August 31, 2007
Spurs: Money all gone, send more
The San Antonio Spurs are asking Bexar County to extend its car rental and hotel tax to provide between $75 million and $164 million in improvements to their AT&T Center. Because, you know, it was built way back in the second season of 24.
The added public subsidies are needed, team officials say, to "keep the Spurs competitive." Because playing in that broken-down five-year-old wreck of an arena, the Spurs have only been able to win three of the last five NBA titles.
August 30, 2007
Vikes bail on land buy
The owners of the Minnesota Vikings, citing the real estate credit crunch, have backed out of a plan to purchase several blocks of land near the Metrodome that would have been used for development around a potential new football stadium. Given other recent events, this can't be seen as a huge surprise. As for its effect on the stadium plans, though Vikes owner Zygi Wilf had touted the downtown development parcel as a prime component of any deal, you have to figure the $700 million hole in his budget is a more pressing obstacle.
Selig: I smell Fish stadium
On the heels of last week's announcement by the University of Miami that their football team is leaving the Orange Bowl for Dolphin Stadium after this season, talk is predictably returning to the prospect of building a new Marlins baseball stadium on the Orange Bowl site. To help matters along - or at least get press coverage - MLB commissioner Bud Selig met with local elected officials on Tuesday, and declared the meetings "very constructive": "It's clear to me that all of us are on the same page. We want to get a stadium deal done here as expeditiously as possible."
Given that Selig was meeting with city and county officials, and most of the opposition to public stadium funding has come on the state level, his warm welcome shouldn't exactly come as a surprise, but whatever. Potentially more significant is that the city and county had been setting aside $88 million for a renovation of the Orange Bowl - if they now consider throwing that money into the pot alongside the $253 million in subsidies already promised to the Fish, it could close the $30 million funding gap that's held up stadium plans since time immemorial.
The other issue, of course, is whether the Marlins ownership would agree to a stadium on the Orange Bowl site, which they've previously disparaged. Miami city commissioner Tomas Regalado thinks they'll come around, telling the South Florida Sun-Sentinel: "I know that the Marlins don't like the Orange Bowl site that much, but if this is the only site that they've got, I'm sure they have to take it."
Stadium architect Rolando Llanes told me earlier this year that he thought an Orange Bowl baseball stadium is a terrible idea, since it's a mostly residential neighborhood that would be overwhelmed by 81 days a year of baseball (or whatever it is the Marlins are playing these days): "I just think it's insanity to tear down the Orange Bowl, and build a baseball stadium in that neighborhood. Wrigley Field would work great there, but I know that's not what they're going to build there--they're going to build an airplane hangar." Needless to say, though, Marlins execs are likely less concerned with what the neighbors think than with what the folks in the burbs think.
August 28, 2007
Sonics' OKC footsie: The plot thickens
Hot on the heels of a Seattle Sonics minority owner telling a reporter that his ownership group had bought the team with the intention of moving it to Oklahoma City - a slip of the lip that earned him a quarter-million-dollar fine from the NBA - comes word of further dalliances by team ownership with that city, even with two months to go before the Sonics are allowed to consider leaving Seattle.
An unidentified Sonics staffer told the Tacoma News-Tribune that during a meeting with club employees last Wednesday, principal owner Clay Bennett was asked what Oklahoma City would be willing to do to lure the team to move. According to the source, Bennett "lit up like a Christmas tree. He got real happy and he started spouting off these things."
"These things" being paying for: any costs of breaking the team's lease on Seattle's KeyArena, which runs through September 2010; relocation fees imposed by the NBA; the costs of upgrading the existing Ford Center to make it NBA-ready, and of ultimately building a new arena. Bennett immediately backtracked from his remarks, saying they represented only a hypothetical payoff from a small-market city such as Oklahoma City, Still, as TrueHoop's Henry Abbott remarked: "If this is really the city's offer to the Sonics, wow. That's a lot of money!" Not to mention that the Ford Center is only five years old - the city spent $89 million to build it in 2002, as part of Rick Horrow's MAPS plan to revitalize downtown.
The Seattle city council, meanwhile, is working on a counteroffensive, considering a bill to force the Sonics to remain in Seattle through the end of their lease by utilizing a "specific performance" clause in the lease to block the team from buying its way out before 2010. If nothing else, a judge could either enjoin a move or force Bennett to pay the city a greatly increased fee to buy his way out of the lease, possibly making an early move unprofitable.
Finally, a lengthy excerpt from Abbott's blog entry on this whole mess, which sums things up better than I (or an economist) ever could:
I'm not an economist, but no one can convince me this is not true: if, over time (as stadiums are replaced, I suppose) every city in America were to be total tightwads ... that is, make steep cuts in taxpayer support for such projects, it would not put the NBA out of business. It would shift the marketplace around. Owners would essentially have to have deep pockets to make that transition. Many would trim payroll on and off the court.
But, eventually, wouldn't more and more owners look at that next free agent and offer half as much? Wouldn't fewer and fewer players get max contracts? Wouldn't the average salary for a starting power forward linger somewhere around $5 million instead of where it is now around $10 million? Would any of that be dreadful -- especially if it came along with lower taxes and/or more money for bridges and schools and the like?
Players create the value -- I have no trouble with them getting a FAT piece of the cake. I'm just saying, when the cake is this rich, do we have to (losing myself entirely now in this cooking analogy) bake it with so much taxpayer butter? Let the wealthy owners and the wealthy players bear a little more of the burden.
That doesn't happen now because every time a city plays hardball, like Seattle is doing now, there's some other city somewhere with stars in its eyes, willing to overpay for the right to have a team. Taxpayers across North America are competing with each other to fund stadiums. The buyers in this market would be well served to just calm down, and bid a little lower.
August 23, 2007
Harwell expands push for Tiger Stadium
If in the development game half the battle is convincing the public you're for real, Ernie Harwell's bid to save part of Tiger Stadium is off to a good start, with articles in the Detroit Free Press, Detroit News, and AP detailing the Hall of Fame broadcaster's plan to bring baseball, football, boxing, recording studios, and a sports museum to a downsized ballpark. Harwell told the News:
"In America, we have a tendency to knock down anything that’s over 30 years old and make a parking lot out of it. Whereas in Europe they preserve all these beautiful buildings and structures that have a history. I sort of like the European approach."
The public Harwell really needs to convince, of course, are the city officials who will decide whether to demolish Tiger Stadium, a decision that Mayor Kwame Kilpatrick says will be made by October 1. Detroit development chief George Jackson so far remains unconvinced, calling the 89-year-old Harwell's plan a "PR gimmick" and saying "our decision will not be based on a public relations campaign. It's going to be based on financial substance, period." That'd be the kind of financial substance with no money behind it, presumably.
(To hear a radio interview with Harwell on his plans, click here.)
August 20, 2007
MN bridge toll rises to 12 people, Vikings stadium hopes
Minnesota Vikings owner Zygi Wilf is putting his stadium demands on hold until 2009 in the wake of the I-35 bridge disaster, according to the Minnesota Star Tribune:
[T]he state Department of Transportation estimates that "taxpayers will have to spend a minimum of $1.4 billion over the next two decades to repair or replace the metro area's aging bridges." ... There had been conjecture before the bridge tragedy that the Metropolitan Sports Facilities Commission, which owns Metropolitan Stadium, would take the drawings for the new stadium on a statewide tour this fall to harness taxpayer interest. But the response now, when some state bridges are labeled structurally deficient, would have been unsettling.
Next fall, now that's a different story. Because who remembers the lessons of disasters a year later, anyway?
August 18, 2007
Samson, Selig: No, really, it's a wolf
It's been more than a year since anyone involved with the Florida Marlins threatened to move the team if a new stadium wasn't forthcoming, so we were probably due for this: Team president David Samson told the disinterested journalists at MLB.com after Thursday's owners meetings, "My nose is crushed because we're so up against it. Every day that passes makes it more and more difficult. The longer this goes on diminishes the possibility of making the timing work." Added MLB lord-of-all-he-surveys Bud Selig: "This team needs a new stadium. I've said many times that I like South Florida. I like it as a Major League market, but I like it as a Major League market as long as they get a new ballpark. ... There are options, but I hope we don't have to use them."
Of course, we've heard this sort of thing from Samson and Selig before, and before that, and before that, and all the way back to when nobody connected Barry Bonds with steroids. So why start rattling this particular saber now? The Marlins' lease at Dolphin Stadium is up after 2010, but leases can be extended, and stadium owner Wayne Huizenga has already said he'll consider doing so. More important, no doubt: The University of Miami could announce Tuesday whether it plans to move out of the Orange Bowl, which would free up that site for a new baseball stadium. And even if Marlins execs say they don't want a stadium there, it never hurts to keep the move threat in the back of the minds of local electeds when stadiums are on the agenda.
August 14, 2007
Sonics co-owner: We wanted OKC all along - wait, are you writing this down?
Throw another move threat on the fire: Yesterday, Seattle Sonics minority owner (and billionaire natural gas mogul) Aubrey McClendon told the Oklahoma City Journal Record that he was "under a self-imposed gag order" regarding operations of the team - then yammered at length about it, including the statement: "We didn't buy the team to keep it in Seattle; we hoped to come here. We know it's a little more difficult financially here in Oklahoma City, but we think it's great for the community and if we could break even we'd be thrilled."
The Seattle media, predictably, blew a gasket, especially considering that the new Sonics owners promised to make a "good faith" effort for one year to keep the team in Seattle as part of their purchase agreement. "We should thank him for exposing chairman Clay Bennett as the duplicitous salesman he is," wrote Seattle Times columnist Steve Kelley. "The old owners were lying when they sold it, the new owners were lying when they bought it," wrote Post-Intelligencer columnist Art Thiel, adding, "and who cares anyway because the NBA is crooked, thanks to a mobbed-up referee." Ouch.
McClendon promptly issued a statement denying he'd said what he'd said:
"I was always aware and understood our number-one goal was to work with officials to build a new arena in the Seattle area. ... The comment about my personal hopes cannot in any way be interpreted to mean the organization has not exhaustively pursued every reasonable avenue to get an arena deal done and keep the Sonics and Storm in Seattle."
As for what it all means for the future of the Sonics, probably not squat - Bennett, after all, has threatened a move to Oklahoma City plenty of times. Nonetheless, Thiel suggests that this should give the city of Seattle increased leverage to keep the Sonics: "I'm not a lawyer, but I'm certain I could sue Bennett, the old ownership and probably the city for contract breach, tie up everyone for years and eventually win."
More likely, McClendon's words will just make it a bit more difficult for the NBA to okay a move of the team without running into criticism that it's kowtowing to carpetbaggers. And who knows - maybe some harsh words from David Stern will even get Bennett to knock a few million off that $300 million asking price of his. A boy can dream, can't he?
August 10, 2007
Mets, Yanks stadium subsidies top $1.25 billion
Field of Schemes has obtained new figures from the New York City Independent Budget Office (I'm sure they'll give them to anyone, but I asked) on the cost to taxpayers of publicly subsidized tax-exempt bonds for the new Yankees and Mets stadiums. The verdict: The $930 million in Yankees stadium bonds will cost the city $10 million in lost tax revenue, the state $18 million, and federal taxpayers a whopping $200 million; for the Mets' $528 million in tax-exempt bonds, the figures are $6 million city, $10 million state, and $115 federal.
Add this to the numbers from Good Jobs New York's recent "Insider Baseball" report, and the combined taxpayer subsidies to the two projects are now $1.267 billion: $799 million for the Yankees, $468 million for the Mets. That's almost double what the two teams themselves will be on the hook for, after revenue-sharing deductions.
The breakdown, for those interested:
City State Federal Public Total Yankees $381m $171m $247m $799m Mets $256m $97m $115m $468m Total $637m $268m $362m $1,267m
That's what we in the sports economics business call "one whole assload of money." But New York taxpayers, look on the bright side: According to this week's Fortune magazine, at least your elected officials will get their own luxury box out of the deal. Maybe if you vote for them, they'll let you sit in it.
