Rams to charge record PSL price, Cavs arena subsidy moves ahead, and other news of the week

It’s Friday again, so let’s go spanning the world:

  • The Los Angeles Rams are considering charging a top personal seat license price of as much as $225,000, just for the right to then buy season tickets for $350-400 per game. This seems like a bit of a reach when the payoff is just that you get to watch Rams games, but I guess Stan Kroenke needs to try to recoup his $2 billion in stadium costs somehow — and at least if it all goes south, he’ll be the one on the hook, not taxpayers.
  • Some Canadian bank bought the naming rights to the Toronto Maple Leafs arena away from some Canadian airline. Is this going to buy it valuable market exposure and name recognition that will justify the $40 million a year expense? Not on this blog!
  • The LED lights at the Atlanta Falcons‘ new stadium make football look all weird.
  • Shreveport Mayor Ollie Tyler says spending $30 million on an arena for a minor-league basketball team is a great idea that only “naysayers” don’t appreciate. “I think sometimes we don’t believe in ourselves and some of our urban areas we don’t believe that we are able to make things happen,” she says. If Mayor Tyler needs a reelection campaign theme song, I have a suggestion.
  • “The Federal Aviation Administration has determined that the Oakland Raiders‘ proposed stadium in Las Vegas would not be a hazard to aircraft.” Huzzah!
  • Would-be St. Louis MLS owner Paul Edgerley says he’s still ready to pay $150 million for a franchise, and $100 million toward a stadium, as soon as someone comes up with the other $60 million in construction costs. Noted.
  • Cleveland Cavaliers owner Dan Gilbert has officially reinstated his plan to do $140 million of renovation work to the team’s arena, with Cuyahoga County paying for half the cost. ”This is corporate welfare at its worst,” said Steve Holecko of the Cuyahoga County Progressive Caucus, after his erstwhile coalition partners the Greater Cleveland Congregations withdrew petitions against the arena subsidy after getting a promise of two mental health crisis centers from the county. Holecko’s group doesn’t plan to mount another ballot challenge on their own, though, so construction work is set to begin later this month.
  • Mikhail Prokhorov is ready to sell the Brooklyn Nets, but will hold onto the Barclays Center, after renegotiating the team’s lease so that it will pay less rent to the arena. This … does not seem like the smartest way of going about things, but maybe Prokhorov is figuring he’ll give up future rent revenue in exchange for a higher sale price now on the team? Or maybe he’s just not very smart.

A’s stadium plan wins friend, Vegas mulls Raiders transit, and other news of the (short) week

I’m going to be on a plane tomorrow to a faraway land, so let’s do the week’s news roundup a day early:

  • Peralta Community College District chancellor Jowel Laguerre now says he’s into the Oakland A’s tearing down his administrative offices in order to build a stadium, so long as they hire his students to work there: “The A’s are in the business of hiring people, and we’re in the business of developing people, so it makes sense to have these conversations.” I can see it now: Laney College, Your Gateway to a Career in Hot Dog Marketing and Sales! (Also the A’s still need to figure out how to squeeze a stadium onto a tiny site, but one battle at a time, I suppose.)
  • Clark County is smarter than Cobb County, it turns out: The Nevada county’s planning director, Nancy Amundsen, said this week regarding the new Las Vegas Raiders stadium: “If it’s determined that they need a pedestrian bridge at this location, or they need wider sidewalks on these streets, or they need streetlights here or there — any upgrade of the infrastructure based on the development on the site — we can request that in the development agreement.” The county commission still needs to do it, mind you, but at least thinking of it ahead of time puts them ahead of the folks who negotiated with the Atlanta Braves around their new stadium and its pedestrian bridges.
  • That El Paso court case over whether the city’s new arena can host sporting events or just concerts and such turns out to be due to the city’s project consultant, according to one neighborhood group opposed to the arena: “David Romo says sports consultant Rick Horrow is to blame for the city stripping the arena ordinance of the word ‘sports’ in favor of ‘multi-purpose performing arts facility.'” If that name sounds familiar, it’s because Horrow has been selling small cities on his “raise the sales tax and build an arena plus a whole of other stuff” model for decades now — he’s the man who talked Oklahoma City into building a new arena with public money (which worked out okay in that the Thunder eventually moved there) and tried to push the same model for such things as an NFL stadium in Birmingham, Alabama (which would not have worked out okay at all). Romo cites Horrow’s own book, which advises, “De-emphasize, even in triumphant cities, the sports model,” and “Each individual project, on its own, will have little chance of passage. together, bundled, is the most enticing way to present the idea to voters.” Except when you write yourself into a corner with bond paperwork that says your new building isn’t for sports; but then, Horrow will probably have collected his fee by then and moved on to the next town.
  • St. Louis’s MLS expansion bid, which pretty much disappeared after voters rejected spending $60 million on a soccer stadium this spring, may not be dead after all! According to alderman Joe Vaccaro, “I have been hearing rumblings and I have certainly no facts.” Or, you know, it might still be dead.
  • Pictures of D.C. United‘s new stadium set to open next year! Spoiler: They don’t look like much. Also spoiler: They don’t really look like the stadium will be ready by midseason 2018 as the plan is (United will start the year on a lengthy road trip to accommodate the construction schedule), but soccer stadiums are a bit simpler to build than those for other sports, so maybe?
  • “Colorful, glossy flyers urging residents to ‘Stop the Stadium!’ and ‘Take Action Now’ were left on doorsteps around the [proposed Miami MLS stadium] area late last week, paid for by a new group called the Overtown Spring Garden Community Collective.” David Beckham really can’t catch a break.

I’ll be back here … Monday? Later than that? It all depends on how well I can navigate whatever weird metric internet they have where I’m going. In the meantime, use the comments on this post as your open thread on any breaking news, and buy David Beckham a muffin or something, he’s probably needs some cheering up.

St. Louis voters approve sales-tax hike, reject giving it to an MLS stadium

St. Louis voters went to the polls yesterday and narrowly defeated a proposal to spend $60 million in city tax money on a new soccer stadium for a proposed MLS expansion team. The stadium proposal failed by a 53-47% margin, while an accompanying ballot measure to raise city sales and use taxes by 0.5% and use some of the proceeds to expand the city’s light rail system passed by a 60-40% vote.

Local news coverage hasn’t provided much in the way of exit interviews with voters about why they cast their ballots the way they did, though the St. Louis Post-Dispatch did include this outstanding photo caption on an image of a woman in a soccer jersey peering out from between her fingers:

Lauren Rapp of The Hill watches vote returns creep in at Union Station during a watch party for the Major League Soccer stadium funding on Tuesday, April 4, 2017. “It’s been a rough night,” said Rapp. “And then (Stephen) Piscotty gets hit in the head.”

The failure of the stadium-subsidy vote puts MLS commissioner Don Garber in an interesting position: He’s previously raved about soccer fandom in St. Louis — and did so again last night after the vote, in a statement saying that the city would be “a tremendous market” for MLS but that the vote outcome was “clearly a significant setback” for the city’s expansion bid. Does the league now turn up its nose at St. Louis and say, “Fine, if you don’t want to throw $60 million at us, we’ll go find some other city that will”? Or does it try to find another way to make a go of it there, either by team owners digging deeper and funding the $60 million on their own, much as Orlando S.C.‘s owners did with their stadium, or by the league lowering its $150 million expansion fee request — either of which would risk the league’s standing in future “the subsidy way or the highway” demands?

If I had to guess, I’d predict Garber will take door #1 for this round of expansion, and figuring he can always circle back to St. Louis next time and see if the appetite for stadium funding has improved any, since it’s clear that MLS is going to keep expanding until such time as it runs out of rich guys willing to blow $150 million on expansion fees. In the meantime, the vote makes one thing clear: MLS fandom may be on the rise, but not enough for fan frenzy about obtaining a team to tip the balance against taxpayer distaste for giving public dollars to the rich dudes who’d own it. There isn’t a whole lot of extortion leverage in being an 80-pound gorilla.

As St. Louis votes on MLS, reasonable people disagree if “no economic benefits” is a bad thing

Tomorrow is the public vote in St. Louis on whether to spend $60 million in city money on a soccer stadium for a new MLS team, and everybody has a hot take:

  • A sports economist and Forbes “contributor” (aka guy who lets Forbes publish his writing for free in exchange for the publicity) says this is a good deal because $60 million isn’t that much, and it’d just be stadium taxes getting kicked back to the team (plus other taxes, but those are on out-of-state purchases so just pretend St. Louis was never getting them, okay?), plus “unprecedented” community benefits! And who can put a price on the “community/psychic/civic value” of civic pride? (Bruce Johnson, actually, and it wasn’t all that much.) Also, soccer is hot.
  • The St. Louis Business Journal notes that there’s no evidence that any of the above benefits actually exist. #micdrop

Team owner Paul Edgerley predicts that the balloting will be close, so vote early and vote often!

St. Louis council approves $127m for Blues, MLS venues, voters can still block the latter

St. Louis lawmakers took major steps last week toward throwing $127 million at upgrades for the Blues‘ hockey arena and construction of an MLS soccer stadium, though the latter will depend on the results of an April voter referendum:

  • The board of aldermen voted on Friday to approve $67 million in subsidies for Blues arena renovations. (It will add up to $105 million over time, but it’s worth $67 million in present value. And while it would mix sales taxes, ticket taxes, and other revenues, all those are all diversion of existing taxes, not new ones the team owners are agreeing to pay, so as discussed earlier, it’s all money that the city would otherwise be able to spend on other things if not being siphoned off for the Blues owners.) Alderman Steve Conway defended the subsidy as necessary to keep drawing NCAA events (“If we don’t make improvements, what comes into general revenue diminishes over time”), though he didn’t appear to provide numbers showing that any added revenue is worth the expense; Alderman Antonio French retorted, “We do not have $105 million to give to anybody. And we’re about to give money to some of the richest people in town because they want a new scoreboard.”
  • Circuit court judge Michael Mullen approved putting $60 million in funding for a new MLS stadium on the April ballot, despite the board of aldermen having approved it too late for the deadline after the initial bill was withdrawn and revised. There will actually be two votes: one to raise sales taxes by 0.5% to expand St. Louis’s light rail system, which would automatically cause use taxes on out-of-state purchases to rise by the same amount; the other would approve taking those use taxes and pouring them into paying off $60 million worth of stadium costs. If either fails to get a majority, the stadium subsidy wouldn’t happen.

The soccer stadium vote will be, unless I’m mistaken, the first time that St. Louis voters will actually be going to the polls under the law approved by a 2002 referendum requiring a public vote on any sports subsidies. (The Cardinals stadium had already been approved then, and the Rams stadium never happened.) The only poll on the subject that I can find is just of Democratic primary voters (though St. Louis is pretty overwhelmingly Democratic); it found respondents opposed to soccer subsidies by a 61-22 margin, so I think it’s fair to say the proposal faces an uphill battle. There’s still two months of campaign spending left, though, so open up those Jamba Juice (and Bain Capital) coffers, Paul Edgerley!

St. Louis committee approves more than $100m in subsidies for Blues, MLS, but who’s counting?

The St. Louis Board of Aldermen’s Ways and Means Committee approved bills this week to funnel public money into both renovations of the St. Louis Blues arena and a new MLS stadium. How much money? As is so often the case, that’s a complicated question:

  • In the Blues’ case, the original plan was to demand $67.5 million from the city, mostly in the form of kicked-back sales taxes. (It would add up to $112 million over time, but the present value would only be $67.5 million.) The committee amended the bill to include $55 million in ticket tax revenue — in place of some of the sales tax money, I think, maybe? — but that cash flow wouldn’t start arriving until 2034 since it’s currently being spent elsewhere. And since it’s not a new tax surcharge but just money that otherwise the city could start collecting for other uses in 2034, I’m not going to go through the trouble of firing up Excel to figure out the present value of that, because it’s a subsidy either way. (The Blues owners are still also demanding an additional $70.5 million from the state of Missouri, though given the new governor’s feelings about such things, that may not go so well.)
  • For the proposed St. Louis MLS team, the original plan was for the city to provide $80 million from mumble-mumble-hey-look-over-there, but that bill was withdrawn by its sponsor last month. In its place now is legislation to provide $60 million in city money, mostly from redirected property taxes, but also including a ticket tax surcharge (really payments in lieu of a ticket tax, for reasons not worth going into here) that would provide $7.5 million to $12 million over the next 30 years, and … okay, now I will fire up Excel, and that’s worth: somewhere between $4 million and $7 million now, so not really a big concession on a $60 million get.

The MLS stadium plan, if approved, would go before city voters in an April referendum. The hockey deal for some reason everyone thinks doesn’t require a public vote, though that’s not what the law passed in 2002 says. Hey, Jeanette Mott Oxford, if you’re reading this, any plans to file suit to intervene in this one?

Every concentration of humans on earth now bidding to build MLS stadiums

Nashville is looking to build a new MLS stadium, and Indianapolis is looking to build a new MLS stadium, and San Diego is looking to get a new MLS stadium, and Detroit is considering providing free land for an MLS stadium, and St. Louis is still looking to build an MLS stadium after rejecting it once, and a guy in Charlotte is still looking to have an MLS stadium built for him, and Tampa is looking to get an MLS franchise but already has a stadium.

These are mostly terrible ideas, notes the Guardian, at least where they involve public money. And if the newspaper slightly overstates the case that there’s growing pushback on MLS subsidies (truth is, they’ve never been an especially easy sell as sports subsidies go, mostly because MLS isn’t as popular yet as the Big Four sports), it does contain a classic defense of them from Peter Wilt, the Chicago Fire founder who now heads later headed the Indy Eleven NASL team and wannabe expansion franchise:

“It is about image and plays into making a city cool to live in, a good experience for young professionals, and reducing the brain drain on a community. Things like that are sometimes not taken into account. If Oakland loses the A’s and the Raiders, which is a possibility, then no one will hear about Oakland in any positive terms for the foreseeable future.”

Things like that actually are taken into account in economic studies of teams and stadiums, which overwhelmingly find that if sports teams make cities “cool,” it doesn’t show up in things like per-capita income or jobs or economic activity or tax receipts. Plus you’d then have to explain how a city like Portland, for example, which until recently had only basketball as a major-league sport and famously turned down a domed stadium in the 1960s that would have brought an NFL team, nonetheless became one of the hippest cities in America. (It has MLS now, but the hipness predated that.)

Anyway, with MLS set to announce four more expansion franchises in the next year or so, the league can probably count on some cities stepping up to throw money at new stadiums, so long as they’re not too picky about which ones. (Cincinnati, Raleigh/Durham, Sacramento, and San Antonio are also in the mix.) Bulk-mailing extortion notes is kind of a strange business model, but hey, whatever works.

Charlotte mayor tells council to email MLS stadium questions, because no time for hearings

Today in everybody and their sister wants to build a damn MLS stadium to get a damn expansion team news:

  • Charlotte’s plan for $100 million in city and county subsidies for a $175 million stadium could receive a Friday city council vote, just two weeks after the proposal first surfaced. If that seems rushed, you don’t know the half of it: Charlotte Mayor Jennifer Roberts said there isn’t time for a public council hearing on the plan, and that members should email their questions to city staff instead. Roberts later called for a council meeting on the subject at 4 p.m. on Friday, which should give plenty of time for everyone to process any testimony before a vote, right?
  • Something Charlotte council members might want to fire up their email clients about: WTF was the Charlotte Regional Visitors Authority smoking when it estimated a billion dollars in new visitor spending over 25 years and 600 new jobs as a result of building a soccer stadium? Not that $40 million a year in economic activity — which amounts to maybe a couple million a year in new tax receipts — would be any great shakes for $100 million in expense, nor is a cost of $166,000 per job. But still, substance abuse is a serious problem, and if you see something, you should say something.
  • Over in St. Louis, meanwhile, that city’s all but dead $129 million MLS stadium subsidy proposal has turned into a $60 million subsidy plus an entertainment-tax kickback of unknown value. The new plan still doesn’t have much support — the bill stalled in committee last week, after city budget director Paul Payne testified that he wasn’t confident the plan wouldn’t end up dipping into the city’s general fund — but supporters are still hoping to somehow get it approved by the council and a circuit court judge in the next four weeks to get it on the April ballot, at which point St. Louis voters can express how much they hate it.

St. Louis soccer stadium plan sponsor kills funding plan, ball’s in MLS’s court, uh, pitch

Looks like we can downgrade the St. Louis MLS stadium plan’s condition from critical to dead, after the sponsor of a city bill to fund $80 million of the cost said she’s withdrawing the legislation:

“That bill will not be moving forward,” Alderman Christine Ingrassia, 6th Ward, said at Tuesday’s meeting of the aldermanic Ways and Means Committee…

Ingrassia said she wanted SC STL to show a proposal that was at least “revenue neutral” on the city’s budget over time.

“It looked like to me, and in the conversations I had with people who have more expertise in the field of public financing, that they were basically just repackaging the same subsidies in different ways,” Ingrassia said. “So they were asking for way more than I feel like we could support here in the city.”

“Repackaging the same subsidies in different ways”? I’m sure I’ve never heard of anything like that before.

It’s not entirely clear what changed Ingrassia’s mind — you go and sponsor a bill to spend $80 million on a soccer stadium, then turn around and say that this is “way more” than you can support? — but it’s worth noting that after newly elected governor Eric Greitens ruled out state funding as “corporate welfare,” Ingrassia started backing away as well. Elected officials are just so susceptible to peer pressure, you know?

If the soccer stadium plan really is dead, at least in this iteration — Mayor Francis Slay held out hope of still getting a proposal on an April ballot, but time’s running out and there’s now no funding plan at all — it’s worth noting that this would be one of the largest MLS stadium subsidies in history, all for a team that doesn’t actually exist yet. Top-level pro soccer in St. Louis isn’t a bad idea — it’s not a bad idea most places, which is why the league is handing out franchises to just about anyone who asks — but providing a near-record subsidy just so that MLS can get away with charging $150 million expansion fees was a terrible one. This alone won’t change the league’s business model, but maybe if Greitens has started something and a few more prospective expansion cities push back against subsidy demands … friends, they’ll call it a movement?

New Missouri gov says no state stadium funding, no way, no how

Sorry for the radio silence of the last few days: I was traveling, and while intending to get back to the stadium grind yesterday, a red-eye flight proved to be incompatible with a regular morning posting schedule. (Though I did find time to finish up some music writing I’d been working on, if that interests you.)

Thankfully, Missouri governor-elect Eric Greitens didn’t take the holidays off, greeting us to 2017 by upping the ante on his comments that MLS stadium funding would be “welfare to millionaires” with a great big raised middle finger to plans for state tax breaks for a St. Louis soccer stadium, telling journalists on Monday: “To be very clear, I have completely ruled out state funding for stadiums.”

Greitens reiterated his description of state aid for stadiums as ”welfare for millionaires” but said he “looks forward to meeting with the leaders of the MLS project to see if there’s a way for them to bring private-sector funding to bring a soccer team to the state of Missouri.”

“We are not going to use money from the people of the state of Missouri for what I believe is corporate welfare,” Greitens said. “We’ve got far too many core priorities of government that have to be invested in.”

That’s about as clear as clear can be. Without the $40 million in state tax credits, the MLS proposal has a (wait for it) $40 million hole in its budget, one that neither the city of St. Louis (which would already be putting up $89 million of its own public cash) nor the team’s prospective owners (who would already be, uh, paying the league’s $150 million expansion fee, what do you want from them, blood?) seems eager to fill. Stadium bill sponsor Ald. Christine Ingrassia remarked following Greitens’ remarks, “I was hoping to get to the point where this proposal made sense for St. Louis, but I’m feeling that less and less,” while Mayor Francis Slay’s chief of staff said, “It will be tough to get this done without the state’s support.”

Not that this kills the St. Louis MLS plan dead: $40 million isn’t an insurmountable gap, and the team owners aren’t likely to just walk away from that $89 million in city subsidies without trying to make it work. But with only three weeks before the deadline to get a vote on the April ballot, there isn’t much time to go back to the drawing board if they’re hoping to get something approved this year. Time for everybody to watch Lewis Reed really, really closely.