April 29, 2011
Samueli increases offer for Kings to move to Anaheim
Anaheim Ducks owner Henry Samueli has upped the ante for luring the Sacramento Kings to move to his Honda Center in Anaheim (not really his Honda Center, since Anaheim owns it, but he controls all the operations and revenue):
In a late move to land the Kings, Orange County billionaire Henry Samueli has offered to increase his personal loan to the team from $50 million to as much as $75 million, and has offered to buy a minority stake in the organization.
Samueli, owner of the Anaheim Ducks hockey team, also has agreed to make far more costly improvements to Anaheim's Honda Center, which he manages, to bring that facility up to NBA standards.
Originally, Honda Center officials had planned to spend $25 million on upgrades. That figure has jumped in the last few days to $70 million, center officials said Thursday afternoon.
No way of knowing whether this will be enough to get the NBA to change its mind about waiting till next year to approve any move. (Presumably Samueli's offer will still be good then, in which case there'd be no harm in waiting.) But if nothing else, all this hemming and hawing over the Kings' future is getting a good old fashioned bidding war going on, which may well have been the goal all along.
Sports bubble watch: Yanks draw another record low
And it's another record low attendance at the New York Yankees' new stadium:
An announced crowd of 40,081 came to the Bronx on Thursday night to watch Yankees-White Sox, setting a new low for attendance at the new Yankee Stadium.
The previous low was an announced crowd of 40,267 on April 5. Capacity at the new Stadium is a little over 52,000.
In case you're wondering how overall MLB attendance is doing so far this year, it's down about 2.3% at the moment, in line with the last time I checked, as well as with the per-season average over the last three years. It's not a crisis just yet, but it is definitely a trend — and a further sign that the sports ticket price bubble is still deflating.
April 28, 2011
Kings-to-Anaheim application now murkier than ever
The NBA relocation committee held a conference call yesterday with the owners of the Sacramento Kings and officials from Anaheim's Honda Center to get more information on the Kings' proposed lease there, and ... nobody's saying what was said:
After the meeting, [Kings co-owner] Joe Maloof, [Anaheim Arena Management chair Michael] Schulman and NBA spokesman Tim Frank each declined to comment.
Meanwhile, the Sacramento Bee is now reporting that a "source close to the situation" says the Maloofs "remain uncertain" about whether to formally request a move to Anaheim by Monday's deadline, and that it "appears unlikely at this point that team owners will come to a conclusion" by then. The Bee's Ailene Voisin adds:
Although the Maloofs have until Monday to file an application to relocate to Anaheim, sources close to the family expect an announcement before the weekend. I also continue to hear that diverging opinions exist within the family — some wanting to sell, others determined to retain ownership even if that means returning to Sacramento and figuring out a way to handle the situation from a p.r. standpoint. Ultimately, this is Joe and Gavin's deal. Unless the Maloofs are totally broke — some sources insist they are, others insist they will recover nicely after restructuring their debt at the Palms — the brothers probably make the decision. Also true: they have been stung and stunned by the resistance from the Board of Governors and what we're hearing from the Relocation Committee. They hate being portrayed and/or perceived as villains, and are reluctant to alienate their peers, especially given the labor situation and ongoing collective bargaining talks.
It sure sounds like the Maloofs have seen the writing on the wall and are just trying to decide whether to file a relocation request and see it put on hold by the NBA until 2012, or decide to go with the flow and wait till next year. Or, if Voisin is right, maybe sell the team now and make the whole thing somebody else's problem, which would certainly be a game-changer.
Can't tell the Oakland Coliseum names without a scorecard
The Oakland Coliseum just got its fourth corporate name in the last 14 years, after Overstock.com agreed to pay $1.2 million a year for the next six years for naming rights for the home of the Raiders and A's. (Make your own jokes about unloading excess outfielders.) That's not a ton of money, but as I told the Bay Citizen (and Craig Calcaterra seconded), used stadium names aren't worth much, because eventually everyone just calls it "the Coliseum."
Worse yet for the new name owners: They themselves are in the process of changing their name, to O.co (supposedly this already happened back in January, but I guess either someone forgot to get the memo or it doesn't apply within the U.S.). So if anyone calls it anything but "the Coliseum" it'll likely be "the O," which will only end up being free publicity for a different company, or maybe for robot assistants.
Meanwhile, the San Francisco 49ers have hired CAA to sell naming rights to their as-yet-unbuilt Santa Clara stadium, which makes it even less clear what the heck Gideon Yu is for.
April 27, 2011
Tampa mayor: I'm not building Rays a stadium, but if I did...
Newly elected Tampa mayor Bob Buckhorn told the Greater Tampa Chamber of Commerce yesterday that he has no plans of stealing the Rays from St. Petersburg with a new stadium. Buckhorn said that he told St. Pete Mayor Bill Foster: "I'm not going to be the boyfriend in your divorce."
Then Buckhorn went on to say that if that divorce happened without him, well, then he might consider picking up the Rays on the rebound:
- "We ought to do everything we can to make sure the Rays stay in the Tampa Bay area," said Buckhorn, adding that he'd prefer a downtown Tampa site: "Urban stadiums can have a huge economic impact. They can revitalize a downtown."
- He suggested that a stadium would require "significant" team money, but allowed for spending public funds on infrastructure, perhaps via a tax increment financing district to kick back property taxes around a stadium.
- Buckhorn insisted that the Chamber of Commerce's current study of baseball stadium is "totally removed from me."
In related news, yesterday's St. Petersburg Times looked at the threats of contracting the Rays or relocating them to another city, and (mostly via quotes from sports economist Mark Rosentraub) concluded that it ain't happening. Isn't this where we came in?
49ers' hiring of Yu a sign of stadium desperation?
The San Francisco 49ers have hired venture capitalists and ex-Facebook exec Gideon Yu to be their "chief strategy officer," a move that has already triggered all kinds of speculation about why on earth a guy of Yu's stature would take such a job, and what this means for the 49ers' Santa Clara stadium deal. As the San Jose Mercury News' Tim Kawakami writes:
Guys like Yu usually buy teams (or at least purchase percentages of them), they don't seek employment from them.
So... I asked [49ers owner Jed] York specifically if Yu is coming in as a minority investor, and York said he was not.
But it's sort of like saying a crumbling institution is hiring Bill Gates strictly as an IT guy—umm, at some point, that doesn't quite fly all the way.
Kawakami speculates that the 49ers "need some new brainpower on the financing front," and that Yu could even be a potential buyer for the team should the Yorks decide to sell. Certainly with the Santa Clara stadium currently stalled by the one-two punch of the lockout and the economy, new ideas would be welcome. But unless he has some hidden talents, it's hard to see how Yu is going to generate a billion dollars out of thin air unless things change significantly on the football revenue front.
April 26, 2011
Regional Sacramento Kings arena task force announced, then un-announced
The latest Sacramento Kings arena plan is barely two weeks old, and already there's squabbling over how to raise the money that no one has yet figured out how to raise. Yuba City Mayor John Dukes said that Sacramento Mayor Kevin Johnson had asked him to lead a regional arena financing effort last week — only to have Johnson's office issue a statement calling any joint arena group "premature."
Assuming this thing finally gets off the ground, officials from Sacramento, El Dorado, Placer, Yolo, Yuba, and Sutter counties — a swath of north-central California that stretches all the way to the Nevada border — will get together and find money ... somewhere. According to the Sacramento Business Journal, "Dukes said he has an outline for where the money for an arena would come from, but he doesn't want to disclose any details yet."
Right now, it seems like KJ's efforts are focused on pulling together $10 million in corporate sponsorships that he promised the NBA he'd line up as a first step at keeping the Kings from moving. Getting local companies to pledge to buy ads and stuff, though, is relatively easy; finding hundreds of millions of dollars to build an arena, when those paying for it wouldn't even get ad space in return, is likely to be another thing entirely.
MN Gov. Dayton: Vikings should pay 40-50% of stadium cost
Minnesota Gov. Mark Dayton upped the ante on the Vikings stadium proposal yesterday, telling Minnesota Public Radio that the team owners should pay between 40% and 50% of stadium construction cost. That's up from the one-third share proposed in the all-but-comatose stadium bill, and way up from the one-third-not-counting-roof-costs that team owner Zygi Wilf said he was in for.
Now, there are lots of ways of counting shares — the Vikings could, for example, pay more cash up front but get more at the back end by getting a bigger cut of stadium revenues — but still, it looks like things are headed in a direction that is not going to make Wilf happy. State senator Julie Rosen, lead sponsor of the stadium bill, said she still has hopes of getting a bill passed this year, and that any final legislation "is going to change dramatically from what it is now." Maybe this is all part of the plan: Ask the Vikings for more cash and see if that gets any more legislators on board?
Of course, there'd still be plenty of public cash — about half a billion dollars of it — and Dayton spoke to that as well:
He said he disagreed with sports economists who say the economic impact of a sports stadium is negligible. As many as 8,000 people could be employed for three years building the stadium, he said.
So, half a billion dollars, to create 8,000 jobs — that's $62,500 per job. That would be almost semi-respectable, except that the jobs only last three years. The long-term full-time equivalent job creation is likely to be in the low thousands, which would put the job creation numbers in the more typical for stadiums $100,000-$250,000 per job range, or as economic development analysts call it, "despicable."
April 25, 2011
What next for the Sacramento-to-Anaheim-to-Sacramento Kings?
More on the Sacramento Kings-aren't-really-moving-to-Anaheim front:
- The Los Angeles Times reported Friday that unnamed NBA executives told the paper they "now expect the Kings to play next season in Sacramento." It quoted one league official as saying that Sacramento Mayor Kevin Johnson's presentation to the owners the previous week was "amazing," and indicated that the NBA now intends to wait until next year to see if Johnson can actually pull off the revived corporate support and new arena plan that he has promised.
- Reading tea leaves, Sports Illustrated's Sam Amick notes that there are "no NBA trips currently scheduled for Anaheim despite the fact that Stern made it clear last week that the owners intended to investigate that plan further." The only question at this point, Amick writes, is whether Kings owners Joe and Gavin Maloof will go ahead and file for relocation on May 2 and have the NBA officially vote to block it, something that "would be unprecedented and would almost certainly take this Sacramento saga to the courts if they proceeded in that fashion."
- The Cowbell Kingdom blog speculates that if the Maloofs want to be welcomed back to Sacramento for a possible lame-duck season, they might want to start by fixing the broken toilets at Arco Arena.
The big mystery now is how on earth KJ plans on getting an arena built, given that all previous proposals have crashed and burned, and last I checked no one had discovered an unknown sea of oil under Sacramento. From all accounts, Johnson's presentation to the NBA only involved a feasibility study for a new arena, not an actual funding plan; and while potential Kings buyer Ron Burkle is a billionaire, he hasn't indicated that he wants to shave off any of his billions by paying for a new arena.
If all those unnamed sources are to be believed, the next deadline could be March 2012, at which point Sacramento would either have to have an arena agreement in place, or we could be going through this all over again. If so, it's going to be a really interesting ten months.
Watch Yankee Stadium get blowed up real good
River Avenue Blues has posted more Yankee Stadium destructo-porn, courtesy of that National Geographic Channel documentary airing on Thursday. Those with weak stomachs probably shouldn't watch, and not just because of the footage of workers vacuuming out the contents of the stadium toilets.
April 22, 2011
Kings likely staying put in Sacramento for 2011-12
All signs are that the Sacramento Kings' move to Anaheim is falling apart, even after getting a two-week extension on submitting their relocation plan to the NBA. According to Sports Illustrated's Sam Amick:
Sources say the Anaheim presentation given at the meetings was as ineffective as Johnson's was impactful, and there is serious doubt as to whether there will be enough support to warrant the Maloofs filing for relocation (a majority vote is needed to approve a move when a team files).
Specifically, a source with knowledge of the proposal revealed that the television rights riches that had long been seen as a major motivating factor for the Maloofs aren't quite as lucrative as they had hoped. ... The plan as presented in New York included a possible partnership worth $20 million annually with KDOC, an Orange County-based, independent television station that is co-owned by the very man working so hard to make this move happen. Anaheim Ducks owner Henry Samueli, who operates the Honda Center where the Maloofs' team would play and has already committed $50 million through city bonds to help cover their cost of relocation, reportedly teamed with Bert Ellis to pay $149.5 million for the station in 2006.
In other words, part of the deal for the Kings to move to Anaheim would be to give their new landlord a cut-rate TV deal, far below what league officials were figuring the Kings could earn from Fox Sports West, which was recently spurned by the Los Angeles Lakers. Amick notes that this could help explain NBA commissioner David Stern's recent remarks that one reason for extending the relocation application deadline until May 2 was concern over "certain areas having to do with the contractual relationship between Mr. Samueli's organization and the Kings, having to do with the building, having to do [with] television revenue."
Meanwhile, a Sacramento group is expected to soon have enough signatures to force a $75 million Anaheim bond sale for arena upgrades to a public referendum, which couldn't happen until 2012. The Kings and Samueli could then try to find an alternate way of raising the up-front cash, but as we've seen before, finding financing structures that work can be tricky — which is, no doubt, why they proposing using city of Anaheim bonds.
Kings owners Joe and Gavin Maloof are still reportedly planning to file for relocation on May 2, but it's hard to see that happening if the writing is on the wall that the NBA won't approve a move until more is known about both Samueli's role (including that possibly never-signed lease) and the possibility of a local Sacramento buyer. This isn't necessarily a disaster for the Maloofs, the Kings, or the NBA — as I've said before, the whole point of a move threat is to play two cities off against each other in bidding for the rights to host your team, and that certainly seems to be happening here. But it could make for a long, ugly maybe-lame-duck season in Sacramento for the Kings next season — if there is a season.
Could Dodgers mess derail A's move even more than it's already derailed?
I haven't chimed in here yet on MLB commissioner Bud Selig's takeover of the Los Angeles Dodgers' finances — you can see a brief writeup I did for Baseball Prospectus here and more discussion during my chat here — because it didn't seem to affect any stadium issues. But that could be changing, as the fine folks at Newballpark.org note:
The McCourt-Dodgers meltdown could have an unusual and for-now unmeasurable impact on the A's depending on one decision: Who will be brought in to oversee the team now that MLB has seized it? According to ESPNLA's Tony Jackson, the shortlist has three candidates:
* Stan Kasten, former Nats president
* John McHale, Jr., executive VP within MLB
* Corey Busch, frequent MLB committee member and former team exec
Yes, that's the same Corey Busch who's on the A's stadium panel with Irwin Raij and Bob Starkey.
If it's Busch, you can forget about him spending much time finalizing that never-finalized A's relocation report he's supposed to be working on. Unless, of course, the study is actually done, and it's just waiting on A's owner Lew Wolff and San Francisco Giants owner Bill Neukom to come to an agreement on how much the A's would pay the Giants for territorial rights to San Jose. Something that's not likely to happen without the involvement of Selig, who's now going to be busy fighting with Dodgers owner Frank McCourt over the future of that team.
Add in that Wolff (as well as Milwaukee Brewers owner Mark Attanasio) has been rumored as a possible buyer of the Dodgers (Wolff swears he's not interested), and it's a fair bet that nothing is going to be moving on the A's situation until the Dodgers mess is untangled. Which, if McCourt files a lawsuit as expected, could take years. Good thing attendance in Oakland is up.
State share of Vikings stadium would mostly tax sports-jersey buyers
The Minnesota Department of Revenue put out its revenue estimates for the state's $300 million share of a Vikings stadium cost yesterday. The upshot: The vast majority of the state money (more than two-thirds) would come from a sports memorabilia tax, with a 5% income tax surcharge on Vikings player salaries a distant second; taxes on luxury suite rentals and satellite TV services would amount to not much more than rounding errors. Also, since all sports memorabilia would be subject to the tax surcharge, this means that this "user fee" would be hitting Twins and Wild fans even if they had no interest in football.
As for the local third of the stadium cost, which would likely come mostly from a countywide sales tax hike, that still has no takers. Hennepin County board chair Mike Opat — who, you may recall, helped lead the charge for a new Twins stadium — this week pretty much ruled out his county bidding to become the Vikings' new home on these terms, telling Minnesota Public Radio, "I think the odds are against it" and "It's hard to think that when there's a summons to come rescue the Vikings stadium effort, that we're going to leap to the front of the line."
With Minneapolis likely out of the running thanks to its voter-approved $10 million cap on city stadium funding, that would leave Ramsey County as the only remaining Vikings suitor. Assuming anyone believes that the Vikings bill has a snowball's chance of hell in making through the state legislature this year in the first place.
Majestic hires L.A. lobbyist to fight AEG stadium plan
Long article in the L.A. Weekly this week on John Ek, a powerful Los Angeles lobbyist who's been hired by Ed Roski's Majestic Realty to lobby for his City of Industry stadium plan — and against AEG's competing downtown proposal. In fact, the paper notes, Ek sent the L.A. city council a list of 44 questions to ask AEG during hearings, and chief AEG critic Bill Rosendahl ended up reading them nearly verbatim:
Majestic: "Will the stadium developer agree to never sell/refinance the project until the bonds are paid off?"
Rosendahl: "Will the developer agree to never sell/refinance the project until the bonds are paid off?"
Majestic: "The L.A. Auto Show controls the entire convention center nearly the whole month of November; will we have football or the L.A. Auto Show?"
Rosendahl: "The L.A. Auto Show occupies the entire Convention Center nearly the whole month of November, which is football season. How will the two coexist?"
Majestic: "Given the passing of Prop. 26, would a 'ticket tax' require voter approval?"
Rosendahl: "Does the new Proposition 26 require that the proposed ticket tax be approved by voters?"
As the Weekly concludes: "Those are fine questions, deserving of answers. But that was even finer lobbying." And it's an indication that the AEG plan could have a rougher road ahead than some might have anticipated — as we've seen before, it's a lot easier to stop a stadium deal when there's a major local corporation in your corner.
Yankee Stadium demolition porn: the movie
National Geographic Channel is debuting Break It Down: Yankee Stadium, a documentary on the demolition of the Yanks' historic ballpark, next week. For an oddly uninteresting trailer, including gripping footage of sod being rolled onto a spool, click below.
April 20, 2011
Baseball Prospectus chat tomorrow, 1 pm EDT
Just a note that I'm doing a live chat tomorrow at Baseball Prospectus from 1 pm to roughly 3 pm. You can submit your questions ahead of time, tune in live tomorrow, or read the transcript later, all at the same location. Baseball questions preferred, but I can bend the rules and take one or two Anaheim Kings questions if the masses demand it.
Santa Clara finds another $10m for 49ers stadium, kinda, maybe
The Santa Clara city council approved a bunch of bonds to maintain some city-owned buildings (including the Santa Clara Convention Center) last night, and slipped in language that could kick an extra $10 million the San Francisco 49ers' way:
If the city sells more than $25 million in bonds, that extra revenue -- up to $10 million -- will go toward funding the planned 49ers stadium next to Great America. Those funds would help the city meet its obligation to contribute up to $40 million toward construction of the arena, which has a total price of $937 million.
The money to pay back the bonds would come from future property tax revenue, which is currently slated for redevelopment projects — unless Gov. Jerry Brown is successful in his attempts to eliminate local redevelopment agencies, in which case it probably wouldn't. Also, the city might not even sell the new bonds at all, given that, according to the San Jose Mercury News, "officials are not overly optimistic that they will have takers" for all of them. If nothing else, though, it's a sign that Santa Clara elected officials intend to keep getting creative in terms of hiding money in as many cookie jars as possible in hopes that they can spend some of it on the 49ers.
April 18, 2011
AEG in L.A. development-rights grab?
Part of AEG's proposal for an NFL stadium in downtown Los Angeles includes having the city hand over control of a valuable 2.4-acre downtown parcel 10 years earlier than otherwise planned, according to an Associated Press report:
AEG now says the city no longer needs access to the parcel, which experts said could be developed into retail and office space worth millions to the company each year in leasing revenue, because a new convention center building would be built along with the 72,000-seat stadium it has proposed.
The request is part of a so-called transaction overview that AEG sent to city officials in February.
"If the city is not going to use it, then there's no need to hold it for them," AEG spokesman Michael Roth said of the parcel, stressing that the company would need to go through a formal entitlement process with the city to have anything built there.
Okay, but still, handing over a piece of property for nothing represents an additional public subsidy for the project. (Absent this deal, AEG would have to make an offer to pay the city if it wanted to use the land before 2021.) A local real estate expert told AP that AEG could lease out the space for $6.75 million a year, which over a decade would be worth roughly $50 million in present-day dollars, though presumably you'd have to factor in the costs of financing developing the land as well. So, not a tremendous giveaway, but something else to add to the pot of this "no public money" project.
NBA on Kings' Anaheim move deadline: Enh, take another two weeks
Sure enough, they punted: On Friday, NBA commissioner David Stern gave the Sacramento Kings a two-week extension until May 2 on their deadline to submit plans to relocate to Anaheim.
Stern credited Sacramento Mayor Kevin Johnson's last-minute plan to have Pittsburgh Penguins owner (and Magic Johnson pal) Ron Burkle buy the team and build a new arena in its current home town — via a "public-private partnership," which is accepted code for "we haven't figured it out yet" — as the proximate cause of the delay. "The mayor's vision we don't know if it's real or pie-in-the-sky, but we'll knock ourselves out finding out over the next few weeks," said Stern on Friday. "This is very building-focused."
However, there are also indications that the emergence of the Burkle plan helped provide cover for NBA execs who are still waiting to hear details of the proposed Anaheim move. The L.A. Times reports:
The relocation committee headed by Oklahoma City Thunder owner Clay Bennett will press the Maloofs and Honda Center officials to specify their plans for anticipated television revenue in Anaheim, and to detail arena improvement initiatives for which the city of Anaheim last month authorized $25 million in a $75-million bond package that includes undetermined relocation fees the Maloofs would owe.
That's a lot of known unknowns, and it's not obvious which if any of them can be cleared up in two weeks. Anyone want to lay odds on whether this is the last extension the Kings get?
April 15, 2011
Kings-to-Anaheim D-Day ... or not
If you were hoping for a quick resolution to the Sacramento Kings relocation drama this weekend, you may be disappointed. After the Kings owners gave a 90-minute presentation to NBA commissioner David Stern and the league's relocation committee yesterday, it looks as if the likely scenario now goes like this: The Maloof brothers file an official relocation request by Monday's deadline, then the league spends the next 60 days figuring out whether it can line up the votes to approve it — or, more to the point, whether it can come up with a territorial rights fee that will placate the erstwhile no votes without breaking the Maloofs' bank.
It's really hard to read tea leaves on this one, though, without any leaks about what conversations are going on at the actual meetings. Until then, we're left with an extremely thin gruel of rumor such as the San Jose Mercury News asking Joe Maloof whether a decision could come today, and Maloof texting back: "Yes, I think so."
Sacramento Mayor Kevin Johnson, meanwhile, told the NBA yesterday that Pittsburgh Penguins co-owner Ron Burkle is interested in buying the Kings and keeping them in Sacramento. Assuming a new arena is built, though, in which case the Maloofs would want to stay in Sacramento, too. Also assuming the Maloofs would sell, which so far they say they won't. Still, it might convince a couple of NBA owners that there are other options than cracking open the Lakers' and Clippers' market, so for KJ, it's certainly worth a shot, even if a low-percentage one.
April 14, 2011
Dayton: Vikings deserve new stadium because the Rolling Stones are awesome!
So I wasn't even going to finish reading today's Sid Hartman interview with Minnesota Gov. Mark Dayton about his Vikings stadium plans, because Dayton didn't say much new (sample snippet: "I think once they crunch the numbers, you know the cost of the different possible stadiums and locations, we'll have a better idea of which ones fit the economic picture or not"), and also, well, Sid Hartman. But then I got a load of Dayton's rationale for sinking $600 million in taxpayer money into a new stadium, and couldn't let it pass without comment:
"I certainly would hate to see the Los Angeles Vikings along with the Los Angeles Lakers. It would just be a travesty," he said. "It's also what makes us a big-league city. You and I can go back to when the Metrodome was built, that was controversial. [But] here you have had, for that public investment ... two World Series; one Super Bowl; all the athletics, college, high school and amateur; and rollerblading, Rolling Stone concerts and monster truck matches; and all the other uses of that major downtown facility. [It's] been a phenomenal economic return."
First off: If losing a single major-league sports team would cast the Twin Cities into minor-league status — they're one of the smaller metro areas to boast teams in all four major sports leagues — then presumably the local economy collapsed between 1993, when the North Stars left, to 2000, when the Wild arrived? Second, the last time the Rolling Stones played at the Metrodome was in 1997, and I don't think they're coming back. (And even if they did, it would be to the Target Center, where they played in 1999.) And third ... rollerblading?
Mostly, though, the point that Dayton misses (or, more likely, tries to evade) is that almost all those other things can still happen if the Vikings leave. The Metrodome, after all, isn't going anywhere (it needs a new roof, but will get one regardless of whether a new stadium is built), and is perfectly capable of hosting monster trucks and rollerblading even without a 10-day-a-year tenant in the fall to keep it company.
Dayton is right about one thing: The Metrodome was a good investment, but not because of the events that it drew, but rather because it was relatively cheap ($68 million) and because the state of Minnesota negotiated a lease with the Twins and Vikings where they actually paid enough in rent to pay off the public construction cost. No one thinks that, three decades later, the Vikings will agree to that again. But "Send money or we shoot these rollerbladers!" does have a certain ring to it.
AEG's Leiweke to stadium critics: Be "cheerleaders," not "professors"
It seems the pressure of having people actually looking at the specifics of his downtown L.A. stadium proposal is getting to AEG president Tim Leiweke. After previously sticking with the soft sell of insisting that no public money would be involved (despite the project requiring $350 million in public money that might or might not be recouped), on Tuesday Leiweke lashed out at critics of the stadium plan during his keynote speech at the Stadia Design and Technology Expo, saying among other things:
- Elected officials should be "a cheerleader for the private sector" in development deals.
- Economists who say that stadiums just siphon money from one part of the economy to another are "professors in classrooms that have never built anything in their lives."
- If the government doesn't want to build stadiums, and private developers are faced with "someone who not only attacks you but puts fear in the hearts of the citizens that the project is going to cost them money," then the private sector might just take their ball and go home and you'd have no new stadiums at all.
The best part of Leiweke's "cheerleader" quote is that it appears to be a (conscious or otherwise) to this Los Angeles Times editorial, which specifically called on local electeds not to be mere cheerleaders for a stadium, but to do due diligence. I suppose there are stranger ways to respond to negative press coverage than by extending a raised middle finger to your city's largest media outlet, but the examples are few and far between.
As for Leiweke's prospective cheerleader recruits, they responded about as you'd expect: Los Angeles City Councilman Bill Rosendahl, a stadium critic who is on the council committee investigating the plan, told the Times: "I'm not a cheerleader, I'm a player. The city is a quarterback or a tight end, it's one of the major roles in the team. And I hope Tim Leiweke is on our team." And not, presumably, this kind of teammate.
April 13, 2011
Kings may not have NBA votes for Anaheim move
Pretty much everything we're hearing about the Sacramento Kings' attempted move to Anaheim these days is at the level of rumor; that said, this is certainly an interesting one: KFBK's Rob McAllister reports that "those close to the negotiations" say Kings owners Joe and Gavin Maloof "are not sure they have enough support from the rest of the league's owners to approve the move." Which wouldn't be a total surprise, given that the precedent of allowing a minimal territorial rights payment for incursions into a team's existing territory is likely to freak out more than a couple of owners, but it is the first we're hearing of this, even as an unsourced news item.
Other tidbits in the KFBK story:
- Honda Center officials "would not confirm" whether arena owner Henry Samueli had signed off on the 200-page arena lease that the Maloofs have presented to him.
- The Kings have tapped a $75 million line of credit from the NBA to help meet expenses, though it's unclear how much of the money they've used so far, and there's no source at all given for this item.
All four Maloof brothers are expected to make their relocation pitch to the NBA owners' meetings tomorrow and Friday, with a vote presumably to follow. At this point, no outcome — quick approval, quick disapproval, or putting off approval till a later date so that Samueli and the Los Angeles Lakers can be placated — would surprise me.
April 12, 2011
Today's Vikings stadium news, in 13 words or less
I was about to sum up the last 24 hours of reaction to the hot-off-the-presses Minnesota Vikings stadium bill, but really, the headlines alone tell the story just fine:
Steep hills for Vikings stadium
Vikings' new stadium bid could need a Hail Mary
Vikings stadium bill is introduced at legislature and is headed to back burner
Viking Quest: Stadium Debacle 2011
No hearings scheduled for Vikings stadium bill
You can read the articles for yourself, but in a nutshell: There's limited time to pass a bill this session, and the legislature is busy with the state's $5.1 billion budget deficit and is showing no interest in moving on a Vikings bill. Not mentioned but also relevant: Um, there's an NFL lockout, people? This is sounding more and more like running stuff up the flagpole in anticipation of a real stadium push in 2012 — conveniently just in time for the Vikes' Metrodome lease to expire, as well as for the league to resume playing football, maybe.
April 11, 2011
Vikings stadium bill: Who pays what?
The long-awaited Minnesota Vikings stadium bill was introduced in the Minnesota state senate later Friday afternoon, only three months after lead sponsor Julie Rosen had initially promised it. The legislation would fund a $900 million roofed stadium with a remarkable mishmash of funding streams. Let's review:
- State of Minnesota, $300 million: The money would be cobbled together via what Rosen and her co-sponsors call "user fees," but which actually include a variety of taxes and other revenues, some of which wouldn't hit the Vikings or their ticket buyers at all: a tax on pro sports memorabilia, a Vikings-themed lottery, a new sales tax on satellite TV, and the kickback of property taxes to the stadium — that's right, a TIF. The three items that could be considered an actual hit on the Vikings: an income tax surcharge on players (which would actually hit players, obviously, but could effectively tax the Vikings if they have to overpay free agents to compensate), a new state tax on luxury boxes, and stadium naming rights proceeds. The Minneapolis Star Tribune notes drily that these are "all moves that may draw opposition from the team and the National Football League" — no kidding, given that luxury box and naming rights revenues, in particular, are generally considered by the league to belong to the team owners, even if the stadium itself and its boxes actually belong to the public, as would be the case in Minnesota.
- "Local partner," $300 million: This would be some Minnesota city or county, though none has volunteered thus far to come up with this kind of money. The lucky winner would be allowed to raise sales taxes by 0.5%, raise taxes on hotels, alcohol, food, and beverages by 3%, and charge an admission tax of up to $1 to per ticket — another item that would hit the Vikings in the pocketbook — all without going to a public referendum, as is usually required for local tax increases.
- Vikings owners, $300 million: The Wilfs would actually be required to put in $1 for every $2 of public money, meaning if the price tag went up, they'd have to pay one-third of the cost overruns as well. That's about $70 million more than the team owners said last year that they'd be willing to pay. Also, the Vikings would be required to open their books to a new state stadium authority, and give up those naming rights.
Quote of the day on all this is from co-sponsor Sen. John Harrington, who insisted: "It's very simple. This is a jobs bill. It's between $700 and $900 million in jobs." Except, of course, that a typical stadium project generates about one full-time equivalent job for every $250,000 in expense, while a decent job-creation program costs more like $25,000 per job or less. So a more accurate assessment would have been "it's $90 million in jobs, at a cost of $600 million in taxpayer dollars" — but somehow that probably wouldn't have the same rhetorical impact.
Kings-to-Anaheim D-Day creeps closer
The NBA owners meetings are just one week away, and it looks like a decision on whether the Sacramento Kings are moving to Anaheim will go down to the wire. Among the most recent developments:
- The Los Angeles Lakers are ramping up their opposition to the Kings' move, with coach Phil Jackson telling Sports Illustrated: "I don't see any community, I don't care if it's Bombay with 25 million [people], being able to support three teams [in the same market]. I know Istanbul does it with three soccer teams, and England does it in London with three soccer teams in the surrounding area, but it makes it very difficult in our community and our television area to do that kind of a thing. It will hurt all the franchises." As SI notes, the operative word is "television," given that the Kings arrival would reportedly cost the Lakers $300 million off their new $5 billion cable deal.
- April 18, the Monday after the owners meetings, is actually just the deadline for the Kings owners to apply for a relocation, not for its approval. So while it's still likely everything will be hashed out next weekend among the various owners involved, it's not unthinkable that they'd kick the can down the road a bit farther — if an agreement on territorial rights fees can't be worked out before then, for example.
- Orange County Register columnist Randy Youngman writes that "another publication hinted that Stern might ask the Maloofs to delay their plans to move until after the lockout, but that sounds like pure speculation." Youngman didn't provide a link, in any case, and Google has been no help, so it's tough to say where this is coming from.
- The Committee to Save the Kings is moving ahead with its signature drive to force a referendum on Anaheim arena bonds, which would delay the bond issuance until June 2012 unless Anaheim chose to fund a special election before then. The drawback, committee attorney Jeffrey Dorso tells the Sacramento Press: "The big pitfall is that it could happen regardless. They could come up with other ways to fund the $75 million." It'd definitely make the financing more complicated, though, and stadium and arena deals have been stymied over less.
- A Kings move could potentially throw a wrench into NBA revenue-sharing talks (or vice versa). As L.A. Times columnist Mark Heisler writes: "Does someone think [Lakers owner Jerry] Buss will watch $250 million fly away because someone set up a lemonade stand in Orange County, then say, 'I'd be glad to kick in an extra $5 million to $10 million annually?'"
- Speaking of revenue-sharing, the Sacramento Bee's Marcos Breton thinks this is all a sign that the NBA's revenue-sharing system is completely broken, even asserting that the division-leading San Antonio Spurs and Oklahoma City Thunder "could go the way of the Kings" eventually if things aren't changed.
- On the other hand, maybe this franchise is just cursed.
L.A. county could have say over AEG NFL stadium
Hey, lookit, investigative journalism! The Los Angeles Times, having (in its words) completed a "review of records spanning nearly half a century of financial and development issues involving the Los Angeles Convention Center," uncovered something unexpected today about the proposed AEG NFL stadium: It would likely require county approval, not just city, because of a joint powers agreement that goes back to the 1960s.
There's no particular sign of opposition to the project from the L.A. County Board of Supervisors, but this could still present a wild card, if only because AEG's lobbying machine hasn't yet approached the county. The Times reports that AEG president Tim Leiweke told the paper earlier this year: "We're not asking anything out of the county because we don't want to deal with them." Surprise!
April 07, 2011
Edmonton council approves framework for talks about how to fund Oilers arena, maybe
In a stunning victory for Mayor Stephen Mandel, the Edmonton city council voted 10-3 last night to approve an arena deal for the Oilers ... okay, wait, actually to approve a financing plan for an Oilers arena ... sorry, that's actually to create "a financial framework the administration must use in negotiations with Oilers owner Daryl Katz." So maybe not quite as stunning as it first appeared, given the over-the-top headlines.
As for the details of the plan, they are:
- The arena cost is capped at $450 million.
- $125 million must be raised via a ticket tax.
- The province will kick in $100 million.
- A Community Revitalization Levy kicking back taxes in the arena district will raise $20 million, down from $125 million in earlier plans
- The missing $105 million will come from a $2.5 million a year subsidy that the city currently pays to the Oilers, plus increased parking revenues.
- The city will own the arena.
- The Oilers will pay operating costs.
Needless to say, there are still plenty of holes in this plan, starting with the fact that the province of Alberta hasn't yet committed to its $100 million share. Also, Katz wrote to Mandel last week that he's opposed to a ticket tax — as you'd imagine he would be, since it would effectively limit the amount of cash he himself could pocket from ticket sales. And there's still the question of the lease, whether Katz would pay any rent, and who would get money from such items as naming-rights sales.
All in all, it's not the worst arena proposal ever — Katz would end up paying for about half the construction cost, counting that ticket tax — but most of the heavy lifting is now kicked over the the province, which must consider the precedent it would set for the Calgary Flames, who are looking for arena funding of their own. So while it's kind of nice that the Edmonton council has drawn a line somewhere in the sand, this still pretty much comes down to a magic asterisk.
April 06, 2011
Yankees fans disguising selves as empty seats again
Another April, another batch of stories about disappointing New York Yankees attendance. River Avenue Blues reports that the Yanks have set new records for lowest attendance at their new stadium for four games in a row, which isn't good when you consider they've only played five games this year.
There are as many theories as empty seats, ranging from fans growing detached from the Yanks' ever-changing roster to those hefty parking fees — I've laid them all out in an article over at the Village Voice news blog. One intriguing possibility, though, is that the new stadium is proving to have a short honeymoon period because fans hate it and would rather stay at home and watch on TV:
"Our seats in section 428, row 10 offered an awful view of the playing field and they weren't going to get any better," wrote NYY Stadium Insider in a January post on "Why We Canceled Our Yankees Season Tickets." When the new stadium opened, they write, they put up with it for the new-car smell, but "in the 2009 ALDS when Joe Mauer hit his controversial ground rule double that was incorrectly called foul, and when Mark Teixeira hit his game winning home run to left field, we were completely in the dark. There are blind spots in the wings of the far-recessed upper deck at Yankee Stadium III and as the season wore on, we realized that we'd be better off watching the games at home."
Now, I doubt that this is a huge factor, at least not compared to things like $35 parking and the fact that the Yankees raised ticket prices after an offseason in which the Red Sox stocked up on free agents while the Yanks largely stood pat. But it's still interesting to see that some fans, at least, are citing the poor game experience at the new stadium as a reason why they're not buying tickets. Too bad the Yankees don't have a beloved old ballpark whose quirks fans were willing to put up with for the chance to visit history, like up in Boston — oh, wait...
April 05, 2011
Vikings stadium bill will include get-out-of-referendum free clause
And here we go again, again: Minnesota state rep Morrie Lanning and state senator Julie Rosen, authors of the Vikings stadium bill they swear they finally will really introduce later this week, say that it will include a provision to exempt local governments from the requirement to hold a referendum on any sales tax hikes used to help fund a stadium. You know, just like the Twins got for their stadium five years ago.
The Minneapolis Star Tribune reports that "there were signs Monday that the referendum issue was leaving legislators conflicted," especially those legislators who voted for the Twins' referendum exemption but didn't realize they'd be setting a precedent. Right now it sounds like a no-referendum pledge would face an uphill battle — if a county that is desperate to raise its own sales taxes for the sake of a billionaire sports team owner can even be found — but these things have been known to change once the lobbyists get ahold of them.
The one thing that's clear: If a referendum were held, the Vikings would likely go down to massive defeat. Of course, for some elected officials that's a sign not that there's something wrong with the stadium deal, but that there's something wrong with democracy: "I don't believe in government by referendum. It lets elected officials off the hook for making judgments about these things," said Hennepin County Commissioner Peter McLaughlin, while Minneapolis City Council President Barb Johnson worried that a referendum requirement "would really sabotage the effort to build a stadium in this time of economic turmoil."
Everybody and their sister spreading Rays contraction rumors
Here we go again: Now it's Forbes magazine's Michael Ozanian, of all people, who's spreading rumors about the Tampa Bay Rays being targeted for contraction if they don't get a new stadium:
Groundswell building in Major League Baseball to dump the Tampa Bay Rays. From what I am hearing, I doubt there will be any baseball at Tropicana Field after 2014 even though the team's lease runs to 2027.
What makes this bizarre is that Ozanian is the main guy behind Forbes' baseball team valuation numbers, so he of all people should know that the Rays are far too valuable an asset to just be tossed in the fireplace. As I wrote today over at Baseball Prospectus (subscription required for this one):
The Rays and A's combined are worth $638 million, up $27 million from the year before, and who in their right mind liquidates an asset that keeps gaining in value without even trying? Stuart Sternberg may be trying to scare St. Petersburg into letting the team open stadium talks with Tampa by dropping contraction threats—at least I think that's what his latest oblique statement about "my patience is greater than Major League Baseball's" was meant to threaten—but the numbers still don't pan out.
Noah Pransky of Shadow of the Stadium adds that Ozanian's conclusions were based largely on the Rays' subpar TV contract — except ratings are way up, and the contract is set to be renegotiation in 2016. Which means that unless Desmond Jennings and Wade Davis turn into total bombs — or cable has been supplanted by wrist-implanted iPads by then &mdash the Rays should be seeing a large cash windfall at that time.
Finally, note that Ozanian provides no sources, which means it's presumably somebody within MLB who's leaking this information (or disinformation, as the case may be). I think we can call it as official: Bud Selig and his henchmen are getting an early start on collective bargaining threat season. And if it helps shake down the Tampa Bay area for stadium cash, all the better.
April 04, 2011
New Vikings stadium plan earns multiple thumbs down
Last week's Minnesota Vikings stadium trial balloon turns out to be going over like a lead zeppelin, with elected officials lining up to say how much they hate the bill, even before it's been officially introduced. Taking a tour of the press coverage:
Hennepin County Commissioner Peter McLaughlin called the bill "badly timed, badly designed and I hope it comes to a bad end. I wouldn't even start talking to the Vikings until they bring half a billion dollars to the table." —Minneapolis Star Tribune
House speaker Kurt Zellers (R): "I hate to sound like a broken record, but until they have a site, until they have a plan, until they have a partner, it's awfully hard for us and the Vikings to get to that point.'" —ESPN.com
Meanwhile, Senate minority leader Tom Bakk (DFL), who was a sponsor of the Vikings' failed 2009 stadium bill, suggested political motives by the two Republicans who have authored the newest version: "If they were serious about a stadium bill, they would have introduced it back in January or February. To wait until the middle of all the budget cut bills is just a political gimmick." —ESPN.com
[Now that] the Vikings are coming off a 6-10 season, it seems that the Vikings stadium finance plan is maybe the only thing that will have bi-partisan agreement. Unfortunately for the Vikings, it seems to be borderline unanimous that they are crazy to be asking for money right now. —I Dislike Your Favorite Team
Plus, video from KSTP TV of Minnesota elected officials talking about how awful the stadium plan is! This has got to be the most pre-release hatred we've seen for anything since ... I dunno, "St. Anger"?
April 03, 2011
Sternberg, Foster celebrate Opening Day with Rays stadium taunts
Friday was Opening Day in Tampa Bay, and Rays owner Stuart Sternberg was at it yet again with his you-don't-wanna-make-baseball-mad shtick, this time asserting that Bud Selig is running out of patience for a new stadium:
"It's imperative that we get this thing moving," Sternberg said. "The can has been kicked down the road and the road is not much longer ... But there needs to be some progress. ... And I think my patience is greater than Major League Baseball's."
Yes, the same Bud Selig whose Oakland A's stadium commission just celebrated its two-year anniversary without any signs of issuing a report. That guy just can't wait for anything! So don't try it, St. Petersburg!
St. Pete Mayor Bill Foster, to his credit, brushed off Sternberg's threats, saying "the city is prepared for interference from Major League Baseball and all of the Selig tricks that have been used successfully elsewhere." (It's easy to be cocky when you're sitting on an ironclad lease.) Though Foster went on to insist that Tropicana Field is a "beautiful facility" and that "I call the [catwalk] rings Wrigley's Ivy" — there's cocky, and then there's too cocky.
April 01, 2011
Edmonton arena would carve out 25 blocks for TIF district
The city of Edmonton has identified how big a Community Revitalization Levy district (what in the States is usually called a Tax Increment Financing district) will be needed to kick back taxes for a new Oilers arena, and it's pretty darn big: about 25 blocks, stretching a pretty good distance from the proposed arena site. The two risks here are the same as with most TIF districts: If promised increased development doesn't come, the district runs out of money and the city either has to find other funding sources or expand the size of the district; and even if it does come, it's hard to know whether it's as a result of the arena, which means the city could end up kicking back tax money it otherwise could have kept.
The same report from Edmonton radio station iNews 880 notes that even with the CRL district, there'd still be a $100 million funding gap for the arena, but that "City Manager Simon Farbrother says part of that gap has been addressed but he wouldn't elaborate." Thanks for clearing that up.
In other tax district news, meanwhile, there's a bill in the Nevada legislature that would outlaw special tax districts there, effectively killing plans for an arena on the Vegas strip. (This would actually be a district with a sales-tax surcharge of 0.9%, not a TIF, but the concept is somewhat similar.) As you might expect, this being Vegas, casino operators MGM and Boyd Gaming are behind the opposition, since they're worried about the arena plan hurting their business; competitor Caesars Entertainment is the developer hoping to build the arena. Look out, grass!
