Alameda County says it won’t even think about A’s tax kickback district until fall, [record scratch sound]

One of the tricks to extracting stadium subsidies for a sports team owner — or any corporate executive, really, but this site is about sports teams because way back in the day Joanna Cagan and I decided “corporate welfare” was too big an issue to cover in one book — is figuring out which level of government to hit up for money. In the U.S., you generally have at least three options: city, county, and state governments, which you can often cycle between to see which one will give you the best deal. Minnesota Twins owner Carl Pohlad, for example, spent a solid decade going back and forth between the three levels of government in Minneapolis, before landing on a deal that only required four out of seven county commissioners to vote to spend county money, while the state legislature just had to okay it by a bare majority but not supply any actual cash.

(That story is in the book, by the way. For similar stories about non-sports entities, you’ll want to check out Greg LeRoy’s book.)

All this is complicated if you need approval from two different jurisdictions that would both have to cough up subsidies for a stadium or arena plan. So if you’re, say, the Oakland A’s, and you’re proposing an $855 million tax kickback that would come out of both city and county coffers, you’ll definitely want to be sure you have both levels on government on board before oh whoops:

Following a long and contentious meeting Tuesday, [Alameda County] supervisors said they won’t even schedule a vote until September on Oakland’s request that the county support the idea of forming a tax district to finance the infrastructure needed for a ballpark and the mixed-use development that eventually will surround it…

County supervisors sharply rebuked the city for not inviting them to the discussion sooner, noting that two weeks is not enough time to analyze the complicated financing plan.

After years of not being “brought to the table,” board Chairman Keith Carson said, “now we’re being told to decide in 20 days.”

Well, that’s a fly in the ointment! A’s president Dave Kaval has been insisting that the city of Oakland sign a non-binding term sheet on July 20, and making ostentatious trips out of town to make sure everyone knows he has a space laser could try to move the team if he doesn’t get his way, but it won’t mean much if the county isn’t on board.

Kaval’s stadium plan, as discussed here before, would involve siphoning off all property taxes above those collected now in a pair of “infrastructure financing districts” (better known nationally as tax increment financing, or TIF, districts) covering a huge swath of downtown Oakland:

The smaller district, which covers just the area A’s owner John Fisher wants to develop, is projected to generate $495 million worth of tax revenue that would go to the team; the larger one would kick in another $360 million. (Presumably this is because more new development, and so more new property taxes, would be concentrated in the smaller district; I haven’t seen any details on what happens to the funding stream if Fisher stops building once he’s done with the stadium, which his term sheet would allow him to do.)

The smaller district is the one the county would be losing tax revenue from. According to the East Bay Times’ report, “Oakland’s consultant” (not named) has estimate that the county would bring in more new tax revenue from the district than it loses to Fisher, clearing about $6.3 million a year. (No word on whether this accounts for development there cannibalizing development that would otherwise take place elsewhere in Alameda County, which is a thing that has come up in other cities.) As for the bigger, city-only tax district, Oakland Assistant City Administrator Betsy Lake said on Tuesday night that it doesn’t seem to be “fiscally responsible,” which is city administratorese for you want us give you all the taxes from what, now?

Kaval declined to comment on the county’s decision to put off a vote, even though it would seem to throw a huge wrench into his plans to have a deal in place next month or else start looking into taking the team and leaving town. He does have another trip to Las Vegas scheduled for next week, though, so presumably he’s hoping that plane trips speak louder than words. He might want to lay off the tweeting this time, though.

 

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12 comments on “Alameda County says it won’t even think about A’s tax kickback district until fall, [record scratch sound]

  1. The county needs more time to do an analysis they should have done at the time HT was going forward (about 2 years ago)? I call it narrative building. “John Fisher and the A’s are the bad guys here. They won’t give us time to be responsible fiscal stewards” A get out of jail free card.

    And we’re suppose to believe Vegas doesn’t have something cooking

    1. As noted above, the county tax-kickback plan was only released in late April. It would have been tough for the county to do an impact analysis of that before they knew about it.

      1. NdM is on point! AlCo didn’t have any interest in joining this endeavor; FWIW they’re done with the sports business. It was poor @$$ Oakland who came begging, I MEAN, asking for the county’s help in financing this fantasy. Again, if I’m AlCo, I’m telling the city of Oakland to kiss my civic @$$!!!

  2. I believe this will be The A’s new theme song: “A fortune, won or lost on every deal, all you need is a nerve of steel, Viva, Viva Las Vegas.” ( Elvis Presley).

    1. Or ZZ Top. Which would tie in to an “A’s to San Antonio/Austin done deal says person with detailed knowledge of situation but unable to comment on record” lead.

      1. “Breaking News!” Yes!!!!!

        Will glue myself to my favorite cable channel for further details, hourly updates.

  3. I would not go so far as to suggest the city is attempting to manipulate the county here… never deploy an explanation of cunning when one of utter incompetence will do.

    That said it is really stupid of the city to try and make their failure to plan/set reasonable timelines for this or any other project the county’s problem to deal with.

    You’re asking them for hundreds of millions of dollars for something they likely see little value in, and demanding an answer within 30 days while providing little or no information on which to base their decisions (not that I think the county would rely on anything the city of Oakland told them).

    “You need an answer by mid July on whether we’ll give you several hundred million dollars? Sure. NO, we won’t. Anything else we can help you with today?”

    Is the county involved for any reason other than that Oakland doesn’t have the money to do this? What benefit would they get from paying for the A’s at HT?

    1. The county wouldn’t get any benefit and would have to siphon off taxes from non-Oakland Alameda County residents to pay for it.

  4. Considering that, not long ago, the city was suing the county for selling its 50% interest in the Coliseum site to the A’s without giving Oakland its right of first refusal… this is unsurprising.

    There’s a big billboard on the 580 approach to the Bay Bridge with an anti-Howard Terminal message, bought by the East Oakland Stadium Alliance (which may or may not be affiliated with that mysterious second bidder for the *city’s* half of the Coliseum site).

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