Your Labor Day weekend reading: Cost to cities of losing teams, and Calgary’s art of the steal

If you’re looking for some light stadium-subsidy reading to make your blood boil over the last weekend of summer, there were a couple of good ones this week, and I don’t say that just because they quote me a lot:

  • Louis Bien at SBNation has a long piece up about the St. Louis Rams, San Diego Chargers, and Oakland Raiders threatening to move to L.A., and the cost on those teams’ fan bases. (I’m not honestly sure what the “you care too much” is about in the headline, as it doesn’t seem to have much to do with Bien’s actual article, but whatever.) Included is a long section on the dubious threat to cities’ well-being that team relocations actually pose, with my favorite line coming from Rick Eckstein of Public Dollars, Private Stadiums fame:

Quality of life improvements claimed by the franchise were “a load of crap,” Eckstein wrote to me. He continued: “Los Angeles has been doing just fine without football for the last decade; there has not been a mass exodus from Seattle after the Sonics left; the Long Island suburbs will not go vacant with the Islanders moving to Brooklyn, just as they survived the Nets leaving; Montreal has shown no ill effects after losing the Expos while the Nationals decidedly did NOT put DC ‘on the map.'”

  • Katie Baker in Grantland has an article that does a really cool thing, taking the “Art of the Steal” chapter from Field of Schemes (and subsequent “Art of the Steal Revisited” chapter from the expanded edition) and applying it specifically to the Calgary Flames owners’ arena demands. Best quote in the piece, though it’s not new and wasn’t particularly said about arena demands (it was about hockey lockouts), is from current Flames president Brian Burke when he worked for the Maple Leafs: “My theory is, make the first meeting as short and unpleasant as possible. Sometimes it’s better to just punch the guy in the face.” Not sure if demanding at least $490 million in taxpayer cash while claiming this would be for the public good quite qualifies as a punch in the face, but it’s pretty close!

Raiders nixed using team revenues for stadium in April, but developer kept it in plan because whatev

So remember how NFL stadium consultant Marc Ganis said back in June that the Oakland Raiders owners would hate Floyd Kephart’s Coliseum City stadium proposal, because they’d be on the hook for all the construction costs? Well, turns out a Raiders exec said so specifically back in April, in an email obtained and published yesterday by the San Jose Mercury News:

“Simply put, the ‘terms required for the Raiders to commit to remaining in Oakland’ are a plan that fills that funding gap without stripping revenues from the stadium and preserves the current level of surface parking (for tailgating),” Raiders President Marc Badain wrote to Kephart on April 28.

He added that “all revenues from the stadium must be retained by the Raiders.”

Not to belittle the Merc News’s “exclusive” too much, but this isn’t really big news: That the Raiders owners don’t want to have to pay for a new stadium with stadium revenues has been a given from the start of this whole mess. (Otherwise the Raiders could just go and build a stadium in Oakland themselves, without messing around with city “conduit bonds” and the like.) So really what we have here is confirmation that an Experienced Developer doesn’t have any more ability to magically make $400 million appear out of thin air than city officials do.

Ultimately, the question here is whether Raiders owner Mark Davis is willing to pick up his team and move to L.A. — where, keep in mind, he would similarly have to pay for a new stadium out of stadium revenues, though he’d maybe have more stadium revenues to work with, depending on how excited you think L.A. fans will be to buy Raiders PSLs — and whether the NFL will go along with him. Which is going to depend on the same two known unknowns we’ve been working with all along: how lucrative the L.A. market really is for NFL owners despite not coming with any added local cable revenue like in other sports; and how the NFL is going to decide which if any of the three teams jockeying for L.A. (the Raiders, St. Louis Rams, and San Diego Chargers) will be given the go-ahead to move. And there’s so no indication that we’re going to know any of this before the start of 2016 at the earliest.

In the meantime, we can take comfort in the reminder that rich developers are mostly pretty useless, at least as far as turning money-pit stadium projects into money makers for all concerned. Though if someone wants to pay me a retainer to say, “I can build a stadium for the Raiders right now, if the Raiders put up the money,” I wouldn’t say no.

Missouri actually identifies $280m in Rams funding, now only has $100m as “dunno yet”

The Missouri Development Finance Board has approved the first $15 million installment of those $50 million in tax credits Gov. Jay Nixon wants to give to the St. Louis Rams to help fund a new stadium. (The next two installments would come in 2016 and 2017.) That’s as to be expected, but the interesting part comes down in the fine print of the tax credit offering, which finally spells out how Nixon plans to cobble together $400 million or so in public stadium subsidies:

They have proposed to pay for construction with $450 million from the National Football League and the team that plays here, $201 million in bond proceeds from the state and the city of St. Louis, $160 million from the sale of seat licenses and $187 million in tax credits, according to the state application.

Let’s take those one at a time:

  • $201 million in bond proceeds is about what the state could get by refinancing the existing Jones Dome bonds: They have $18 million a year in hotel-motel tax money (approved for the last Rams stadium 20 years ago, which is now unconscionably old), and about $100 million in remaining debt on the dome, so if they can get an interest rate of around 4% they should be good to go there. It’s still doesn’t explain how the city will now pay off the convention center debt that it’s currently using some of the tax money to cover, but at least it exists.
  • While including $160 million from the sale of seat licenses as part of the public portion is a bold move, no doubt Rams owner Stan Kroenke is going to want PSL money to cover his share of the cost. So calling it public funding is going to be contentious, to say the least.
  • $187 million in tax credits: Whaaaa? The $50 million from the Missouri Development Finance Board is discussed above, and there’s been discussion of maybe $30 million in federal Brownfield credits. Other than that, if Nixon and friends have specified what other tax credits they’re thinking of, I’ve missed it (and so has Google).

In other words, we’re still looking at a funding gap of at least $100 million here, though presumably somebody has at least an idea of where to ask for it, even if it’s not completely public yet. And even then, we’re talking about only (“only”) $388 million in public cash, which, while more than the entire last stadium cost, is still less than Nixon had promised. Whether that’d be enough to make Stan Kroenke and the NFL happy enough not to move the team to L.A., assuming it all eventually gets approved, is the $388 million question — if nothing else, it should make for some interesting conversations in NFL board rooms along the lines of “Jeez, Stan, take the free money,” though you know no one’s going to say it out loud for fear of blowing the chance to shake Missouri down for even more.

(Or maybe Kroenke really will just require the people of St. Louis to build the stadium with their bare hands. Some things, after all, money can’t buy.)

Carson stadium design scraps lightning-bolt tower, what’s the point anymore?

The San Diego Chargers and Oakland Raiders presented their Carson stadium plan to the NFL last week, and on Monday shared their trailer with the public. If you like swooping CG renderings and Kiefer Sutherland, it’s, well, got those:

It’s also missing something from earlier static renderings. Try to figure out what it is? (Er, without peeking at my headline.)

Previous plans called for a tower that extends 115 to 120 feet through and above the main concourse of the sleek, futuristic stadium. The tower’s cauldron would change depending on the team: simulated lightning bolts shooting out of a glass ball for the Chargers and a massive flame in honor of legendary owner Al Davis when the Raiders play…

Stadium backers confirmed that the design elements have been scrubbed from the plans. No reason was given, other than the previous renderings, released in April, were preliminary in nature.

Translation: Sure, we threw it in with the initial drawings, but it was too hard to do with our video software, let alone actually build. That would be crazy!

So farewell, giant Van De Graaff generator. We are sad to see you go, but not all that surprised, because that’s why they (okay, I) call i “vaportecture.”

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Which NFL teams will go to LA? No one can predict, but here are some predictions anyway

I’ve been trying to think of what to say about yesterday’s NFL non-action around moving teams to L.A. or not — in short, the owners of the St. Louis Rams, Oakland Raiders, and San Diego Chargers submitted presentations on the same L.A. stadium plans that we all already knew about, then no one decided anything — and while I was thinking, Barry Petchesky of Deadspin went and did it for me:

It’s a simple matter of math at this point. The NFL is going to move at least one team—Giants owner Steve Tisch says “it’s better than 50-50” that a decision will be made by the 2016 season—and Oakland is the only chopping-block city currently unwilling to offer its team’s ultrawealthy owners hundreds of millions of dollars to stay. Mark Davis has no attachment to the Bay; sentiment doesn’t factor into it.

Good for Oakland, honestly. It—like St. Louis, like San Diego, like every single American city—has much more important things to spend its limited funds on. But this remains sad news for Raiders fans, who seem likely to lose their team, possibly as soon as next year. It’s not fair, but the NFL has all the leverage, because if Oakland won’t make any concessions, there are other cities that will. The only way the stadium scam will ever be stopped cold is if politicians everywhere simultaneously decide sports leagues don’t deserve handouts. It’s hard to see that happening in the near future. It’ll be even harder when politicians look at football-less Oakland, and know the NFL will be more than happy to call their bluff.

Well, maybe. Undeniably, Oakland has the least close to anything resembling a viable football stadium plan: Whereas St. Louis is offering the Rams to go halfsies on a stadum and isn’t sure how it’ll come up with its half, and San Diego has a plan to pay for maybe a third of a stadium that the Chargers hated the minute it left the presses, Oakland has hopes that maybe one day there will be a plan that can actually debated, but not very strong hopes at that. So with three teams and five slots (counting L.A. as two), it’s hard to picture Oakland not ending up an empty chair when this is all over.

That said, it’s never as simple as all that. What happens next is the NFL owners all sit around and figure out how to decide on which teams should most logically move for next season — oh, sorry, they figure out how to exploit the current situation to make the most money. For the time being (the course of the 2015 season, certainly), that should mean speaking ever more loudly about how two teams will be moving to L.A. in 2016, in order to keep fans and elected officials in St. Louis, San Diego, and Oakland panicked that they not be one of the two.

What happens, though, if — okay, when — we get to January and the three non-L.A. cities are still all in their various states of incomplete deals? Sure, you can set ever-shorter deadlines, you can fly Roger Goodell into town to frighten the state legislature, but eventually you need to decide whether to have your bluff called or not. Which means deciding whether to take the offers on the table from existing cities, or selecting Door #2, whether that be Inglewood or Carson.

And here’s where we run into unknowns again, because we simply don’t have a clue how lucrative the L.A. market is compared to the certain cost of being on the hook for paying for virtually all of the cost of building stadiums in Inglewood or Carson. And for that matter, the NFL may not know either. It all remains a massive game of chicken with unreliable information all around, which is no doubt one reason why the league has been stalling as long as it can, in the hopes that somebody makes somebody an offer they can’t refuse.

If I had to guess, I’d see three options. In one, Rams owner Stan Kroenke gets approval to move to L.A., then either the Raiders or Chargers join them. Whichever team is left out immediately starts threatening to move to St. Louis in order to get a better deal out of it current home town. In the second, the Chargers and Raiders move to Carson as planned, and Kroenke probably takes whatever deal he can get in St. Louis, though he’d lose a ton of leverage at that point. (One reason why option one is more likely to be approved by the NFL.)

Option three is the status quo: The NFL owners can’t come to an agreement, and decide to let things drag on into 2016. I’m not sure I’d say it’s likely — there’s little to be gained from stalling much longer than they have already — but it is 100% possible. Just keep in mind that none of this has to do with what makes sense: It’s a bunch of people demanding ransom in a chaotic situation, and those can often end in unexpected ways.

Rose Bowl nixes hosting NFL team, L.A. temporary stadium options down to Coliseum or playing in street

The Pasadena-controlled board that owns the Rose Bowl voted this week not to bid to provide a temporary home to an NFL team in Los Angeles, saying they would rather host an annual music festival instead. (The music festival wouldn’t be during the NFL season, but its environmental impact statement requires that the Rose Bowl not host pro football if the festival takes place.)

This still leaves the NFL with a bunch of options, but as the Los Angeles Times’ Sam Farmer and Nathan Fenno report, they’re all problematic. Dodger Stadium and Angel Stadium are baseball stadiums, and not only does the NFL hate playing in baseball stadiums, but baseball teams hate sharing digs with football, which messes up their schedule and tears up the grass. The Los Angeles Galaxy‘s StubHub Center in Carson only holds 27,000 — though NFL stadium consultant Marc Ganis tried to put a happy face on this to the L.A. Times, saying, “There’s something interesting about playing in a smaller facility, to start with creating a scarcity of tickets and increase the level of interest early on,” yeah, right — and is run by AEG, which already has no love for the NFL after having its own downtown L.A. stadium plan shot down.

That leaves the L.A. Coliseum, which would be fine but for two things: First off, USC’s lease on the Coliseum only allows it to host one NFL team, which would be a problem if, say, both the Raiders and Chargers needed temporary homes while waiting for a new stadium to be completed. Second, it’s really hard to get a bidding war going with only one serious bidder, so any team wanting to bunk at the Coliseum temporarily likely just saw its prospective rent go up.

This probably isn’t enough to be more than a speed bump en route to a new L.A. NFL stadium (and team), but given that the finances of such a project already look shaky enough, you never know which is going to be the speed bump that breaks the camel’s back. (Yeah, I know the metaphor doesn’t really make sense, work with me here.) The fight to be the future home of the Raiders, Chargers, and Rams still seems like a battle that no one can possibly win — it’s one reason I don’t expect any resolution soon, but I guess we’ll get some hints, maybe, following the August owners’ meetings.

Oakland developer provides city with Raiders funding plan, but you aren’t allowed to see it yet

The Raiders-A’s land war in Oakland is really heating up now, with developer Floyd Kephart providing city officials with a financing plan for a new Raiders stadium (which he can’t tell you about, and the city won’t release yet). Since A’s owner Lew Wolff still insists that he wants the Raiders to vamoose so he can build a stadium and surrounding development on the Coliseum site (and MLB commissioner Rob Manfred backs him up, because that’s what he’s there to do), looks like there’s gonna be a gum fight.

Oakland Mayor Libby Schaaf, meanwhile, only released an email statement that she is “analyzing the viability of the submission from Mr. Kephart,” and taking a “multipronged approach so we have as many options available as possible for stadium development without the use of City of Oakland general fund dollars.” Given that past Raiders plans have all involved the use of a heck of a lot of City of Oakland money, this doesn’t seem promising for Kephart’s plan, but we’ll know more when we know more.

Meanwhile, down in Carson, where a combined Raiders/San Diego Chargers stadium remains on the table — and which is currently embroiled in a crazy internecine government battle involving sexual assault charges against the current mayor and the city clerk calling a former mayor a “witch,” all of which is very entertaining but not really all that relevant to the stadium issues at hand — there was a public town hall meeting last night with Chargers and Raiders officials, and the Raiders officials failed to show up. Anybody who has a clue what Raiders owner Mark Davis is thinking in all this, please raise your hand, okay?

Talks over Chargers stadium now just involve both sides insulting each other

If San Diego Mayor Kevin Faulconer thought that proposing a Chargers stadium plan that nobody was really happy with and then calling for a public vote in order to avoid a more difficult public vote would at least be a productive starting point for negotiations — hey, it worked in Milwaukee, sort of — it’s not really working out that way at all. We already covered the Chargers owners’ statement on Tuesday that this voting thing doesn’t really work for them; since then, things have only descended further into everybody just yelling at each other:

  • Faulconer sniped on Twitter that “we can get this done if we have a willing partner,” while one of his political consultants snarked, “For the first time in seven months of incredibly hard work from the City, County, and the CSAG, the Chargers did something honest – walk away from the table.”
  • Faulconer said he’d next go straight to the NFL to convince the league that a public vote could be held without worries about holdups from environmental lawsuits, with city councilmember Scott Sherman adding approvingly, “They wouldn’t have a choice but to come back to the table.”
  • Chargers stadium czar Mark Fabiani told a KPBS interviewer that “we’re out of time for 2015″ and the only way the Chargers stay put in San Diego is if the NFL rejects their move to L.A. (Asked why the team had agreed to negotiate at all if it was too late, Fabiani replied, “We were hoping the city would come up with something we hadn’t thought of.”)
  • Fabiani told a 10News interviewer via email that negotiating with the city had been “a waste of five months,” that the L.A. market is “far more lucrative,” and that “we haven’t seen any evidence so far in our dealings with Mayor Faulconer that he is capable of managing such a complex project,” calling his approach “remarkably unsophisticated.”

Yep, that’s a lot of yelling. What it all seems to add up to is two sides each trying to make their pitch to the NFL: Fabiani is trying to tell the Chargers’ fellow owners, “Hey, we tried, the mayor’s a buffoon, we have no choice but to go to L.A.,” while Faulconer is sending the message, “We have a good offer on the table, kick these nuts in the butt and tell them to negotiate.” This is looking more and more like the endgame will be an NFL meeting in which the Chargers, St. Louis Rams, and Oakland Raiders owners all try to be the first to win approval to go to L.A.; I’m still skeptical that any of them should really want to, but NFL owners are as susceptible as the next person to wanting things that they’re told they can’t have. Maybe more so.

USA Today report on NFL LA move may violate own unnamed source rule, says source close to journalism

Stop the presses! USA Today reported on Friday that it’s heard the NFL is exploring where a team could play temporarily in Los Angeles, maybe, while a new stadium was possibly being built, if that happens, possibly, says some guy:

The league plans to soon begin talks with existing stadiums in the Los Angeles area in an effort to provide temporary housing for any team or teams that might relocate there, if any, a person familiar with the situation told USA TODAY Sports. The person asked not to be identified because of the sensitivity of the situation.

This is totally expected, since the league needs to do due diligence if it’s going to consider approving a move of either the St. Louis Rams, San Diego Chargers, and/or Oakland Raiders. And, for that matter, it’s also totally expected that the NFL might want to leak this to the papers for their own purposes, as a way of turning up the heat on St. Louis, San Diego, and Oakland to get new stadium plans in gear already, instead of mucking around with whether it would be legal or whether it makes any sense. You might even wonder if USA Today is being used by the league here for PR purposes, with the whole “asked not to be identified” thing serving as cover so the NFL doesn’t have to answer any uncomfortable questions.

In fact, let’s see what USA Today’s editorial ethics policy has to say about basing stories on the testimony of unnamed sources:

The use of unnamed sources erodes our credibility and should be avoided.

Okay, that’s not a good start. But what about when, you know, you really really don’t want to avoid it?

The identity of an unnamed source must be shared with and approved by a managing editor prior to publication. The managing editor must be confident that the information presented to the reader is accurate, not just that someone said it. This usually will require confirmation from a second source or from documents…

Anonymous sources must be cited only as a last resort. This applies not just to direct quotes but to the use of anonymous sources generally. Before accepting their use for publication, an editor must be confident that there is no better way to present the information and that the information is important enough to justify the broader cost in reader trust. This is not to be taken lightly…

Unnamed sources should be described as precisely as possible. Additionally, reporters and editors should explain why the source could not be identified and if possible, add any information that establishes the credibility of a source on the subject matter in question.

Obviously, we as readers have no way of knowing whether USA Today’s managing editor signed off on this, whether a “second source or documents” was provided, and whether the information was “important enough to justify the broader cost in reader trust.” Still, at best, this seems like bending the “Don’t use unnamed sources unless absolutely necessary” rule for the sake of a juicy headline, even if it’s not a story that necessarily tells anyone much of anything. Which goes on all the time, of course, but that doesn’t make it any better a way of running a journalistic railroad.

 

Extorting four cities for new NFL stadiums at once is hard, guys!

The Los Angeles Daily News’s Vincent Bonsignore has a good article up today detailing the careful balancing act the NFL needs to play in deciding which, if any, teams end up moving to Los Angeles:

Short of San Diego or Oakland stepping forward with satisfactory stadium plans for the Chargers and Raiders, which seems to be a long shot at this point, or [Rams owner Stan] Kroenke surprising everyone by accepting the stadium proposal Missouri leaders are hammering away at, the NFL is headed toward a potentially ugly fight in which owners will be asked to take sides with or against one other.

Worse, if it ultimately comes down to a vote, the team or teams losing out will report back to their local markets with tails decidedly between their legs and left vulnerable while trying to revive new stadium talks.

And that, in a nutshell, is why you’re hearing a lot of rumor and innuendo right now, and no real action, especially on the part of the NFL: Any step forward by one team’s plans would mean a step backward for someone else’s — and the last thing the NFL or its owners wants is for anyone to lose leverage in negotiating a stadium deal. So the endgame here is going to have to be carefully calibrated to ensure that everyone gets a deal they can live with before anything gets finalized. (Bonsignore’s solution — let the St. Louis Rams and San Diego Chargers move to a shared stadium in Inglewood, and take $400 million from their relocation fees and stadium revenues and give it to the Raiders for a new stadium in Oakland — almost certainly won’t work, since it’s unlikely there’s an extra $400 million in profit just sitting around in any Inglewood finance plan, but hey, an article can’t have everything.)

Instead, let’s watch Hollywood Park racetrack get blowed up to make way for either Kroenke’s Inglewood stadium if it ends up getting built, or for something else if it doesn’t. Momentum!