There is no admissions tax at Safeco field or at CenturyLink. You make it sound as if this is something only happening at the proposed arena, it is not.

There is no city collected admissions tax at Safeco field or at CenturyLink. You make it sound as if this is something only happening at the proposed arena, it is not.

Sorry for the two posts, having one of those days.

The fatal flaw in your analysis is that you consider the deal as if it were in a vacuum. Say the words "mitigation", "traffic", "substitution", economic "leakage", "loss of jobs", "gentrification of industrial land", and these people go out of their minds. Oh, yes, "debt capacity". Forgot that one.

I read your book and it is very good, and so I am surprised you are missing all of this.

Sorry for the double post: "almost break even" means that it won't comply with a people's initiative, passed by 75%, that states that cash on cash return for a subsidized arena has to be more then a 30 year US bond. It doesn't pass the test here either.

Steve: I believe that both Safeco and CenturyLink have admissions taxes that are kicked back to help pay for their construction costs, a la what Hansen wants. Not sure who's on the hook if there's a shortfall there, but in any case, only a small slice of Hansen arena spending would likely be cannibalized from the M's and Seahawks.

Godwin: As has been discussed ad infinitum, the way I-91 was written this technically meets the "cash-on-cash return" provision, even though it's not an actual profit. If your concern is whether this will earn Seattle a 2.7% per year profit on its $200 million, it almost certainly won't, and you shouldn't support this. If your criterion is "Will this amount to a sea of red ink?" then the answer is "almost certainly not."

And I don't understand what you mean by the "in a vacuum" remark. Explain?

Right, but they are collected by the pfd not the city. They do not go into the general fund like other admissions taxes. In Hansen's case that would go back to the city along with his rent, correct?

"Sorry for the double post: "almost break even" means that it won't comply with a people's initiative, passed by 75%, that states that cash on cash return for a subsidized arena has to be more then a 30 year US bond. It doesn't pass the test here either."

- Hansen has clearly stated that this will provide the necessary return at even the most conservative case. You are getting return and profit confused

"Sorry for the double post: "almost break even" means that it won't comply with a people's initiative, passed by 75%, that states that cash on cash return for a subsidized arena has to be more then a 30 year US bond. It doesn't pass the test here either."

- Hansen has clearly stated that this will provide the necessary return at even the most conservative case. You are getting return and profit confused

In evaluating this proposal - shouldn't the taxes generated during the construction of the arena also be considered? None of that is being used to pay off bonds.

Also - in looking at it overall you have to also take into account state taxes, again, none of which will be used to pay off the bonds.

Thanks for actually looking at this completely objectively. I wish more in Seattle would do the same.

Safeco and Qwest both collect reduced admissions tax rates (and though they are in Seattle they're specially charged by the county). After the bonds are paid off (via the special tax streams) the admissions taxes are supposed to increase to 10% to pay for ongoing maintenance. The odd financing was an end run around the local vote being slightly against building in Seattle and the state legislature ordered the county to build safeco.

www.leg.wa.gov/JointCommittees/LFOKC/Documents/2008-07-16KingRevenueStreams.pdf

dor.wa.gov/docs/reports/2010/Tax_Reference_2010/52admission.pdf

Another concern is that the Parent Guarantee is unsecured except for a number of provisions. It's a little unclear to me if an ArenaCo subsidiary can actually pledge away the proceeds of the team sale from the TeamCo subsidiary. It depends how the contract is written up and which parties sign it.

New money to the State of Washington for NBA and NHL franchises relocating is, roughly, $2.5 to $3 million a year for the NBA, $1.5 to $2. Million for the NHL, combined to pay $4 to $5 million dollars a year in B&O taxes every year.

What percentage actually goes to the largest city in the state? Don't really know, but as a citizen of Seattle, King County, and the State of Washington, it all matters to me.

About half of that new money will go to education, K-12 and higher ed.

Over the life of the life of the bond repayment, that's $75 million for just the NBA business, to $150 million for both franchises, depending on franchise value.

Hasn't it also been reported that during the 2-3 years the Sonics would play in Key Arena those taxes generated would not be diverted to the new arena deal?

How does the $52MM in taxes that Prof. Beyers analyzed the region would take in during the two years of arena construction fit into the analysis?

Not really, the MOU says they can negotiate on where that goes. In fact, I don't think they'll even charge the NBA/NHL rent according to the provisions on pg 17 of the MOU. ArenaCo pays just the $1M/yr ground lease amount during the construction phase.

seattle.gov/arena/docs/120516PR-MOU.pdf

Any City taxes generated during the tenancy at KeyArena of either the NBA team or the NHL team over the base amount of taxes that is currently received from activities at KeyArena will be used to benefit the Arena Project or KeyArena, as mutually agreed.

Thank you for this post Neil! There are plenty of other political hurdles this will need to jump over to get approved but nice to see the biggest issue spelled out with your assumptions.

The Hansen arena admission taxes would go to pay off the arena bonds, as would the B&O taxes. So all of that is zeroed out in the first item.

Construction sales taxes mostly go to the state, and I purposely didn't figure out the state's profit/loss because 1) the state isn't voting on this, 2) the substitution effect gets way more complicated on the state level since the vast majority of spending is likely redirected from somewhere in the state, and 3) I don't honestly know how to figure out the opportunity cost of using construction sales taxes (i.e., if Hansen didn't build there, might someone else?).

here the city would only be paying for part of the land cost.

Neil, the base case scenario is the city paying 115M and the county paying 5M with the land acquisition being the first public expense. It's also a bit unclear if all the individual parcels of land Hansen's been acquiring will be appraised in a way that would yield a profit on the land after it's been assembled, approved for a stadium, and the street vacation of the road in the middle of the proposed arena has been granted. It may be that the city ends up "paying" Hansen more than the land cost when all is said and done.

Neil, this is the most positive set of comments I've ever seen you write about a sports facility deal. This can only mean one thing: The Seattle city council will reject it. It probably won't even be close.

We'll know a lot more tomorrow.

Seattle, you're crazy if you don't take this deal. Some people in Seattle are saying, "Worst deal ever!". Sorry, but you're wrong. Hansen has done a good job of making sure this is about break-even. I don't think he's being greedy.

So, you're about to reject a pretty fair deal. Figures.

I have trouble accepting your assumptions on the admissions tax when you say that it takes admission taxes away from other venues assuming people would attend other events. And then you say 'out of towners' would spend their money in Seattle regardless.

That seems like a very debateable assumption to make as you are making no forecast on attendees coming from Snohomish, Pierce and Kitsap counties. It doesn't seem one could assume those citizens would spend money in Seattle regardless. I think the same argument could be made for the Eastside as well, though to a lesser degree perhaps.

And one has to consider the hockey fans, which are quite similar to soccer fans. They are very passionate about their sport and this represents a currently untapped market to a great extent. The Silvertips in Everett and the T-Birds in Kent have drawn very well, and actually outdraw a number of the Canadian counterparts in the WHL, so one could see those fans as incremental increase in attendees and admissions tax payers.

In short, I think you are being a little conservative in those assumptions. Having said that, at least you are expressing an open mind which in this debate is quite refreshing!!!

ChefJoe: The city is buying the land, but half of the money for it is being provided by Hansen in the form of rent. San Francisco just flat-out paid to have the Pac Bell Park site cleared for the stadium.

John: That's why I used a range around Beyers' 50% figure from his Key Arena study. Ideally, you'd have an actual impact study that would take into account things like where hockey fans would be coming from, etc., but failing that I've gotta go with what I've got.

Basically, what's going on here is that while arenas return a very small benefit to the cities that host them, Hansen has kept the public cost low enough that it's pretty much a wash. I've always said that there's a price point where giving some public aid to a stadium or arena is worth it, and Hansen looks to be at least in the (ahem) ballpark.

Just want to say I am glad to here a good unbiased positive report about the arena here.

Just something that has been bothering me a bit though. Everyone assumes the arena will be useless after 30 years. Does everyone think the team is going to leave Seattle after 30 years? Does everyone think a lease will not be renewed after the original 30 year lease?

I know, with the exception of Madison Square Garden, there are currently no arenas older than 30 years, but I feel arenas are being built smarter in this new era of arena building. The newer arenas were being built to maximize dollars to pay increasing salaries and to make the owners more money as it was the true revenue stream for owners. However, the new revenue stream for these owners are the megamillion(billion) TV contracts being signed. The new collective bargaining agreement and these new TV deals will lessen the need of brand new arenas.

Also, as part of the MOU Hansen and company are responsible for keeping the arena up to date with NBA standards, so the arena she not be completely lacking in amenities or in decay at the end of the 30 year lease.

In other words, I feel the arena will still house the NBA and NHL as well as other events after the initial 30 years of existence. After that everything is profit for the city and county.

Just my 2� worth.

Arena shelf-lives are getting shorter, not longer. And how long they lasted was never a matter of how well they were designed, but rather of how long it took the owner's chutzpah to build up to demand a new one.

For the Hansen arena to have value in 30 years, you have to imagine that the team owners would voluntarily sign a new lease then that pays the city significant rent without demanding either a new arena or major upgrades to the old one. While I would like to live in such a world, I'm not holding my breath.

Neil;

Thanks for the more detailed breakdown.

I believe that the arena may have negligible (or negative, IE: less than demolition cost) value at the end of the term.

However, even as a relatively staunch public-funding-for-arenas opponent, I must say that this still looks like a good deal to me. Could it be better for the Seattle taxpayer? Sure. There's always room for improvement.

But, correct me if I'm wrong, I can't think of a more favourable arena deal proposed in the last 20 years. Yes, Seattle will have to put "something" in. No, they might not get a cash/cash return on their investment. Still, Hansen isn't requiring a free building, no taxes, and an annual operating subsidy (like many, many other 'destinations' we could mention).

Seattle 'gets' NBA basketball back. There is a cost, but that cost is modest (IMO) and quantifiable. It's up to Seattle taxpayers to decide if Sonics II are worth the price. But for my money, it's a good deal, and they should take it. Again, as an opponent of welfare for billionaires, it's hard for me to say that.

But... any subsequent deal is likely to be dramatically worse in every respect.

"50% (Bill Beyers' estimate for how much Key Arena spending is substituted though that's countywide, there are also reasons to believe it's an underestimate since it doesn't account for out-of-towners who would be spending their money in Seattle while on vacation regardless)"

Beyers did not estimate 50% substitution effect. What Beyers said was that 50% of the money spent at Key Arena came from out of town. Just because 50% of the money then came from IN TOWN does not mean that 50% is substituted. To assume that would be a very gross error. There is possibly a 10% substitution effect ON THAT 50% coming from in town (in King County). So that would be a 5% substitution affecting the whole county. As you mentioned, not all of that substitution effect would hit Seattle coffers; a lot of fans come from Auburn, Federal Way, Belleuve, Shoreline, etc. So even less than 5% substitution from city of Seattle.

10% substitution effect is a common figure used by economists. I see no reason to poo-pooh that figure.

"Hansen would get to keep $15.1 million in incremental property taxes on the arena site. Again, if raising property values in SoDo reduces them elsewhere, some of this could be cannibalized from elsewhere, but this is likely to be such a small effect that I wouldn't bother worrying about it. Let's call it $0-1 million in cost and move on."

Hansen will pay, by my crude calculations, $300K per year in estimated leasehold exise taxes, which amounts to $9 million in such taxes over 30 years. This is supposed to supplant what he would have paid in property taxes if he were the owner of the land & building. So at the very least, you should subtract $9 mil from your $15 mil prop tax figure. Also not sure where that $15 mil figure came from?

"Hansen is giving the city about $50 million worth of SoDo land as part of the deal (technically the city is buying the land, but with the same rent and tax payments mentioned above, so it doesn't really cost them anything). The catch, of course, is that the city doesn't get to use any of the land until 30 years have passed and Hansen's lease expires (and the by-then-obsolete arena is demolished, at a cost of around $30 million). Depending on whether you expect SoDo land to wildly appreciate between now and then, and how you discount present value of land 30 years from now, let's say this is a benefit to the city of between $20 million and $40 million."

UM! The land appreciating at 4% per year (which is a highly conservative estimate) at a starting equity of $50 mil garners $162 mil after 30 years. Minus your high figure of $30 mil for demolition (most figures are lower, man), you get $132 million in profit for the city/county.

Other estimates of annual appreciation are 5% and 6%, given that we are talking about land in a specially zoned area that is one of the only areas into which downtown seattle commercial, retail and residential can grow. Look at the past if you want to check the appreciation numbers.

5% growth yields $216 million after 30 years. Minus your high estimate of $30 mil for demolition, that yields $186 million for the city/county.

6% appreciation rate yields $287 million after 30 years. Minus your high estimate of $30 mil for demo, yields $257 million for the city and county. Free money baby!

Speedcat:

Your math only works if you discount inflation and the general drop in purchasing power of a dollar. I note your 'demo cost' numbers are in 2012 dollars, not 2042/2047...

It sounds impressive. But in the real world, the land under the (prospective) arena will be worth precisely what someone is willing to pay for it in 30-35 years.

So Hansen considers this an endorsement ?

www.sonicsarena.com/news/a-leading-arena-critic-on-the-sonics-arena-proposal

Speedcat: I have no idea where you're getting your 10% substitution effect - not only is it not a "common figure used by many economists," it doesn't even make sense to talk about a flat substitution rate, as the wider you draw the circle, the higher the substitution. (In the extreme case, the substitution of arena spending on the entire U.S. would be close to 100%, because how many people are going to drive down from Canada just to see a game?)

On leasehold excise taxes: Those are getting kicked back to pay off the arena bonds, so they're not a net gain to the city. $15m figure is from here: www.fieldofschemes.com/news/archives/2012/06/4970_estimating_seat.html

On land value, as John Bladen notes, you forgot to discount to current dollars. Getting something worth $132m in 2042 is not the same as getting something worth $132m today. (And if you disagree, I have a no-interest loan I'd like to arrange with you...)

Hi, I guess I am just not seeing how the land that Seattle will purchase,as per Sections 8 and 10 of the Seattle MOU, for the Arena Review Panel estimated price of 100 million dollars, with "cash" acquired from a #more than likely, unspecified in the MOU# general obligation bond issue,could be called Hansen giving Seattle the land.

The MOU specifies that Seattle pay the MOU identified Delaware incorporated LLC the estimated 100 million dollars in "cash" in one sum to purchase this land. I am not seeing Hansen "giving" Seattle anything on the land sale.

There would also be the Occidental Avenue right of way/easement vacation. This would be Seattle "giving" to Hansen as the MOU specifies that Hansen must have the site in his possession before the proposal may move forward.

There is also the MOU engineered artificial inflation of the land's value, and the MOU engineered captive buyer for the artificially inflated land, Seattle. Compare the reported price that Hansen has payed to purchase the properties #at least the ones that are known# to these properties last assessment. Hansen already has overpayed for these properties. The MOU engineered land purchase, while the land is at the highest inflated value, is Seattle giving to Hansen.

It is strange that this binding MOU does not have a concrete figure for price of the land. Some future appraisal by some consultant appraisal group? What is that. That is another gift from Seattle to Hansen.

Then in discussions about tax revenue during construction, and throughout the 30 year length of the proposal. Section 19 of the MOU mandates that Seattle must actively work with the proponents to assist them in tax avoidance at the State, and Federal level, and any other level of government. How much is this tax avoidance to be over the 30 years? Where is Seattle's cut of these probable 10's of millions of dollars? Not in the MOU. This is Seattle giving to Hansen.

Anyway, to the land sale. Projected future rent does not mean that Hansen is "giving" Seattle any land. Seattle would be buying this land. Seattle would be going into debt for this land. Seattle taxes would be used to pay debt service on this land. Seattle would have to pay to pay Hansen, and pay over double the already artificially inflated price of the land. No, "giving" from Hansen here, just profit to Hansen from Seattle public funds.

It is a stretch to call the projected rent Hansen would pay as Hansen giving Seattle the land. Rent is not giving. The land would be bought and payed for by Seattle with cash in one sum as mandated in the MOU. Rent would be rent, no giving involved. I do not wish to criticize hurtfully; but the choice of wording in the land section of your article # is that the right word? or is it post?# is not accurate, and is misleading. There is no giving from Hansen on the land sale to Seattle.

If Hansen were building this without any deal with the city, he'd just keep the land and pay no rent on it. (He'd pay property taxes, but that's included in the calculation above.) Instead he's "selling" the land to Seattle, but all the payments on the land purchase are being paid off either by Hansen's rent payments or by kicked-back arena taxes (again, included as a subsidy above).

Basically, what's happening here is Hansen is trading off future control of the land for about $100m in tax breaks. (And for a cheaper borrowing rate, of course.) That's not the super-awesomest deal in the history of the world, but given that there's *some* small positive economic impact for Seattle from an arena, it ends up pretty close to break-even.

Could Seattle negotiate a deal that cuts down on Hansen's subsidies and actually leaves the city turning a real profit? They could certainly try. Is this deal worth doing even if they can't? Depends on how much you value the return of an NBA team, and how strict you want to be about not giving subsidies to developers under any circumstances.

I do not mean to belabor this; but if one purchases a house with ones own money (including borrowed money),and one then rents out this house, it does not mean that the individual, who rents the house, is giving one the the house.

Hansen would pay rent on land that he did not own, and would encumber for 30 years. Hansen paying rent can not be called Hansen giving Seattle land. Giving Seattle land would be Hansen going down to the courthouse, and signing over the deed to the land at no cost to Seattle.

The fact that the MOU mandates that Seattle pay Hansen for this land in cash in one sum means that the land is no gift from Hansen. Rent does not equate to a gift. Let's say Seattle purchases the land, and then something happens and Hansen, et al withdraw from the picture; Seattle then has this land to rent, Seattle rents this land to twenty different small businesses. Now, would the twenty small businesses be "giving" Seattle this land?

I do not mean to belabor this; but if one purchases a house with ones own money (including borrowed money),and one then rents out this house, it does not mean that the individual, who rents the house, is giving one the the house.

Hansen would pay rent on land that he did not own, and would encumber for 30 years. Hansen paying rent can not be called Hansen giving Seattle land. Giving Seattle land would be Hansen going down to the courthouse, and signing over the deed to the land at no cost to Seattle.

The fact that the MOU mandates that Seattle pay Hansen for this land in cash in one sum means that the land is no gift from Hansen. Rent does not equate to a gift. Let's say Seattle purchases the land, and then something happens and Hansen, et al withdraw from the picture; Seattle then has this land to rent, Seattle rents this land to twenty different small businesses. Now, would the twenty small businesses be "giving" Seattle this land?

There is no way on earth Hansen would be paying $7 million a year in rent on whatever sliver of land isn't his already. The "rent" is just a way for Hansen to pay off part of the bonds.

If you prefer to look at this as an actual land sale, though, then Seattle is spending $100 million for the land, then getting $7 million a year in rent on it - enough to pay off the entire $100 million with interest. That's like buying a house and having the seller agree to rent it back from you for enough money to pay off your entire mortgage.

The land sale mandated in the MOU is a land sale. So, I do look at this as a land sale. This is about business to me, not sports. The MOU details a land sale, down to an assessment,what the form of payment for the land would be, and the day that this payment would go to WSA Properties III LLC. Hansen sure considers this a land sale, it would behoove Seattle to consider this a land sale also. That rent on this land is earmarked to pay back bonds makes no difference. It cannot be said that Hansen is giving Seattle the land. No more than it can be said that tax revenue payed at the proposed arena would be Hansen paying off bonds. The word "gift", and "giving" has been used a lot over the last few months in Seattle in regards to Hansen. The MOU has Hansen giving Seattle nothing. Seattle pays for the land, and then Seattle forgoes tax revenue at the proposed arena. Hansen won't even be paying Seattle general fund taxes. The giving is from Seattle to Hansen. Anyway, this is just how I think about it.

"Your math only works if you discount inflation and the general drop in purchasing power of a dollar. I note your 'demo cost' numbers are in 2012 dollars, not 2042/2047..."

Wait a minute. So you're saying you've discounted inflation in your numbers which were (from memory here) $20 to $40 million? How is the land worth LESS than it is today in 30 years? Makes no sense, even if you do add in the somewhat questionable reduction based on inflation.

jhande, it's pretty simple. Yes Seattle buys the land, using councilmanic bonds. Then that purchase debt gets paid off over 30 years by the arena. So Seattle is really only loaning money here. Their payoff for said loan is ownership of the building and land.

Many folks think the building will be a tear down in 30 years, despite the requirement in the MOU that it be kept up to NBA standards during the entire lease. The upgrades of course would be paid by ArenaCo, not by the city.

But even if you consider the arena to be valueless after 30 years, the land should have major value. I don't see why Neil and others want to take inflation out of the numbers. Why? Because inflation has not been removed from any other numbers in this deal & discussion.

If we are to do the inflation thing, why don't we consider the benefit then of having a fixed rate loan over 30 years and paying it off every year with increasingly cheaper dollars? Why don't we do a straight line increase on ticket costs over 30 years and include those revenue "gains" in the analysis? Using inflation now is like picking your favorite facts and ignoring the rest of the facts to make your argument. It's simply not accurate or fair.

I include inflation, but I also discount the value back to current dollars. If I promise to give you (say) $132 million in the year 2042, that's not worth $132 million to you right now. It's worth whatever you'd have to have now in order to stick it in the bank or the stock market or whatever and end up with $132 million in 2042.

Neil,

Do you feel that City of Seattle should tear down the Key Arena now or in the near future? I mean it's not NBA compatible, we know that. And it's footprint won't allow NHL. So in that sense, it's somewhat obsolete. I guess they made a profit last year. There is no debt on the building since the City accepted the settlement that sent our Sonics out of town in return for $45 million. Should we tear it down?

It's "not NBA compatible" by David Stern's standards, but I guess his are the only ones that count.

I don't think they should tear it down, but if they build a new arena I think they'll eventually have to, since I don't expect Seattle can attract enough arena-size events to fill two buildings. The question of what an arena is worth after 30 years isn't just about whether it's still a good building; it's about whether anyone will pay you to buy it, which depends as much on whether there's a new arena ready to take its place as anything else. And in 30 years, unless things have changed for the better in the workings of the sports industry by then, I pretty much guarantee you that the neo-Sonics will either be getting a new arena or demanding public improvements to the old one.

The Gift is the almost 300 mil in building costs in order to secure a tenant for the New Seattle Arena. Maybe even 2 tenants. NHL and NBA. The city buys a piece of land and has an automatic tenant with a few of the richest guys in Seattle, Nordstroms and Ballmer basically signing the lease.

No brain'r

The incremental property tax thing isn't just ArenaCo's property taxes being used to pay the arena... it's ArenaCo being taken off the "payment due" list and all the remaining property tax payers have to pitch in to cover the ArenaCo property tax bill amount. Then those payments get used to pay $35M in ArenaCo debt service ($15M NPV). It's kind of doubling up the tax credit.

No, that's not correct. The increased property taxes on other Seattle property owners go into the general fund, not to pay off the ArenaCo debt service:

www.fieldofschemes.com/news/archives/2012/06/4976_seattle_arenas.html

It's still a subsidy, but not a double one.

So how does a city/county owned arena property, which because of the public ownership doesn't pay any property taxes, get credited as making property tax payments to the arenaco debt service (which is bonds paid from monies transferred out of the general fund)?

clerk.seattle.gov/~public/fnote/117480.htm

Is the city just saying "if you did owe property taxes, you'd pay this and we'll make the payments for you..." out of what ? Or is it property tax assessments based on the ArenaCo owned improvements like scoreboards, etc ? It takes a lot of stadium to make a $800k yearly property tax bill.

My understanding of the MOU is that Hansen would continue to own the arena itself for the course of the lease, just not the land under it. The property tax rate in Seattle is about 1%, so all you'd need would be an average valuation of the arena at $80 million to get $800,000 a year in property taxes.

Neil, the Transfer day occurs when the arena is built/teams are ready to move in and the city/county takes ownership at that time, they just have a standing lease agreement with ArenaCo. It's also the time when the City/County transfer the remaining bond money to cover the facility construction.

The date that title to the Arena Facility transfers to the City and County is referred to as the �Transfer Date.� The Transfer Date will occur on the day following the date when the Arena Facility is added to the property tax rolls or such later date, not to exceed 180 days thereafter, that ArenaCo may request. ArenaCo will lease the Arena Facility from the City
and County or sublease from the City and County or trustee, as the case may be (�Arena Lease�), on the Commencement Date.

On the Transfer Date, the City and County will pay ArenaCo an amount equal to the principal component of all lease payments due under the Lease-Purchase Agreement, as they may be adjusted, or if the City and County have appointed a trustee with respect to certificates of participation in lease payments, then the City and County will cause the trustee to pay to ArenaCo an amount equal to the principal component of all lease payments under the Lease-Purchase Agreement. In either event, the City and County (or a trustee on behalf of the City and County) will purchase the Arena Facility from ArenaCo as provided in this MOU.



The largest plot of land he's purchased (the warehouse half of the site) has a 206k yearly tax bill with the following distributions. Using the City/County % there would require about a $200M property... give or take.

Distribution Information Dollars Percent *

State $46,765.76 22.7%

Local School $46,344.35 22.5%

County $27,331.46 13.3%

City $63,249.16 30.7%

Then somebody screwed up royally, because the cash flow spreadsheet I have from the city indicates $62.5m in new construction, 100% privately owned, at a 2-3% tax rate, for the course of the lease.

Let me see if I can find out what's going on here.

Good luck Neil. There's a lot of stuff to wade through as this deal is pretty different from most stadium construction plans.

Before you spend too much time trying to find my numbers, I screwed up and only got the $800k figure from the city... the city and county total is just over 1M when the transfer date occurs in year 3. Those % would indicate around a $230M assessment. This is using the post-MOU financing structure.

clerk.seattle.gov/~public/fnote/117480.htm

I guess there could be practice facilities and such that ArenaCo would own.