Search Results for: Rams seeking $700m in upgrades to 17-year-old, $280m dome

Last-minute bill would fund $200m worth of North KC stadium that Royals owner may not even want

access_time personNeil deMause

The Missouri state legislature is “facing a Friday deadline to approve a plan to keep the Kansas City Royals’ new ballpark on the Missouri side,” reports KMBC, and wait, what? Last we heard, Royals owner John Sherman was still kicking the tires on whether to look at a stadium site in North Kansas City or one in downtown Kansas City that the giant QR code wants or maybe something across the state line in Kansas somewhere, and now there’s suddenly a deadline this Friday? For what, exactly?

A bill already approved by the state Senate proposes $300 million in funding for the ballpark, allocating $15 million annually over 20 years.

The state House must approve the plan by 6 p.m. Friday to advance it to Governor Mike Kehoe.

Oh, okay, it’s just a deadline for approving one particular Royals stadium funding plan. This one would create a stadium authority in Clay County and fund it with $15 million a year in state money for 20 years, which would actually only be enough money to pay off less than $200 million worth of up-front stadium costs, because interest is a thing that exists. That would leave at least several hundred million dollars more still to come from somewhere; the Missouri Independent paraphrases bill sponsor state Sen. Kurtis Gregory as saying “some sort of local support would likely still be needed,” so this would only be a first small step toward building a North Kansas City stadium, if Sherman decides that’s something he’s even interested in.

And if your attention isn’t wandering off already, add that the bill is a last-minute addition to the legislative calendar that is pretty unlikely to pass, given that it has to pass both the state house and senate by Friday, and opposition senators can always run out the clock by filibustering it. Let’s all keep one collective eye half on this as the week progresses, and check back in on Friday night — or really Monday morning, we all deserve a nice weekend off — to see if there’s anything more to this than some weak vaportecture fireworks.

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How many billions of dollars would a Commanders stadium subsidy be? An investimagation

access_time personNeil deMause

I had a long chat with University of Colorado Denver economist Geoffrey Propheter on Friday to try to nail down exactly how much the total subsidy — in government cash, discounted land, and tax breaks — would be for D.C.’s proposed Washington Commanders stadium. While “exactly” is a hopeless cause at this stage of the game, with so many unknowns about both the project and what else could otherwise be built on the RFK Stadium site, what follows is the best accounting to date of all the ways that D.C. would be enriching Commanders owner Josh Harris at the expense of taxpayers:

  • $1.058 billion for stadium construction, garages, and site infrastructure. This would all be direct city spending, and has been well established since day one of Mayor Muriel Bowser’s plan. (That some of the money would be used for actual construction of the stadium foundation and not just infrastructure wasn’t revealed until day two.) It’s the basis of the $850 million public cost figure that much of the media and pollsters have settled on, though that number leaves out either one of the garages or one of the site infrastructure items, hard to say which as the media sources generally fail to cite specifics.
  • $429 million in property tax breaks for the stadium, plus an unknown amount of property tax breaks for the surrounding commercial development. The $429 million estimate is from Propheter, and includes only the stadium itself, not the land or any additional development. How to calculate the cost of giving Harris a 90-year lease on tax-free land is a bit tricky: The RFK land is owned by the federal government and leased to D.C., so it wouldn’t be subject to property taxes regardless, though the district could conceivably ask Congress for permission to charge payments in lieu of taxes to a site developer. And even if you consider that far-fetched, there’s still a benefit to Harris here from getting non-taxable land — an added value that under normal circumstances a developer might pay for in additional rent. Which brings us to…
  • Somewhere between $6 billion and $25 billion in free rent. The Commanders stadium itself, it’s becoming clear, is only an amuse-bouche for the far bigger subsidy Harris is set to receive via rent-free use of city-controlled property for private commercial development. Harris’s deal would give him a 90-year lease on 24 acres of land, for which he would pay no rent for the first 26 years and a reduced price thereafter. Guessing at what fair market value for that land would be is, well, guesswork, but Propheter used two different comparable tracts of D.C. commercial property and a bunch of different assumptions about the value of future money and came up with a low-end estimate of $6 billion in rent discounts for Harris, and a high-end one of $25 billion.

[Ed. note: All numbers above are in present value.]

The absolute minimum cost to D.C. taxpayers for Harris’s RFK Stadium site project, then, is $7.5 billion, and if the land turns out to be more valuable than expected, it could be more than three times that. Some of this would be out-of-pocket costs that would come out of D.C.’s existing budget and some of it would be money that the district would be leaving on the table by handing over the land to Harris rather than seeking a developer who would pay real rent; all of it, though, puts the lie to the notion that Harris would be paying for most of the stadium costs out of his own pocket, since he’d be getting benefits from D.C. that would repay his construction bill many times over.

And even if we stick with the most conservative $7.5 billion figure, that is a whole hell of a lot of money — by far the biggest public subsidy for any stadium project the world has seen. Maybe the Washington Post’s pollsters should consider going back to D.C. residents and asking them “Would you favor or oppose the District government using about eight hundred fifty million dollars in city funds, plus several billion dollars of free rent and exemption from property taxes, to help finance development for a new football stadium for the Washington Commanders where RFK Stadium now stands in D.C.?” and see what the results show? I’ll wait here.

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Friday roundup: D.C. poll shows public support for spending fraction of what Commanders stadium would actually cost

access_time personNeil deMause

It’s been another long week in what feels like an endless series of long weeks, complete with the most expensive stadium subsidy demand ever and whatever the hell this was and a new pope, so let’s all take a moment to relax by watching a major league baseball player get hit on the head with a pop fly. I watched it four times in a row before writing this post, there’s something remarkably soothing about it, provided you’re not Chase Meidroth or his team physician.

And now there’s no avoiding it: the remaining news of the week!

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Vikings execs want $20m a year in tax money for upgrades of 9-year-old stadium

access_time personNeil deMause

Hey, remember how the state of Minnesota approved using revenues from electronic pulltab gambling (basically bingo apps on iPads) to help fund $500 million in Vikings stadium expenses back in 2012, and then e-pulltab gambling initially didn’t get off the ground, so state legislators had to raid a fund of tobacco tax money instead? Well, good thing people finally started using e-pulltabs, and the state used the resulting revenue to pay off the stadium early, and now can use that to backfill what it would have spent the tobacco money on otherwi—

The Minnesota Vikings want state lawmakers to put up to $20 million a year in tax revenue from electronic pulltab gambling toward the future upkeep of U.S. Bank Stadium.

The Minnesota Sports Facilities Authority (MSFA), which operates the state-owned stadium, estimates the nine-year-old facility will need nearly $300 million in maintenance over the coming decade.

Yes, Vikings execs say that their nine-year-old stadium is in such dire shape that it needs $300 million in upgrades (no details provided on what), so it needs a steady flow of tax money to pay for it. What else is an NFL franchise worth $5 billion that turns an annual $111 million profit to do?

The Vikings subsidy bill is co-sponsored by Democratic state Sen. Nick Frentz and Republican state Sen. Jeremy Miller, who argued “Do we want to have to come back to the Legislature every time there is a capital need?” (Frentz) and “This is an asset of the state of Minnesota and it is our responsibility to maintain the stadium” (Miller). No one appears to be arguing “If the Vikings owners wanted to get a guaranteed stream of upgrade revenue, they should have put it in their initial stadium agreement, but then they probably figured that never would have passed the legislature at the time and instead they’d wait 13 years and see if they could get the state to throw good money after bad, as one does” — maybe once this enters the legislative debates over how to pass a budget to fill in for federal cuts and keep the state government from shutting down at the end of June, we’ll get more diversity of opinion.

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Royals’ expiring lease may not be the stadium leverage John Sherman pretends it is

access_time personNeil deMause

Kansas City Royals owner John Sherman has been publicly demanding a new stadium for two and a half years now, and one argument he has made is that the team’s future needs to be resolved by the time its lease runs out after the 2030 season.

The traditional way for news outlets to address this is with one line somewhere deep in every article warning that the city faces a “deadline” in the form of the expiring lease. The less common one is to actually look into who really holds leverage around the lease expiration and what might happen as it approaches, and the Kansas City Business Journal, to its credit, took that path less traveled and found:

  • Sherman can simply extend his lease for two additional five-year terms, something that “some current and former officials” think he may end up doing.
  • Cities like Nashville and Salt Lake City are already saddled with big public debts for other sports venues, and so aren’t likely to lavish money on a baseball stadium as well, says Holy Cross economist Victor Matheson: “It’s not like there is city after city after city that’s just clamoring to hand out a billion dollars to a billionaire ownership group and a bunch of millionaire players. The A’s are the best example (of) saying that we will not play here beyond a certain date, and that’s turned out to really backfire on them. … Playing hardball only works if you really do hold the cards.”
  • Even without those five-year lease extensions, says University of Colorado-Denver economist Geoffrey Propheter, there would be nothing stopping the Royals from going year-to-year on their lease, making any deadline totally illusory: “It’s a knee-jerk reaction to get fixated on this end point … and all of a sudden, all decisions are revolving around this point, as though something bad happens at this point. Nothing bad happens at this point. This point just means your current agreement ends, and you need to crap or get off the pot.”
  • Former K.C. councilmember Becky Nace, who is now an activist against public subsidies for a new Royals stadium, says team execs are “just hoping that the city government leaders will somehow blink and offer them a better deal, but the problem is, we’re beating the best deal on the table if we do that. We’re bidding against ourselves.”

All this is true, and important: Yes, an expiring lease makes it easier for a team to threaten to leave town, but it then has to have somewhere to leave town for; if the only option is “if you don’t build us a new stadium we’ll go play in the street” — or in Sacramento — that’s not much of a threat. Government officials need to learn that they have leverage, too: There may be a limited number of pro sports teams to go around, but there are also a limited number of major metro areas, so team owners need cities as much as or more than cities need teams.

The one catch that the Business Journal did not mention, of course, is that “metro areas” can include a lot of different jurisdictions, which is precisely what Sherman is trying to do with the Kansas City metro area: The neighboring state of Kansas last summer approved a potentially bottomless pool of tax money for stadiums for both the Royals and Chiefs, and if the teams’ owners haven’t leaped to take it yet, they’re certainly going to remind Missouri politicians at every opportunity that it’s an option. Again, it’s questionable how much of a threat that should really be: Royals and Chiefs fans could still go to games if they were just across the state line, and any Missouri tax losses from being cut out of team sales and income taxes would be more than offset by not having to shell out a couple billion dollars for stadium construction —  and that’s if Sherman and Clark Hunt even really want to move their teams to Kansas. Maybe this would be a good topic for a followup article: “Would K.C.’s best option be calling Chiefs’ and Royals’ move threat bluff?” You can have the headline, K.C. Business Journal, that’s a freebie.

 

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Commanders stadium plan is somehow even worse for DC taxpayers than we thought

access_time personNeil deMause

I now have a copy of the term sheet for the proposed Washington Commanders stadium, so we can answer some of the remaining questions from yesterday’s preliminary estimate of the costs and benefits of Mayor Muriel Bowser’s plan. As you’ll recall, the total public cost stood then at around $1.5 billion, with no idea of what if anything D.C. taxpayers would get in return.

Now we have more details, and hoo boy:

  • First off, the $500 million in city money for “horizontal construction, meaning roads, sidewalks, etc. around the stadium” turns out to actually mean a whole lot of other things as well: “pedestrian circulation, open space, plazas, stairs, ramps, landscaping, sidewalks, curbs, gutter, roadways, and other site improvements,” plus “foundations, slabs on grade, piles, pile caps, concrete, stairs, excavation, below grade mechanical, electrical and plumbing materials and equipment, below-grade elevators, and horizontal surfaces and finishes that are below the average site ground level” and other stuff. This is being described by the plan’s proponents as tax money going to pay for “infrastructure,” but items like “foundations” and “stairs” sound like straight-up “structure.”
  • The stadium would be owned by the city, meaning Commanders owner Josh Harris would indeed get that $429 million property tax break that Geoff Propheter estimated yesterday.
  • In exchange for getting development rights to the bulk of 180 acres of public land, Harris would pay all of $1 a year in rent for the next 30 years for the stadium, and for the next 28 years for the surrounding development. If we use the average price per acre in D.C. of $6.6 million, then this free land is worth close to $1 billion, even before accounting for the full property tax exemption it would receive.
  • While D.C. would pay for a large chunk of the costs, it would get 0% of stadium revenues: The team would receive all “stadium operating revenues, including from naming rights, sponsorship, advertising (both interior and exterior), premium seating, ticket proceeds, merchandise, food and beverage, and parking for both NFL and non-NFL events.”
  • That’s not to say that nobody in the public sphere gets anything: The mayor and D.C. council would receive the use of two free luxury suites, something that sure doesn’t smell like a quid pro quo or anything.
  • Some good news: Harris would be responsible for keeping both the stadium and the garages in state-of-the-art shape, so at least D.C. wouldn’t be on the hook for those upgrades.
  • Coupled with some more bad news: Parking and personal seat license sales would both be exempt from sales tax, and sales taxes on anything else sold at the stadium would get poured into an “RFK Campus Reinvestment Fund” to be used to pay off construction costs and for future “maintenance and repairs and capital expenses,” so D.C. could be on the hook for some upgrades after all.
  • “The District recognizes the public value in providing spaces for women’s sports and is discussing with TeamCo whether such an opportunity can be provided for professional women’s soccer at the Project.” Cool! Who would pay for that, and would it get the same tax and rent breaks as the rest of the deal? The term sheet doesn’t say.

That all adds up to … I dunno, $2.5 billion in public subsidies? $3 billion? It would surely set a new record for the most taxpayer money poured into a single stadium in the history of the U.S. if not the known universe, in any case.

Whatever the final tally, the main takeaway is: Josh Harris gets to pay only $1 a year in rent for a huge tax-free swath of public land, while keeping all revenues from the stadium and other development he builds there, even as the district pays to build everything from parking garages to the stadium’s foundation. And the council — where Ward 3 representative Matthew Frumin has now declared himself “could be for it, could be against it,” leaving the overall body leaning slightly no but with several potential swing votes — only has until July 15 to vote it up or down in one indigestible lump, as the term sheet includes a clause declaring that if the council “materially changes” the terms, then the whole agreement is null and void. Mayor Bowser clearly wants to railroad this thing through before anyone takes a closer look — which makes sense, because on closer look this thing is a dumpster fire.

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Taxpayer subsidy for Commanders stadium hits $1.5B, for public return of ¯\_(ツ)_/¯

access_time personNeil deMause

There’s a bit more information now about the details of Washington, D.C. Mayor Muriel Bowser’s plan to help build a new Washington Commanders stadium at the former site of RFK Stadium — not nearly enough information, mind you, not when the only official documents are a cursory press release, a hype video, and a PR slideshow. But at least we can start to get a general sense of what we know and what we don’t know:

Stuff D.C. taxpayers would be on the hook for:

  • $500 million for “horizontal construction, meaning roads, sidewalks, etc. around the stadium.” Some or all of that money would be raised by extending the business tax surcharge that was used to pay to build the Nationals stadium, and which was supposed to sunset next year once those bonds were paid off, and putting the money toward Commanders stadium costs.
  • $181 million for a parking garage, to be paid for by EventsDC, the city’s convention and sports authority.
  • $175 million to “purchase other parking facilities from the Commanders in 2032.”
  • $202 million for “utilities infrastructure, roadways, and a WMATA transit study” so the rest of the site can be built out.
  • $89 million for an indoor “sportsplex” for youth track and gymnastics.
  • An estimated $429 million in foregone property taxes on the value of the stadium alone.
  • The lost value of whatever the development rights to the RFK site would be worth if opened up to bidders, assuming Commanders owner Josh Harris won’t be paying full market value for the “multiple parcels of land” he would be “activating and developing” with “restaurants, entertainment venues, hotels, housing, green space, and more.”
  • Any costs of developing the Kingman Park District, a parcel of the land that D.C. would remain in control of.
  • Any costs of building a new Metro transit station, depending on what that WMATA transit study finds the site needs.
  • Any costs of providing police and fire services  to the stadium, plus schools and other services to the surrounding mixed-use community.

Stuff D.C. taxpayers would get in return:

  • New tax revenues amounting to … well, that’a a good question. Bowser’s office has asserted that the project would create “approximately $4 billion in total tax revenue” over the next 30 years, a number that has found its way into innumerable media reports. (The Washingtonian, getting extra-excited and not bothering to read too closely, called it “$4 billion in annual new tax revenue,” which even Bowser isn’t claiming.) I initially assumed that was from the report by consultants Jones Lang LaSalle Americas Inc. and the Robert Bobb Group that the district released last June — but even that report, with its no sourcing or methodology beyond citing the software package IMPLAN, only projects (see table 6.7) $26 million in annual tax revenue, which would be worth about $400 million in present value.
  • Rent or a cut of stadium revenues, maybe? Neither Bowser nor Harris has breathed a word of what a proposed lease would look like, so we have no idea here, beyond reports that the plan to have Harris build garages and sell them to D.C. for $175 million would be paid for out of “in-stadium activity once the stadium is operating,” which could mean either actual in-stadium revenue or things like kicked-back sales taxes on hot dog sales, so really we have no idea here.
  • A guarantee that the Commanders would play at the D.C. site for … again, no lease yet, so no clue.
  • A guarantee that at least 30% of the housing built would be affordable, which is required by city law so would be the case with any development of the RFK site.

Those seem to be the major line items. There are, clearly, a lot of questions — starting with “How the hell would it cost D.C. half a billion dollars just for roads and sidewalks” but also including how many as-yet-unreported costs are hiding in the fine print and whether Harris would give up even a sliver of the money he takes in at his new stadium to help defray the public’s share. It seems reasonable, though, to say that Bowser’s proposed stadium deal would involve at least $1.5 billion in subsidies to Commanders owner Harris, in exchange for benefits that are still almost entirely undefined.

Unlike most other media reports on this deal, I just went back and changed all instances of “will” to “would,” because we’re still talking about a hypothetical here: Mayor Bowser may have signed off on all this, but D.C. hasn’t approved nothing until its council weighs in on it. The mayor will need seven out of 12 votes on the council — how’s that going so far?

  • Council chair Phil Mendelson, probably not: “The cost to the District will be nearly $1 billion – and that does not include investments in Metro and the surrounding park land site – and I continue to be concerned with investing any public money into a stadium while we have constrained budgets and revenues, and unmet needs.”
  • Ward 1 councilmember Brianne Nadeau, no: “It’s a ‘no’ for me. The District cannot afford to spend $1 billion in taxpayer money on a sports stadium for a privately held team, a stadium that will sit dark most days.”
  • Ward 2 councilmember Brooke Pinto, yes: “Welcoming the Washington Commanders back to DC is not only good for the team, it’s an investment in our city’s spirit, in economic development, and in a future for our city that makes us all proud.”
  • Ward 6 councilmember Charles Allen, no: “In stark financial terms, at a time when the District is facing a recession and tens of thousands of workers are losing their jobs, this proposal is asking DC residents to pay more than $4 million for each and every home game for the next 30 years, a proposal that doesn’t even include funding for a sorely needed Metro station expansion to give people alternatives to driving.”
  • Ward 7 councilmember Wendell Felder, probably: “As the councilmember I plan to conduct a robust community engagement plan to go directly to neighbors especially around the neighboring communities and figure out what we can do to make sure their quality of life is not disrupted.”
  • At-large member Kenyan McDuffie, yes: “We want to make sure we are that we are working together as a council, working with the executive to do what’s in the best interest of the District of Columbia residents, taxpayers, and families. This deal is going to fit within those priorities.”
  • At-large councilmember Anita Bonds, yes: “For me it’s about or community, and every community is looking to ways to revitalize, and we are lucky. We have the Commanders that want to be here.”
  • Ward 4 councilmember Janeese Lewis George and at-large members Robert White and Christina Henderson, probably not, having signed on to a 2022 letter stating that “we will not support a football stadium” at the RFK site.
  • Ward 3 councilmember Matthew Frumin, Ward 5 councilmember Zachary Parker, no data.

That’s going to be a tough vote, though as always, close decisions in city councils usually end up meaning haggling, and swing votes can often be had pretty cheap. Bowser wants this approved by June, so the next few weeks are going to see the pressure turned up on D.C. elected officials — watch the tea leaves closely, and if you’re a D.C. resident who has feels about this plan, share them with your representatives ASAP.

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DC mayor reveals Commanders stadium plan hype video (UPDATE: $1.147B public cost)

access_time personNeil deMause

Washington, D.C. Mayor Muriel Bowser announced this morning an agreement with Commanders owner Josh Harris (if not yet with her city council) for a new stadium at the RFK Stadium site, and she did so in the form of … a video? On X, the platform formerly known as The Platform That Used to Be Twitter? That’s a choice.
So what can we glean from it, while we wait for, hopefully, some actual written words and numbers?

  • It’s Joe Theismann! He had a great time as a Washington football player at the RFK site! Until, you know, he didn’t.
  • “A new stadium will serve as the anchor for the RFK site.” You’re forgetting what Allen Sanderson said about NFL stadiums! No, not the helicopter thing, the cemetery thing.
  • “New housing, new restaurants, retail, and public spaces are all possible!” A new multibillion-dollar stadium is needed because of all the other things that aren’t stadiums that you can then build with whatever land and money you have left over!
  • “A world-class city deserves a world-class stadium.” And world-class schools? We’ll get back to you on that.

Bowser has a press briefing planned for 11 am, which will hopefully provide more actual financial details and not just more grainy footage of fans from the 1980s. Watch this space for further updates.

UPDATE 11:12 am ET: It’ll have a roof! Price tag TBD.

UPDATE 12:30 pm ET: $2.7 billion stadium construction cost, with a total of $1.147 billion in public money:

-$500M for Horizonal construction, meaning roads, sidewalks, etc. around the stadium (Funds from Capital Budget)
-$181M for Parking (Funds from EventsDC and Capital Budget)
-$175M for Parking (Generated by Future Revenue)
-$202M for “preparing the site,” meaning roadways, utilities infrastructure and WMATA Capacity Study — This money would have been needed to decide the future of the site regardless of whether a stadium was built.
-$89M for State of the Art SportsPlex at Fields at RFK

The mayor’s office calls this 24% of stadium and parking construction costs, which doesn’t seem right no matter how you slice it, but math is hard!

UPDATE 2:30 pm ET: A few more details slipping out:

  • The $500m in construction money from the capital budget will come from partly from the business tax surcharge that has been paying off construction of the Nationals stadium. This could run into problems with either 1) local businesses who were counting on that tax sunsetting next year  or 2) the Nats owners, who may have had their eye on it for their own stadium upgrades or 3) literally anyone else in D.C. who might have been thinking about using that money for something else once the MLB ballpark was paid off.
  • Bowser’s office anticipates “200 yearly events, including non-sports opportunities” at the NFL stadium, which I can tell you without looking would be by far the record for any 65,000-seat facility, unless Taylor Swift decides to clone herself in the near future.
  • An official with the mayor’s office said it is “proscribed” under city law that 30% of the new housing in a stadium district be affordable, without giving details on whether there would be additional city subsidies for that, or what they think the word “proscribed” means.
  • The D.C. council is expected to vote on the plan this summer, with the stadium, if approved, opening by fall of 2030.

Still waiting to hear what the team’s lease would look like, whether D.C. would get any cut of stadium or stadium district revenues, whether either the stadium or the mixed-use district would pay property taxes or payments in lieu of property taxes — you know, the small stuff. There’s a slideshow on the mayor’s website, but it doesn’t provide much in the way of a coherent financial summary. It does have a photo of Taylor Swift, though, you think her image licensing people had to sign off on that?

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Friday roundup: Bengals reno plan called “PR stunt,” plus the return of the Rays two-stadium plan

access_time personNeil deMause

Thanks to everyone who generously donated (and in some cases more than generously, you know who you are) to the Field of Schemes spring supporter drive — I have a whole lot of fridge magnets to send out! But first, there’s a weekly news roundup to get to:

  • That Hamilton County agreement to spend $80.5 million on Cincinnati Bengals stadium upgrades and repairs in exchange for no lease agreement at all turns out to be not so popular with the Hamilton County Commission, where commissioner Alicia “hugging the zero down” Reece called it “a PR stunt” because there’s no new lease while commission president Denise Driehaus countered (?) that “No one at that meeting ever said this was related to the final lease.” The county commission only has three members and the third, Stephanie Summerow Dumas, didn’t show up to yesterday’s meeting, so it’s hard to say what this means for the stadium proposal’s ultimate fate.
  • Hey, what if the Tampa Bay Rays built two stadiums, asks Tampa Bay Times opinion editor Graham Brink, one outdoors and one a refurbished Tropicana Field? Would that be cheaper or better? Probably not? Too bad, I already wrote the op-ed, and anyway this is just “back of the napkin” stuff. (Or envelope, which actually has two distinct sides. NAPKINS GOT BACKS!)
  • WAMU-FM reports that “a source familiar with [Washington Commanders stadium] talks” says funding “will likely involve the city borrowing against new tax revenues expected to be generated by any new development,” i.e., tax increment financing. The station cites a 2020 study claiming that D.C. has turned a profit on average on TIF districts — on first look it appears that the study’s authors guesstimated that development would still happen in the districts without the TIF but would take longer, which is probably a reasonable assumption but could create huge swings in the revenue numbers depending on what you mean by “longer.” I have emails out to a couple of TIF experts, I’ll update here if they have anything instructive to add.*
  • Former Cleveland Plain Dealer editorial director Brent Larkin says the Cleveland Browns stadium plans should be submitted to a public referendum, arguing that Ohio voters usually approve sports subsidy referendums anyway, so where’s the harm? Oh, and also it would be “a wildly generous gift to billionaire professional sports team owners at the same time those same elected officials are cutting aid to schools, food banks, libraries and programs for poor kids.” But anyway, it’ll probably win, so let the voters feel like they’re having a say, that’s democracy!
  • St. Petersburg Mayor Ken Welch has issued a proposal for redeveloping the waterfront that would include demolishing Al Lang Stadium, the old spring training ballpark that is currently home to the Tampa Bay Rowdies USL team. City councilmembers don’t sound too enthused about this, but also Welch’s managing director of city development said the Rowdies owners are “involved and they’re aware” of the plan, so maybe there’s a new soccer stadium proposal in the works? Worth keeping an eye on, if nothing else.
  • A group of downtown Kansas City businesses put up a giant sign with a giant QR code asking that a Royals stadium be built downtown. Chair of the Downtown Council of Kansas City: Gibb Kerr, managing director of the K.C. office of Cushman and Wakefield, a major developer, who surely would not be in position to profit from a downtown stadium, the Kansas City Star would certainly tell us if it were.
  • Work has begun at the proposed Las Vegas A’s stadium site on making it even flatter, this is what passes for progress these days.
  • Los Angeles Dodgers ticket prices are going up, and so is their payroll, and Forbes “contributor” Dan Schlossberg (author of “41 books and more than 25,000 articles about baseball”) concludes that the payroll must be driving up the ticket prices — sorry, Dan, that’s not how it works, there’s a book you might want to read if you have time between writing them.
  • Economist Joe Cortright has done his own analysis of the Portland baseball stadium income tax diversion proposal that I estimated could leave Oregon taxpayers hundreds of millions of dollars in the hole and determined that the total hole would be more than $600 million.
  • I was on WOSU’s “All Sides with Amy Juravich” on Wednesday to discuss the Browns and Bengals situations, and you can listen to it here. For those who are wondering: Yes, Andy Zimbalist and I did run into each other on the Zoom call as my segment ended and his began, and no, there were no punches thrown.
  • You can buy a piece of the shredded Tropicana Field roof at Tampa Bay Rays games for $15, with the money going to a Rays charity, and doesn’t the city own the roof remnants, shouldn’t the money be going to the general fund? Anyway, if anyone in the Tampa area has been looking for a National Hairball Awareness Day present for me, hint, hint!

*UPDATE: Eight minutes after I hit publish on this post, sports economist and tax expert Geoffrey Propheter replied to my question about the D.C. TIF study. Propheter said it “falls short of academic standards for economic policy analysis” because it doesn’t try to analyze how tax revenue from TIF developments compares to comparable plots of land, but rather just compares actual developments to hypothetical ones that would (according to the study’s assumptions) see different kinds of development take place. He concludes: “I don’t understand how anyone would use this study to justify a TIF for a Commanders stadium.”

And while I was writing the above, Greg LeRoy of Good Jobs First (disclosure: I’m doing some paid work for them, not on the subject of stadiums or TIFs) chimed in to note that D.C. TIF districts like the one for Gallery Place have had to be expanded to siphon off sales taxes from other nearby neighborhoods in order to break even.

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Hamilton County reveals deal to pay $64.5m for initial Bengals renovation, with way more to come

access_time personNeil deMause

The Cincinnati Bengals stadium negotiations have been a weird one: Lurking beneath the talks is the fact that 1) the Bengals’ lease is historically awful for Hamilton County, which is on the hook for any upgrades needed to keep the stadium “state of the art” and 2) the lease expires next year, but the team owners have the option to extend it for five more two-year terms if they want. So a lot of the haggling has been about how much in stadium renovations the county is willing to pay the Brown family for to make the old lease go away.

So this development yesterday is just plain weird:

Chris Wetterich of the Cincinnati Business Courier (via Sports Business Daily) reports that the Bengals and the league will foot the bill for $120 million of improvements, with Hamilton County picking up $64.5 million. The $184.5 million project is described as the “first phase” of a potential $830 million overhaul of the venue…

The short-term deal to improve the stadium is separate from whether the Bengals will exercise their right to extend the current lease, or whether the two sides will strike a long-term agreement.

On the one hand, given the terrible lease, the Brown family kicking in almost two-thirds the cost of upgrades isn’t so bad a deal — though 100% of the benefits from the “renovated suites and lounges, better concession areas, and improvements to the stadium plazas” will go to the team, and about half the team’s cost will be covered by the NFL’s stadium fund. On the other hand, with the lease about to expire anyway, Hamilton County really has no reason to honor the lease terms at this point, since the Bengals owners declaring them in breach of contract and canceling the lease would if anything be doing the county a favor. So what we have is the county handing over $64.5 million for upgrades so the Bengals can boost their profits — plus another $16 million in “maintenance, operations, and capital repair obligations” — in exchange for absolutely nothing, as the Brown family hasn’t agreed to either a new lease or tearing up the old one.

On top of this, there’s that eventual $830 million overhaul, which will paid for by reply hazy, try again later:

As of the execution of this MOU, the County and Team anticipate that the primary funding and financing sources for the Stadium Renovation and Modernization Program will be comprised of fair and equitable contributions from: (i) County; (ii )Team/NFL; and (iii) State of Ohio, in the general context of reasonably comparable funding structures in other NFL peer markets and shall also take into consideration the funding commitments made by the Team and County throughout the term of this Agreement.

The agreement, which will be voted on by the Hamilton County Commission next week, is just a memorandum of understanding laying out the general outlines of a stadium plan. So it’s not entirely clear what the county would actually be agreeing to here, and how much of this is just the Bengals owners and the NFL putting their best foot forward in hopes of winning a lucrative deal for a more substantial renovation from the county. (And from the state of Ohio — the MOU emphasizes that “the Team and the County agree to work together to seek additional funding and financing sources from third parties for the Stadium Renovation and Modernization Program.”) Either way, for the county to agree to anything without the Brown family agreeing to either cancel the old lease or agree to a new one (“Nothing in this MOU is intended to, nor shall be deemed orconstrued to, alter the terms of the Lease or Earlier MOUs”) is a bizarre negotiating tactic by the county — maybe there’s another shoe yet to drop, but right now this looks like county commissioners handing over $80.5 million in exchange for no concessions from the team owners, which is … I’m going to go with “not great.”

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