Friday roundup: Grading Mariners subsidies on a curve, Cobb County could close parks to pay off Braves debt, Beckham punts on another stadium deadline

Congratulations to the team that had never won the hockey thing winning it over the other team that had never won the hockey thing because it was a new team! And meanwhile:

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

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

Calgary council forms new committee for Flames arena talks, without pesky mayor who knew how this stuff worked

As rumored last month, the Calgary city council has gone ahead and formed a committee to reopen talks with the Flames owners on a new arena, a committee that will edge Mayor Naheed Nenshi out of a central role in negotiations. Nenshi, though, either thinks the rest of the council will hold a hard line or is just making a brave face of it, because he had this to say:

“I think hitting the reset button is a good idea, but the reset button has to be hit on both sides,” Nenshi said.

“Given that we were not the party that walked away I think it’s important everyone come back to the table and maybe with new faces around the table as well.”…

“It will be hard for the committee to convince me to put a lot more public money on the table,” Nenshi said Monday. “I think it will be hard for the committee to convince council to do that.

“I think it will be hard for the committee to convince Calgarians to do that.”

The concern here, ultimately, isn’t who does the negotiating on behalf of Calgary residents, it’s whether they give away the store. Nenshi still wields influence on the council, and obviously still has the bully pulpit to embarrass all concerned with facts, so it’s not like the Flames owners have carte blanche now. Still, this is something to keep an eye on, to be sure that it’s genuinely the Calgary council telling the team, “We’re willing to talk so long as you’re not asking us to give away the store,” and not “Okay, we pushed out the guy who understood economics, when do you want us to jump and how high?”

Columbus arena hurt by lack of ticket tax, Hartford arena hurt by presence of one?

Columbus’s Nationwide Arena, the privately built and publicly bailed-out home of the Blue Jackets, is running out of money unless the county rides to the rescue with a citywide tax on sports and entertainment tickets:

The initial proposal outlined in January was for the city to levy a tax of 3 to 8 percent on tickets to arts, cultural, entertainment and professional sporting events within the city limits and for Franklin County to contribute sales-tax revenue.

Together, those sources could generate $15 million to $20 million a year, with $4 million being earmarked for the arena and the rest going to artists and organizations that the arts council supports.

Basically, what’s going on is that the county funded the arena bailout, including future renovations, with a casino tax, and Columbus residents just haven’t been gambling their money away like everyone had hoped. And while initially the county arena authority proposed just a tax on tickets at the arena, that’s expanded to a tax on all tickets anywhere in Columbus, and arts groups and their supporters are understandably miffed about the prospect of having to be taxed in order to fund a competing entertainment option just because the Blue Jackets needed to make more money.

(Ticket taxes, as has been covered here ad infinitum, tend to come out of the pockets of those selling tickets, not buying them, as they’re already charging the maximum that the market will bear; though there’s some argument that a citywide ticket tax would hit ticket buyers a bit harder, since they wouldn’t be able to avoid it by going to see some event other than hockey.)

So we have the specter of Don Brown, executive director of the Franklin County Convention Facilities Authority, saying of a money-losing arena, “To keep that magic happening, we have to keep reinvesting in the arena itself.” Magic!

Plenty of other local governments have funded their sports venues with ticket taxes, of course, among them Hartford, Connecticut — where the public operators of that city’s arena want nothing more than their ticket tax to go away:

The overseers of the XL Center in Hartford say the venue is feeling the sting, in more ways than one, from a 10 percent state admissions tax that kicked in six months ago.

The levy has played a role in the 16,000-seat arena striking out on as many as a dozen events, mainly concerts, that it bid on, according to Michael Freimuth, executive director of the Capital Region Development Authority (CRDA), XL Center’s management overseer…

The problem, Freimuth said, is that the tax curtails a show’s potential profit margin “by such a degree that it results in the building losing actual events and the subsequent revenues.”

Connecticut’s is a statewide tax (though some venues have gotten exemptions, including the Hartford arena at times in the past), so it’s not entirely clear what the arena managers or concert promoters are griping about — it’s not like they can get out of the tax by just going to, say, Bridgeport. Though I suppose griping is how concert promoters get better deals — Freimuth told the Hartford Business Journal that “They say ‘you just took my margin down, split it with me,'” which indeed sounds like something a concert promoter would say.

The lesson here is: You can’t get blood from a stone, or much more money from a concert industry that has other options, especially when you’re a market like Columbus or Hartford that big-name acts can just skip if they aren’t feeling the profits. Though if you’re a concert promoter, you totally can try to get a state to cut your taxes to boost your profits by threatening to blacklist them. And if it seems like letting sports teams and promoters play states off against each other in a bidding war to the bottom is bad public policy, yeah, maybe Congress should have listened to David Minge.

As mayoral election threatens Nashville soccer, hockey subsidies, Predators’ mascot weighs in with key endorsement

When MLS announced that it was awarding one of two new expansion teams to Nashville S.C. last December, it seemed like the city had gotten the nod mostly because it had promised more than $75 million in subsidies for a new stadium. As it turns out, though, neither is now entirely certain — the public funds or the expansion franchise — thanks to, well, let’s let VenuesNow magazine tell it:

Former Mayor Megan Barry championed the stadium project but resigned in March after pleading guilty to a felony theft charge connected to her affair with a former police bodyguard. Mayor David Briley, who took over for Barry, faces a special election May 24, and other candidates have called into question the wisdom of Briley continuing on the stadium path.

Mayoral candidates have questioned allowing the team to take over space next to the stadium for development while Nashville taxpayers shoulder financial risk, candidate Ralph Bristol told local daily newspaper The Tennessean. One, Carol Swain, doesn’t believe the city can afford to fund the stadium, which the team plans to pay off with $25 million up front and $9 million a year over 30 years (ticket taxes are expected to cover the remainder of the yearly debt), and another, state Rep. Harold Love Jr., wants to look at changing the location but wonders whether any money at all should be spent on a stadium.

But can a new mayor undo a decision that the metro council already made last fall? Apparently so, as the council still needs to approve the stadium lease and rezone land at Nashville’s fairgrounds for stadium use. And if it doesn’t, team owner John Ingram warns, MLS could still pull the franchise and give it to another city.

And Nashville SC isn’t the only sports team concerned about Thursday’s mayoral election: The owners of the Nashville Predators, who have been seeking a new lease that would include public money for renovations for their arena, are worried about the outcome as well. So they waded in the only way they know how: By having the Predators’ president and mascot stand side-by-side to endorse Briley for re-election:

I don’t know about you, but when a silent person in a giant sabre-tooth tiger head points at me with instructions on who to vote for for mayor, I pay attention. I don’t know that I do what he says — the only pointing mascot I’ll take political leadership from is Youppi! — but I will certainly stare on, transfixed by the spectacle.

Friday roundup: Graceland seeks arena money, Marlins and Cards seek spring-training stadium money, guy in Raleigh seeks MLS stadium money

In no particular order, or as we call it in New York, Mets style:

Connecticut puts Hartford arena up for sale, hints at paying buyer to take it off its hands

If you’ve always dreamed of owning the former home of the Hartford Whalers, yesterday was your lucky day, as the state Capital Region Development Authority officially put it up for sale — and the state of Connecticut might help you buy it from itself, what?

[CRDA executive director Michael] Freimuth said the state is not pledging to devote funds for improvements as part of the RFP, but “the state could be a player. I would think honestly whatever proposals come in, it would require some state participation.”

So what this sounds like is that the CRDA is hoping that some state renovation funds could sweeten the pot to get higher bids for the arena, though given that the arena is already owned by a state authority, it would be more straightforward just to let people bid whatever they want without involving subsidies, but of course straightforward isn’t always what state officials (or arena owners) want, because it’s too obvious where the money is going then.

Anyway, Freimuth says that the CRDA has already received multiple bids, which is good, because running an arena in a mid-sized city with lots of competition elsewhere in the state and no major-league sports tenants isn’t exactly the kind of thing that sets investors’ hearts a-flutter. Let’s just keep our fingers crossed that whoever buys the building doesn’t demand more in “state participation” than they pay the state in the first place, because that’s the kind of offer that Connecticut can’t afford not to refuse.

Friday roundup: Senators owner stalling on arena commitment, Jaguars owner wants to buy Wembley, and gondolas, forever gondolas

As late as Wednesday, I thought this was turning out to be a slow news week. Then the news made up for it in a hurry:

  • The New York Islanders owners held a question-and-answer session for residents near their planned new arena on Tuesday, and when asked about how they plan to increase Long Island Railroad service to avoid tons of auto traffic, a state development official said, “We are in very active discussions with the LIRR — meeting with them once a week — and those talks are ramping up.” Hopefully they’re involving Dr. Strange in those discussions, because they badly need to find some new topological dimensions.
  • Ottawa Mayor Jim Watson says he plans to talk to Ottawa Senators owner Eugene Melnyk about whether he actually plans to pursue the LeBreton Flats arena development he won rights to last year, after Melnyk called it “a huge project with tremendous risk” and said, “If it doesn’t look good here, it could look very, very nice somewhere else, but I’m not suggesting that right now” and “Something’s got to break somewhere and I mean a positive break.” Melnyk has made threats like this before, but you’d think now that he has an agreed sale price for the land he’d be happy; it sure sounds like he’s angling for some additional public subsidies now that he has his mitts on the land, which you can’t really blame him for, since Watson opened the door to that already. Come on, mayor, haven’t you learned yet not to get the can opener out when the cat is around?
  • Tampa Bay Rays 2020, the group started by the Rays to push for business support for a new stadium, is signing up plenty of members, but DRaysBay notes that “the real test of commitment will come when businesses are asked to make clearer financial commitments to a stadium plan.” Yeah, no duh. (The subhead here, “Business leaders line up behind stadium plan, but financing questions linger,” is also a masterpiece of understatement.)
  • MLB commissioner Rob Manfred says that the Toronto Blue Jays‘ Rogers Centre “needs an update to make it as economically viable as possible,” noting that other stadiums “have millennial areas, things like that that have been built and become popular more recently.” So, like, an Instagram parlor?
  • Here’s a story about how 25 years ago the NHL handed Norman Green the rights to move the Minnesota North Stars to any open market as consolation for putting an expansion team in Anaheim, where he’d wanted to move, and he ended up going to Dallas. Also it has Roger Staubach in the headline for some reason.
  • And here’s a story about how 50 years ago NHL expansion inadvertently kicked off the rise of arena rock, which is probably overstated but it has links to vintage Cream videos in it, if you like that sort of thing.
  • Jacksonville Jaguars owner Shahid Khan is in talks with the Football Association to buy London’s Wembley Stadium for £600 million, which is certain to raise eyebrows about the possibility of the Jags moving to London, but is probably for right now more about Fulham F.C., which Khan also owns, being about to get promoted to the Premier League and wanting a bigger place to play. Khan also said, “I think it needs investment and updating. Compared to American stadiums the video boards are something that need to be looked at. The lounges are a little bit dated.” The current Wembley Stadium was built in 2007.
  • The son of former disgraced Los Angeles Dodgers owner Frank McCourt wants to build a gondola to take fans from Union Station to Dodger Stadium to avoid traffic. “It’s not actually crazy,” Los Angeles Mayor Eric Garcetti insisted on Thursday, which, given that this is a city considering allowing Elon Musk to build a network of tunnels to whisk residents about via some unknown technology, maybe we should take that with a grain of salt.
  • San Diego State says its stadium plans could eventually be expanded to fit an NFL team, for a mere additional $750-$850 million. Most San Diegans responding to an internet poll (which means some San Diegans, some non-San Diegans, and some dogs) don’t think they’re getting an NFL team anytime soon, anyway.
  • The Port of Oakland has approved giving the Oakland A’s owners exclusive negotiating rights to develop Howard Terminal, which now gives the A’s exclusive rights to two possible stadium sites. As DRaysBay would say, financing questions linger.
  • NBA commissioner Adam Silver has toured the new Milwaukee Bucks arena and says it has “unique sight lines.” Hopefully he means that in a good way, though I’m still wondering about that “sky mezzanine level.”

How cities haven’t actually fallen out of love with funding sports stadiums

The May issue of Governing magazine has an article with the provocative headline, “How Cities Fell Out of Love With Sports Stadiums,” though it’s really mostly about why St. Louis balked at throwing money at an MLS stadium and fought back against paying for arena upgrades for the Blues after getting burned when the Rams got the most sweetheart lease deal in history and then used a lease loophole to move back to Los Angeles just 21 years later.

All that is good and fine, as is the article’s discussion of how “the economic impact reports singing the praises of sports development have largely been discredited.” But in the service of trying to make the story into “regular folks used to fall all over themselves to hand money to sports teams, but now they’ve smartened up,” writer Liz Farmer oversimplifies or just plain gets wrong a number of things about the stadium subsidy game and how it’s played, which is going to be a problem if any people in the business of actual governing take it as gospel. Let us count the ways:

“When [Rams owner Stan] Kroenke came along and had the gall to start making demands for a football team that hadn’t had a winning record since 2003, the city was — quite literally — spent. St. Louis was suffering under the same socioeconomic and fiscal pressures as Cleveland, Detroit and most other Rust Belt cities. Its population was declining rapidly, and it was stuck paying off debt for the existing stadium until 2022. Residents were increasingly skeptical when it came to investing in gaudy entertainment amenities the lower-income population couldn’t afford to use.”

St. Louis’s population has been declining since 1950 — if anything, it’s leveled off some in recent years — though its county population has soared as more people moved to the suburbs. And residents were pretty darned skeptical before, too: Way back in 2002, St. Louis citizens approved a referendum requiring that all public subsidies for sports facilities would need to go to a public vote. Unfortunately for voters, courts ruled that the target of that referendum — the Cardinals stadium deal that had just been approved prior to that — was grandfathered in, but it’s not like public resistance in St. Louis is anything new.

“The era of taxpayer-financed stadiums came about almost by accident. Seeking to limit the use of government bonds in stadium financing, the federal Tax Reform Act of 1986 included a provision that capped at 10 percent the direct stadium revenue — mostly from ticket sales and concessions — that could be used to pay for the cost of the facility. That meant that governments would have to raise broad-based taxes, such as on sales or business, to cover the rest of the cost.”

Not quite. What the 1986 tax reform law was attempting to do was to rein in cities’ use of federally tax exempt bonds for private projects — not just stadiums, but all kinds of development — by saying, “Look, only really public amenities, okay? Don’t just offer discounted bonds to anybody who asks and then stick federal taxpayers with the bill.”

Unfortunately, the way that Congress chose to address this was by defining public amenities as things that were paid for by the public — if more than 10% of the cost was paid off by private funds (or special taxes that were just private funds masquerading as public dollars to get eligibility), low-cost federal bonds were off the table. Unfortunately, what that did was to increase the leverage of sports team owners, who could now say, “Yeah, sorry, we would love to put in more money of our own, but then it would increase the financing costs, and we can’t have that, can we?”

This is by no means what started the era of taxpayer-financed stadiums, though: Team owners were already demanding new stadiums and arenas left and right, using the usual playbook of methods to do so (move threats, claims of economic benefits, etc.). The tax reform law further titled the scale toward bigger demands, but it didn’t create the demands in the first place — and while getting rid of tax-exempt bond subsidies would be a nice step, it wouldn’t put an end to stadium subsidies in the slightest.

“But Congress didn’t account for the fan loyalty and pride that — at the time — made raising local taxes more acceptable.”

Fan loyalty and pride are still on full display, but sports fans are taxpayers, too, and have been resisting handing their tax dollars over to sports team owners as much as anyone since the beginning. Just ask Frank Rashid.

“The boom was driven in part by demand from teams and fans for a more sophisticated sports experience than the drab concrete coliseums they were used to.”

If by “more sophisticated sports experience” you mean “more pulled-pork sandwiches and nicer cupholders,” sure. But plenty of sports venues have been torn down in recent years to make way for new facilities that are arguably even drabber than the ones they replaced.

“The Washington, D.C., soccer team, D.C. United, spent years negotiating with the nation’s capital over a new soccer-specific stadium. Those talks effectively shut down once the economic downturn hit in 2008, and the team spent another seven years shopping around in the surrounding counties — even going as far as Baltimore — trying to find a local government that would pay for the facility. None would bite. Ultimately, the team stayed in D.C. and is paying to build a stadium on land the city spent $150 million acquiring. The deal includes a non-relocation agreement.”

In addition to that free land, D.C. United is also getting $43 million in property tax breaks, making it the most expensive MLS soccer stadium subsidy in history. The tide is turning!

“Kiel Center Partners, the firm that owns the NHL Blues, had asked the St. Louis City Board of Aldermen for $64 million to finance upgrades to the Scottrade Center. Had the city’s voters not been distracted by the soccer stadium proposal and by a heated mayoral election, the financing might have met more resistance. Some aldermen did question whether the city’s 1994 lease with the team required it to pay for upgrades, but still the proposal narrowly passed. If it had been submitted to a popular vote, it most likely would have failed.”

Again, “if voters had been asked, they would have voted it down” is likely true of all of St. Louis’s past sports subsidy deals. (Possibly not the original Rams deal, though if they’d known that it would allow the team to move away by claiming their two-decade-old stadium was no longer “state of the art,” they might have balked at that, too.) And voters didn’t get to vote because the city council just up and decreed that they wouldn’t be allowed to, despite that 2002 referendum, so it’s tough to see how this is a sign of increased political resistance.

“So the hockey team got its way. Things like that still happen. But they don’t happen easily, and they don’t happen with broad public support. Several years ago, for instance, when the NFL’s Minnesota Vikings wanted a publicly funded stadium, the state legislature rejected the proposal. Eventually the team got its money, but with a state law capping public contributions to the $1 billion project at $498 million.”

OMG, the Vikings owners actually had to ask for stadium subsidies multiple times! And then they had to settle for a mere half-billion dollars in cash, except counting tax breaks and other hidden goodies it’s actually costing taxpayers more like $1.1 billion, so, uh.

In the end, the Governing article isn’t a terrible one, and it does touch on a lot of details of the stadium scam that Governing likely wouldn’t have been caught dead discussing 20 years ago. (Now there’s some progress.) But if the takeaway is that the general public loved sports stadium plans, but now have realized they were duped, that’s not the story at all: Actually it’s been a battle from the beginning between team owners trying to extract as much public money as possible, and taxpayers and some of their local representatives trying to push back. And while maybe a few more elected officials are pushing back harder, there’s pushback against the pushback, too. So this whole mess isn’t ending anytime soon, much as I wish it were so I could retire this blog and go back to treating sports as the purely apolitical, fun pastime that it never really was.

Some Calgary council members want Mayor Nenshi out of Flames arena talks, because he’s not “gung ho” enough

This article from the Toronto Star is really weird and convoluted and lede-burying, but if I get the gist of it, it’s that some members of the Calgary city council are trying to find a way to freeze Mayor Naheed Nenshi out of future negotiations with the Flames over a new arena, because he’s been too good at not giving away the store. The evidence on hand:

At least 10 councillors are directly involved in or aware of recent meetings in which elected officials have discussed drafting a notice of motion calling on council to strike a new committee — one that may exclude past brokers from both parties.

“Initially, it should be new blood that’s on it to give it a different perspective than we’re getting now,” said Coun. Ray Jones.

“The longer we leave it, the more it just kind of goes away,” he explained. “Everybody right now is gung ho to get going on it, and I think we should take advantage of that.”

And:

In addition to Jones, councillors Ward Sutherland, George Chahal, Sean Chu, Shane Keating, Peter Demong, Diane Colley-Urquhart, Joe Magliocca, Evan Woolley and Jeff Davison are directly involved in or aware of discussions to restart talks and form a new committee.

“We’ve got to get a few oars in the water here and moving in the same direction before we really can make any headway with it,” said Davison, who is leading the charge.

“Overall, you’re just seeing a different makeup on council,” he said. “There’s a lot of us that are new, and sometimes some of the ideas that failed in the past get rejuvenated.”

And:

Lori Williams, associate professor of policy studies at Mount Royal University, said councillors might be wary of voter backlash given many Calgarians supported Nenshi’s position.

“I suppose it does make sense to try to get new people to the negotiating table so that any animosities that may be lingering from the breakdown of negotiations in the past would not be part of this,” Williams said.

Okay, sure, “new blood” and “new ideas,” but otherwise this is just weird: The last round of negotiations “broke down” not because of any problems on the council side, but because Nenshi pointed out that the Flames owners’ plan could cost the city more than a billion dollars, and then the Flames walked away from the table and put all their energies into trying to defeat Nenshi in last fall’s mayoral election. When that didn’t work, they mostly sighed a lot about how now what were they gonna do with a mayor in power who didn’t want to give them lots of taxpayer money, and deployed NHL commissioner Gary Bettman to say that the Flames will lose money without a new arena, when that’s patently not true.

While Nenshi has been possibly the most prominent city mayor anywhere in holding the line on sports subsidies, he’s always been limited by Calgary’s weak-mayor system, in which he’s only one vote on the 15-member council. Given that the Star report only talked to a couple of council members, it’s hard to say whether this is an actual major revolt or just some people trying to trash-talk the mayor into getting out of the way and letting them get down to the business of shoveling money at the Flames — one councillor, Shane Keating, is cited as having said of Nenshi, “I’ll never be as intelligent as you are, but I’ve been smarter than you many times,” which is described as a “stinging rebuke.” Maybe it sounds different in the original Canadian?