Oakland mayor on Raiders stadium: We’ve got better things to do with our money

Add another mayor to the growing list of those speaking out against throwing public money at local sports teams without, like, a good reason:

“That money we’re paying now is general-fund money we could spend on police, parks or libraries,” said Oakland Mayor Libby Schaaf, who has said she cannot support spending a dime of public funds for a new stadium.

This is the strongest statement that Schaaf has made to date against subsidizing a Raiders stadium plan — back when first elected in January she said the Raiders and A’s should be asked to bid for the land they both want — and while it provides plenty of wiggle room (is public land the same as public funds?) it’s certainly a strong indication that she, like Anaheim’s Tom Tait, Minneapolis’s Betsy Hodges, and Calgary’s Naheed Nenshi, doesn’t see a political downside to standing up to local sports owners’ subsidy demands. Which is probably accurate, at least if you’re going by mayors being punished at the ballot box (being punished at fundraising time is another story), but there does definitely seem to be a mini-trend going on here. Will be very interesting to see if it spreads, not to mention how hard a line the Gang of Four are willing to take if teams start busing in commissioners to threaten that they’ll move — though the Raiders are already there and Schaaf doesn’t seem overly concerned.

Commissioners gotta commissioner: Silver says “upgrades” needed for Cleveland to host NBA All-Star Game

Hey look, everybody, a sports league commissioner has used the promise of a major sporting event as a carrot to demand arena and/or stadium upgrades! That’s surely never happened before!

NBA Commissioner Adam Silver said the only thing that would prevent the city of Cleveland from hosting an NBA All-Star game is failing to make improvements to Quicken Loans Arena.

“They’ve expressed interest in it and we’re waiting for them to get the additional work done on the building,” Silver told Northeast Ohio Media Group during Game 2 of the Eastern Conference Finals…

“It really comes down to when are the upgrades going to made to the arena,” Silver reiterated.

Cavaliers owner Dan Gilbert has been asking for public money to upgrade the team’s 21-year-old arena, because the public money he got last year at this time wasn’t enough, or something. So Silver just did him a favor by delivering a promise, or a threat, or a promise-threat, in the hopes that Cleveland officials will get all exciting about the possibility of an NBA All-Star Game without checking to see whether other host cities have actually benefitted from them one bit. Because that’s what commissioners do.

In totally unrelated news, the NFL has said that it will maybe consider holding the 2020 Super Bowl in Los Angeles, if there’s a stadium and a team in place there by then. Must be nice to be the kid with the new car everyone wants to ride in.

Are NFL stadium subsidies really falling? Here’s a chart that won’t help answer that at all!

The San Diego Union-Tribune (officially re-rebranded as of last week, though its domain name hasn’t caught up yet) has been running lots of lots of news articles about the Chargers stadium plan, too many to take in all at once. Let’s find a promising one: How about Saturday’s “Why the Chargers need cash to stay,” which promises to explain the reasons that San Diego citizens should be putting up between $650 million and $ 1.15 billion when the team is willing to build a stadium in Carson for far less in subsidies? Let’s begin:

When it comes to financing new NFL stadiums, think of the Great Recession as halftime in a one-sided football game poised for a big shift in momentum.

I’m sorry, my brain just broke. Enough with the forced sports metaphors, people!

The upshot of the article appears to be that until 2006, the public spent a lot of money on NFL stadiums, but “since 2010, when the New York Jets and Giants built their own new stadium, the trend has clearly moved toward more hefty private contributions.”

Really? The chart that the U-T includes with its article indeed shows several stadiums with larger private costs in recent years (Dallas, New York, Atlanta, Miami, Santa Clara):

stadiumpriceonline-01_t837But that’s a bit misleading: Atlanta’s public cost is listed at $200 million rather than the $554 million that is more accurate, and Dolphins owner Stephen Ross is getting around $100 million in public subsidies toward his own stadium work, which isn’t even a new stadium at all, just a renovation. Take that away and the main trend is that NFL stadiums have gotten way more expensive, and team owners have largely covered that additional cost, while public expenses have remained pretty consistent.

And why have costs soared? The U-T notes that “owners now want the biggest and best so they can command even higher premiums from well-heeled fans and corporations,” while economist Victor Matheson credits this to “stadium envy.” It’s unclear whether this means owners are earning their money back on more expensive stadiums (in bigger markets, at least) or just trying to keep up with the Joneses, but that’s okay, because it genuinely is unclear which is the case, especially for stadiums that haven’t opened yet.

The U-T’s conclusion, meanwhile, is that cities aren’t throwing money at NFL teams anymore, but that’s because only big cities are building NFL stadiums, so San Diego still needs to throw money at its team. That’s pretty much wrong on all counts (Atlanta and Minneapolis are big cities?), but it’s right enough in a couple of cases (New York, Santa Clara) that it’s good enough for newspaper work, and ducks asking questions about whether the proposed public expense for a Chargers stadium is either worth it or necessary to keep the team in town, or just a number that a bunch of local CEOs picked out of a hat in hopes it would make the team owners happy. But there are lots more U-T articles out there to be written — why look, here’s one on how a public vote is needed to prevent the “threat” of a referendum drive that could “stall” the stadium campaign — so I’m sure they’ll get around to the actual finances of the financial plan eventually.

Seahawks owner expresses “concerns” about not-anywhere-close Seattle arena, this is news, people

Citizen responses to environmental impact statements are usually among the most academic of exercises — you file them, they go in the back of the final report, and no one ever reads them again. Unless, that is, you’re a citizen who owns the local NFL team:

Paul Allen’s First & Goal Inc., which oversees all operations at CenturyLink Field, expressed serious concerns about the proposed sports arena that could house NBA and NHL franchises in Seattle’s Sodo neighborhood…

“It was anticipated that the EIS regarding the arena would resolve many of our questions and concerns,” the letter stated. “Unfortunately, after reviewing the FEIS and the most current version of the Arena proposal, we continue to be troubled that the arena has not yet disclosed and the city does not yet know how the proposed arena will fit within the existing stadium district or how it will mitigate many of its potential effects.”

Allen hasn’t previously complained about Chris Hansen’s proposed Sodo arena — unlike the owners of the Mariners, who’ve griped about it causing traffic problems — and the Seahawks owner insists that he’s still supportive of the plan, despite his concerns. But it still has the Puget Sound Business Journal asking what Hansen will do with his downtown land if he doesn’t build an arena on it. (Answer: sell it to somebody for commercial development, say two commercial realtors.) Not that Hansen is ready to break ground on this thing regardless — he still doesn’t have a team to play in it, for starters — but it sounds like now the media is developing an exit strategy for him, whether he wants one or not.

Milwaukee arena reporter Don Walker has passed away

I’ve poked a lot of fun at the Milwaukee Journal Sentinel’s Don Walker in recent months — most memorably for this — but he’s done a bunch of good reporting as well, all part of his assignment to cover the Bucks arena deal on a daily basis. And even if he hadn’t, it still would have been a shock to see this just now:

No word yet on the cause, though Walker was still tweeting as recently as last night, so presumably something sudden. (From his college graduate date, it looks as if Walker was in his early 60s.) Our condolences to his family and friends, and respect to someone who clearly cared a lot about reporting on the sports-business world, even if we came at it from very different places.

Chargers owner on $650m+ stadium subsidy offer: “Haven’t read it yet, is it good?”

If you’ve read the San Diego Citizens’ Stadium Advisory Group’s proposal for a new Chargers stadium, that puts you one up on Chargers owner Dean Spanos, who apparently hasn’t had time to actually read about how much money the task force is offering to throw at him, because it’s 42 pages and he’s busy, guys:

“I have not seen the actual report,” Chargers chairman Dean Spanos said Wednesday before departing the league’s two-day owners meetings here. “I’m going back today, and I’m going to look at it this afternoon.”…

“I think they submitted some sort of framework of a potential financing plan,” Spanos said of CSAG. “That’s what we’re going to take a look at this week … I’ve always said, and I maintain the fact we want to stay in San Diego. We’re committed to keep trying to see if there is a viable solution. It has now come down to a financing plan, so I am anxious to see what the city puts forth.”

Now, there are several possible explanations here. One is that Spanos was just so busy with the NFL owners meetings (new extra point rules, everybody!) that he didn’t have time to read anything. Another is that he’s read it and still has too many questions — about all those details “to be negotiated,” perhaps — that he doesn’t want to comment just yet. Or he’s waiting to talk to financial people who can tell him exactly how much money he’d get out of the deal. Or he’s sick of this whole thing and wants his sons to be the ones to answer questions from now on.

Whichever it is, it’s slightly weird for the owner of an NFL team isn’t responding to an offer of possibly close to a billion dollars in subsidies that he’s been waiting on for months. But not any weirder than an NFL owner not picking up the phone to listen to stadium subsidy offers. This whole L.A. move threat game is all a complex stew of gamesmanship and personal idiosyncrasies, so it’s probably best not to read too much into anything, at least not until Spanos has decided whether the in-flight movie is more interesting than the stadium proposal that could determine the fate of his team and his bank balance.

Cubs owner buys three more rooftops, has brief respite from “Wrigley Field is health hazard” news

Chicago Cubs owner Tom Ricketts is continuing to solve his ongoing disputes with neighboring rooftop owners over his video board spite fence by just buying them out: Ricketts picked up another three buildings with rooftop views of Cubs games this month, bringing the total he’s bought to six. (Three holdouts are still suing him over their obstructed views.) As expected, this whole rooftop lawsuit kerfuffle is mostly coming down to how much Ricketts will have to pay to buy everyone out, and as sale terms haven’t been disclosed, we can’t even keep score at home.

Meanwhile, in more Cubsy news, the Cubs’ concession stands have been hit with health code violations, including “MEN’S RESTROOM ON THE LEFT FIELD SIDE IN THE UPPER DECK HAS NO HOT WATER” and “FOUND COLESLAW AT 45F INSIDE THE 1-DOOR REFRIGERATOR.” Which is probably par for the course with these inspections, but Ricketts still must cringe these days whenever he sees a news story with “Wrigley” and “restrooms” in the same sentence.

Garber, Beckham, to meet with soon-to-be-retired person to discuss joint soccer-football stadium

MLS commissioner Don Garber, former soccer star David Beckham, and University of Miami president Donna Shalala are scheduled to walk into a bar meet later today to discuss a possible joint project to build a stadium for Beckham’s MLS expansion team and UM’s football team. Here’s how it would work, per the Miami Herald:

[Shalala] said she would favor a 40,000- to 44,000-seat venue, which would be larger than the 25,000- to 30,000-seat stadium MLS officials prefer but probably a size the league could live with. Shalala also happens to be a huge soccer fan. She is a member of the U.S. Soccer Federation board of directors…

UM would be willing to consider contributing toward construction costs, [a] source said.

That’s somewhat promising — if UM and Beckham’s team were both getting use out of the same stadium, they might actually be able to cobble together enough money to build the thing. Not that anyone knows how much money it would take to build the thing. Or where it would go — the leading site is the spot next to Marlins Park that is currently the site of public ballfields, that may not have enough room for a soccer stadium let alone a larger football stadium, and that could require tens of millions of dollars in tax breaks and discounted land. Also, Shalala is retiring as UM president next month, so while it would no doubt be nice for Beckham and Garber to get her blessing, it’s not like she’s going to be around for negotiations. But hey, sometimes you gotta take your momentum where you can find it.

Bucks arena talks prove fruitful at finding new, vaguer ways of expressing optimism

Another week, another set of closed-door meetings about the Milwaukee Bucks arena funding plan, another batch of news articles filled with nothing but quotes from participants expressing vague optimism:

WISN 12 News reporter Kent Wainscott was told that some funding questions still need to be resolved, but a couple of the participants told him after the meeting that they believe a deal may be closer than it has been to this point.

And:

“I’m confident we will get to a solution,” [Bucks President Peter] Feigin said. “We are happy the Bucks are involved in that solution.”

This is barely news on the best of days — “People Trying to Negotiate Thing Express Confidence That Negotiations Will Be Successful: Film at 11″ — but even less so given that everybody at these meetings just expressed the exact same platitudes three weeks ago. A better headline might have been “Chris Abele, Bucks express same optimism on arena deal as they’ve expressed through last month of so-far fruitless meetings.” (It’s wordy, I know, but think how it’d do on social media!)

Come on, Don Walker of the Milwaukee Journal Sentinel, didn’t anybody say anything about where the money would actually come from?

Asked about the substance of the talks to date, Feigin said negotiators were trying to figure out the revenue streams a new arena would produce, what revenue would result from ancillary development and how that would be allocated.

“That is the crux of what we are trying to figure out,” he said.

So, city, state, and team negotiators trying to figure out how to pay for a Bucks arena are focused on whether it would make any money, and who would get it. Film at 11.

San Diego stadium plan could include half billion dollars in hidden subsidies, depending on fine print

Yesterday I got a lot of questions from newspaper and radio reporters (including one who introduced himself as from the “San Diego Union-Tribune” — I congratulated him profusely on the restoration of their rightful name) about the new $647 million Chargers stadium subsidy plan and whether there were any hidden risks for the city. I mostly replied that $647 million is a plenty big risk in itself, but now the Voice of San Diego thinks it’s found as much as another $352 million in additional subsidies:

  • $217 million to $327 million in future operations and maintenance costs, based on estimates that running Qualcomm Stadium costs the city between $7.2 million and $10.9 million a year. “It’s a significant issue,” Erik Bruvold of the National University System Institute for Policy Research told VoSD. “That’s another general fund subsidy.”
  • $20 million to $25 million for a new park on the stadium site, which would be paid for with “potentially state and federal funding,” according to Citizens Stadium Advisory Group member Mary Lydon.

Now, there’s no doubt that maintenance and operations costs are a huge hidden cost of stadiums — and new ones, with more moving parts that can break, typically run even more to maintain. The question now is, is this something the city would really be on the hook for, on top of that initial $647 million in cash and land? Let’s look at the proposal itself:

To pay for the proposed stadium, parking, stadium-related infrastructure and operations and maintenance, CSAG’s financing plan includes 60 acres of land from the City of San Diego valued at $180 million, and more than a dozen funding sources that exceed $1.4 billion

So the implication there is that future operations and maintenance costs would be covered by the initial $1.4 billion, which includes the $647 million from the city and the rest from the team (assuming you count things like NFL funding and naming-rights revenue as “from the team”).

Anything else?

The City, County and Chargers should share the costs of operations and maintenance. These costs will rise over time so payments should be indexed to inflation.

Now, “share” is an incredibly nebulous word — 90% team and 10% city is a share, and so is 10% team and 90% city. What appears to be going on is that the task force has estimated $1.154 billion as the cost of a stadium plus related infrastructure, coming up with $1.4 billion in revenues, and hoping that the difference will be enough to fund future operations and maintenance costs. (Here “share” would mean “paid for out of the big pot of money that both the Chargers and the city are throwing cash into.”) That’s certainly conceivable — the remainder would be $246 million, which is toward the low end of VoSD’s estimates — but it’s more than a bit worrisome that the task force report never actually spells out how much it’s actually budgeting for maintenance and operations, not to mention that elsewhere it proposes using a chunk of this excess money to pay off Qualcomm’s remaining $52 million in debt.

Plus, under the heading of “creating revenue streams to help the City and County recoup capital costs and pay for operations and maintenance,” there are additional subsidies not mentioned in the first $657 million, including $116 million for an “Enhanced Infrastructure Financing District (a TIF by any other name) and $40 million in hotel taxes from a potential new hotel. And again, the task force appears to be double-dipping here, as elsewhere this money is designated for infrastructure for the hotel and other development, not for stadium operations.

So depending on what exactly the plan means — and it’s worth noting that the whole maintenance and operations piece is listed under “Recommended terms for negotiations with the Chargers,” which makes it even less set in stone than the rest of the proposal — we could be looking at anywhere from $647 million to $1.155 billion in public subsidies for this deal. That’s an awfully wide range, and no doubt one reason why NFL commissioner Roger Goodell responded with a “let me get back to you on that” when asked what he thought of the proposal. Though he could also have realistically gone with “Somewhere between $600 million and over a billion dollars in free taxpayer money? Mmm, yeah, that’s why I got into this business.”