January 30, 2003
Portland legislator vows to stop stadium
Oregon state senator Lenn Hannon, citing the state's financial crisis, is promising to block passage of a baseball stadium bill in the upcoming legislative session. "As far as I know, I'm standing on the air hose," said Hannon. "No, make that jumping up and down on the air hose."
January 29, 2003
Former owners threaten injunction against Expos' sale
The simmering lawsuit filed last summer by former Montreal Expos limited partners has been turned up a notch with reports that the plaintiffs may seek an injunction against the team being moved or sold. Even a temporary restraining order could effectively stymie the team's sale, baseball business guru Doug Pappas tells FoS News: "Even if the injunction technically allows the Expos to be sold, they're unsalable until the underlying action is resolved. The Expos are worth $X in Montreal but $4X in Washington/Portland/wherever - it'll be next to impossible for MLB and a willing buyer to agree on a price within that range."
January 28, 2003
Expos bidding skirmish begins
MLB has begun meeting with local officials who want to lure the league-owned Montreal Expos to their cities, but if Bud Selig was hoping to provoke a bidding war of stadium subsidy offers, so far the response seems underwhelming. A delegation from Northern Virginia is proposing a stadium plan that would be paid for one-third by the team, one-third by ticket taxes and stadium-related sales and income taxes. with a remaining $100-150 million that "has not been accounted for," according to an AP report. Portland, Oregon, meanwhile, has pinned its hopes on a special baseball payroll tax, which was supposed to generate $150 million in stadium financing; the other half of the construction costs would come from, well, no one seems sure. Washington, D.C. Mayor Anthony Williams has proposed $300 million in city aid to the Expos, without saying where the money would come from. Meanwhile, other projected suitors seem to have lost interest, according to USA Today: New Jersey and San Antonio say they've had no contact with MLB about the Expos, while Charlotte City Councilor Lynn Wheeler says, "We have no funds. We are tapped out." (Thanks to Ballparkwatch.com for the links.)
January 26, 2003
Send money or we'll shoot this Super Bowl
NFL commissioner Paul Tagliabue has threatened that if San Diego doesn't build a new stadium for the Chargers, this will be the last Super Bowl played in the city. Most San Diegans, according to the L.A. Times, couldn't care less. Which is as it should be, say sports economists.
January 21, 2003
San Diego officials get tix from NFL
The NFL is offering San Diego elected officials scarce Super Bowl XXXVII tickets at face value, reports the San Diego Union-Tribune. "It clearly is designed to make the public officials feel better about the NFL and the new stadium, and that's the reason they're doing it," California ethics expert Bob Stern told the Union-Trib. (The Chargers are demanding $200 million in city subsidies for a new stadium.) NFL spokesman Jim Steeg insists there's "nothing sinister or evil or conniving about it. ... It's our way of thanking them" for work done on Super Bowl preparations. Us, we would have gone with a box of chocolates.
NYC $3B Olympic stadium plan "a rough row to hoe"
"It sounds like a rough row to hoe," says Dallas City Hall TIF expert Ryan Evans of New York's plans to pay for Olympic development with future property taxes. "Because someone has to take the risk, and then hope there's enough taxes generated to pay it back." Adds NYU economist Emanuel Tobier: "If you're going to rely on these distant forecasts, you're looking for trouble. That's how we got the stock market bubble." For more, read my article.
January 20, 2003
Expos to stay put, await better payola?
It's looking increasingly likely that the Montreal Expos, rumored to be entering their final season every year since 1999, will stay put yet again for 2004. Asked if the Expos would definitely be moved following this season, MLB commish Bud Selig replied: "Ask me that later this year." The Washington Times speculates that MLB could be waiting for better economic conditions that would facilitate public stadium subsidies, noting: "The voter appetite for supporting public sector dollars for sports facilities is near an all-time low."
January 17, 2003
Chargers ask for $200m for stadium
The San Diego Chargers issued their long-expected demand for a new football stadium yesterday: $200 million in public funds, to pay for half the construction costs of a $400 million facility that would replace Qualcomm Stadium. Team officials claimed that the public funding could be generated by selling part of the Qualcomm site to create an "urban village" that would generate additional property taxes; however, Citizens' Task Force on Chargers Issues David Watson pointed out that only part of that revenue would go to the city, with the rest reserved for other agencies. (It's also unclear if the Chargers have a developer in mind for the project - the Padres stadium across town has been beset by financial problems in part caused by promised hotel development that failed to materialize.) The team hopes to have a stadium measure on the ballot by November 2004.
January 10, 2003
Ottawa's woes have arena roots
With the Ottawa Senators filing for bankruptcy protection on Thursday, it's worth noting the role of arena shenanigans in the team's plight. Follow the bouncing puck:
When politically connected computer titan Rod Bryden bought the Sens in 1992, he borrowed heavily to pay for the construction of the $225 million Corel Centre (built, perhaps not coincidentally, by one of his other companies, the Palladium Corporation). Rather than pay off this debt, which has since ballooned to $376 million, he first demanded government subsidies for Canadian hockey teams from his old cronies in Parliament - a plan that went awry only when Canadians deluged their MPs with angry calls and faxes, causing legislators to back down. With a bailout off the table, Bryden ultimately filed for the Canadian equivalent of Chapter 11, which will allow him to sell the Sens for a tidy sum, while stiffing the banks that funded his construction project in the first place. Now all that's left is to see if Bryden can make a clean getaway...
January 06, 2003
Bond agency: Stadium cash to be tougher to come by
According to a report in Sports Business Journal (no public link for non-subscribers, sorry), the bond rating agency FitchRatings is about to issue a report indicating that bond sellers are becoming more cautious about getting involved in stadium projects. "Many people would just blindly look at these new facilities going up, and they financed it thinking you would have a ton of money," Sal Galatioto, Lehman Bros.' head of sports finance, told SBJ. "Now people are taking a closer look. [Previously] they had more faith in the [financial projections]. Now they are looking at the more severe downside scenarios."
Fitch calculates that $18 billion has been spent on stadium projects since 1990, with $10.4 billion of that coming from public coffers. (No details on how those figures were calculated, whether they include indirect tax and lease subsidies, etc.) According to SBJ, "Fitch expects the more than two dozen professional sports franchises looking for stadiums and arenas to need a combined $5 billion to $7 billion to build their new homes."
Papa needs a new pair of ad panels!
Buffalo Sabres wannabe owner (but only if New York state helps with the purchase price) Mark Hamister has revealed what he wants to spend part of his demanded public subsidy on: an "elect ronic advertising ribbon" to run around the periphery of the HSBC Arena. "We're not criticizing what's wrong with a 6-year-old building," Hamister told the Buffalo News. "What we are saying is, if you want to correct the economic challenges of this building in this market in this economy today, we need to be more flexible in how we obtain our revenue sources." Hamister predicted that the new ad panels would cost about $5 million and would generate $2-4 million a year in revenue, which sounds like the sort of thing your local business loan officer would jump at - except, of course, that unlike the public treasury, a private bank would want to be paid back. New York Gov. George Pataki has yet to weigh in on Hamister's demands - stay tuned...
