Atlanta bridge that cost $27m to be ready for the Super Bowl will be closed for the Super Bowl

It got a bit overshadowed by Cobb County’s Atlanta Braves bridge fiasco, but the Falcons got their own crazy-expensive pedestrian bridge as well as part of their new stadium deal with the city, at a crazy price tag of $27 million. That was up from an initial, marginally less crazy, price tag of $12.8 million, with the increase thanks to rush charges to get to bridge ready for this year’s Super Bowl:

At the council’s Transportation Committee meeting earlier this week, Katrina Taylor-Parks, deputy chief of staff to Mayor Keisha Lance Bottoms, requested that the committee approve an additional $12.3 million in funding quickly because of next year’s NFL Super Bowl, which will be played at Mercedes-Benz.

“It is time sensitive,” Taylor-Parks said at the committee meeting. “You know Atlanta is planning on hosting a huge event in early 2019, actually several.”

Fortunately, the bridge was completed on time. Less fortunately, it will be closed for Super Bowl week, because security:

“The bridge is considered inside the stadium security perimeter,” said Alison Blue, spokeswoman with AMB Group LLC, the parent company of the Atlanta Falcons. “It will be used by only credentialed staff/media after they’ve gone through a security checkpoint.”

On the bright side, Northside Drive, the road that the bridge spans, will be closed during the Super Bowl itself, so nobody will need a bridge to get across it. On the significantly less bright side, what the heck was that extra $14.2 million for, then? Hopefully at least the Falcons will turn the bridge lights on, so football fans can admire it as really pricey artwork.

Fulton County court to rule on whether Falcons owe $700m in property tax on grounds their “public” stadium really isn’t

Ever since a New Jersey court ruled that the New York Red Bulls had to pay property taxes on their new stadium even though it was city-owned, because it was a private use, a small subset of people — okay, probably just me and Geoffrey Propheter — have been wondering when some other jurisdiction, or its residents, would try a similar gambit. And some Atlanta residents are doing just that with the Falcons‘ publicly-owned-and-subsidized, privately controlled stadium:

For a year and a half, some residents have argued that the stadium — which has been exempted from property taxes since it was built — should be paying into city, school and county tax funds. A lawsuit the group filed in 2017 estimates its tax bill at $26 million a year under June 2018 tax rates…

Over the life of a 30-year agreement the Falcons have to use the stadium, it might generate more than $700 million in property taxes, according to estimates by attorney Wayne Kendall, who is representing the residents who filed the suit.

This suit has been kicking around since 2017, and already got bounced by Fulton County Superior Court, but was revived by a state appeals court last month and kicked back to county court for reconsideration. The key argument for the Falcons having to pay property taxes is that, unlike in its previous deal at the Georgia Dome where it just rented the place 20 days a year, the new stadium is fully controlled by the team: “The Falcons manage the stadium year-round, and receive the revenue from all events held in the building, not only ticket revenue. Kendall argues that under the new agreement, the Falcons are a long-term leaseholder, and long-term leases are taxable under state law.”

College of the Holy Cross economist Victor Matheson tells the Atlanta Journal Constitution that this would be “a real game changer nationwide” if the Atlanta suit prevails, and while Matheson is almost always right, the Harrison case hasn’t been a game changer yet, so it’s possible this wouldn’t be either. Though for Atlanta residents looking to get back some of the $700 million they’re spending on Megatron’s Butthole, it would be a huge deal indeed.

Friday roundup: Tampa won’t divert road money to Rays stadium (probably), Columbus may spend $100m on Crew stadium, Anaheim signs Ducks lease extension as new mayor vows to placate Angels

You know who the real turkeys are this week? Nah, my heart isn’t in making Thanksgiving puns, just read the news, folks:

  • Three of seven Hillsborough County commissioners have promised that a new sales tax for transportation projects won’t mean diverting money from the existing transportation project to, say, a Tampa Bay Rays stadium, which the mathematically inclined will notice isn’t actually a majority of the county board. It’s still not super likely that the county will try to raid transportation funds to pay for a stadium, unless maybe it’s for transportation costs related to one, and there’s still several hundred million dollars in construction costs unaccounted for, but anyway it’s worth keeping at least half an eye on as we head toward the team’s December 31 lease opt-out deadline.
  • A paid consultant working on a new downtown arena for Saskatoon says it could have a “catalytic effect,” because of course he does, really, Global News, you ran an entire article that’s just interviewing one guy employed on the project? For this you want me to disable my ad blocker?
  • Forbes’ Mike Ozanian reports that “a person with knowledge of the deal to keep Major League Soccer’s Columbus Crew in that city” says the new owners will pay $150 million for the franchise and spend $150 million toward a new downtown stadium, while “the public would foot the other $100 million.” Nobody else seems to be reporting on this, so maybe we should wait to be sure that Ozanian didn’t get his plus and minus signs mixed up again.
  • The Atlantic’s Rick Paulas suggests that we end stadium extortion by forcing pro sports leagues to massively expand and then institute promotion and relegation, which would sort of work, if there were an easy way to accomplish this through antitrust legislation, which you’d think if Congress could manage that they could manage the much more straightforward measure of taxing sports subsidies out of existence, but who knows, maybe a “market-based” solution would go over better in these times, sure, what the hell. “Of course, cities could also elect leadership that will defend them against bad deals,” notes Paulas, which isn’t a bad idea either.
  • Anaheim has signed a lease extension to keep the Ducks in town through 2048, involving the city selling the team 16 acres of land for $10 million — which if the stymied Angels deal is any guide would probably be a small discount, though Anaheim officials claim it’s market value — but the city will get a cut of arena profits after the first $6 million a year instead of the first $12 million, a threshold that’s never been hit. There are a lot of (small) moving pieces here, but I’m willing to say this is probably not too bad a deal, especially compared to some of the much, much worse lease extensions that cities have agreed to. Next is to to see about getting Angels owner Arte Moreno to accept the same logic, now that newly elected mayor Harry Sidhu is vowing to change “the hostile political environment in Anaheim” and “keep the Angels in Anaheim where they belong,” okay, Anaheim residents are probably going to have to settle for just a good Ducks deal.
  • Atlanta Falcons COO Greg Beadles tells NPR it’s not team owner greed that causes stadium food prices to be so high, it’s just that after teams force concessions companies to bid as high as possible for stadium contracts, the only way they can make money is to charge through the nose for food! Anyway, NPR gets busy talking to fans at a Falcons game about whether they’re happy the team lowered its food prices, and they’re happy about it, so no time to fact-check whether team execs’ statements make any damn sense. Free refills on soda, woohoo!

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: Bucks say arena can fight racism, Rays in line for federal tax breaks, Falcons to get glowing bridge

Slow news week thanks to the holiday, but there were still a few items of note:

  • Milwaukee Bucks president Peter Feigin thinks his new publicly funded arena will help fight segregation because it’ll have a public plaza. The Chicago Tribune notes that the Bucks owners once released a strongly worded statement of support for one of their players after he was tased by Milwaukee police, so … nope, I don’t get the connection either, unless this reporter was assigned to cover Feigin and couldn’t find much else to say about his bizarro statement, so just googled “Milwaukee and race and basketball” and dumped the results into a Word file.
  • The Sacramento Kings owners are going to use computers at their arena to mine cryptocurrency for charity, which mostly serves as an excuse for the team to issue a press release mentioning themselves in the same sentence as blockchain, because we know that’s a thing. Too bad the earth is going to burn as a result, but everything’s a tradeoff, right?
  • Ybor City, where the Tampa Bay Rays want to build their new stadium (price and funding still TBD), has been tabbed as a federal “economic opportunity zone,” meaning developers can use it as a short-term tax shelter for profits that are reinvested into the area. The program is way too complicated for me to calculate at the moment just how much U.S. taxpayers would end up paying toward a Rays stadium, but suffice to say it’s one more piece of the funding puzzle that team owner Stuart Sternberg doesn’t have to worry about himself.
  • Speaking of the Rays, they’ve announced they’ll release new renderings of their stadium plans next Tuesday, which I guess makes this announcement itself vaporvaportecture?
  • The Atlanta Falcons pedestrian bridge that will now cost Atlanta residents $23 million is going to glow! And who can put a price on that, really?
  • Since it was a slow stadium news week, here’s a bonus article on how Nevada giving $1.4 billion to Tesla to open a battery factory there is looking to be a disaster, with the state ending up losing its entire budget surplus while new workers attracted to the area have driven up rents and increased local government’s police, fire, and schools costs, leaving residents with a higher cost of living and fewer services. One unemployed local who was forced to move into a motel room listed for the Guardian things she now considered unaffordable luxuries: “Ice cream. Bacon. A movie ticket.” It’s a fun weekend beach read!

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

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

Friday roundup: Warriors debt fight, giant American butts, and the blackout curtains that will eat Minneapolis

It’s laugh to keep from crying week! (Just kidding: It’s always laugh to keep from crying week.)

  • The 46-year-old Richmond Coliseum is “clearly past its prime” and “smaller and gloomier than many competing venues,” and the city should use “original thinking and strong leadership from the private and public sectors” such as tax-increment financing to help pay for a new arena, according to the Richmond Times-Dispatch. Not included in the editorial: any indication of how much a new arena would cost or whether the benefit to the city would be worth it, because why think about such things when there’s new-car smell to be had?
  • Oakland and the Golden State Warriors owners are still fighting over who’ll pay for $40 million in remaining Oracle Arena debt once the Warriors move to San Francisco in 2019. It sure sounds like the team’s Oakland lease requires them to pay off remaining debt if they leave before 2027, but the city really would have had a much stronger case if it had refused to grant the team a lease extension without an agreement on debt payments, and made Steph Curry go play in the street for a couple of years.
  • The Texas Rangers‘ new stadium will feature seats that are 1 to 2 inches wider than in their old one, which is good for fans with wide butts (I stand accused, although not of being a Rangers fan), but less good for fans with butts of any size who will have to make do with seats farther down the outfield lines to make way for the butts of more well-off fans. Everything’s a tradeoff.
  • The Detroit Grand Prix owners, seeking to justify turning a public park into a private raceway for three months of preparation each summer, claim the annual event is worth $58 million to the local economy, and I told the Detroit Metro Times why that’s probably bullshit.
  • Here are some pictures of Los Angeles F.C.‘s new stadium in the final stages of construction that look disturbingly like pictures of stadiums in the first stages of demolition. At least season-ticket sales are going well, and those are way harder to fake than individual game ticket sales!
  • Derek Jeter may have gotten rid of anything not nailed down from the 2017 Miami Marlins, but he still can’t move Red Grooms’ horrific home run sculpture, because the public helped pay for it so now it’s public art. (Too bad Marlins fans couldn’t have tried the same argument about Giancarlo Stanton.)
  • The NCAA has awarded the 2019 men’s Final Four to U.S. Bank Stadium in Minneapolis, and now is demanding a giant blackout curtain to cover up the building’s windows for the event. Cost, according to Minnesota Sports Facilities Authority chair Mike Vekich: “It will be expensive — obviously.” Crazy idea: Tell the NCAA, “You already awarded us the Final Four, if you want a giant venetian blind, pay for it yourself or go play in the street with Steph Curry.”
  • The cost of a pedestrian bridge to get fans to a new stadium in Atlanta — no, not that bridge to that stadium, a different bridge to the Falcons stadium — has nearly doubled from $12.8 million to $25.1 million, thanks in part to rush charges to get ready for next year’s Super Bowl. You know where next year’s Super Bowl would look great if the NFL won’t pay rush charges for a bridge? You guessed it!

Friday roundup: Islanders close to Nassau deal, Olympic stadium to be razed after four uses, and it’s rethink your MLS stadium site week!

And in other stadium and arena news this week:

Have a great weekend, and see you Monday!

Falcons make more money by lowering food prices, also make less money by lowering food prices

I have griped here about the New York Times’ Ken Belson on so many occasions, usually right after he’s written a long article drawing sweeping conclusions that aren’t actually quite justified by the facts of what he’s describing. Today, Belson is back with a report on concessions prices at the new Atlanta Falcons stadium, and let’s see if he has improved any:

In Atlanta, Concessions Prices Go Down and Revenue Goes Up

Wow, that would be an impressive feat! How did they manage this?

Despite a 50 percent decrease in prices for food and nonalcoholic drinks compared to prices in the Georgia Dome, the amount spent per fan increased by 16 percent, Blank’s sports company, AMB Sports and Entertainment, said on Thursday.

The results suggest that fans will consume more if prices are kept at more reasonable levels, with potentially no effects on the team’s bottom line.

That … is not how math works. Even if fans spend more overall on cheaper food, actual team revenue from concessions depends on what’s left over after you pay for all that additional food — so if you bring in 16% more in cash but spend, say, 30% more on buying frozen hot dogs, that’s not “no effects on the team’s bottom line.” So how did this gambit actually work out in terms of net revenue?

Belson doesn’t actually say, but fortunately Bloomberg has the full story:

[Fans] bought more food — sales were up 53 percent — and each fan spent, on average, 16 percent more on concessions. It wasn’t enough to offset the drop in prices, though. The team made less on concessions in 2017 than it did the year before, according Steve Cannon, chief executive officer of AMB Group, the company through which Blank owns the team.

Okay, then! So Belson’s article really should have been headlined “Falcons Cut Food Prices by Half, But Make It Up in Volume.’

To be fair: Belson doesn’t explicitly say that the Falcons are profiting on the food price cuts (though he implies that they could), and even the headline could mean “gross revenue goes up” and not “net revenue (i.e., profit) goes up,” though that’s not how normal humans tend to read that word. Still, it’s all very misleading, especially when Bloomberg shows how to get it right.

Why is this all important, aside from getting to poke fun at the Paper of Record yet again? Because the true numbers hint at the reason why concession prices — and ticket prices, and everything prices — at sporting events are so crazy high: Yes, you can make more fans happy by setting prices lower, but in the early 21st-century economy, you make more money by selling fewer seats/pulled pork sandwiches to fewer people than by selling more of them to more people.

Props to the Falcons management for not choosing to do it that way — given Cannon’s quote to Bloomberg that “sure, we could shake out a few more dollars of margin under the old model, but we believe that the direction we’ve taken, given all the other positive benefits, is the bigger revenue play, period,” it sounds like they figure this is a necessary loss leader to keep people interested in live football, especially with fans increasingly choosing to watch on TV or not at all. Or maybe they figure fans will spend more willingly on pricey tickets this way, as I predicted when they announced the food pricing scheme back in 2016. Either way, it’s a move that’s worth not oversimplifying if we want to understand how sports teams try to extract maximum dollars from our pockets, and that’s what we’re here to do every day, right?

Megatron’s Butthole is leaking

And speaking of unfortunate headlines, here’s one from yesterday’s Kansas City Star atop an AP story ahead of last night’s College Football Playoff title game at the Atlanta Falcons‘ new stadium:

High-tech Atlanta stadium a hit with fans after early woes

Mercedes-Benz Stadium is about to be on perhaps its largest national stage — Monday night’s College Football Playoff title game — and fans say Atlanta’s new $1.5 billion facility is living up to the hype despite a series of construction setbacks that delayed its opening…

So far, the stadium is winning attendees over despite its signature feature, the retractable roof, being opened a couple times during events since the opening in August. The roof, which opens and closes like a camera lens, is one of the many attractions of the stadium including the massive 360-degree, 63,000-square-foot halo video board and cheap food pricing.

So those construction delays and malfunctioning retractable roof are all a thing of the past, and everything works great now! Except maybe you might have wanted to wait for the game actually to be played before writing that headline:

The roof of Atlanta’s $1.6 billion stadium is leaking at the CFP title game
With rain hitting Atlanta on Monday, reporters at the College Football Playoff national title game noticed a stream of water pouring in from the Mercedes-Benz Stadium roof.

And:

Fans frustrated after long waits to get into Mercedes-Benz Stadium

The lines were constant, no matter how early fans arrived. By 5:30 p.m., nearly three hours before game time, the wait to get into the stadium was running about an hour.

And worst of all:

President Donald Trump arrived in Atlanta on Monday night to attend the National Championship Game between Alabama and Georgia.

Okay, so Trump’s presence can’t actually be blamed on the new stadium, except inasmuch as that if Atlanta hadn’t gone and helped build it, they probably wouldn’t have gotten to host the CFP championship game and then would have been spared the president’s presence. (Is this what economists call an externality?) The leaky roof is a bigger problem, and it really might be time to ask whether spending hundreds of millions of dollars on a cool-looking retractable roof is worth it when it doesn’t retract and also doesn’t really work as a roof. Though I guess it did earn the stadium an awesome nickname, and what price can you put on that?