected to cover the remainder of the yearly debt), and another, state Rep. Harold Love Jr., wants to look at changing the location but wonders whether any money at all should be spent on a stadium.

But can a new mayor undo a decision that the metro council already made last fall? Apparently so, as the council still needs to approve the stadium lease and rezone land at Nashville’s fairgrounds for stadium use. And if it doesn’t, team owner John Ingram warns, MLS could still pull the franchise and give it to another city.

And Nashville SC isn’t the only sports team concerned about Thursday’s mayoral election: The owners of the Nashville Predators, who have been seeking a new lease that would include public money for renovations for their arena, are worried about the outcome as well. So they waded in the only way they know how: By having the Predators’ president and mascot stand side-by-side to endorse Briley for re-election:

I don’t know about you, but when a silent person in a giant sabre-tooth tiger head points at me with instructions on who to vote for for mayor, I pay attention. I don’t know that I do what he says — the only pointing mascot I’ll take political leadership from is Youppi! — but I will certainly stare on, transfixed by the spectacle.

Nashville councilmember proposes rescinding MLS stadium funding, is immediately shouted down

I didn’t even get a chance to post about yesterday’s proposal by Nashville councilmember Steve Glover to rescind the city’s approval of $75 million in funds for a new MLS stadium before it was immediately voted down by the full council:

The council voted 16-8, with seven abstentions, to strike down a plan to scrap funding for one of former Mayor Megan Barry’s defining projects. It would have revoked the council’s 31-6 vote in November to approve $225 million in revenue bonds for the future stadium.

Glover’s intent, it sounds like, was to put the funding on hold because of concerns that money was being spent on stadium prep before the bonds had even been sold:

Glover’s push was inspired by recent reports from WSMV-TV scrutinizing preliminary work for the stadium. That included one story that found Metro Chief Operating Officer Rich Riebeling authorized $135,000 in predevelopment work overseen by Commonwealth Development Group that came from Bridgestone Arena’s financial account. The Metro Sports Authority, which operates the arena, was unaware of the spending.

“We have spent money that we never authorized,” Glover said. “And until we get our act together, until we as a council fully understand what the expenses are, then I’m asking us to rescind it.”

Stadium backer Councilmember Colby Sledge, though, retorted that funding had to be approved so that negotiations could begin with the owners of Nashville S.C. over a community benefits plan:

“If we’re going to go ahead and have this action to rescind then what’s the point?” Sledge said. “Why are we asking community members to come out and spend their time?

“To me, I think it’s disingenuous to say we would potentially do this and have this hang over our heads.”

Uhhh, maybe actually the team owners might have more incentive to negotiate a community benefits agreement if they didn’t already have their money in hand? Just a thought. Now that the funding is back on track, we’ll see how well Sledge’s “hand over the cash now, negotiate terms later” plan ends up working.

MLS announces expansion teams in Nashville and TBD

The long-awaited MLS expansion teams announcement is in, and the winners are Nashville and … nobody?

Nashville is the first of 12 cities that submitted formal bids in January to be awarded one of four available MLS expansion teams…

As a result of a private-public partnership between the club’s owners and the community, the team will play in a new, 27,500-seat soccer stadium at The Fairgrounds Nashville in the capital city’s artistic Wedgewood-Houston neighborhood.

That’s all well and good and expected, given that Nashville was waving $75 million plus free land at the league as an inducement for getting a team. (That’s what sports league press releases call a “private-public partnership.”) But what about expansion team #2? Why didn’t Sacramento, Cincinnati, or Detroit get a nod as well?

Nashville and Sacramento had been viewed as the favorites for the league’s newest teams, with Cincinnati and Detroit the other finalists. A decision on the second area picked is expected within a few weeks.

So you gotta ask at this point: What is MLS waiting for? Holding out hope that someone will fill the Cincinnati ownership group’s $25 million stadium funding gap? Waiting to see if David Beckham’s Miami team will really be ready to go anytime soon, or if the league should pick two more winners now, and push Miami back till the next round of expansion? It could be anything, really — but until we learn more, it’s just congratulations, Nashville taxpayers, your $75 million check has won you an MLS team, enjoy.

 

MLS picks four expansion finalists, only two (or three!) will win the prize

Major League Soccer announced four finalist cities for expansion franchises yesterday, and the results are both unsurprising and kind of intriguing, for reasons I’ll get to in a minute. The four remaining contenders:

These are the four frontrunners predicted by Soccer Stadium Digest last week, so no shockers there. It’s an interesting mix of candidates, though: two with stadium plans in place, one with strong fan support but a funding gap, and one with a prominent ownership group but only an NFL stadium to play in, which the league has said previously it would consider, but it seems kind of suboptimal if your goal is to extract as many new stadiums as possible. Only two winners will be chosen later this month (December 14 will reportedly be the vote), so one would think that this will come down to Sacramento and Nashville, with Cincinnati and Detroit getting a “thanks for your efforts, try again next year once your stadium plans are more firmed up.”

Unless MLS could actually pick three winners. Because don’t forget, David Beckham’s previously announced franchise still doesn’t have a home, and his stadium partner Tim Leiweke told the Toronto Star on Tuesday that he’s not super optimistic:

“I’m helping any way I can with David,” Leiweke told the Sun. “I hope it gets done, but it’s not done. I have my fears as to whether it’s going to get done because things like this that drag on this long that’s always tough on a process. But for David I hope he lands somewhere.”

So, Cincinnati and Detroit could be in there as fallbacks in case MLS needs a last-minute sub for Miami. Or, Leiweke could just be saying this as leverage to get the final hurdles cleared for a Miami stadium, and this really is still a four-to-get-two situation. In which case the final verdict will say a lot about MLS’s business model: If it’s Sacramento and Nashville, we know that anybody with a $150 million check and a soccer-only stadium deal will get the nod; if it’s Sacramento and Cincinnati, we know that MLS is looking to where there’s the most established fan support; and if Detroit is involved at all it’s either because of the allure of a more major media market, or the allure of some big-money owners who can increase the league’s ties to the NBA, or who knows.

A lot is likely to depend on how things play out the next two weeks in Cincinnati, where both the city council and the county commission approved $50 million in public stadium subsidies yesterday, but still nobody’s saying how that additional $25 million would be paid for. (Or even what the total stadium cost would be; the gap could end more than that.) And also in Nashville, where the group Save Our Fairgrounds filed suit yesterday to block construction of a new stadium at Fairgrounds Nashville. Maybe hedging with four finalists isn’t a bad idea, in other words, but picking a final two (or three) two weeks from now is going to be anything but an easy task — I guess asking the four bidders to throw money on the table until two have emptied their pockets would be too unseemly?

Nashville MLS study ignored cannibalized sales taxes, author says it’s still “modest”

Hey, the Associated Press actually asked some economists whether the $75 million in subsidies for a new MLS stadium that Nashville approved last week could ever pay off via increased sales tax receipts, and it turns out they’re split: The economist who did the city’s study says it will, and everybody else says it won’t.

  • “It doesn’t seem to be the kind of objective appraisal that the city would need to render a believable opinion on why they should spend public money subsidizing the stadium,” said Lake Forest College economist Robert Baade, noting that the city’s study failed to account for “substitution,” where people spending money at at a soccer match will then spend less on other entertainment options that they’re skipping in order to go to a soccer match.
  • University of Colorado economist Geoffrey Propheter says the idea that a sports team increases local area income “has been debunked.”
  • University of Tennessee economist Lawrence Kessler, who co-authored the city’s study, admitted he didn’t try to account for substitution effects but said “we tried to be as modest as possible” in projections. Which, it seems like being as modest as possible would actually involve trying to account for the fact that you’re relying on the Casino Night Principle to make your numbers work, but I’m not paid the big bucks to be an economics professor, so okay.

This seems like it could have gotten a stronger headline than USA Today’s “Cost study for proposed MLS stadium in Nashville questioned” — under the new rules of subjunctive journalism, you’d think it could at least warrant “Proposed MLS stadium could be massive money pit.” (The Tennessean, which ran a longer version of the USA Today article, used the headline “Nashville’s proposed MLS stadium may have hidden costs to city coffers,” which is a lot better.) But then, I’m not paid the big bucks to write headlines, so — hey, wait, I actually am. Props on fact-checking the city’s stadium claims, then, USA Today, but points off for not having the backbone to report what the actual evidence says: Friends don’t let friends count stadium sales tax revenue as new money, because it’s not.

 

Nashville MLS stadium lives, Virginia Beach arena dies (for now)

As expected, the Nashville Metro Council voted yesterday to approve $225 million worth of public bonds for a new soccer stadium for a proposed MLS expansion team, in a deal that will ultimately cost taxpayers at least $75 million, plus free land:

The financing overcame criticism over a part of the deal to give the Ingram-led ownership group 10 additional acres of city-owned fairgrounds land for a future private development next to the stadium.

Ingram, along with minority owners Steve and Jay Turner of MarketStreet Enterprises, has planned a mixed-use development with affordable and market-rate housing, retail, restaurants, a hotel and office space that he says is “essential” to the fan experience and the overall deal. Skeptics have slammed it as a “giveaway” to wealthy developers — on top of eight acres of fairgrounds land needed for stadium’s footprint.

“We’re giving away tens of millions of dollars worth of land to billionaires,” [councilmember Dave] Rosenberg said.

The Tennessean speculates that this could make Nashville, along with Sacramento, one of the frontrunners for an expansion franchise award in December, which, sure, maybe? It’s all the same to MLS where its $150 million expansion fee checks are coming from, so might as well reward the cities that provided public subsidies for the league’s prospective owners.

And also as expected, the developers of a proposed Virginia Beach arena couldn’t get their acts together by last night’s deadline to provide a financing plan for the project, even though more than 90% of the costs would be repaid by public subsidies. Or, at least, they claimed they’d gotten their acts together, but provided no concrete evidence of said acts:

Just hours before that deadline they stood before city council and said it was a done deal.
“We have JP Morgan, the United States largest bank, that is ready, able and willing to close this evening with direction from the city,” said Andrea Kilmer with Mid-Atlantic Arena. “We are ready to spend over $250 million dollars dollars in this city.”

However, city council did not believe the developer was ready.

“I would say that the city would disagree with what she represented to you,” said Mayor William Sessons.

Sessoms, however, said he was still open to the idea of a new arena, and even to working with these developers, so the deadline was apparently a bit of an abstraction? At this point, I’m never willing to call an arena plan dead until I see the wooden stake protruding from its chest.