Charlotte Observer now serving as Panthers’ p.r. department on city-funded stadium upgrades

The Carolina Panthers have announced what they plan to do with the $87.5 million the city of Charlotte gave them last year for stadium renovations, and in one of the most egregious cases of stenography journalism in a long while, the Charlotte Observer chose to cover this by running a Storify consisting entirely of tweets from the team like this one:

But seriously, the Observer has to have covered this with a real news story, right? Okay, here’s one, and it consists of … just a summation of what the Panthers said, with the only quotes coming from team president Danny Morrison. (Though at least it does mention that the renovations are being paid for mostly by the city.) Not that this calls for a major investigation — the story today is the details of the renovation plans, not the funding plan — but it would be nice to give at least a hint of analysis of what the public is getting for its cash. Though really, who can put a price on the public benefit of seamlessly integrated escalators?

Eagles announce stadium upgrades, don’t announce public subsidy request, but will

The NFL approved league G-4 stadium funding yesterday for the Atlanta Falcons, Carolina Panthers, and Philadelphia Eagles, as part of the expected shares of new or renovated stadiums that — whoa, wait, the Eagles? What are the Eagles doing on that list?

“We are excited to have received league support today for our stadium revitalization project at Lincoln Financial Field,” said Eagles President Don Smolenski. “We will share the details of this project with our fans in the coming weeks.”

And not just with fans, one hopes, but with Philadelphia legislators as well, since one of the conditions of the G-4 program language is that any funded projects must be “public-private partnerships.” So the only way this is going to work is if the Eagles seek some public money for upgrades to 10-year-old Lincoln Financial Field. If those cost $60 million to $100 million as previously projected, then we’re talking about $30 million to $50 million in public money. It’s the sort of thing you’d hope that any of the numerous articles about the renovation plan would have mentioned, but I guess it’s a lot to expect today’s newspaper journalists to think outside the press release.

Charlotte invited Panthers owner to closed meeting to demand stadium cash because “that’s what Jerry wanted”

When the Charlotte city council met on January 14 to approve subsidies to the Carolina Panthers for renovations to their privately owned stadium, members of the public were barred from attending, leading to a lawsuit for violating the state’s open meetings law. The only people allowed in the room were elected officials — oh, and one more person, according to Charlotte NPR station WFAE:

Generally “closed” means “closed,” because the council needs privacy to work out its negotiating strategy and terms, says City Attorney Bob Hagemann, because “you do not want to have those kinds of conversations in front of the other party to the negotiation.”

You certainly wouldn’t want to have them in front of the company’s CEO. . . right?

But that’s exactly what the city did with Panthers owner Jerry Richardson.  He sat in on two of the four closed sessions council held to discuss using tax dollars for Panthers’ stadium renovations.  Minutes from those meetings show council members were fine with the arrangement. They still are.

“I don’t know if it was appropriate or not, but it was important to him,” says Councilman Andy Dulin. “It must have been of importance because he did show up – you know that put an exclamation point on the seriousness of the negotiations that some might not have done. I appreciated him being there.”

Councilman James Mitchell also appreciated Richardson coming and asking directly for the money: “I think that’s what Jerry wanted. I think Jerry wanted the council to know why he was doing this.”

And what did Jerry have to say during his private audience with council members? Fortunately, the council at least took minutes, which show that Richardson touted how he’d “gone to bat for the city” by getting the NFL to move its opening day to make way for the Democratic National Convention, plus talked about how he quit the NFL in a salary dispute. (Because he’s a hardball negotiator, see?) City attorney Bob Hagemann and deputy city manager Ron Kimble also warned that the Panthers were “ripe for courting” by Los Angeles.

As Deadspin remarks: “The system, every system, is rigged in the favor of the powerful; the council voted 7-2 in favor of funding the stadium.” Some are more rigged than others, though. The open-meetings case is expected to have its first hearing any day now; I can’t be the only one who can’t wait to see how this plays out.

Charlotte to pay Panthers $14.6m for each year they stay put through 2019

Oh, okay, fine, here’s some real news:

Charlotte’s city council voted unanimously Monday night to approve an agreement to provide $87.5 million for upgrades to the Carolina Panthers‘ 17-year-old stadium in exchange for a commitment to stay in North Carolina’s largest city for at least another six years.

This has been a foregone conclusion for a while now, but still, it’s worth noting that this is one of the weakest returns any city has gotten on a stadium subsidy, ever. Typical stadium deals involve a lot more public money, obviously, but they at least usually include, say, a 30-year lease. (Albeit sometimes a 30-year lease with a ridonkulous out clause.) Here, Charlotte has given Panthers owner Jerry Richardson $87.5 million in exchange for agreeing to stay put through 2019 — in a stadium he himself owns, meaning that to leave before 2019 the Panthers would need to find a city willing to build them a stadium, wait for it to be completed, and also figure out what to do with their current stadium once they’d abandoned it. But now Charlotte citizens can rest assured that that won’t happen, at least not for another six years.

Richardson also has promised he’d never move the team himself, which has led to one of the strangest developments in the history of stadium shakedowns: an NFL owner threatening that if he doesn’t get renovation subsidies, he will literally die.

The 76-year-old Richardson, who had a heart transplant a few years ago, said the deal was important to assuring the Panthers would stay in Charlotte upon his death.

During a presentation highlighting the deal, city officials said the Panthers would be sold no later than two years after Richardson’s death.

So let’s see, a six-year extension, and it would take two years to sell the team — Richardson is clearly planning to kick the bucket no later than 2017. Maybe he knows something we don’t know.

NC to let Charlotte give Panthers $88 million for no reason at all, if they want

The North Carolina legislature may not be willing to give Charlotte a restaurant-tax hike to pay for Carolina Panthers stadium renovations, but they did vote yesterday to allow Charlotte to use its existing hotel-tax money on the Panthers. Unanimously, even.

The problem for Charlotte now is that the hotel taxes are already being used to pay off the Charlotte Convention Center, so it’s not as simple as just handing the money over to the Panthers. Charlotte councilmember James Mitchell estimates that the city could maybe afford to give the Panthers $88 million, which is a lot less than the $206 million they’d initially requested. Mitchell said that “it’s time for us to re-engage with the Panthers and talk about a lower-cost upgrade to the stadium.”

Unfortunately, Mitchell also said that with less money at stake, there’s no way the Panthers will agree to a promise to stay put in Charlotte for 15 years in exchange for the stadium cash. Which makes you wonder why Charlotte would give them any money at all — a promise to stay put for only a few years isn’t worth squat, especially since any other city wanting to lure the team would take years just to get a stadium built. But apparently to some Charlotte lawmakers, getting something worthless for less is better than getting something marginally more valuable for more. Too bad there’s nobody in the state who could explain to them why this makes no sense.

Charlotte council sued for barring public from Panthers stadium vote

But enough about potential lawsuits. Let’s talk about an actual lawsuit:

A Charlotte lawyer on Tuesday accused the Charlotte City Council of violating North Carolina’s open meetings law when it agreed in closed session in January to support a tax hike for renovating Bank of America Stadium.

Paul Whitfield, in a motion filed in Superior Court, asked that the city be cited for contempt of court and fined at least $1.4 million. That’s 1 percent of the $144 million that City Council discussed giving to the Carolina Panthers for upgrading their stadium.

That’s right: Not only did the Charlotte city council utterly fail to convince the state to let it raise restaurant taxes to pay for upgrades to the Panthers‘ privately owned stadium (a bill to allow Charlotte to use existing taxes for that purpose continues to wend its way through the legislature, but Charlotte needs that money for other stuff), but apparently they also forgot that they’re under a permanent court injunction against violating the state open meetings law.

The council voted behind closed doors, councilmember Beth Pickering told the Charlotte Observer, because doing so openly might have led to “misimpressions.” This is going to be the awesomest court case ever.

 

Leaked docs show Panthers made $100m profit over two years while whining about 16-year-old stadium

The Deadspin tip line has turned up another doozy: audited internal financial documents that show that the Carolina Panthers turned a $112 million profit over the course of 2010 and 2011. That’s the same time period when Panthers owner Jerry Richardson was calling for a hard line in labor talks with players, declaring that league owners had “a negative cash flow of $200 million.”

Richardson, of course, is also demanding more than $200 million in public funds for stadium renovations, on the grounds that … well, he hasn’t actually said, other than hinting that Charlotte should be so happy to be allowed to have an NFL franchise that it should just throw money at it. That was already proving to be massively unpopular — 88% of state residents oppose it, the governor said he wouldn’t go for it, and yesterday a bipartisan group of state legislators reiterated that it was a no-go — and it’s only likely to get more so now that there’s evidence that Richardson is making money hand over fist at the old stadium.

Note, incidentally, that the lesson here isn’t necessarily that “Richardson can afford to pay for the renovations himself” — he can, in the sense that he has oodles of money, but he could also afford to buy a lifetime supply of $40 ice balls, yet that doesn’t make it a good idea. The question for Richardson is whether he’d make enough on stadium renovations to repay his costs; if not, he shouldn’t do it, but what the Deadspin revelations make clear is that he’s doing just fine, financially, in his 16-year-old stadium.

Now, would he do better elsewhere? The main reason the Panthers are so profitable, according to the Deadspin documents (nicely summarized here by Newballpark.org), is the more than $100 million in TV revenue that the Panthers, like every other NFL team, rake in each year. So you could argue that the Panthers would be just as profitable in another city, and so are a legitimate threat to move. Though of course there are no other cities that currently have even teenaged stadiums to offer, so effectively Charlotte is bidding against itself — something that North Carolina elected officials seem to have realized, at least, even if city ones haven’t.

The Panthers, meanwhile, responded with a statement saying they only turned a $66.5 million profit over those two years, which is still a pretty hefty amount of money. And as Deadspin notes, official NFL bookkeeping gets to take into account the “infamous roster depreciation allowance”:

The RDA is an accounting gimmick whereby a new owner of a sports franchise gets to write off 100 percent of the purchase price of the team over a 15-year period, on the specious logic that a roster depreciates the same way, for instance, that your office’s new fax machine does. That tax deduction shows up on the books as an operating expense, even though it’s a pretend-loss that exists only in the quirks of the tax code. Thus, Stephen Ross, who purchased the Miami Dolphins for $1 billion, can claim an operational hit of nearly $70 million. “It has a huge impact on the bottom line,” [University of Oregon business professor Dennis] Howard says. “You’re able to transform a real profit into an operational loss.”

Maybe there’s a reason why Richardson’s excuses for asking for public funds have been limited to “because we can.”

Nearly every man, woman, and child in North Carolina hates Panthers subsidies

So it turns out the governor of North Carolina isn’t the only one opposed to using state funds for Carolina Panthers stadium renovations:

A new Elon University Poll found that 88 percent of North Carolinians oppose using state money for renovating Bank of America Stadium…

“Although arguments have been made that the 17-year-old stadium has helped bring in revenue to the local and state economy, 88 percent opposed a state subsidy for the renovations, a view that held steady regardless of race, gender, age or party identification,” according to a release by the pollsters.

It’s not uncommon for polls to run handily against stadium subsidies, but 88% is a lot. And note that this was before the governor came out and said the state can’t afford it, and before the Los Angeles move threat got even less believable.

Still no public response from Panthers owner Jerry Richardson to the rejection of state funds, meanwhile. (Team president Danny Morrison did issue a statement: “We have met with state officials multiple times. They have always been supportive of our efforts and indicated the importance of the Panthers to both the State and Charlotte. We are hopeful that ultimately these assurances translate into support for the team.” Which translates, roughly, as: “We’re going to keep on lobbying and hope no doesn’t mean no.”) An association of Charlotte restaurants did issue a letter saying they were willing to “be part of the discussion of an additional food and beverage tax, if necessary,” but given that the state legislature looks to have pretty much nixed that idea, it doesn’t much matter.

In short, it looks like back-to-the-drawing board time. And while it’s nice to imagine Richardson saying, “Oh, well, if the taxpayers won’t pay for it, might as well pay for it on our own,” I’m guessing that far more likely is “Let’s wait a year for the next legislative session and see if we can come up with a new line of attack.”

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.

 

NC gov to Panthers: No money for you

So it turns out that state bill cutting the amount of Charlotte restaurant taxes they could use for their stadium renovations was the least of the Carolina Panthers‘ worries: North Carolina Gov. Pat McCrory declared yesterday that he was rejecting the team’s demand for $62.5 million in state moneytoward the project, telling the Charlotte Observer, “We don’t have the money in the state to address that issue. I have never been actually asked for the $62 million, nor do we have it.”

This now leaves the Panthers with only access to Charlotte’s existing restaurant taxes, which would be enough to contribute about $110 million toward the stadium project — if the city decides that it wants to spend all of its restaurant tax money on renovating a privately built and owned stadium for an NFL team owned by a half-billionaire. No response yet from the team, but I assume it’s only a matter of time before Roger Goodell flies into town to allude darkly to the Panthers moving to L.A. if the right palms aren’t greased.