I may have noted to The Nation’s Dave Zirin last week that building tons of sports venues and giving the surplus ones to megachurch operators who balked at opening them up to disaster victims was an inefficient way for Houston to get hurricane shelters, but I didn’t suggest that Houston’s flood damage could be directly linked to its stadium spending spree or anything. Washington Post sports columnist Kevin Blackistone, though, has no such qualms:
Two Januarys ago, the City of Houston, after a delay of at least seven years, finally started a critical long-term project. It was patchwork on two dams constructed during the post-World War II era to protect the city from catastrophic flood and deemed by the U.S. Army Corps of Engineers to have fallen into as dangerous state of disrepair as possible. The cost: $72 million in federal funds.
Two decades ago, Houston found itself without a professional football team for the first time in seemingly forever. There was no holdup. There was no skimping.
Okay, so it’s not like Houston had a simple choice between fixing dams and building stadiums, and decided, “Stadiums it is, on the double!” But as Blackistone points out, there’s been no shortage of editorials and the like pointing out that aging dams needed to be shored up — or else “floodwaters could submerge downtown, west and south Houston and the Texas Medical Center,” in the words of one Houston Chronicle editorial last year — but the city’s response has been to wait for federal money to pay for the work. Meanwhile, Houston area taxpayers have spent around $1.4 billion on new buildings for the Astros, Texans, and Rockets in recent years (per the numbers in Judith Grant Long’s book with the really long name). As the kids today say, that’s not a good look.
And aside from the Cleveland Cavaliers arena subsidy returning from the dead, Mrs. Lincoln, here’s how some of the rest of the week in stadium and arena news went:
- Chicago is looking at closing some streets to accommodate DePaul University’s new city-subsidized basketball arena, because of course they are.
- The new arena for the Detroit Red Wings and Pistons will have a Kid Rock-themed restaurant, because of course it will.
- San Diego mayor Kevin Falconer wants to build a professional lacrosse stadium, even though the owners of the city’s newly created lacrosse franchise say they don’t need one, because of course he does.
- Rhode Island state senate president Dominick Ruggerio says he hopes the state legislature will vote on $38 million in public funding for a new Pawtucket Red Sox stadium in November, despite not believing the team has a viable threat to move to Worcester if it doesn’t get what it wants, because “You know what, we’ll get criticized for anything.” And you know, he’s got a point: No matter what elected officials do, there’s somebody somewhere who won’t like it, so might as well do whatever they want, right?
- The Las Vegas Raiders’ stadium construction could be delayed because nobody realized until now that they needed Army Corps of Engineers approval to remove a flood culvert. (The Raiders have agreed to pay the $1 million cost, at least.)
- Dave Zirin at The Nation has examined how Joel Osteen’s dithering over whether to let Hurricane Harvey evacuees into his megachurch has its roots in the Houston subsidy deal that turned the Rockets‘ old arena into the church in the first place, and I put in a cameo to note that while littering the landscape with redundant current and former sports venues is one way to create a lot of hurricane shelters, it’s probably not a very cost-effective one.
- Wells Fargo released a report that “real stadium construction spending” on new sports facilities has “climbed 80 percent over the past five years” to $10 billion per … something. And are they counting money committed, or actual construction money spent, and does this count both private and public funds? I guess we should cut Wells Fargo some slack, they have a lot on their minds these days.
The disarray of the world financial system continues to hit the stadium world: The latest victim looks to be the Harris County-Houston Sports Authority, which could see huge hikes in its bond payments on Minute Maid Park, Reliant Stadium, and the Toyota Center thanks to the collapse of the esoteric financial instruments known as
credit default interest rate swaps. (You may recall CDSs for bringing down a little company called AIG.) Without going into all the technical details — which, frankly, I’m not sure I understand even after reading more about default swaps than is really healthy [UPDATE: Apparently I really didn’t understand, as I mistook credit default swaps, which sunk AIG, for interest rate swaps, which threaten to sink the Sports Authority; everything else I wrote here is still valid, though] — the upshot is that in order to undo the bad financing, the sports authority will have to pay off its stadium debt early, with annual debt service expected to rise from $62.3 million to $83.7 million over the next two years.
That’s troublesome, because the authority only collected $79.3 million total in 2008 — and tax revenues, which depend on things like car rental and hotels that are highly dependent on a booming economy, look to be dropping. “I’m deeply concerned about the financial stability of the sports authority and all its bonded indebtedness,” former authority chair Jack Rains told Bloomberg News (which somehow managed to give Janet Jackson’s “wardrobe malfunction” equal mention in its article). “When you borrow for 30 years, you have to do prudent things, and they didn’t.”
If the shortfall comes true, the sports authority could end up having to go to the county for a bailout. And we know how well that’s worked in the past.