August 30, 2010
MLBleakgate Watch: More outrage over Marlins' profits
The Florida Marlins financial document firestorm just won't die. In the latest flareup, the Miami Herald reported on Saturday that, shockingly, the Marlins have been turning a profit solely on revenue-sharing payments from the rest of baseball:
The Florida Marlins reaped more from Major League Baseball's revenue sharing than the team paid for player salaries the last two years -- a disparity fueling the $52 million in operating income the franchise pocketed in that time, previously secret financial records show.
The team secured its profit -- which exceeded that of five other franchises whose books have also been leaked -- as it won hundreds of millions of dollars in public money for its new stadium, the records show.
Now, there are two potential reasons to be upset about this. One would be if you're opposed to low-revenue teams profiting by getting a share of high-revenue teams' cash - but then, this is all that the revenue-sharing plan was ever reasonably expected to accomplish, as it was never going to do much to reduce disparities in how much teams were willing to pay for players. As I wrote for Baseball Prospectus at the time:
Baseball is left with what might be called the "Don't make Bud come in there rule": Teams are supposed to make every reasonable effort to compete, and not just sit back and collect revenue-sharing checks. (Not too obviously, anyway.) It's a typically old-school approach for the old-boys cabal: Don't sweat what the rules and regulations say; we'll handle our own.
We'll know more about the full effects of the new CBA once the lawyers actually finish putting the general agreements made at the negotiating table into hard-and-fast rules. (There have already been some reports of things that were agreed on by the negotiators, but scrapped once they couldn't be translated into legalese.) But if you're a Royals fan hoping that "overhaul of the revenue-sharing system" means your team will finally have an incentive to spend with the big boys, don't hold your breath.
The more legitimate gripe is that Marlins owner Jeffrey Loria covered up his profits in order to cry poor in stadium negotiations with the city of Miami. Unfortunately, it seems unlikely that there's much to be done about that now after the fact, though some local electeds are trying.
South Florida Sun-Sentinel columnist Michael Mayo, meanwhile, goes so far as to say that the fault lies not with Loria's shrewd bargaining on the stadium deal but with the government "enablers" who let him get away with it:
The Marlins simply did what every sports team — and any shrewd business — could do. They milked the public to the max. They'll pay a fraction of the overall cost yet keep nearly every dollar in revenue from the stadium, which will ultimately cost taxpayers billions in bond repayments. ...
"The Marlins aren't to blame for this," said Norman Braman, the Miami auto magnate who sued unsuccessfully to stop the project. "The fault lies with the politicians."
Politicians like Miami-Dade Mayor Carlos Alvarez and former Miami Mayor Manny Diaz, who could have at least demanded to see the Marlins' books before agreeing to such a lopsided deal.
"If you read the depositions in the suit, you'll see they never even asked," Braman said. "Alvarez said, 'I didn't think it was necessary.'"
That's just bad business, and bad leadership.
While I get Mayo's point, there's plenty of blame to go around here; one doesn't have to let Loria off the hook just because all the other kids were doing it. There's plenty of blame to go around here, both for those who hid their finances, and for those who didn't think to look at the books.
Meanwhile, Marlins president David Samson's insistence that the team's profit wasn't really profit — it was for improved minor-league facilities, see, and saving up for the team's share of stadium costs — rings increasingly hollow as more news outlets uncover line items in the team's finances that make it look like Loria was simply pocketing money. The Herald reports that in addition to $16 million in cash that Loria took out of the team in 2008 and 2009 (Samson insists this was repayment of a loan), the Marlins paid $5.4 million over those two years to the Double Play Company, a separate company owned by Loria and Samson.
All this is likely to raise eyebrows not only at Miami city hall, but in Major League Baseball, whose other teams can't be happy that they're sending money to Florida just so that Loria can fatten his wallet. Normally I'd say that you'd expect the other teams would have had access to this information already — if the insurer who's thought to be the source of the document leak had it, then surely it was available to baseball insiders — but as we've seen this week, sometimes people have to be slapped across the nose with numbers before they notice what they mean.
Canada official: No money for Quebec arena, except for maybe money for a Quebec arena
First line of a story in Saturday's Montreal Gazette:
Quebec City shouldn't look to a deficit-fighting federal government to help fund a new arena that would enable it to lure back a National Hockey League franchise, Treasury Board President Stockwell Day said yesterday.
Four paragraphs later:
Day did allow that federal money could possibly go toward funding a new NHL-calibre arena. "Different municipalities have different plans in terms of infrastructure and I can't comment directly on those plans," he said.
Boi-oi-oi-oing. Even after scouring the Internet, I haven't found any indication of what the heck Day meant: That federal money could be used for arena infrastructure, but not for an arena itself? That Quebec City could use existing federal revenue streams, but not ask for new money? Any native Canadian speakers who can help me out here?
In any case, it looks like the plan to lure the NHL back to Quebec with a new $400 million publicly funded arena is alive again. Or not.
August 27, 2010
Columbus Crew owner says 11-year-old stadium's days are numbered
I've heard of one-upping, but this is getting ridiculous:
[Columbus Crew owner Clark] Hunt said 11-year-old Crew Stadium, which his father funded and built, remains "a fantastic venue to watch a soccer game." But the team must look at its long-term facility needs, he said, including a new stadium.
McCullers also said the Crew is closely watching the Columbus Blue Jackets' effort to improve its lease at Nationwide Arena through a possible public purchase of the privately owned venue. One of the financing scenarios under discussion is tapping tax revenue from the new Columbus casino to fund an arena buyout by Franklin County and the city.
"My message to those that have an ongoing interest in that," McCullers said, "is we shouldn't just fix the Blue Jackets' situation but fix the professional sports infrastructure situation in Columbus. That includes us."
Two lessons here: One, the only thing stopping team owners from demanding new stadiums every year, as economist Rod Fort once suggested, is the limits of their chutzpah. And two, when considering a bailout to one of your city's sports teams, you really need to watch out for that camel's nose.
MLBleakgate Watch: Miami mayor threatens Marlins garage money
Okay, now it's the mayor of Miami (not to be confused with the mayor of Miami-Dade County — that wacky Florida!) who wants to see about getting money back from the Florida Marlins on their stadium deal, now that it's official that the team has been earning big profits. And Mayor Tomas Regalado knows just what money he wants to recoup: the $100 million Miami is set to spend on parking garages for the new stadium.
Regalado asked city attorney Julie Bru whether the city -- which recently declared a state of "fiscal urgency" amid dwindling revenues and a gaping budget hole -- has authority to reopen the parking contract. ...
As a commissioner, Regalado voted against the stadium deal.
Now, citing leaked financial reports showing the team turned a $49 million profit the past two years, the mayor wants the city to receive 100 percent of the advertising revenues from signs that would adorn the garages. The deal now calls for a split.
"If the answer is in the positive, I would like to bring this issue to the city commission in September or October," Regalado wrote to Bru. "If the answer is in the negative, what recourse do we have to expose those who misinformed the commission and public during a public hearing?"
It seems pretty unlikely that Miami will be able to wriggle out of its garage commitment, but it'll sure be interesting to see Regalado try. If nothing else, Jeffrey Loria and David Samson can expect to be beat up plenty more in the local media so long as they insist on sticking to the original terms of the deal — but somehow I think they'd rather pay that price than one with dollar signs attached.
Cal senate won't move on Kings arena until more questions answered
Looks like the Sacramento Kings arena land swap plan has hit a stumbling block in the form of California state senate president pro tem Darrell Steinberg, who's actually (gasp!) asking questions about the deal before he'll consider enabling legislation. Among the items that Steinberg wants more info on:
- Whether Cal Expo actually wants to relocate its state fairgrounds to the Arco Arena site. (A report on this is due next month.)
- Whether the cost estimates for a move are reliable.
- What laws would need to be changed to allow the land swap.
Now, Steinberg did say that once those questions are answered, he'd consider introducing a bill in December. But the Kings arena plan still comes down to: Until Cal Expo signs on and they figure out a way to pay for, this ain't going nowhere.
August 26, 2010
MLBleakgate Watch: Miami official demands more stadium cash from profitable Marlins
The fish are really hitting the fan in Miami now over those revelations that the Florida Marlins owners weren't really losing money when they sweet-talked local governments into giving them $478 million for a new stadium:
- Miami-Dade County Commissioner Rebecca Sosa called for the Marlins to cough up more dough for the stadium, now that the team's profits are revealed. (It was actually a letter to Mayor Carlos Alvarez asking that he "explore alternatives to the possibility of securing a greater financial contribution from the Marlins towards the stadium construction," but I like my wording better.)
- Marlins president David Samson shot back that "a contract is a contract" and insisted no more money would be forthcoming from the team. He also told a local sports radio interview that he "absolutely never" lied about the team's finances (as when he said in 2007 that owner Jeff Loria was "committed to stop losing money"), and that all that annual profit actually went to "pay down debt," save up for the team's own stadium costs, and build up the team's minor-league operations.
Meanwhile, more on yesterday's argument from St. Petersburg Times sports columnist John Romano that the documents show the Tampa Bay Rays are likely losing money, as they were shown making a slim profit in 2008 and their payroll is up since then while revenues are down. Noah Pransky of WTSP-TV writes on his Shadow of the Stadium blog:
In making his argument about the Rays' limited television revenue, Romano ignores the fact that the problem is likely to remedy itself in a few years.
From 2009 to 2010, Rays' television ratings have soared more than 70 percent. And while it doesn't mean a ton of extra money right now, it will in 2017 when they begin a new yet-to-be-negotiated television contract.
As entertaining as all this is, all of this debate about "how much do teams have" is still a bit beside the point: Regardless of whether they're turning a $10 million profit or showing a $10 million loss (and likewise regardless of whether those numbers mean anything real — one Miami accountant notes that the Marlins' financials appear to show $10 million a year in "costs" that are really salary payments to team owner Jeff Loria), anyone rich enough to own a sports franchise can "afford" to buy a stadium the same way you or I afford to buy a house: You go to the bank and borrow the money, then pay it off from your income over the years. That's true whatever the profit-and-loss baseline is that you're starting from.
Or to put it even more simply: If the added revenues the Rays (or the Marlins, or whoever) expect to get from a stadium are enough to pay off the stadium debt, then shouldn't they be paying for it? And if they're not enough, then what's the point in building a new stadium in the first place, other than as an excuse to bail out the team's finances with public dollars?
Minnesota gov candidates all want Vikings stadium, hedge on how to pay for it
The Minnesota Vikings' flagging stadium campaign got a boost yesterday, when all three Minnesota gubernatorial candidates declared their support for state aid in building a new Vikes stadium. As for what that state aid would look like, though, they were pretty vague:
- Independence Party candidate Tom Horner wants to add slot machines at racetracks to pay the state's share, notwithstanding the repeated failure of such a plan in the state legislature. Horner also says the Vikings should pay 40% percent of the stadium cost, and let the state get revenue from non-NFL events.
- Republican Tom Emmer says he wants a Vikings stadium, but doesn't want to use general fund money to pay for one. Emmer mentioned using tax money currently going to the Minneapolis convention center once that debt is paid off — yet another plan that went down in flames last legislative session — but didn't actually say whether he endorsed it.
- DFL candidate Mark Dayton says, "I'd work with all entities to put together a deal."
Either way, the state still faces that $6 billion deficit, and the NFL is still looking at a likely lockout in 2011, so the Vikings have to be looking at an uphill battle to get a stadium passed next year. Still, stranger things have happened.
Forbes: Jets and Giants will make a mint, barring lockout
The freshly validated Forbes team value estimates for the NFL are out, and there are two main stories: One, average team values have fallen for the first time on record, thanks to the sucky economy. And two, the New York Jets and Giants are worth more thanks to their new stadium, but the debt they took on for it puts them at risk if there's a lockout in 2011:
Every team would suffer, but "a lockout would affect the Giants and Jets probably more so than any other NFL franchise," [Forbes senior editor Kurt] Badenhausen said.
"The Giants' and Jets' built-in costs of servicing debt are so much higher. If we have a lockout, they still have to pay the interest on their debt, even if nobody's buying a ticket."
Of course, the other way to look at this is that here's another benefit of teams putting up their own money for stadiums: They have an incentive to actually play football, instead of shutting down the sport every time they want to win a bargaining victory over the players' union. Not that the Giants and Jets owners are likely to have that much sway over NFL labor tactics, but we can dream of world where franchises pay their own stadium debts, and take on their own risks...
August 25, 2010
MLBleakgate Watch: Wait, Marlins weren't really going broke without a new stadium?
Okay, the Great Baseball Financial Document Foofaraw is taking a weird turn. Today's meme is that the fact that the Florida Marlins have been turning a profit shows that they didn't really need that $478 million in public stadium subsidies after all. As Yahoo! sportswriter Jeff Passan put in a column last night:
Most harrowing is the takeaway that baseball's biggest welfare case could have funded a much greater portion of the ballpark. In 2009, when the Marlins started spending some of their profits on their portion of the stadium, they still had an operating income of $11.1 million. The team fought to conceal the $48.9 million in profits over the last two years because the revelation would have prompted county commissioners to insist the team provide more funding. Loria, an art dealer with a net worth of hundreds of millions, wouldn't stand for that. He wanted as much public funding as possible - money that could've gone toward education or to save some of the 1,200 jobs the county is cutting this year.
Equally outraged are Miami-Dade county commissioners — or at least, the ones who voted against the stadium deal in the first place. Commissioner Carlos Gimenez told the Miami Herald: "[The idea] is horrible and the financing is even worse. And now you see they took us for a ride ... I tried to make it a condition on the contract that we see the books. This shows me they could have put more into the stadium than they did. We could have sold less bonds." Added Commissioner Joe Martinez: "None of us were aware of this. ... I do believe that if some people had known they were taking a profit, they would have voted differently."
Not to say "I told you so" or anything, but... seriously, didn't anybody bother to read Forbes before this? You know, the magazine that estimated that the Marlins were turning a $43.7 million profit in 2008, as against the leaked documents' $39.2 million? If, as Martinez insists, "none of us" on the county commission were aware of this, then that betrays a pretty serious failure of background research by Miami's elected officials.
The real news, as the South Florida Sun-Sentinel's excellent Sarah Talalay makes clear in her blog post today, isn't that the Marlins were making a profit, but that team execs were lying when they claimed they weren't. Writes Talalay:
Each time Forbes released its annual team valuations, Samson disputed the figures saying he didn't know Forbes sources, but he also insisted the team wasn't making a profit, and if there was one, team owner Jeffrey Loria would put it back into the team.
There are several examples of this, but here's one from 2007, when Samson was asked about Forbes' reporting the Marlins had the highest operating income of the leagues' 30 teams at $43.3 million and with a league low payroll of $24.8 million:
"Very often the mistake that's made is they look at revenue sharing numbers and the team's payroll and take the difference and see profit without looking at our expenses," Samson said.
Marlins owner Jeffrey Loria "would want any dollar extra going into payroll," Samson said.
"What's happened is he committed to stop losing money, but he has never said he makes his living from the operation of the Florida Marlins. He simply doesn't want to lose all his money."
Finally, on the journalistic flip side, you have St. Petersburg Times sports columnist John Romano, who argues that the documents really show that the Tampa Bay Rays do need a new stadium, because while the team is turning a profit, it's only doing so because it's getting revenue-sharing money, and winning while spending less than the Yankees and Red Sox.
So let me see if I can follow the logic: Tampa Bay taxpayers should give money to the Rays for a new stadium because, even though the team right now is both winning and turning a profit, there are other teams that are able to win the same and turn a profit while spending more? Does Florida have some sort of citizen right to throw $16 million a year at A.J. Burnett that I don't know about?
UPDATE: Romano points out that his main argument was that if the Rays turned a $14 million profit in 2008, when they went to the World Series, they likely lost money last year, when they missed the playoffs and had a higher payroll.
That's a fair assessment, but it still makes for a weak case for a new stadium, which is still not going to put the Rays into the same spending echelon as the Yanks or Red Sox. At best, it might afford the Rays an extra $20 million or so a year — call it one Carl Crawford, or 1.2 A.J. Burnetts. Or, if they ran their team like Jeff Loria, a couple of Picassos.
August 24, 2010
MLBleakgate Watch: Did Marlins' stadium costs price them out of keeping Cabrera?
I've been trying to avoid the foofaraw over the leaked MLB financial documents, in part because I don't believe even internal sports financial docs are worth the paper they're printed on (cf. then-Toronto Blue Jays VP Paul Beeston's famous statement, "Under generally accepted accounting principles, I can turn a $4 million profit into a $2 million loss, and I can get every national accounting firm to agree with me."), but because they're not really anything new. Forbes' annual estimates of franchise profits had teams like the Pirates and Marlins raking in roughly the same amount as the leaked documents reveal — so if commentators are going to be up in arms that teams are turning a profit on revenue sharing money instead of spending in on player payroll, aren't they a couple of years late?
That said, this latest from the ever-quotable Marlins president David Samson in today's New York Times just cries out for comment:
Samson said the Marlins' decision to maintain a modest payroll and trade a star like Miguel Cabrera after the 2007 season was to save money to help finance its $645 million, retractable-roof ballpark, which is to open in 2012. The team must pay about one-quarter of the cost, with Miami and Miami-Dade County providing the rest. "We could have had Cabrera, but no ballpark," he said. "That's what I tell fans."
Samson didn't say whether he tells fans this with a straight face, but you have to wonder. The Marlins are putting up about $160 million towards the new stadium, which comes to somewhere around $12 million a year in debt payments over 30 years. A large chunk of that is expected to come from naming rights, which the Marlins kept for themselves — even in today's depressed market, something like $5 million a year in naming rights isn't unreasonable — and another large chunk can come out of stadium revenues, which the Marlins also kept for themselves. The Fish are getting full control over a $645 million stadium for the bargain price of $160 million, and you don't turn down a deal like that whether you're saddled with a first baseman with a large contract or not.
On top of that, though, let's take a look at Miggy's contract itself: Under the extension he signed when he was traded to Detroit, the likely AL MVP candidate is set to earn $20 million and some change each year for the next six. That's real money, certainly, but just like the Marlins' stadium cash, it's an investment, not just an expense: A prodigious slugger like Cabrera puts fannies in the seats, which puts dollars in the cash registers, and helps defray the cost of paying his salary.
Now, admittedly nobody's coming to see the Marlins now, with or without Cabrera — but that's all expected to change once the new stadium opens in 2012. (Or fervently hoped to change by Samson and Co., anyway.) So really, Cabrera is more worth the investment when you have a new stadium than without one, since suddenly having an attendance draw means you can actually draw attendance.
In other words, it would have been more honest for Samson to say: "Sorry, but we weren't sure about this whole stadium thing back in 2007, so we figured we could make more money by dumping salary and collecting revenue-sharing checks than by trying to sell tickets to our invisible fan base. We'll try to do better once the new stadium opens, if it looks like fans will actually show up to see star players." That's the kind of thing that makes you sound like a selfish plutocrat, though — so better to just blame your minimal stadium costs for forcing you to sell off your best players, even if it doesn't make any economic sense.
Astrodome: To raze or not to raze?
A Houston Chronicle opinion piece published today suggests either fixing up Houston's Astrodome, at considerable expense, or tearing the darned place down.
The piece, written by Richard Justice, suggests that a teardown might be more likely, stating, "If Yankee Stadium and Tiger Stadium can go, then the Astrodome can go, too." Nevertheless, he recommends trying to save it, suggesting a full-scale renovation and a conversion into vast retail and hotel space so that it becomes a place "where people stop and stare and remember the spirit of a great American city."
But stopping and staring and thinking about a city's spirit is not likely to get the cash register ringing to the degree that might be needed to save the place, so Justice opens the floor to democratic alternatives, stating, "If my vision is the wrong one, that's fine. Let's hear yours. Let's work together and come up with a consensus and see if there's a way to save it." Generally, when stuff of this nature hits the papers, it is a precursor to demolition, but time will tell.
August 23, 2010
Carolina Panthers prez says 14-year-old stadium's days are numbered
From the "Once you take off the shrinkwrap, it's used" department:
For the first time, the Carolina Panthers are discussing publicly the eventual need for a major renovation of the 14-year-old Bank of America Stadium, or perhaps a replacement stadium.
"You would have to think we're in the middle of a normal NFL stadium cycle," said team President Danny Morrison, who was hired last September. "The two options you would have somewhere down the line, in 10 or 15 years, would be a major renovation or something new."
And why, exactly, does Morrison think the Panthers will soon need a new stadium, other than the obvious that it's always nicer to have this year's model? The Charlotte Observer gives several reasons:
- All the other kids have one: "Of the 32 stadiums in the NFL, only 13 are older than Bank of America Stadium," notes the Observer. "And of those 13 older stadiums, several have recently undergone major renovations that cost upward of $100 million each."
- Their old stadium doesn't have enough parking: Former Panthers president Mark Richardson apparently griped about this three years ago, though a whole new stadium seems a bit like overkill when all you want is more parking spaces.
- There's a new stadium! And it has a hat! Forbes editor Kurt Badenhausen says the Panthers' stadium is still "very financially viable," but pales in comparison to the new Dallas Cowboys and New York Giants and Jets stadiums, especially in terms of added money-makers like sports bars.
So, basically, it's nicer to have this year's model.
Morrison says he's talked with Charlotte City Manager Curt Walton about the stadium issue, but that their discussions were only preliminary. Still, this is why speculation that the new stadium boom is over "because everybody already has one" is invariably wrong: There's always some team waiting to go back to the head of the line and ride again.
August 21, 2010
Vegas mayor promises MLB team for some, miniature American flags for others
Oscar Goodman has been mayor of Las Vegas for 11 years, and in that time probably his most defining characteristic is that he's never met a sports franchise he didn't like. (And that's saying something, given that this is a guy whose Wikipedia entry includes an entry for "Controversies: Thumb amputation and caning.") He's publicly wooed the Montreal Expos, Florida Marlins,San Diego Chargers, and Pittsburgh Penguins, all without the barest hint of where these teams would play if they relocated to Vegas.
Still, even Goodman had never done what he did last week: told reporters that he was in "very serious" talks to built a 45,000-seat domed stadium and that Las Vegas had been "designated an American League city." By whom, Goodman wasn't saying — I'm pretty sure the last time baseball divvied up territories by league was during expansion discussions in the early 1960s, so it'd be pretty bizarre for MLB to revive the concept now.
Baseball business observers likewise greeted Goodman's pronouncement with skepticism, noting that MLB says it doesn't intend on moving any teams across state lines anytime soon and that Vegas doesn't really need a baseball team to compete with the casinos as an attraction.
Still, even merely hinting that he was going to lure a major-league baseball team was enough to get Goodman's name in the papers — and even got our old friend Zennie Abraham speculating that clearly it's the Oakland A's headed to Nevada. Which doesn't seem very likely, but if it does happen — even if in the year 2050 — Goodman was vague enough that he'll be able to claim credit. That's always a good way to pad your Wikipedia entry, and nobody even has to lose their thumbs.
August 19, 2010
Giants reverse course, offer PSL-free seats for sale
Hey, remember how the New York Giants swore that they'd be able to sell out their high-priced PSLs by opening day? Well...
After insisting for months they had no more non-premium PSLs available and fewer than 1,200 premium PSLs left, the Giants yesterday quietly announced plans to sell single-game tickets without PSLs through Ticketmaster.
The sure-to-be-controversial plan starts today, when existing PSL holders get first dibs on what the team described in a news release as "a limited number of individual game tickets for the Giants' eight 2010 regular season games."
What is certain to cause hard feelings will come Monday, when fans who did not buy PSLs -- which started at $1,000 for the Giants -- will have the chance to buy single-game tickets without the PSL requirement.
The controversy, of course, is that Giants fans have been buying PSLs after being told by the team that this would be the only way to get tickets. This won't be as bad as 15 years ago, when the Oakland Raiders only managed to sell half their PSLs and ended up selling the rest of their seats as individual tickets, but it's still likely to anger many PSL buyers, and potentially open the door to lawsuits.
Giants owner John Mara tried to downplay the controversy, insisting that these were just a handful of extra seats held back to comply with ADA rules and ensure that all season ticket holders had seats, and adding, "We never said that we wouldn't sell single-game tickets. But we didn't advertise it." Which would be a better defense if the Giants hadn't posted this on their own website in 2008:
The so-called PSLs, one-time payments that guarantee the purchaser associated rights to purchase Giants season tickets, will be part of the purchase price for every stadium seat in the new building.
If nothing else, it'd be interesting to see what the FTC has to say about this.
August 18, 2010
Could Newark sell arena to recoup costs?
Newark city officials are debating selling the Prudential Center, home of the Devils (and, for the next two seasons, the Nets), to help close the city's budget gap. Two city councillors say a sale could bring in between $80 million and $200 million, plus put the building back on the property tax rolls, while Mayor Cory Booker says a sale is "not feasible" until the Devils' ongoing rent dispute is resolved.
While in the abstract a sale sounds like a great idea, you have to wonder why, if the arena currently isn't making any money (thanks in part to that Devils lease), any private investor would want to pay $80 million to buy it and agree to pay property taxes to boot. That may be a sad statement about a building that cost more than $500 million to build just three years ago, but there it is.
August 17, 2010
New Meadowlands is grey, expensive, video-filled
The new kajillion-dollar Jets and Giants stadium in the New Jersey Meadowlands opened on Monday night, and the reviews are decidedly mixed:
- The Jersey Journal calls it "metallic and neutral," praises the numerous hi-res video boards, and notes that the seats are "much further from the field than in the old building."
- The New York Daily News says fans like the sightlines and video screens, but not the high concession prices.
- The Newark Star-Ledger reports that one fan says "it's beautiful" and the food lines moved fast, but tickets were too expensive and the cell phone service was "spotty."
The grey decor is intentional, so as not to give either team an advantage in terms of team colors, though it's already drawn complaints before this. Ditto the high prices. As for the cell phone service, maybe the Jets and Giants could subcontract with the New York City subway system to improve on that.
August 16, 2010
Today in Pistons-to-Ilitch rumors
There's very little solid information, but today's Crain's Detroit Business is just jam-packed with speculation on the potential sale of the Detroit Pistons to Tigers and Red Wings owner Mike Ilitch:
- Crain's Bill Shea reports that Pistons owner Karen Davidson is seeking $500 million for the team and the Palace of Auburn Hills arena, but cites industry experts as saying she likely won't get more than $400 million, especially if she wants to conclude a sale fast.
- Shea also has a list of the rumored bidders, including Magic Johnson and an unnamed group from Dubai.
Finally, and most noteworthy for our purposes here, University of Michigan sports economist Rod Fort tells Shea that he expects Ilitch has a financing plan for both the purchase and construction of a new downtown arena. He also expects it will include public subsidies:
"It would behoove the Ilitches, if they obtain the Palace, to already be talking to Detroit city government on the subsidy that's going to be (sought)," he said.
A facility for both the Red Wings and Pistons is believed to be what the Ilitches want, a venue that is expected to cost about $300 million or more.
"If that's the ultimate goal, we should expect the Ilitches to behave as others have in the past in that situation, which is to suggest to city and possibly state government that a subsidy is needed to make this happen," Fort said.
Fort believes Detroit can be creative enough to help finance a new arena, through a special assessment like the tourist tax, or something else.
"It's not a place without resources," he said.
Of course, all Fort is really saying is "Ilitch will probably ask for a subsidy, because they all do." But on a slow news day, speculation is all we've got.
August 12, 2010
Tiger-Cats to Hamilton: We don't want your stinking downtown stadium
The Hamilton city council stuck to its guns Tuesday night, voting 12-3 to approve the downtown West Harbour site for a stadium for the 2015 Pan Am Games and, if they choose to accept it, the Hamilton Tiger-Cats. Early signs are that accepting it is not going to be happening:
- Even before the vote, Ticats owner Bob Young announced he was pulling out of stadium talks. Yesterday, Young told a Toronto sports radio station: "We think it's a massive mistake and may end the Ticats in Hamilton. We can't continue to lose millions of dollars a year." He added that there's no deal in place to move the team to Quebec City "that I'm aware of," and said, "I'm looking forward to someone coming up with a solution for this because the way this thing is playing out is very scary for the future of Hamilton Tiger-Cat franchise."
- "Hamilton Tiger-Cat legend Angelo 'King Kong' Mosca," according to the Toronto Sun, is hopping mad, and called the mayor "full of shit." (Unless "sh.." stands for something else in Canada. Full of shite?) Along the same lines, the Hamilton Spectator's reporter posted on his newspaper's blog the night of the vote: "There will be no official response from Ticats tonight on council vote. I'd publish the unofficial reaction but this blog is still affiliated with a family newspaper."
- CFL commissioner Mark Cohon, unsurprisingly, has backed Young in the dispute, though rather than rattling the move threat saber as some U.S. commissioners are fond of doing, he seems to be angling for coming up with a new stadium plan that will make everybody happy: "We're talking about a 141 years of history with the Hamilton Tiger-Cats. This is not going to be resolved in one or two days. We need to step back and understand that there are a lot more things that have to take place in the coming weeks and months."
- Mayor Fred Eisenberger seemed to leave the door open to coming up with a new plan, calling the vote "bittersweet," and saying, "I don't think it is a victory until we have a stadium where we can get the Tiger-Cats to play ... as well. ... We'll do our best to encourage them to come back to the table and talk about how we can make it work."
Add in that Hamilton might not even get to host part of the Pan Am Games even with a West Harbour stadium, and it sounds increasingly like everyone's going to retreat to their corners and figure out how to start discussions from scratch a couple of months down the road. Not that that's going to stop the scare headlines in the meantime.
AZ Republic: Without Coyotes, no one would buy stuff
The Arizona Republic ran a long article on the city of Glendale's finances for its arena deal yesterday; you can read it for yourself here. I'm just going to focus on the article's first sentence:
One thing is clear: the picture today would look worse if last summer's bankruptcy had sent the Coyotes to Canada.
The evidence, if you read further down: Reporter Rebekah Sanders notes that most of Glendale's arena debt is paid by sales tax revenues, writing that "dining and shopping largely spurred by sports games around Westgate brought $12.8 million in sales-tax revenues in 11 months last fiscal year." But, of course, those people would be eating and shopping anyway even without the Coyotes — many of them still doing so in Glendale — which means you can't credit the team's presence with creating all that tax revenue.
It would have been nice for a newspaper article to try to figure out how much of the arena-district spending is actually new revenue — or at least mention this "but-for" problem — but that's apparently outside the scope of today's journalism.
West Side Tennis Club presents plan to gut stadium for condos
New York has yet another stadium controversy afoot: On Tuesday night, the West Side Tennis Club in Queens unveiled for its members a plan to replace its 1923-era stadium with condos (and hideously ugly condos, too, if the rendering is any guide). The facade of the stadium, formerly the home of the U.S. Open and host to concerts by the Beatles and Talking Heads, among others, would be retained under the plan.
Club president Ken Parker insisted that saving the stadium would cost too much: "The stadium itself cannot be used. It's not safe for people to climb into it."
Several elected officials called yesterday for more community input into the project, with U.S. Rep. Anthony Weiner declaring, "Just because the decisions are being made by people in white tennis shorts and not gray suit jackets doesn't mean that the community shouldn't have a say." The Wall Street Journal's reporter, meanwhile, noted on the paper's blog that member reaction is mixed: "While some members want to save the 15,000-seat stadium, others recognize that residential development is a sensible use." "Recognize"? Editorializing much there?
August 09, 2010
Ilitch throws hat in ring to buy Pistons
Other shoe: dropped.
Sports and pizza boss Michael Ilitch said today he wants to buy the Detroit Pistons and move the team to a new arena in downtown Detroit.
The Ilitch family already owns the Detroit Tigers and the Detroit Red Wings.
The Ilitch bid is for the entire Palace Sports & Entertainment organization, not just for the basketball team itself. If successful, that means that the Ilitches would also own the Palace of Auburn Hills arena, the DTE Energy Music Theatre and other aspects of the Palace network.
You'll recall that the big question about this plan, which was originally floated about a month ago, was whether giving monopoly control over sports and concerts in the Detroit area would really generate enough money to pay for a new Detroit arena. Still nothing on that in today's coverage, though enough column-inches were spilled on it that there was room for worries that Bud Selig might thing Ilitch doesn't love him anymore.
Hamilton council to decide on stadium site, unless it doesn't
The Hamilton Tiger-Cats saga lurches ahead, as an end-of-the-week deadline nears for picking sites for the 2015 Pan Am Games:
- After two Ontario legislators said that the provincial government wouldn't help fund a stadium at the city's preferred downtown site, other provincial and federal legislators insisted nuh-uh, funding will go to whatever site the city chooses.
- The Hamilton city council is set to vote tomorrow on both stadium sites, but several councillors say they don't have enough information, according to the Hamilton Spectator: "Councillors Lloyd Ferguson and Bob Bratina say the issue remains unclear on what will happen to the funding if council supports the west harbour. They also note there are no answers to a staff report saying the east Mountain stadium would cost taxpayers between $55 million and $80 million more than the west harbour site."
- Ti-Cats fans are split on which site they prefer, but most don't buy the threat that the team will leave: "People leave when they have somewhere to go," one told the Spectator, while another argued: "I don't think they would leave because Hamilton is better in Hamilton." Tough to argue with that.
August 04, 2010
I'm going to be on the road the next week and a half, so expect fewer posts here until I return on August 16. (Though I expect I'll have to chime in on, say, the great Tiger-Cats staredown if it comes to a head before then.)
In the meantime, I'm going to open up fieldofschemes.com to what the Journalism 2.0 types call "crowdsourcing," or in layman's terms, "letting your readers do your work for you." If you feel the need to comment on breaking stories, share URLs, or what have you, feel free to do it in the comments section of this item. I'll check in periodically, and the usual rules apply: No personal attacks, no spam, no running with scissors, etc. Violators will not have a present brought back for them from the airport gift shop.
See you all in ten days, if not sooner.
CFL commissioner: If you don't take care of Tiger-Cats, we're not getting you a new one
Hey, looky thar, I missed another sports league commissioner ultimatum last week:
CFL commissioner Mark Cohon is warning that if the Tiger-Cats leave the city over the location of the proposed Pan Am stadium, "it will be the end of the CFL in Hamilton."
Cohon's dire statement is included in a three-page letter he sent to city councillors late yesterday in which he urges them to reject placing the stadium at the west harbour and to back the Tiger-Cats' desire to have the stadium built on the east Mountain. ...
"I understand that there are those who assume that, if the Tiger-Cats under Bob Young's ownership were to leave the city of Hamilton for any reason, our league would be certain to grant the city another franchise by way of expansion," Cohon writes.
"I do not support that type of thinking nor would our board. In fact, I am deeply concerned that should this issue force the Tiger-Cats to leave the city, it will be the end of the CFL in Hamilton."
What's going on here, for those of you who don't follow Canadian football (or as they call it in Canada, "football"), is that the city of Hamilton has agreed to build a new stadium for the Tiger-Cats, but wants to do so at a downtown site. The Tiger-Cats owners prefer a site in the suburbs, where there's more room for parking and, crucially, other development to go alongside the stadium.
All this would just amount to your usual team-vs.-city standoff, except that there's an August 12 deadline to decide on a site for the stadium, or else risk losing Hamilton's share of the 2015 Pan Am Games — which comes with $60 million in federal and provincial funding (or as they call it in Canada, "$60 million"). Hence the threats from Cohon, who's trying to scare the Hamilton city council into agreeing to the team's preferred site by brandishing the threat of a move, possibly to the new stadium in Ottawa. (Which got preliminary approval back in June. Did I forget to mention that at the time? My bad.)
Most observers seem to assume that the whole plan will crash and burn as the standoff continues, but you never know with these things. We'll know more after August 12 — or not, given that the Pan Am Games have already extended their deadline once already.
August 03, 2010
Goodell to Jags fans: Buy tickets or we shoot this team
NFL commissioner Roger Goodell visited Jacksonville yesterday, and delivered one of those veiled threats that only sports league execs can do so well:
"We want the team to be successful and we want it to be here. We just want it to play in front of sold-out audiences." ...
Goodell was asked if sellouts this season would keep the team in Jacksonville.
"I think this team is going to continue to be successful here," he said in response.
You think before you can become a commissioner, you have to go to protection racket school?
Meanwhile, the Jacksonville city council seems prepared to give the Jaguars an additional lease break, on top of the $4 million kickback they're getting on their naming-rights deal. The new provision, which has been approved by two committees but hasn't yet gone before the full council, would allow the team to pay for stadium maintenance in advance and then reimburse themselves from a pool of city money. It's being sold as a way to allow the Jaguars to pay for costs as they arise and not when the city budget is ready, and it may be — but it also leaves open worries about the city having to reimburse the team for costs it didn't approve or even know about beforehand.
49ers threw $5m at stadium voters
Campaign filings show that the San Francisco 49ers spent nearly $5 million on their stadium referendum campaign in Santa Clara this spring, including a last-minute infusion of $800,000 from Niners owner Jed York. That would be a record for a Santa Clara referendum, and close to one for any stadium campaign anywhere. It would also be more than $300 per "yes" vote.
Meanwhile, the opposition, Santa Clara Plays Fair, raised a little over $20,000 for the "no" side. That means the 100-to-1 rule remains in place: Outspend your opposition by a factor of 100, and you'll probably win a stadium vote; less than that, and you'll probably lose.
