Friday roundup: Cincy stadiums still gobbling tax money, XFL to use old Rangers stadium, Crew stadium to require $50m+ in public cash

So very very much more stadium and arena news from this week:

Hamilton County may now have to fire sheriffs to afford payments to Bengals required by stadium lease from hell

Hamilton County, Ohio, has reached an agreement with the Cincinnati Bengals allowing the county to defer $2.67 million in payments to the team from this year to next. And if you’re wondering why the county is sending public money to the local pro sports team on a regular basis, you clearly haven’t been following the county’s lease from hell, which not only requires taxpayers to foot the bill for any future stadium improvements needed to keep the team on par with other NFL franchises (including, famously, holographic replay systems once they’re invented), but also has the team paying negative rent, with the county forwarding $2.67 million a year (rising by 5% each year) to the Bengals owners for “operating costs.”

County officials made noise late last year about simply refusing to make the payment and seeing what the Bengals owners would do — they could break the lease and threaten to move, but then they can do that when the lease runs out in 2026 anyway — but instead they seem to have settled on waiting a year to figure out where to come up with this year’s $2.67 million, plus next year’s $2.8 million. Which is going to be a bit of a problem, because the cupboard is pretty much bare:

The cash-strapped county can’t pay the Bengals this year because it faces $28 million budget deficit in 2019. The county is considering raising the sales tax to help keep the overcrowded jail running, pay for sheriff patrols and avoid deep cuts to staffing.

If Hamilton County ends up adding “laying off sheriffs” to “selling public hospitals” on the list of things it’s done to pay for this Bengals stadium over the years, it will truly cement its place as negotiator of the worst lease in the history of professional sports. If it hasn’t already, that is.

County may refuse to cut check to Bengals for $2.67m in stadium operations costs

Among the many, many terrible provisions in the Cincinnati Bengals‘ stadium lease (holographic replay systems!) is one that, in the last nine years of the lease, requires Hamilton County to pay for $2.67 million a year of stadium operating costs. County officials have been trying to renegotiate that clause for the past year, and have gotten nowhere, so instead it looks like they’re going to straight-up refuse to make the payment and see what happens next:

Hamilton County Commission President Todd Portune told WCPO he has no plans of writing that check to the NFL team.

When asked if the Bengals are aware the county intends to ignore the request for payments, Portune said: “I think they know it’s coming.”

The Hamilton County administrator also did not include the payments in his proposed budget for 2018.

On the face of it, this sounds like a great way to get sued for breach of contract. (Portune says he has an “old opinion from the prosecutor” that the payments are illegal but can’t divulge it because of attorney-client privilege, which, that’s not how attorney-client privilege works, you know that, right, Todd?) But that may not actually be such a bad thing, for several reasons:

  • The Bengals’ lease only has nine more years to run, because the terrible, terrible lease only required them to stick around for 26 years rather than the 30 that is more standard in these things. So even if the team sues, and then threatens to move, they’re probably going to do that soon anyway, so might as well save $2.67 million a year in the meantime.
  • The rest of the deal, including that infamous state-of-the-art clause that the county has to buy the Bengals anything that other NFL teams get, is only going to get more expensive in coming years, as more NFL teams get other things that the Bengals don’t have. So if you’re going to break the lease, this is as good a time as any.
  • There aren’t any cities with newer stadiums out there for the Bengals to threaten to move to, so it would be a multi-year process for them to try to find one and get a stadium deal there, at which point the lease will likely be about to expire anyway.
  • Who knows, maybe the county really does have some kind of legal opinion that the lease clause is illegal? Anything is possible.

I don’t actually know if Portune is trying a “break up with the Bengals before they break up with us” gambit, but if so, it’s not a bad one at all. He told WCPO-TV that he’s hoping to start renegotiating a longer-term lease immediately rather than wait until 2026 is nearer, and this will certainly start the ball rolling in the right direction; given other recent lease extension deals, the county is probably looking at some pricey demands from the team owners, but may as well find out now. This is almost certainly going to involve move threats (or at least saber-rattling) from the team, and a huge uproar over which would be worse, Cincinnati losing its NFL team or throwing even more good money after bad on its stadium lease — but as we’ve seen before, you can’t win in the stadium negotiation game without playing hardball, so if that’s what this is, it’s a noble start.

Friday news: Phoenix funds Brewers but not Suns, brewers float crowdfunding Crew, and more!

So, so much news this week. Or news items, anyway. How much of this is “news” is a matter of opinion, but okay, okay, I’ll get right to it:

  • Four of Phoenix’s nine city council members are opposed to the Suns‘ request for $250 million in city money for arena renovations, which helps explain why the council cut off talks with the team earlier this week. Four other councilmembers haven’t stated their position, and the ninth is Mayor Greg Stanton, who strongly supports the deal, meaning any chance Suns owner Robert Sarver has of getting his taxpayer windfall really is going to come down to when exactly Stanton quits to run for Congress.
  • Speaking of Phoenix, the Milwaukee Brewers will remain there for spring training for another 25 years under a deal where the city will pay $2 million a year for the next five years for renovations plus $1.4 million a year in operating costs over 25 years, let’s see, that comes to something like $35 million in present value? “This is a great model of how a professional sports team can work together with the city to extend their stay potentially permanently, which is amazing, and we’re doing it in a way where taxpayers are being protected,” said Daniel Valenzuela, one of the councilmembers opposed to the Suns deal, who clearly has a flexible notion of “great” and “protected.”
  • And also speaking of Phoenix (sort of), the Arizona Coyotes are under investigation by the National Labor Relations Board for allegedly having “spied on staff, engaged in union busting and fired two employees who raised concerns about pay.” None of which has anything directly to do with arenas, except that 1) this won’t make it any easier for the Coyotes owners to negotiate a place to play starting next season, when their Glendale lease runs out, and 2) #LOLCoyotes.
  • A U.S. representative from Texas is trying to get Congress to grandfather in the Texas Rangers‘ new stadium from any ban on use of tax-exempt bonds in the tax bill, saying it would otherwise cost the city of Arlington $200 million more in interest payments since the bonds haven’t been sold yet. (Reason #372 why cities really should provide fixed contributions to stadium projects, not “Hey, we’ll sell the bonds, and you pay for whatever share you feel like and we’ll cover the rest no matter how crappy the loan deal ends up being.”) Also, the NFL has come out against the whole ban on tax-exempt bonds because duh — okay, fine, they say because “You can look around the country and see the economic development that’s generated from some of these stadiums” — while other sports leagues aren’t saying anything in public, though I’m sure their lobbyists are saying a ton in private.
  • A Hamilton County commissioner said he’s being pressured to fund a stadium for F.C. Cincinnati because Cincinnati will need a sports team if the Bengals leave when their lease ends in 2026 and now newspapers are running articles about whether the Bengals are moving out of Cincinnati and saying they might do so because of “market size” even though market size really doesn’t matter to NFL franchise revenues because of national TV contracts and oh god, please make it stop.
  • MLB commissioner Rob Manfred says the proposed Oakland A’s stadium site has pros and cons. Noted!
  • NHL commissioner Gary Bettman says the Calgary Flames‘ arena “needs to be replaced” and the team can’t be “viable for the long term” without a new one. Not true according to the numbers that the team is clearing about $20 million in profits a year, but noted anyway!
  • Cincinnati Mayor John Cranley is set to announce his proposal for city subsidies for F.C. Cincinnati today, but won’t provide details. (Psst: He’s already said he’ll put up about $35 million via tax increment financing kickbacks.)
  • The Seattle Council’s Committee on Civic Arenas unanimously approved Oak View Group’s plan to renovate KeyArena yesterday, so it looks likely that this thing is going to happen soon. Though apparently the House tax bill would eliminate the Historic Preservation Tax Credit, which the project was counting on for maybe $60 million of its costs, man, I really need to read through that entire tax bill to see what else is hidden in it, don’t I?
  • The owners of the Rochester Rhinos USL club say they need $1.3 million by the end of the month to keep from folding, and want some of that to come from county hotel tax money. Given that the state of New York already paid $20 million to build their stadium, and the city of Rochester has spent $1.6 million on operating expenses over the last two seasons to help out the team, that seems a bit on the overreaching side, though maybe they’re just trying to fill all their spaces in local-government bingo.
  • There’s a crowdfunding campaign to buy the Columbus Crew and keep them from moving to Austin. You can’t kick in just yet, but you can buy beer from the beer company that is proposing to buy the team and then sell half of it to fans, and no, this whole thing is in no way an attempt to get free publicity on the part of the beer company, why do you ask?

Cincy may lack cash for MLS stadium because it has too many other sports venues to subsidize

About 100 F.C. Cincinnati fans attended a Hamilton County Commission meeting last night to urge the commission to spend $100 million on a new soccer stadium for the USL team, which is hoping to land an MLS expansion franchise. County Commission President Todd Portune, however, told them that “we have more projects than we have money,” with the county facing $1.5 billion in pending capital projects. Like, the county jail is overcrowded and needs expansion, and a new waterfront development project is still mostly undeveloped, and, um:

The city’s two current major league sports teams — the Reds and the Bengals — will eventually come knocking on the county’s door for a new deal. The Bengals stadium lease with the county expires in 2026 with the Reds’ lease expiring a few years after. Combined, the two stadiums could need more than $200 million in upgrades within the next decade.

“While no one is talking about demoing these stadiums, we know there will be substantial maintenance (needs),” [Hamilton County Administrator Jeff] Alutto said.

Those leases running out are worth planning ahead for, I suppose, but it’s still a little worrisome that Hamilton County is already budgeting for stadium renovation “needs” that the teams haven’t even asked for yet. Apparently either somebody hasn’t gotten the memo that it’s okay to demand that taxpayers not take a bath on stadium projects, or else Hamilton County leaders think that Cincinnati has less leverage to keep its teams without bribing them to stay, which, okay, maybe.

That said, the rest of the county’s wish list includes a $230 million convention center expansion and a $342 million rebuild of the city’s arena, neither of which exactly seems like a “need” per se. If the only choice for Hamilton County is which dumb project for private profit to sink public money into, I can sort of see why soccer fans would feel justified in saying, “Us first!” Too bad overcrowded prisoners don’t have fan clubs.

Las Vegas Raiders to have fans park in Idaho, and other Friday stadium news

I’ve been busy this morning working on further research into Jeffrey Loria’s Miami Marlins windfall for an article set to run at Vice Sports on Monday, so rather than let the day slip away entirely, let’s do another round of news briefs:

Stadium architects dream of holographic players, and other Friday news

Hey, know what we haven’t done in a while? A Friday news roundup. Let’s do one of those now!

Happy weekend, everybody!

Bengals’ 16-year-old stadium could end up costing taxpayers around $1 billion

Hamilton County’s lease deal with the Cincinnati Bengals is bad. Real bad. There’s the requirement that the county pay to add such items as “holographic replay systems” in the event they’re ever invented, for starters — but also plenty of items costing taxpayers plenty of money here in the actual present. How much money, you ask?

Hamilton County taxpayers have spent more than $920 million since 2000 as part of a deal to build and operate Paul Brown Stadium…

By the time 2026 rolls around and the 26-year lease between the team and the county expires, the county will have spent more than $1.1 billion on the deal for the Bengals to play in Cincinnati.

Now, some of that is financing costs — a little over a third of the stadium costs are interest payments, which are really a cost of deciding to push payments out into the future, and so pretty much a wash in present dollars (where “present” is defined as the stadium’s opening in 2000). But much of it is not, including a new requirement that the county start paying about $2.7 million a year in stadium operating costs next year, because expecting a massively profitable pro sports franchise ($55.5m in profits last year alone, according to Forbes) to pay to clean its own bathrooms is just crazy talk. Here’s a handy chart provided by WCPO-TV:

Screen Shot 2016-01-06 at 12.03.29 PM_1452099867537_29456359_ver1.0_640_480Even if you don’t count the interest payments, that’s about $650 million so far, with tens if not hundreds of millions more to come over the next ten years. By which point the Bengals will almost certainly be demanding a new stadium, or at least a new lease with further upgrades to what will then be a 26-year-old venue. You really have to hope that this time county officials will pay attention to the fine print, but probably not.

Bengals call for review of other NFL stadiums to see what goodies they can make taxpayers buy for them

The Cincinnati Bengals are famous (around here, anyway) for getting a state-of-the-art clause in their stadium lease that requires the county to pay for any upgrades that 14 other NFL teams already have, spelling out that this specifically includes “holographic replay systems,” in the event those are ever invented. The team’s owners already used this clause last year to get $7.5 million in public money for a new scoreboard, and now it sounds like they have bigger dollar figures in their sights:

The team sent a letter to Hamilton County officials this week asking for a review of the stadium’s condition and for talks to begin on how it could be improved to keep up with newer stadiums in other NFL cities…

The team’s letter, signed by Bengals Vice President Troy Blackburn, doesn’t mention specific problems or potential upgrades at the stadium, which cost $450 million to build, but it does note that several NFL stadiums have been updated in recent years and that new stadiums under construction in Atlanta and Minneapolis will include “significant changes in stadium design.”

Reading between the lines of the story, it doesn’t sound like the Bengals have a wish list of improvements (in fact, Bengals development director Bob Bedinghaus specifically said he doesn’t have such a list), but rather that they’re taking advantage of a clause in the lease to trigger a review of other stadiums to see what they can shake loose. If the team and county can’t agree, it goes to a panel of arbitrators; given how that worked out in St. Louis with the Rams‘ similar state-of-the-art lease clause, it’s probably not too early for Cincinnatians to commence panicking about now.

Hamilton County officially approves $7.5m for new Bengals scoreboard under “state-of-the-art” clause

The Hamilton County Commission voted Wednesday to approve paying for three-quarters of the cost of a new $10 million scoreboard for the Cincinnati Bengals — something it actually agreed to back in April, and which it kind of had to given the horrible, horrible lease the county agreed to with the Bengals that requires the public to buy the team anything that the kids down the block have. But anyway, now it’s official and all.

I’d love to show you a rendering of what the new scoreboard will look like, but this is all that any news sites have run with their stories. Is that the old scoreboard, or a Photoshopped rendition of what the new scoreboard will look like? I’m going to have to find somebody who’s actually been to a Bengals game to tell me, aren’t I? At least maybe this year some fans won’t be too embarrassed to admit it.