Category: Olympics

Friday roundup: Rays execs threaten to “evaluate alternatives” if Tampa won’t hand over $1B; could LA revise its Olympics deal?

access_time personNeil deMause

There’s an absolute ton of news to get to today, but first the biggest news of all: The Field of Schemes gift vault is down to only one remaining numbered Vaportecture art print out of the 100 created for site supporters! That means the next person to sign up as either a new Patreon subscriber or new one-time donor gets print #100, and then there are no more! I’m working on a fun new reward or two for those of you who allow this website to happen, but it’ll take a minute for those to be ready — meanwhile, site supporters are still eligible to get any refrigerator magnets you haven’t already received, plus of course my eternal thanks for helping me devote the time each day to this site that, tragically, still has reason to exist after 28 years of this nonsense.

And speaking of nonsense, here’s more of this week’s stadium and arena news:

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Friday roundup: Has Cleveland’s mayor actually found a way to make Guardians and Cavs owners help pay for own repair costs?

access_time personNeil deMause

No time for a lengthy roundup intro today, I’m too busy catching up with the latest problems resulting from sending Microsoft Outlook into space. Plenty of juicy bullet points, though, you can dig into those right now:

  • Cleveland Mayor Justin Bibb is proposing establishing sales tax surcharge of up to 5% in and around the Guardians‘ stadium and Cavaliers‘ arena to help fund what could be $400 million in ongoing repairs and upgrades at the venues, expenses the city’s sports authority is required to cover under the teams’ leases but which it has no money for. Cleveland.com describes this as “Cavs and Guardians fans footing the bill,” but actually a lot of this could fall on the team owners, as fans are unlikely to put up with higher prices on tickets (or, to a somewhat lesser degree, hot dogs or souvenirs) just because taxes went up. One catch: Any “New Community Authority” would require any property owners to agree to join and be subject to the tax; the stadium and arena are owned by the sports authority, though, so it’s at least possible Bibb could force this on the teams over their objections. Lots of team prepare for such backdoor funding attempts by inserting “no ticket tax surcharge” clauses into their leases — I’m not spotting any in the Cavs and Guardians leases on an initial look, but feel free to search for yourselves.
  • NFL Commissioner Roger Goodell turned up the heat on the Chicago Bears stadium situation on Tuesday, declaring: “They need to find a solution for a stadium. … I think it’s really important that they come to a resolution on this relatively soon. … This is an important time to get this resolved sooner rather than later.” Okay, that’s less “heat” than “typical commissioner whingeing,” no reason to report on this as upping the pressure in any real oh come on, NBC Chicago.
  • Predatory lending tycoon Tom Dundon has been approved as the new owner of the Portland Trail Blazers, and he was not pleased at all that one of the first questions he got was why he hasn’t committed any of his own money toward an arena renovation that the team is seeking $600 million in public subsidies for. “No one’s ever told me I didn’t have skin in the game before,” snapped Dundon. “We don’t know each other very well. So, look, we’re going to negotiate and do a market deal.” Easy for him to say since he’s already landed the first $365 million in state funding, but at least maybe this will give local legislators a bit more backbone as they negotiating the remaining $235 million — especially since minority owner and venture capital succubus Sheel Tyle declared, “I don’t want people to be concerned or scared. We are committed to Portland, 100 percent. Full stop.” Somebody please alert Ron Wyden.
  • The Maryland legislature has killed legislation for the 2026 session to spend $217 million in public money on a stadium to host new Baltimore men’s and women’s soccer teams, partly because there’s community opposition to building it atop a public golf course that was the site of some of the first integration of the city’s public facilities. “When we introduced the legislation, the purpose was not to get it funded,” bill sponsor state Sen. Antonio Hayes told the Baltimore Banner, “the purpose was to keep the conversation going” — so you can rest assured we’ll hear about this again in the 2027 session.
  • Denver Broncos owner Greg Penner says he won’t be able to meet an “ambitious” 2031 target date for opening a new stadium without help from “a lot of key partners at the city level [and] at state level.” In particular, Penner still needs to finish acquiring land for the stadium — he said if the new stadium isn’t ready by 2031 he could just extend his lease at the old one, so it’s not clear why anyone would feel pressured by this deadline other than him, but this is just how team owners roll.
  • The Missouri legislature is considering cutting $2 million from its stadium maintenance budget and redirecting it to a fire department program in retaliation for the Kansas City Chiefs announcing they’ll move to Kansas in 2031 — though in the meantime, it would also reduce maintenance spending on the Royals stadium as well, assuming the Royals stick around.
  • World Cup participant countries typically get tax exemptions during their teams’ time spent in the host nation, but because Trump administration is only extending that courtesy to nations that have signed specific double-taxation agreements with the U.S., “It’s going to cost most non-European countries a lot of money to go to the World Cup” this summer, says tax consultant Oriana Morrison. And that’s before visiting fans pony up for the inflated cost of train tickets to the games in Massachusetts. Props to both the federal and local governments for finding ways to claw back some of the costs of hosting the World Cup, I guess, though taking it from the pockets of Haitians seems just slightly cruel and unusual.
  • Inglewood is spending $8.5 million to “revitalize” its downtown so that it’s more lively in advance of the 2027 Super Bowl and 2028 Summer Olympics, hey wait, weren’t Super Bowls and Olympics supposed to revitalize their surroundings? U.S. news media, we await your corrections.
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Friday roundup: Can the Home Team Act save your home team, and other pressing questions

access_time personNeil deMause

Let’s get this out of the way, since it’s blowing up on the socials: Yes, Sen. Bernie Sanders and another less famous guy (Rep. Greg Casar, a second-term representative from Austin and chair of the Congressional Progressive Caucus) yesterday introduced a “Home Team Act” that would require sports team owners to give one year of notice before moving or terminating a team — and also give local buyers the right to purchase the team “at a fair and reasonable price” first, with the price determined by a team of appraisers appointed by the Treasury Department. According to the bill, either private buyers or local governments themselves would be eligible to purchase the team, and any owners who jumped the gun would be subject to a $30,000-a-day penalty.

Removing team owners’ ability to threaten to yank a city’s team away if they aren’t bestowed with public subsidies would indeed be a huge step toward ending stadium shakedowns. And it’s justifiable on a couple of grounds: Not only do teams owe their livelihood to the local fan base, but leagues also routinely use their monopoly power to deny teams to cities if they, say, have one in the next state over, or just out of spite.

At the same time, though, there are plenty of questions about this bill. First off, this is Congress we’re talking about, which has not exactly shown the backbone to stand up to the sports industry — even Sanders and Casar, notes the Chicago Tribune, “acknowledge the legislation won’t get passed quickly, if at all.” The bit about governments being allowed to purchase teams could be dicey, given that leagues currently have the power to reject public ownership, or, for that matter, even private buyers they don’t like. And in terms of enforcement, a $30,000-a-day penalty only amounts to $11 million over an entire year, and no sports team owner is going to let a crappy $11 million stand in the way of moving wherever they damn well please, or at least threatening to in order to extract money from the public treasury. (Local governments could also seek “injunctive and monetary relief,” so presumably judges would have the power to impose harsher penalties, if they saw fit.)

Basically, once this has more than two co-sponsors, then we can start taking it more seriously. Until then, it goes next to David Minge’s Distorting Subsidies Limitation Act as proof of concept that our elected representatives could be doing more to stop the flow of tax dollars to extortionate billionaires, they just don’t want to.

Other pressing questions from the week that just was:

  • Could there be some speed bumps for the Tampa Bay Rays stadium plan and its $2.25 billion in public cash, land, and tax breaks after all? Hillsborough County Commissioner Josh Wostal is demanding that the county and the Tampa Sports Authority release “all draft documents and personal notes” about the deal before a hearing is held next Wednesday — and further says if no public hearings are held before a scheduled April 15 vote, he’ll move to postpone it. “People at a minimum deserve transparency,” said Wostal. “And we are playing hide the ball?“ No word yet on whether others on the commission will support such a wild-eyed radical position as wanting to talk about what’s being voted on before a vote, but people are arguing on the internet about the Rays deal, and in particular its potential use of infrastructure money that elected officials previously pledged wouldn’t go to stadiums, so that’s a start, perhaps.
  • Will the Ohio state legislature add $45 million in road and transit upgrades around the Cleveland Browns‘ new stadium to the $600 million in state money they’ve already promised owner Jimmy Haslam for construction costs? We won’t know until they revote on April 23 following a public comment period, but given the committee that can authorize such spending unanimously passed it the first time: probably.
  • What about Haslam’s demand for $50 million in city and county money for a stadium for a Columbus women’s soccer team, will he get that too? Five out of nine city councilmembers say they’re opposed, the other four say they need more information, more lobbying is clearly needed.
  • Will the new Oklahoma City Thunder arena end up costing taxpayers there more than the $850 million they approved back in 2023? Possibly, says assistant city manager Brent Bryant, who explained that given “economic uncertainty,” the city will “add a factor to that on top of the anticipated cost, to try to plan for that.” What does that mean? Sorry, only one question per bullet point!
  • Is prospective new Portland Trail Blazers owner Tom Dundon “a go-getter” with “enormous passion and spirit,” like NBA commissioner Adam Silver said he was on Wednesday, or a predatory lender who got rich by letting people take out high-interest car loans that they would inevitably default on, like Oregon Public Broadcasting and ProPublica reported earlier that morning? Nothing saying it can’t be both!
  • As Anaheim officials push for the Los Angeles Angels to restore “Anaheim” to the team name, could team owner Arte Moreno or the 80-year-old’s eventual successors move the team to Los Angeles County? The L.A. Times’ Bill Shaikin writes that “the logical landing spot would be Inglewood,” only to have Inglewood Mayor James Butts tell him, “We’re maxed out when it comes to sports. We are not going to reduce the housing stock and move residents out to have a baseball team.” Welp, that’s unfortunate, but the column’s already written, too late to go back and choose a new topic!
  • Does the city of L.A. know what year the 2028 Olympics will be held? Possibly not!
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Friday roundup: Blazers threatened councilmembers’ careers if they didn’t subsidize arena, Rays stadium tax vote planned for April 1

access_time personNeil deMause

Would love to have a witty introduction for you here, but it’s late enough already and this week’s bullet points are far too juicy to wait any longer!

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Friday roundup: Breaking down taxpayer costs of the proposed Indiana Bears deal, plus other stadium news

access_time personNeil deMause

The Indiana legislature’s amended bill for a Chicago Bears stadium project is finally up, and we can start to get a slightly better sense of what it would entail in terms of public costs. Tax expenditures would include: a city of Hammond admissions tax, Lake County and Porter County food and beverage tax surcharges, a Hammond food and beverage tax surcharge, a Lake County hotel tax surcharge, what looks like local income and sales taxes from a stadium district, and state sales taxes from a stadium district. The stadium authority would also own the stadium and lease it to the Bears (terms very much TBD), so it would presumably be exempt from property taxes.

That is a ton of moving parts, needless to say. There being no fiscal analysis attached to the bill to project how much each of these taxes will raise, it’s impossible to determine what the total public price tag would be, though something upwards of $1 billion seems likely given all the revenue streams involved. (WGN calls it $1 billion exactly, not sure where that number comes from, though Indiana house speaker Todd Huston did throw that number around as an estimate yesterday.)

The bill also says that “the stadium board is responsible for the operation and maintenance of the capital improvement upon completion of construction,” which sounds bad, and then two paragraphs later that “the authority has no responsibility to fund the ongoing maintenance and operations of the capital improvement,” which sounds good but also contradictory. (It’s possible this is just dividing up responsibilities between two state agencies, I need to keep going through the bill language to be sure; if so, it’s bad for taxpayers because it could end up a grift that keeps on giving.) Also “the stadium board will retain all revenues from operation of the capital mprovement,” which sounds very good for Indiana but also not likely something the Bears ownership would agree to if it really meant what it sounds like it does. So lots of questions still up in the air, we get another public hearing on this before the full Indiana house and senate votes next week, right? Right? Anyone?

Meanwhile, in other news this week:

  • The proposed Tampa Bay Rays stadium development at Hillsborough College’s Dale Mabry Campus would include relocating a middle school and some county offices to … somewhere, while the college’s buildings would be rebuilt in a compressed corner of the campus … somehow. The new Tampa Bay Times reporters on this story, one of whom was just promoted from intern and the other just graduated from college last summer, don’t appear to have actually asked anyone with the Rays or with Gov. Ron DeSantis’s office about how this is all expected to work, sure do miss Colleen Wright’s reporting on the Rays stadium saga.
  • The Cleveland Guardians and Cavaliers would like some of that sweet state unclaimed funds money that the Browns are using for their new stadium, please, to use for upgrades to their current homes. The state can get right on that just as soon as that little matter of the restraining order against the state using the funds at all is cleared up.
  • The estimated $750 million cost of renovations to the Arizona Diamondbacks stadium — which only cost $354 million to build in the first place in 1998, about $700 million in today’s dollars — is now expected to be “much higher,” according to team CEO Derrick Hall. Hall didn’t say exactly how much higher, or whether it will all fall on the state to increase its planned $500 million cut of the costs, or when the D-backs will get around to actually signing a new lease in exchange for the renovations.
  • Athletics team execs say $300 million has now been spent on construction of John Fisher’s Las Vegas stadium and $989 million contracted for, out of a total price tag of still figuring that out. This is either the biggest bluff in sports history or the biggest dog-catching-the-car-and-having-to-figure-out-what-to-do-with-it, honestly looking forward to the inevitable cataclysmic denouement either way.
  • The waiting to see if the state of Connecticut will provide $127 million to build and MLS Next Pro soccer stadium in Bridgeport is over, and the answer is: Nope, go kick rocks. State Economic Development Commissioner Daniel O’Keefe cited the need to reduce state spending and what the Connecticut Post termed the “mercurial nature of the sports industry,” noting that the Connecticut Sun may be about to move to Houston and the Bridgeport Islanders may be about to move to Hamilton, fool me three times, shame on me. Developers plan to instead use the planned stadium site for a project involving youth sports indoor and outdoor fields, which apparently don’t require hundreds of millions of dollars of state subsidies like pro sports do.
  • The video of my interview yesterday on whether Los Angeles should try to renegotiate its 2028 Olympics hosting deal is now up at Alissa Walker’s Torched site, go check it out if you like. Chris Tyler of Strategic Actions for a Just Economy, which commissioned me to do my Olympics report, joined as well, and the three of us spent a solid hour discussing what went wrong and options for trying to fix it — suffice to say that if former L.A. mayor Eric Garcetti’s ears are burning today, this is why.
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Friday roundup: Friends don’t let friends host the Olympics, and other cautionary tales

access_time personNeil deMause

Last week I teased a big project of mine that would drop this week, and it went live yesterday morning: a 57-page report, commissioned by Los Angeles economic justice advocacy group Strategic Action for a Just Economy, on whether L.A. can or should be trying to extricate itself from its hosting obligations for the 2028 Summer Olympics — something some local critics have suggested, especially in the wake of the city’s wildfire crisis and budget crisis and  immigration enforcement occupying force crisis. You can probably get a pretty good sense of the report’s findings from its title, “Damned If You Do, Damned If You Don’t,” but if you want slightly more details, here’s the nut graf:

While there are numerous unknowns—the history of the Olympics shows that budget questions are never resolved until it’s far too late, a path that L.A. has headed down with its agreements for the 2028 Games as well—the available documentation and history of international event hosting shows: Yes, if Los Angeles officials, or voters, decided to withdraw from hosting the Olympics, they could do so. This would come at the risk of potentially billions of dollars in damages from a breach-of-contract lawsuit and losses from expenses already undertaken. However, continuing as host also comes with a potential risk of losses that, if history is any guide, could similarly amount to billions of dollars.

The report also contains a wealth of information about Olympic financial history, including other locales’ attempts to back out of hosting major international sporting events for fiscal reasons (the Denver 1976 Winter Olympics that never happened, plus the 2026 Commonwealth Games that the Australian state of Victoria bailed on in 2023 amid concerns about snowballing costs), as well as mention of my new favorite Olympic factoid: that time they held a Winter Olympics in Nagano, Japan and nobody knows how much it cost because the local organizing committee literally set fire to its financial records. It’s all here, dig in if you’re in the mood for a long, enraging read — or if not, you can instead read the excellent summaries in Torched (which includes a quote from me on this week’s revelations about L.A. Olympics chief Casey Wasserman’s history with Jeffrey Epstein) and LAist.

And now that that’s off my plate, I have plenty of time for stadium and arena bullet points, and good thing, too, because this week brought craploads of them:

  • The Wyandotte County Commission followed suit with its neighbors in the city of Olathe and voted 7-3 to approve devoting local sales and hotel tax revenue to pay off part of the state’s $2.775 billion in bonds for a new Kansas City Chiefs stadium and surrounding development. The county, to be clear, gets absolutely nothing out of kicking in its own funding (total price tag still TBD), given that the state has indicated it will go ahead with the stadium deal regardless. Kansas City, Kansas mayor and county commission chair Christal Wilson, who didn’t vote because no ties needed to be broken, wrote on Facebook that she thinks kicking in county money is warranted because it gets the county “a seat at the table” — okay, though it’s questionable whether getting to sit at the table is worth having to split the check.
  • Indiana state Rep. Earl Harris Jr. on his bill to create a sports authority to build a Chicago Bears stadium in northwest Indiana with money from (feigns coughing fit until you go away): “Indiana does sports things like this very well. When you look at the Pacers, the Colts, the Speedway, we’re very good at figuring out a good financial plan that does not hurt the taxpayer.” Um, about that…
  • Will the Portland Trail Blazers move if the city and county decline to spend $600 million on upgrades to their arena? It’s an “urgent race against time” and “the clock continues to tick,” writes The Oregonian, citing a deadline of … huh, seems like they didn’t mention any deadline, must have run out of room. (Though there was room for “Are you ready for the Nashville or Kansas City Trail Blazers?” to cite two cities that are not particularly shopping around for NBA teams.)
  • Tampa sports radio host JP Peterson insists that spending upwards of $2 billion on a new Tampa Bay Rays stadium is warranted because it “will produce millions in tax revenue and bring major events, Super Bowls, National Championship games, World Baseball Classic, MLB All-Star games” — [citation needed], my man. Also, I can save you some time: Even if a new baseball stadium does bring in millions in tax revenue, from hosting, uh, football games, when it costs hundreds of millions a year in tax expenditures, maybe that’s … not good?
  • Speaking of the Rays, fresh Rays vaportecture! I’m sticking with my comment from yesterday: Glad to see the Rays acknowledge that even after a future stadium is built, fans still won’t buy jerseys with player names because they know they’ll be sold off as soon as they reach arbitration.
  • And if you want still more Rays commentary from me, I spoke with both WMNF radio and Tampa Bay 28 TV about the ongoing dispute this week; the former is much longer, the latter offers a view of what I have on my living room walls, pick your poison.
  • Just in time for the Super Bowl (what time does it start again?), here’s a Top 40 list of things the NFL demands from Super Bowl host cities. It’s impossible to pick just one favorite, but equally impossible to beat “three championship-level 18-hole golf courses and two top-quality bowling alleys, free of charge.”
  • Plans to build an Indy Eleven a soccer stadium for a new MLS team on Indianapolis’s former heliport are on hold because something about not rewarding a city that “continues to thumb its nose” at ICE; the FAA will soon be weighing in on the matter.
  • Washington Gov. Bob Ferguson has met with NBA commissioner Adam Silver, though not in the sense of actually meeting meeting like in person, and “offered to be helpful in bringing back the Sonics” as an NBA expansion team. Seattle already has a practically brand new arena, though by the time the NBA is ready to expand it could be pushing 10 years old, is that too soon to ask for upgrades?
  • San Antonio Mayor Gina Ortiz Jones says Spurs owner Michael Dell donating $6 billion to Donald Trump’s “Trump accounts” savings plan “really pissed me off” because “if you can give $6 billion for these accounts, you could have paid for your own arena.” But then Dell wouldn’t have those billions he saved by getting taxpayers to build his arena! Sounds like somebody doesn’t understand what the whole point of being a billionaire is. (Hint: It’s getting billions of dollars, not spending it.)
  • And finally on the Rays front, Frank Nockels of Land O’ Lakes, Florida asks: “If we pay for half of the Rays’ new stadium, can we get free tickets?” Ian Betteridge has some bad news, Frank.
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LA Olympic organizers, facing billions in potential taxpayer costs, trade arena naming rights for free tax prep

access_time personNeil deMause

Los Angeles, which won Olympic hosting rights after Boston withdrew its bid because it was too expensive, is continuing to prepare for the 2028 Summer Games, a little less than three years out from the planned opening ceremonies. This puts L.A.’s Olympic committee smack in the middle of fundraising season, and L.A. officials negotiated a concession from the International Olympic Committee that it hopes will help avoid the crushing fiscal losses of past Games: the ability to sell naming rights to Olympic venues, instead of having to give them non-corporate names as the IOC has previously required.

The latest news on that front is that the Clippers arena, which is set to host Olympic basketball, will continue to be named after Intuit in a deal worth, let’s see:

Terms of the deals were not disclosed.

No terms at all?

The arrangement with Intuit includes the company providing free tax preparation for some U.S. athletes and expanding its financial education program for the LA community.

That doesn’t sound great, though also naming rights that will last only about a month likely aren’t worth all that much, so maybe free tax prep is at least better than nothing.

All this matters for more than just the organizing committee because while L.A. is hoping for a repeat of the successful 1984 Summer Games, there’s a key difference this time around. In the run-up to the 1984 Olympics, then-mayor Tom Bradley led a push to successfully demand that the city not take responsibility for any costs overruns, forcing L.A. organizing committee head Peter Ueberroth to get creative to find a way to balance Olympic budgets. But this time around, then-mayor Eric Garcetti declared that attempting to get a similar agreement “would be a nonstarter for the IOC,” and instead settled for stuff like naming rights. This means that if the 2028 Olympics go over budget — and every Olympics since 1984 has done so, with costs often doubling or more — the city of L.A. will be on the hook for the first $270 million in losses, the state of California for the next $270 million, and the city again for anything over that.

How the Olympic budget is going so far is impossible to say, as the L.A. Olympic Committee’s periodic budget reports just indicate projected costs (currently $7.149 billion) and revenues (conveniently, also $7.149 billion) with no real breakdown of how those numbers are determined or where the money is coming from or going to. Olympic finances are famously handwavy during the preparations for the games — Olympic scholar Jules Boykoff has called them “Etch-a-Sketch economics” because the numbers change so much — and often even afterwards, thanks to measures like the organizers of the 1998 Nagano Winter Olympics setting fire to their own financial records.

Whether L.A. can get significant money from naming rights sales, then, looks like it may well be important for deciding if California taxpayers take a bath on the 2028 Summer Games, along with such questions as “Will international tourists still come if the city is a Trumpian military zone?” and “Is it a great idea to devote city time and money to hosting a sports mega-event when a large swath of your city just burned to the ground?” Not questions that the Olympics organizers are being made to answer in public, though — surely it’ll be okay, this one will be different!

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Friday roundup: D.C.NFL stadium comes with nine-figure Metro cost, Mets owner likely to win casino on city parking lots

access_time personNeil deMause

I had a nice talk yesterday with Chris Francis of Straight Arrow News (owned by the union-busting Joe Ricketts, sigh) about ballooning hidden public costs of sports stadiums and arenas, and the resulting article is up this morning. Key quote: “I think the team owners and the officials who work with them have realized that it sounds worse to give a check, a taxpayer check, to the team for the stadium than to say, okay, we’re not going to give you that, but we will give you money for infrastructure. We will give you tax breaks. We will give you a break on land costs.” We were talking about the Denver Broncos at the time, but really it goes for all modern sports subsidy deals: All the real costs come in the fine print.

Speaking of the fine print, let’s see what it holds this week:

  • When Washington, D.C. agreed to pay $1 billion in cash and $6 billion or so in future rent breaks to Commanders owner Josh Harris for a new stadium, did everyone forget to mention it would come with a major expansion of the Metro station near the stadium site and perhaps a new station nearby as well? That could cost “in the ballpark of hundreds of millions of dollars,” says councilmember Charles Allen, but “we cannot afford not to do it.” Remember when Allen was saying “D.C. has a responsibility to scrutinize the proposal & demand a better & fair deal” with a “billion-dollar industry”? Yeah, neither does he.
  • New York Mets owner Steve Cohen is set to be awarded a casino license for the city-owned Citi Field parking lots he controls, after it turned out the state senator opposing it was the most disliked woman in Albany. There’s no public money involved, only public land, and that was effectively given away when then-mayor Mike Bloomberg gave Cohen a 99-year lease on the property as part of his stadium deal, but if you want to be annoyed at a multibillionaire sports team owner getting his way over community opposition, don’t let me stop you.
  • The main opposition group to next month’s referendum on giving the San Antonio Spurs around $150 million worth of future tax money toward a new arena is splitting its recommendations, urging a no vote on Prop B (which would provide the arena money) but remaining neutral on Prop A, which would devote tax money to redoing the area around the old arena to attract more rodeo events. COPS/Metro wants to see the county’s money from hotel and rental car taxes spent on “a range of community projects” guided by a citizen committee; it’s not entirely clear what happens to the arena plans if Prop A passes and Prop B does not, but that’s looking like a possibility.
  • The Cleveland Browns owners have started moving dirt at their new stadium site even before figuring out how it will all be paid for. All the kids are doing it!
  • The Athletics have filed for $523 million worth of construction permits in Las Vegas; getting those still won’t guarantee that the vaporarmadillo comes to pass, but it’s edging closer to decision time.
  • Heywood Sanders has elaborated on why the $2.6 billion plan to expand the Los Angeles Convention Center in advance of the 2028 Olympics is a terrible idea, saying in a Q&A with Torched’s Alissa Walker that other similar centers are seeing attendance drop even when they expand, and are having to offer discounted rates to lure a dwindling number of events. Key quote from Walker: “[Bangs head on desk].”
  • The organizers of the New York Marathon claim that it and other running events add almost a billion dollars a year to the city economy; it doesn’t look like they even bothered to hired a consultant to write a report justifying the number, but Crain’s New York Business published it anyway, this is fine.
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L.A. approves $2.6B convention center expansion, even as convention demand shrivels

access_time personHeywood Sanders

There are boondoggles, there are big boondoggles, and then there are public development disasters. Los Angeles has just embarked on a disaster.

Last week, the Los Angeles city council approved an expansion of the Los Angeles Convention Center with a price tag of $2.62 billion. The number itself is impressive. But what is even more impressive, or totally depressing, is how the city got to that figure.

Back in 2015, after a deal to combine a new football stadium with the convention center fizzled when Farmers Field ended up not being built, city tourism officials came up with a new scheme to expand and modernize the center with the aim of boosting the city’s competitive position. While acknowledging that other cities had built or expanded their centers on the “naïve assumption that, ‘if you build it, they will come,’” they asserted Los Angeles was “not a second-tier market or a desperate city trying to be more than it can realistically be.” The Convention, Sports and Leisure consulting firm promised that the center would see at least a 42% increase in convention attendees and hotel room nights after the expansion.

At that point, the cost estimate for the LACC expansion was $470 million. But year by year, as city staff tried to engineer a public-private partnership and design an updated and expanded venue, the price tag grew. By February 2020, the city council was warned that cost estimates had grown to $957 million. The figure from the city’s chief administrative officer in November 2023 came to $1.4 billion. What the city council accepted and supported last week was $2.62 billion — with every realistic likelihood of increasing more in the future.

So, what will the city get for $2.62 billion, which will be paid off via $193 million in annual debt service for the next 30 years? The chief administration officer says the project will create 2,153 new jobs each year after the expansion, the product of $150 million in new visitor spending each year. Local downtown interests and construction interests assert that it will be “transformative” for downtown, and by boosting the city’s convention center space will allow L.A. to compete for larger events against the likes of New York and Chicago.

The argument, set out by CSL in 2015, that more space means more convention business had been repeated by the CAO’s office in the years since. The 2023 report forecast that the hotel room nights generated each year by the center would grow from 288,045 to 490,758 — a 70% increase. Even now, the city continues to use those figures, as well as even more expansive estimates of increased tax revenue.

Yet the convention market has changed significantly in the last decade. When CSL delivered its forecast in 2015, Chicago’s McCormick Place had 937,600 convention and trade show attendees. Last year it saw 794,250. The total attendance of New York’s Javits Center in 2015 was 2.16 million. For 2024, its attendance came to 1.37 million. The Las Vegas Convention Center saw 1.3 million convention and trade show attendees in 2015. The comparable figure for 2024 was 1.1 million.

The 2015 white paper that made the case for the L.A. expansion cited examples of “large conventions that would choose Los Angeles if the LACC had adequate levels of properly designed and placed space offerings and program solutions.” The list included the annual meetings of the American Heart Association and the American Academy of Ophthalmology. That year, the AHA meeting in Orlando had 17,978 attendees. Last year, its attendance totaled 12,900. The 2015 ophthalmology meeting in Las Vegas had 28,355 attendees. The attendance for the 2024 meeting in Chicago was 16,543.

Even as Los Angeles commits to spending hundreds of millions of dollars in annual debt service — public dollars that could be used to employ police, firefighters, and other public servants — the likelihood of any significant increase in the city’s convention business is effectively nil. As L.A. has debated its convention center expansion, other cities have continued to add to heir own spaces, justified by the same arguments: downtown transformation, competitive demands, and optimistic consultant studies. And Los Angeles, which for years has had to offer its convention center space almost for free — token $1,000 rentals for space which should rent for $500,000, $710,000, or $1.1 million — will inevitably have to continue to give it away well into the future.

Built south of downtown in an area with effectively no nearby hotels or amenities, the L.A. center never offered the kind of environment typically sought by meeting planners and convention attendees. But it did offer a spacious home for the local auto show, other local public shows, and a large number of film shoots for major movies. Still, those did not bring out-of-town attendees to the city and do anything for the area’s economy. The answer was supposed to be the development of a great big hotel next door, together with restaurants and other attractions. Phil Anschutz’s AEG opened a 1,001-room JW Marriott/Ritz Carlton hotel together with the L.A. Live entertainment complex in 2007, using abundant public subsidies. Even that didn’t significantly reduce the deficit in nearby hotel rooms, or increase the center’s convention business.

In 1999, the LACC’s strongest year after a 1993 expansion, the center produced about 375,000 hotel room nights for the city. Things slid after that, as competing expansions in Las Vegas, San Diego, and other cities competed with L.A.  The center managed about 290,500 room nights in 2012, by offering free rent deals to event organizers. But the figure fell again, to about 245,000 in 2019.

In the end, L.A.’s $470 million convention center expansion has turned into a $2.6 billion one, in an overbuilt and declining market where Los Angeles and all of its competitors increasingly have to give their space away for next to nothing. Sounds like a great deal!

[Ed. Note: While L.A.’s convention center expansion began as a pairing with a never-built NFL stadium, it’s now being driven in part by a deadline to get the building ready for hosting events during the 2028 Olympics — even as L.A. has touted this as a “no-build” Games. Alissa Walker’s Torched newsletter has all the details.]

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Friday roundup: Spurs, Bengals owners to seek even more public money, Olympics could cost LA $1.5B for security

access_time personNeil deMause

Congratulations, we once again made it to the end of another programming week, as well as the end (presumably) of the “Will Washington Commanders owner Josh Harris get to pocket billions of dollars of cash and tax and land subsidies?” saga. (Answer: He sure will.) Which cities’ sports funding debates could be the next to absorb the eyes of a nation, or at least the eyes on this website? Let’s run down some contenders from this week:

  • We’ve already covered the ongoing San Antonio Spurs arena debates here this week, but that earlier report on the city council’s Wednesday hearing missed the tidbit that right now the plan is for San Antonio to provide $500 million, Bexar County to provide $311 million (really only enough to pay for about half that in up-front costs, since the money would arrive over 30 years), and team owner Peter Holt to provide $500 million, which is less than the potential $1.5 billion arena cost. Spurs chief legal counsel Bobby Perez said (in the San Antonio Report’s paraphrasing) that’s “something the Spurs would have to figure out,” but that the team would pay for any overruns above the final public price tag, whatever it ends up being, which is maybe not as reassuring as he meant it to be. Perez also said that the team would not consider sharing any arena revenue to help pay the public’s share of costs because Holt will be using it to pay off his own share of costs, the public will just have to make it up in volume or something.
  • The Cincinnati Bengals owners finally signed their new lease with Hamilton County that will include at least $700 million in public subsidies, everybody relax. Though the Bengals and the county said they’re still planning on asking for even more money from the state, exact dollar figure TBD, so maybe don’t relax just yet.
  • Philadelphia Inquirer columnist Mike Sielski wrote that if Philadelphia Eagles owner Jeff Lurie wants a new stadium, he should pay for it himself, and got a flood of agreement back from readers, including that it’s a bad time to ask for public money “with hospitals closing, SEPTA broke, and schools struggling” and that “many people think that Camden Yards created the Inner Harbor, but the Inner Harbor was booming long before the Orioles left Memorial Stadium. And now the Inner Harbor has collapsed.” Good thing for Lurie that it’s almost certain none of these people will get to vote on any stadium plan, because that’s not how cities east of the Mississippi roll.
  • The owners of Boston Legacy F.C. (née BOS Nation F.C.) faced an August 1 deadline to figure out how they will pay for their share of stadium costs on top of the city’s $100-millionish, but they blew that deadline so now they get a new one of September 15. Meanwhile, mayoral candidate Josh Kraft is accusing Boston Mayor Michelle Wu of not being transparent about the total cost of the women’s soccer project, at the same time as Josh’s dad Robert is fighting with Wu about his plan to build a new men’s soccer stadium for his New England Revolution in neighboring Everett, which Wu has warned could subject Boston to increased traffic, this is the most convoluted HBO Max series plotline ever.
  • When the Los Angeles Olympic host committee promised that the 2028 Games would come at “zero cost” to the city, apparently it didn’t include security costs, which could amount to maybe $1.5 billion. There’s now growing talk of getting L.A. to pull out of the 2028 games altogether, especially now that Donald Trump has threatened to send in the military during the event; that doesn’t sound very likely, but the Unite Here hotel workers’ union has proposed a ballot measure that would require many Olympic venues to get voter approval to be used for the Games, which looks to be mostly a tactic to head off attempts to overturn the $30/hour “Olympic wage” passed by the city council in May — I take it back, maybe this is the most convoluted HBO Max plotline ever.
  • ESPN is about to own part of the NFL’s media package and the NFL is about to own part of ESPN, don’t see any potential problems there. I do greatly look forward to every football highlight on SportsCenter being accompanied by a disclaimer that “the National Football League is a part owner of ESPN,” surely a company with such a great ethical record as ESPN wouldn’t skip over that.
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