The stadium and arena subsidy game is definitely heating up again after its annual summer lull, what with six news items already this week and lots more to cover in the week-end roundup:
- Buffalo Bills and Sabres owner Terry Pegula’s net worth jumped from $5.7 billion to $6.7 billion in the last year, a year in which he got a little over a billion dollars in stadium subsidies from the state of New York and Erie County while committing to pay nothing at all himself after factoring in NFL money and personal seat license sales. It’s probably not a direct one-for-one relationship — just because he’s getting $1 billion worth of stadium paid for by someone else doesn’t necessarily mean Pegula will see $1 billion worth of added revenues — but if you want your takeaway to be “billionaire gets $1 billion in public money, becomes $1 billion richer,” by all means don’t let me stop you.
- In related news a scientific survey of whichever Bills fans happened to post to Twitter found that they think the team’s new stadium designs are “unbelievably Mid” and lack “the ‘Wow’ of the new Tennessee Titans’ stadium drawings.” Like, this is Wow? Maybe Buffalo fans really get off on transparent roofs, though given that one demanded “a stadium with as much character as it’s [sic] fan base,” maybe they’re just upset there’s no futuristic area for jumping through folding tables.
- The Tempe city council could vote in November on approving a new Arizona Coyotes arena involving $200 million in sales-tax kickbacks plus additional property-tax kickbacks, which is a little sudden given that just two weeks ago team officials said they were “still in the negotiation phase,” but okay. Will there be any public hearings first? Arizona elected officials don’t generally like to play that way, but we shall see.
- The city of Allentown has turned down the Lehigh Valley IronPigs owners’ demand for $1.5 million in COVID relief money, with team execs saying it could force the team to move out of town. Given that the IronPigs owners are already getting $6 million in state and county money toward $10 million in renovations that they say MLB is requiring, threatening to leave town thanks to having to maybe cover an extra $1.5 million themselves is maybe just a tad hyperbolic, but it does show that MLB’s takeover of the minor leagues continues to work gangbusters in letting team owners threaten “MLB will take your team away” instead of “We’re gonna take your team away.”
- There’s another potential Tampa Bay Rays stadium site in Tampa, though the Rays’ potential development partner doesn’t own it yet and also no one is offering any money to build a stadium there and Rays owner Stuart Sternberg still doesn’t wanna spend his own money, I honestly don’t know why I even mentioned it except to fill out another bullet point, maybe the stadium news isn’t quite back up to full speed yet? Getting there, though, and certainly way more busy than I ever dreamed it would still be today way back in 1998.
Tempe has learned nothing from past history, and will realize the pain from repeating it.
Tempe’s best off ramp if they approve this charade of a proposal is a shovel never hits dirt because 1) nobody will finance $2,100,000,000. 2) Phoenix will sue and win. 3) the Coyotes won’t even be able to fill a 4,600 seat college practice arena and it will finally hit Bettman that his 27 year desert farce is finally over.
For the millionth time.
It’s not up to Bettman. The league doesn’t own the team. And even if they did, he can’t make big decisions like this without the support of the owners, which he clearly has, for reasons that elude me.
Mereulo can keep losing money if he wants to. The other owners may eventually pressure him to sell or move but they will try to stay in Phoenix if they can because it is a big market.
They’d move to Houston if an owner there stepped up but none has.
The owners have made it very clear that they do not want to have a team in Quebec City. It is just too small, in their view, and doesn’t bring them many fans who aren’t already watching the NHL.
If somebody in Quebec made an offer they couldn’t refuse to buy the team, and the Coyotes were for sale maybe it could happen. That’s what happened with the Jets 2.0. But a lot of other things have to happen before that will happen.
Houston is never getting the NHL — that metropolitan area is now at least 40% of Latin American origin.
Quebec City isn’t “just too small”, it’s in Canada where the local currency is again weak compared to the US dollar. Economics are the reason the original Nordiques became the Colorado Avalanche.
Hmmm. The article linked doesn’t specify, but I would be willing to bet that Pegula’s wealth increase (according to Forbes) was calculated excluding any possible impact of the new Bills stadium deal.
He owns other stuff as well, and at least until the stadium starts construction it would be hard to imagine how even the most favourable deal would increase his wealth (real or perceived) now.
It’s hard to put a great deal of faith in Forbes numbers given that they claim that practically every sports franchise (major) has tripled in value in the last ten years.
As the revenues for most of the clubs in the four/five major sports leagues have risen I’m sure the values have gone up too, but I don’t know of a single franchise that (barring strip-it-to-the-wood payroll years for a couple of teams named Oakland, Pittsburgh, Tampa etc) have seen a reliable 300% net profit over that period.
Forbes franchise valuations tend to lean more heavily on the ‘bigger idiot’ theory than any actual measurable financial metric. And as Rob Walton & Steve Ballmer have proven, that theory is sometimes quite correct.
* net profit increase