Bills getting more than $200m in stadium subsidies in exchange for staying put six more years

The Buffalo Bills‘ stadium is getting $130 million in renovations at the end of this season, and the Buffalo News is ON IT! About how “like a football player at age 40, Ralph Wilson Stadium needs reconstructive surgery”! About how the renovations will “make the aging facility more fan-friendly”! How in place of nine entry gates there will be six “super gates” with more entry lanes and video boards so you can watch highlights while you have your non-clear plastic bags rejected for entry! How there will be a “huge new Bills Store” and 22 percent more restroom space!

And who will be paying for all this? Let’s see, scroll down, scroll down, here we go:

jointly funded by New York State, Erie County and the Bills

Okay, how much from each party, exactly? Scroll down, scroll down — really, Buffalo News? I have to do everything myself? Well, fine:

Under the proposed lease, the state [and county] would immediately pay $94.5 million toward renovations of Ralph Wilson Stadium, which is less than the $200 million that the Bills owners asked for earlier this year. The state would also be on the hook, though, for $132.3 million in operating subsidies over the next ten years.

Bills owner Ralph Wilson, meanwhile, will pay a grand total of $35.455 million toward the stadium improvements, about 27% of the total cost, and an amount that he’ll easily earn back in the first three years of “operating subsidies,” not to mention whatever new revenue he gets from the Bills store and the like. (Of course he doesn’t have to share any of this money with his public partners — why would he agree to something silly like that?) New York state taxpayers, meanwhile — including those nowhere near Buffalo, like, say, me — will be on the hook for most of the rest.

Still, I suppose $227 million isn’t an outrageous sum, as these things go, to keep the Bills in town for … let’s see … ten years? Counting the current season, so really nine years. And starting after the 2019 season, the Bills can break the lease by paying just $28.4 million, so it’s really just a six-year guarantee, after which Wilson (or more likely his heirs, since the man is 94 years old) will be free to take his money and run. But who really can put a price on roomier restrooms?

Downtown L.A. stadium declared officially dead, unofficially

I’m not actually how to read this, as the official NFL position on AEG’s downtown Los Angeles stadium plan has been that they’ve hated it for a year and a half now, but: Yahoo! Sports is reporting that two “sources” (one of them a “league source”) are saying that the AEG plan is dead as far as the league is concerned, as “Unofficially, the NFL believes that the cost of the AEG plan, which the league believes will be at least $1.8 billion, will make it unworkable”:

“The numbers just don’t work, no matter how you look at the deal,” a league source said in February. “It’s either too hard for AEG to make money [and pay the debt on the stadium] or too hard for the team. I just can’t see a way for it to work.”

Again, nothing really new, except that the NFL is now sending off-the-record staffers to leak the word that really, it’s time to move on to other L.A. stadium proposals. Not to mention a decidedly on-the-record Marc Ganis, the NFL consultant who might as well be a league source, who pointedly told Yahoo!: “The focus on the sale of AEG has stalled the chance for people in the area to view potential other sites and opportunities. … If Los Angeles leaders don’t move on to look at other options it will only delay the return of the NFL to Los Angeles further, possibly even years longer.”

This might be a reasonable ploy to get L.A. moving on some other stadium possibilities — or at least vague rumors of possibilities — but it’s terrible timing for the Carolina Panthers, Miami Dolphins, Atlanta Falcons, Buffalo Bills, St. Louis Rams, San Diego Chargers, Oakland Raiders, and any other NFL teams I may have left out that are currently using the “L.A. has a stadium deal ready to go!” threat to try to extract money from their current hometowns for new or renovated stadiums. I was just telling a reporter yesterday that these teams are all scrambling for stadium funds now because they have a limited window to use the L.A. threat before it either falls apart or somebody else moves there first; it looks like that window may have just begun to slide shut.

 

Bills try to sneak through $226m in stadium subsidies without anybody noticing

It’s one of the basics of public relations that when you want to bury a story so that no one does any substantive reporting on it, you release it on a Friday afternoon when all the reporters are headed home for the weekend. So look what got announced on the Friday before a long Christmas weekend, yet:

The Buffalo Bills aren’t going anywhere any time soon, and the team’s CEO, Russ Brandon, guaranteed it Friday.

“Guaranteed,” Brandon said at a hastily called news conference, announcing the Bills had agreed to sign a new 10-year lease with the state and county to continue playing at Ralph Wilson Stadium.

“This is a monumental day for us,” he added. “The Buffalo Bills are right here in western New York, where we’re going to be for many decades to come.”

That’s the start of the Associated Press story that almost every news outlet ran with, and it’s actually not entirely correct: The Bills and New York state agreed not on a lease, but on a memorandum of understanding about the terms of the lease, which has yet to be finalized. And while Gov. Andrew Cuomo agreed to this lease deal, it still needs to be voted for by both the state legislature and Erie County legislature.

Under the proposed lease, the state would immediately pay $94.5 million toward renovations of Ralph Wilson Stadium, which is less than the $200 million that the Bills owners asked for earlier this year. The state would also be on the hook, though, for $132.3 million in operating subsidies over the next ten years. And it establishes an exploratory committee for building a new stadium at that point, meaning in effect the state is agreeing to pay the Bills to play in Buffalo while they’re waiting for a new stadium to be built.

In exchange, the Bills agree to be locked in to staying put through 2020, though after that they can buy their way out of the lease for a small fee. Given that it’s likely to be several years before anyone could build an NFL stadium for the Bills to move to anyway, this is a massive no-brainer for the Bills, who get to have their immediate stadium subsidy and still keep the opportunity for saber-rattling about a move in order to get a new stadium deal — hell, the Tampa Bay Rays have a lease that doesn’t expire until 2027, and that hasn’t stopped them.

But anyway, the Bills’ coach calls this “a win-win it looks like to me for everybody,” and the head of the Buffalo Bills Backers Club is ecstatic, and Deadspin says of the deal:

The CEO also did not answer questions about how exactly this will improve the morale of Western New Yorkers when they’re on the hook to pay more in annual taxes (about $226 million over 10 years) than the team gives back to the state (about $20 million annually), and fans may well find themselves watching the franchise play out the Buffalo string very shortly into this 10-year lease (which has a small buy-out after seven years). But other than that, this is a proud day for the community.

Okay, well, so not everybody is thrilled. Just pretend that Deadspin went home for the holidays along with all the other news outlets, and it’s a merry Christmas for all!

Some guys want to build a $1.4b Bills stadium with $400m+ in state subsidies

The Buffalo Bills stadium battle has been simmering for a while, but now it finally has what it’s been missing: a grandiose, hugely expensive plan for a new stadium with a retractable roof. According to the Buffalo News, a company called Greater Buffalo Sports & Entertainment Complex — which formed early this year and is based in Delaware, giving new meaning to “greater Buffalo” — will today present the city Common Council with a plan for a $1.4 billion development project that would include a 72,000-seat, retractable-roof stadium, on land owned by the Niagara Frontier Transportation Authority.

Obviously, $1.4 billion is quite a bit more than the $200 million that the Bills were talking about for a renovation of Rich Stadium, so where would the money come from? According the the News, GBS&EC vice president George Hasiotis helpfully explained that while

it was premature to talk about financing a stadium but that based on other stadium projects across the country, it was reasonable to expect the State of New York to pay about $400 million, the NFL $200 million to $400 million. Such a project would bring in hundreds of millions for the construction trades, since 10,000 such jobs were expected to be generated, he said.

Well, yes, if you spend $1.4 billion on construction, it’d be hard not to generate hundreds of millions of dollars for the construction industry. Ah, the wonders of “economic activity.”

In any event, those “reasonable” figures are likely to raise some eyebrows both in Albany and at NFL headquarters: $400 million is more than the state has kicked in for another other recent stadium project, and the NFL’s G-4 stadium fund caps out at $200 million per team. Plus, the project would apparently require an “option” on 167 acres of harborfront property owned by the state-run Niagara Frontier Transportation Authority, which it’s not clear whether GBS&EC would pay for.

Still, if nothing else, Buffalo now has a stalking horse notable enough to make the newspaper, which if nothing should be enough to make $200 million for renovations look cheap by comparison. As I’ve noted many times before, half the battle for teams seeking stadiums is shifting the debate from whether to build something to how and where to build something, and by that measure, even overpriced vaportecture is an important first step.

Buffalo News: Bills subsidies are key to 2016 presidential campaign (no, really)

Here’s one for the newspaper stadium cheerleading files: Today’s Buffalo News has a long article trying to make the case the New York Gov. Andrew Cuomo’s political future rests on whether he’s willing to throw state money at stadium upgrades for the Buffalo Bills.

The News argument is that Cuomo did poorly in western New York when he won in a landslide two years ago, and former governor George Pataki gave money to the Bills when he was first elected, and Cuomo will want to avoid a “perceived failure” if he’s going to run for president in 2016. And then there’s this:

“Some politicians have been fried when a city loses a pro team on their watch,” said Andrew Zimbalist, an economist at Smith College in Northampton, Mass., who has studied stadium construction deals struck with the help of public financing by politicians desperate to keep a sports franchise from leaving.

Right, because we all remember … um … that guy … no, that guy was subjected to a recall vote for voting for stadium subsidies … wait, wait, don’t tell me…

Aside from the phantom fryers reference, Zimbalist does hedge his bets by noting that if Cuomo “is wishy-washy, and he gives away the store, I don’t think he comes out OK. He might make people in Buffalo happy, but he makes the rest of the people in the state angry.” So basically, Cuomo’s political future depends on him giving the Bills enough money that nobody in a hypothetical future presidential race can accuse him of being a sports-hating team-loser, but also that no one can accuse him of being a corporate-welfare-slinging spendthrift. Sounds about right.

Buffalo residents: No tax money for stadium! Buffalo developer: Do we have to call it “tax money”?

And today in News Items That Should Surprise Absolutely Nobody:

Fifty-six percent of respondents to this week’s RBJ Daily Report Snap Poll say it’s not the responsibility of Erie County and state taxpayers to help pay for more than $200 million in proposed renovations to Ralph Wilson Stadium, which opened in 1973.

Noticing this, Buffalo developer Rocco Termini writes in an op-ed in the Buffalo News that the solution is simple: Give the Bills tax money, but call it something else.

The Bills organization pays approximately $13 million per year in New York State payroll taxes. We can all agree if the team were not in New York State, we would not be getting that yearly $13 million in income. We should create payroll tax incremental financing. Every year the Bills organization will pay its payroll tax into a special lock box created by the state. This money will be used to pay the bonds that were used to borrow the money for the improvements. Over the 15-year term of the lease, $13 million a year in payments at 4 percent can amortize $150 million in improvements.

Tax increment financing projects (aka TIFs) have a long and sordid history in the U.S., particularly around sports facilities — the basic concept being that if the sports team weren’t there, it wouldn’t be paying any taxes to the state, so it should get its state taxes kicked back to pay for a new building. (You can try out the logic of this next April 15, by telling the IRS that because you wouldn’t owe any U.S. income taxes if you moved to Switzerland, you shouldn’t have to pay any even though you live here.) Aside from this program in St. Louis, though, I haven’t found any other localities that exempt companies from state payroll taxes for agreeing to locate within their borders, so that’d be new.

And really, why stop there? If the Bills left Buffalo, after all, the state would no longer collect highway tolls from fans driving to games. Stores would no longer collect sales tax on big-screen TVs bought to watch the games. Talk radio stations would lose ad revenue when people stopped calling in to complain about the scab referees. Really, shouldn’t all that money be going to the Bills, since they created it — and by “they” I mean 94-year-old owner Ralph Wilson, not the players or anything — with their bare hands?

The possibilities are endless, really. Any other ideas, please post in comments.

Bills punt on stadium negotiations

The Buffalo Bills and Erie County have agreed in principle to a one-year lease extension after team management complained that stadium renovation talks were stalling. (Okay, actually Bills CEO Russ Brandon said that “we’ve hit somewhat of a cone of silence in the discussions,” which is far more excellent.) This will give the two sides — plus the state of New York, which is being asked to chip in as well — more time to hash out an agreement, as well as more time for the Bills to apply for an NFL G-4 loan, which can now be pushed back from October to March.

The Bills talks are destined to be a strange one, as the team has fairly little leverage, given that owner Ralph Wilson has deep Buffalo roots — the stadium is named after him, already — and isn’t likely to threaten to move to Los Angeles or anything. You have to wonder how long it’ll be before the NFL sends someone to town to start dropping hints about what could happen if public stadium subsidies aren’t approved. I’m going to go out on a limb here and set the over/under for January; check back then and see how my prediction went.

Cuomo, Schumer stick their fingers in Bills stadium reno debate

If you’ve been kept up nights worrying about how the Buffalo Bills will come up with $200 million to renovate Ralph Wilson Stadium, which was just renovated in 1997, then worry no longer, for New York Gov. Andrew Cuomo and U.S. Senator Chuck Schumer are riding to the rescue:

Gov. Andrew Cuomo on Wednesday announced the appointment of a sports expert to advise the state in its efforts to secure the Buffalo Bills‘ future in western New York.

Sen. Charles Schumer, meanwhile, said he has asked the NFL for changes in a stadium renovation loan program that he said would advance the same goal.

Cuomo’s new stadium czar is Irwin Raij, who not only consulted for the group that overpaid for the Los Angeles Dodgers this spring, but who is also on MLB’s Oakland A’s stadium committee that still hasn’t released a report after more than three years. So you know he’s got to have some interesting recommendations to make, or at least lots of free time on his hands.

As for Schumer, he’s pushing the NFL to lift the restriction on its G-4 stadium loan program that requires team owners to pay back the entire loan when they sell the team, since Bills owner Ralph Wilson is 93 years old and his heirs are presumed to want to sell. Since basically this is exactly the kind of quick flipping that the G-4 provision is designed to prevent, it’s hard to see why the NFL would listen to Schumer, but who knows? Maybe he’ll threaten to ban them from riding Amtrak if they refuse…

 

Bills to ask for $200-million-plus in stadium upgrades

The Associated Press reports that Erie County and the Buffalo Bills owners may be nearing agreement on a $200-million-plus renovation of Ralph Wilson Stadium, as part of a new lease for the team. That’s more than double what Bills owner Ralph Wilson was proposing last year — no explanation of why the higher price tag.

As for who’d pay for this, Erie County Executive Mark Poloncarz said only that (in the AP’s words) the Bills and the NFL have been “asked to contribute an undisclosed share,” while New York State will be asked to “provide a commitment.” More details will be laid out in a memorandum of understanding that is expected to be drawn up in coming weeks, but even then we may not know a lot of the details — such as whether the Bills will repay any public expense via lease payments or shared stadium revenues — until an actual lease is drawn up over the next year, not to mention until the state legislature sinks its dysfunctional teeth into it.

Basically, this is all just an opening gambit. If you’re an Erie County resident or New York state taxpayer — hey, wait, that’s me! — curious about whether your money will be used to prop up the value of the Bills when they get sold, you’ll just have to stay tuned for further details.

Buffalo radio sports guy proposes downtown Bills stadium

No sooner had we gotten used to the prospect of Buffalo Bills owner Ralph Wilson demanding public money for a renovation of Ralph Wilson Stadium than suddenly there’s talk of building a new downtown stadium for the Bills. Though how you define “talk” depends on how far you read down through this news item from WKBW-TV:

Plans for a New Stadium in Downtown Buffalo Emerge

Okay, that sounds clear enough from the headline. What does the lede of the story say?

Could a new stadium be heading to the Queen City? It’s a proposal that’s being discussed inside city hall.

“Inside city hall” — so presumably either the mayor or the city council is on board with this. Sounds serious.

Mix 1080 AM WUFO Sports Director Patrick Freeman says he has a plan to bring a new multi-use stadium to the heart of downtown Buffalo and presented his ideas to the Buffalo Common Council Tuesday.

Wait, what? A local radio sports director said at a city council hearing that a downtown stadium would be a good idea, and that’s your idea of “discussions inside city hall”?

It does sound like councilmembers took Freeman’s suggestions seriously, or at least politely — one said that this “could be, oh, something that could help us save face from all the mistakes that have been made in the past in the city of Buffalo, you know, moving stadiums into Orchard Park.” But with no funding or site identified, and no price tag even, it’s a little bit, shall we say, premature to even call this a “plan.”

What this does mean, though, is that we’re potentially moving from debating whether New York state should fund $100 million in stadium renovations to debating how to choose between spending on renovations or spending on a whole new building. Somewhere, Ralph Wilson has to be smiling.