Category: Cleveland Guardians

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: Bears battle drags on, Blazers subsidy heats up, 15 teams now angling for Ohio unclaimed funds cash

access_time personNeil deMause

It’s Friday! But because of other commitments, I’m writing this from Thursday evening! So if there’s any breaking Friday morning news, complain about it in comments, and we’ll get to it on Monday, which for me will probably be Sunday. You following all that? Doesn’t matter, just read your bullet points, they’re good for you:

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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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Cleveland still has no money for Cavs, Guardians upgrades, is resorting to stalling

access_time personNeil deMause

The controversy continues over the city of Cleveland and Cuyahoga County having to cover more than $400 million in upcoming repair costs for the Guardians stadium and Cavaliers arena despite having no money to do it with. And according to Cleveland.com, there’s nothing the local governments can do about it:

Under its lease agreements with the Cleveland Cavaliers and Cleveland Guardians, Gateway Economic Development Corporation of Greater Cleveland is responsible for paying for capital repairs over $500,000 at Rocket Arena and all repairs — big or small — at Progressive Field.

Worse yet, it’s not just genuine repairs that taxpayers are on the hook for; the Guardians leases also contains one of those dreaded state-of-the-art clauses that requires publicly funded upgrades if the Cleveland stadium has fallen behind three-quarters of other MLB ballparks, “as well as any changes required by television networks, the league, insurers or government regulations.” Most recently, this required the city and county to spend $1.3 million to install padded seats behind home place in 2023, on the grounds that all the other kids had them.

Gateway officials have responded by trying to stall on approving the payments, with one board member telling a Guardians official, “We are required to fund it. We are not required to fund it on the schedule that you’re asking.” But ultimately, according to the lease extensions approved by lawmakers in 2004 and extended in 2021, the leases require the city and county to cover these costs in exchange for the Cavs and Guardians staying put through 2034 and 2036, respectively.

The city and county do have a doomsday option, though. As I wrote last December:

The leases say the teams can sue Gateway for damages if they don’t get their repair money on time. However, if Gateway runs out of money — which it would if the city and county stopped giving it more cash — it doesn’t appear that the Guardians and Cavs owners can sue the city and county, so it’s within the governments’ power to shut off the money spigot and dare the teams to break their leases and try to find better ones elsewhere, if they wanted.

That doesn’t seem to be the plan so far: Gateway officials are griping to the city and county that they need a bailout — another bailout, following one for $20 million last year that raided funds for a minority business program and other projects — and Mayor Justin Bibb is muttering about creating tax surcharges in the stadium district to help cover costs. This all seems destined to end with the team owners negotiating another round of lease extensions in exchange for a lot more public cash, like how it’s been done one state to the west; you’d like to think that Ohio legislators could be better negotiators than Indiana ones, but if city and county officials had shown any ability before this to write leases that would protect taxpayers, they wouldn’t need the talcum powder.

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Friday roundup: Chiefs to ramp up Kansas saber-rattling, Bears’ Indiana move threat gets cool reception in Illinois

access_time personNeil deMause

Are people still flipping out about Chicago Bears management acknowledging that Indiana is next door to Illinois and they could try to build a stadium there if they wanted? Yep. Does that mostly come down to “fans in Indiana would be happy with a shorter drive and those in Chicago would be unhappy with a longer one”? Yep.

We’ll get back to the Bears in a sec, but first the latest in a more advanced cross-state NFL team location battle:

  • A Kansas legislator says the state’s Legislative Coordinating Council, a joint committee of leaders of the state house and senate, is set to meet on Monday to discuss a proposed agreement between the state and the Chiefs on a new stadium, though the state commerce department cautions that “no final agreement has been reached.” The Missouri Independent says the committee could start the process of approving state-backed STAR bonds at its Monday meeting, though the state already approved those in concept last year, and it doesn’t seem possible to actually sell specific bonds without a specific agreement in place, so not clear on what could actually get decided on Monday. Mostly, this seems to be a way for the legislature to declare that Chiefs owner Clark Hunt has met the required end-of-2025 deadline to be eligible for the bonds — as has Royals owner John Sherman, apparently, despite no concrete stadium plans at all, given that committee chair Ty Masterson’s office said he believes the Royals have met the deadline by being “fully committed” to Kansas. Some sort of announcement of a Chiefs deal on Monday seems likely, but it’s also likely that a lot of details will still need to be worked out, so let’s hold off on the “Chiefs are moving to Kansas” headlines for the — never mind, too late.
  • Back in Illinois, state officials are taking talk of a Bears stadium in Indiana in stride, with State Rep. Kam Buckner (district includes Soldier Field, is opposed to stadium subsidies) calling the team’s move threat “very predictable” and saying “in negotiations, what you do is you create leverage by saying you have more options,” while State Rep. Mary Beth Canty (has sponsored a bill to allow for stadium subsidies in Arlington Heights) asked that the Bears “engage with the General Assembly in good faith, without threats.” State Sen. Bill Cunningham, meanwhile, called giving the Bears a property tax break (but not necessarily all the infrastructure money team execs are asking for) “a good starting point” because it would only be local, not state, tax money, but said “we have more important things to tackle first.” It certainly sounds like the Bears owners can get something out of Illinois, even it not everything they’re demanding; dropping an Indiana move threat may help them get on the legislative agenda, which may be all they want, but there’s still a whole lot of haggling to go.
  • Cleveland’s Gateway sports authority is facing an estimated $150 million in imminent repair costs for the Guardians stadium and Cavaliers arena, plus another $261 million over the next decade, and has no money on hand to pay for these costs and no plans for how to raise it. Not great! The city and county cover capital repairs while the teams cover maintenance, so there’s still the possibility of haggling over which is which. The government taking on all capital repairs during the teams’ 2004 lease renegotiations still seems like a terrible idea, and Gateway just defaulting on this and daring the teams to break their leases (which expire in 2034 and 2036 anyway) early seems like a reasonable consideration compared to throwing $400 million in good money after bad, but nobody’s talking about that just yet.
  • The Dodger Stadium gondola project refuses to die, year after year after year. “NBC Los Angeles reports that during the meeting, project supporters waved signs reading ‘Build the gondola’ while opponents held signs saying ‘Stop the gondola’,” can’t we come to some sort of compromise?
  • Inter Miami‘s new stadium is finally set to open next spring, but the promised accompanying public park space won’t be ready yet, seen that one before.
  • And then there’s Germany, where when a pro women’s soccer team needs a bigger stadium, the team owners buy the one that a recently relegated men’s team is no longer using plays in. It was built way back in 1992, can you imagine how outdated the Getränkehalters must be?
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Friday roundup: What if schools got all the money they needed and sports teams had to hold bake sales to build stadiums?

access_time personNeil deMause

Yes, that story about nobody knowing how much the 1998 Nagano Winter Olympics cost because the Olympic committee literally set fire to its financial records is incredible, and yes, I really need to make a fridge magnet about it. This is more a note to myself than to you all, feel free to skip ahead to this week’s speed-round bullet points:

  • Cleveland mayor’s office chief of staff Bradford Davy said of the Guardians and Cavaliers owners’ insistence on more public money for venue upkeep and upgrades that “we are going to have to make sure that those relationships are strong and thoughtful,” but also that “the general revenue fund cannot be held accountable” and the city needs to look for other revenue sources that wouldn’t take away from spending on basic city services. I see where this is inevitably going, just be sure to say no to soufflés.
  • Also in Cleveland news, a federal judge has declined to issue an injunction against the state of Ohio’s use of unclaimed private funds to pay $600 million toward a Browns stadium plus more for other private sports projects, but is letting a lawsuit against the spending to move forward. It’s unclear what will happen if the Browns get their state check and the state then either loses its case or has its unclaimed private fund pool drained by state residents applying to get their money back — look for other revenue sources, I guess, it’s all the rage!
  • A consultant hired by the Wisconsin Professional Baseball Park District has issued a report concluding that the Milwaukee Brewers stadium parking lots could hold $700-800 million worth of development, which if fully built out and taxed would supply $18.8 million a year in property taxes. True, the land is owned by the state stadium authority and so is tax-exempt, but maybe the district could cut a deal for payments in lieu of property taxes with some as-yet-unidentified developer, despite “environmental issues” like the parking lots being partly in a flood zone? Anyway, the Brewers’ president of business operations called it a “good first step,” that’s enough to build an entire headline around, print it!
  • Ottawa Senators owner Michael Andlauer has hired a team of lobbyists to push for public money from the federal and provincial governments for the new arena that the team has been fighting for since before their old owner died. It’s not clear exactly how much the lobbyists are asking for beyond money for “infrastructure financing and other government programs,” but the Ontario government does have an $8 billion infrastructure fund sitting right there, which you know must get Andlauer salivating. The local media is also reporting that Andlauer wants a similar deal to the one the Calgary Flames owners got in which about $300 million is coming from the province of Alberta and $537 million from the city of Calgary, but also that the Sens owner “has publicly stated that the organization will not be asking the City of Ottawa for taxpayers’ money.” Say no to soufflés, Michael!
  • Springfield is still looking at building a pro soccer stadium. Which Springfield? All of them, probably?
  • Rhode Island officials have refinanced their Pawtucket soccer stadium bonds with the terrible interest rate and somehow managed to be both paying even more this time and also having the state treasury for the first time be the backstop for bond payments. GoLocalProv reports that “the Rhode Island Commerce Corporation and the Pawtucket Redevelopment Agency have refused to comment on the new financing scheme,” and can you really blame them?
  • If you’ve been craving a supercut of the Buffalo Bills-themed Hallmark movie (horrifyingly not the first NFL-team-themed Hallmark movie) only containing the parts where the male romantic lead talks about how great the new Bills stadium is, Defector has got you covered.
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Friday roundup: Royals “poll” fans on why they need a new stadium, plus still more soccer teams, so many soccer teams

access_time personNeil deMause

I’m posting this week’s roundup from the road, so apologies if any news slipped through the cracks, and I’ll try to catch up with it next week. But at least I’m not shutting down my site to take a full-time editing job: While I’m very happy for Tom Scocca’s bank balance and health coverage, he’s one of the best writers and most astute political analysts in an increasingly threadbare media landscape, and his writing at Indignity and elsewhere will be sorely missed.

In happier news … hahaha, what am I saying, most of this news is dismal as always. But anyway in LOLdemocracy news:

  • Kansas City Royals officials are surveying selected fans about their thoughts on three potential stadium locations — Downtown/Near Downtown, Clay County/North Kansas City and Johnson County/Overland Park — some of which surely is meant to serve as a push poll, given that it only includes one positive option about the team’s current home (“Kauffman Stadium is still a great place to watch a game; There is no reason for the Royals to leave”) and two negative ones (“Kauffman Stadium is past its prime and needs to be replaced by a modern ballpark that is surrounded by an entertainment district with shops, restaurants and bars” and “I love the ‘K’, but it lacks the amenities of modern ballparks and our region would be better served with a brand-new ballpark in a different part of town”). And while surely team owner John Sherman will use the actual responses in some way, you know that his main concern is who he can extricate the most public money from — and by naming three potential locations, he also creates leverage to get the most public money from whichever site he or fans might prefer otherwise, so really win-win-win for him!
  • Raleigh may be asked to build a new stadium for the NC Courage and North Carolina F.C. (currently about to go on hiatus before jumping to the USL’s new top tier intended to compete with MLS) soccer teams, and Green Bay may build a stadium for new minor-league soccer teams, and Rancho Cordova may get tax incentives to help build a $175 million arena for an indoor soccer team, hands up everyone who knows where Rancho Cordova is or that the U.S. has an indoor soccer league! In any event, everybody still gets a soccer team, cities really don’t have to rush to pay for stadiums to get one, you have to beat them away with sticks at this point.
  • Tampa Bay Business and Wealth (?) headline: “The data is in: Mixed-use stadiums win big for cities and fans.” Actual report (?) by consultants JLL (“We believe in the power of real estate to shape a better world”) linked to in the article: “Attendance trends from the 2025 MLB regular season show that stadiums in Lifestyle Market ecosystems drive elevated attendance, even when team performance is poor” (mostly based on the success of the Atlanta Braves, who drew well in 2025 despite sucking largely because people still  bought tickets thinking the entire starting rotation wasn’t going to get injured) and “By 2040, we predict that at least half of MLB organizations will announce plans to develop a new stadium or perform a major redevelopment of their existing venue” this seems to be more winning big for team owners than for fans or cities, you know?
  • MLS commissioner Don Garber is headed to Vancouver to complain that the Whitecaps don’t get first dibs on dates for playoff games and have to share food and beverage revenue with their government landlords, can you imagine the nerve of those Canadians?
  • On Cleveland Mayor Justin Bibb’s proposal for a sales tax surcharge district to fund Guardians and Cavaliers upgrades, Cleveland.com reports that “on Reddit, users on r/cleveland and r/cavs were largely united around the same message: billionaire team owners should pay for their own stadiums. They rejected the idea that beers or hotdogs should cost more,” while “on Facebook, the reaction was more skeptical — and often sarcastic.”
  • We already knew that the Baltimore Ravens were working on a nearly-half-billion-dollar renovation funded mostly by tax dollars, but “The Ravens are investing an additional $55 million for the improvements, with the stadium authority set to reimburse the team up to $35 million of that amount” is a new twist, not to mention a new definition of “investing.”
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Cleveland mayor wants new taxes to fund Cavs, Guardians upgrades to avoid using old taxes to do so

access_time personNeil deMause

This week’s candidate for weirdest headline, from yesterday at Cleveland.com:

Bibb to Cavs and Guardians: No more bailouts until there’s a new game plan to fund stadium repairs

So once the Cavaliers and Guardians owners agree to a new way to fund stadium repairs, then Mayor Justin Bibb will agree to bailouts? Wha? Let’s read further:

Bibb told reporters at a recent news conference that he wants to create a special financing district that could collect small fees on parking, dining and entertainment in the Gateway District. The mayor said it’s a “practical, pragmatic” way to generate revenue to help maintain Progressive Field and Rocket Arena.

“Fees” on parking, dining, and entertainment are more commonly known as “sales tax surcharges,” and applying these to the entirety of the Gateway District — which includes not just the Cavs arena and Guardians stadium, but a bunch of malls and restaurants and other attractions — would represent additional tax money that locals and tourists alike would have to pay toward maintaining and upgrading the teams’ venues. That’s in one way better than the city having to scrounge around every couple of years for more cash to spend on upkeep, but in another way worse in that the city would be implementing a new tax to funnel upgrade money to the team owners ad infinitum, presumably even after the expiration of the current leases (2034 for the Cavs, 2036 for the Guardians) during which the city took over major capital repairs for the teams in exchange for them agreeing to stay put a few more years.

If the Cavs and Guardians aren’t ready to pursue new revenue streams, Bibb said City Hall won’t approve another bailout.

“I made it clear to the teams,” Bibb said. “I’m not tapping the general revenue fund until we look at these other concepts.”

“Take my tax money or I won’t give you any more tax money” is a novel approach, I’ll grant you that. Bibb says using surcharges in a New Community Authority, or NCA, would “shift the cost of stadium repairs away from residents and toward visitors who attend games and dine nearby,” but 1) residents go to see Cavs and Guardians games, that’s exactly who Cavs and Guardians fans are, and 2) even if this were all tourist money, it’s still tax money that the city could choose to collect and keep, but would instead be turning over to the team owners. (Cleveland currently has a similar taxing district on the lakefront, but that’s designated for building public spaces, at least, not for upgrades to privately controlled sports venues.)

One weird twist about Ohio NCAs is that property owners have to opt in to them, so it’s entirely possible all the landholders whose restaurants and malls would get newly tax-surcharged could tell the city to pound sand and there would be no new revenue at all. (The stadium and arena are co-owned by the city and the county; it’s an interesting question if the Cavs and Guardians, as tenants, could opt out of being taxed to fund their own upgrades.) Cleveland.com theorizes that “business owners would support it because the Cavs and Guardians drive foot traffic that keeps the Gateway District lively,” but that presupposes that 1) business owners will assume the Cavs and Guardians will leave without new taxes, despite those leases being in place for another decade and 2) they think game-day foot traffic is valuable enough to be worth getting saddled with as much as a 5% tax hike.

All this is coming to a head because the cigarette and alcohol taxes that were originally used to pay for the Gateway venues and later extended to pay for upgrades are coming up short of what the teams want, and local voters are currently so steamed by the Browns moving to suburban Brook Park that they may not approve a renewal of those taxes anyway. Mayor Bibb is also famously steamed about the Browns moving, or at least was until Browns owner Jimmy Haslam agreed to make $80 million worth of payments to his city, but he’s stuck with those leases for the near future, and would rather raise taxes just in the sports district than on all of Cleveland.

Even if it’s public money either way, you can kind of see where Bibb is coming from. Or you could point out that the whole Gateway complex was pitched as economic development that would pay for itself but instead is requiring ever-higher levels of public subsidies, and there’s a time to stop throwing good money after bad. At this point it would probably require breaching the teams’ leases and letting them walk if they want, but since neither has any great immediate options for relocation (Brook Park isn’t going to build two stadiums) and they can walk in another 9-to-11 years anyway, there’s an argument to be made for calling their bluff now and seeing what their owners do once the subsidy faucet is shut off.

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Friday roundup: Cleveland sin tax hike could add $300m in sports subsidies, A’s declare moving dirt around is “essentially” breaking ground in Vegas

access_time personNeil deMause

Donald Trump’s “One Big Beautiful Bill Act” passed the House yesterday by a single vote, and while there are probably other more important bits to pay attention to — the massive money transfer from the poor to the rich, the mandatory cuts to Medicare that would be triggered, the sops to Big Oil that could increase energy costs — it’s worth noting that it would also cut sports franchise owners’ amortization loophole in half. (This is the tax dodge discovered by Bill Veeck in the 1950s that allows some team owners to double-dip on deductions by claiming tax breaks both for their annual spending on player development and for the presumed loss in team value from the fact that players wear out and have to be replaced. It’s not the biggest of sports subsidies, and there’s no guarantee it will survive the Senate version of the bill, if the Senate actually passes it at all — recall that when Trump’s first-term tax bill tried to eliminate the use of tax-exempt bonds for sports stadiums, the Senate conveniently excised that language — it’s worth keeping one eye on.

The other eye, meanwhile, has had plenty to keep it busy this week:

  • The Cleveland Browns stadium wars keep heating up, with Cleveland and Cuyahoga County officials saying they will no longer work with the Greater Cleveland Partnership, the region’s chamber of commerce, following the partnership’s endorsement of the Browns moving to a new stadium in Brook Park. Cleveland Mayor Justin Bibb, meanwhile, said that “we gotta move on” regarding the Browns remaining in their current stadium, and that he plans to focus on developing “a lakefront our residents can be proud of,” with plans to issue a request for proposals this summer. Meanwhile meanwhile, the owners of the Cavaliers and Guardians have issued letters to the partnership expressing concern that if the Browns owners seek to use cigarette and alcohol tax money for their stadium — something they haven’t done yet, but also the financing plan still has big holes in it at present — it could kill chances for Cleveland’s other teams to get increased “sin tax” money, given how much local voters hate the idea of using that money to move the Browns to Brook Park. A sin tax hike could bring in an additional $20 million a year, which could fund about $300 million in future repairs and upgrades for the three teams’ venues.
  • The Oakland Athletics of West Sacramento‘s Las Vegas stadium has “essentially broken gr0und,” claims team president Marc Badain, with cranes coming in to do “shallow foundational work” starting July 1. Badain’s statement was largely overshadowed by the issuance of an agreement for the team to submit a $3.7 million bond to cover the costs of building an eight-foot wall around the site if no stadium ends up being built there; while this probably isn’t a sign that the project is on any shakier ground than already expected — the Raiders signed a similar agreement before successfully building their stadium — it’s still not a great look.
  • There have been a bunch of town halls in D.C. around the proposed $7.5 billion–plus Washington Commanders stadium project subsidy, and while there are people on both sides, one comment from Frazer Walton, a member of the Kingman Park Civic Association, is worth particular attention: “I absolutely support using public funds. I absolutely support seeing millionaires come to the city, so they can pay some of these taxes for us.” That is absolutely not how taxes work and D.C. officials haven’t even released consulting-firm numbers about how they pretend they will, and it makes the case better than I can that D.C. is better off using that money for its education budget, clearly its schools aren’t doing the job they need to.
  • Orange County Mayor Jerry Demings says if wannabe Orlando MLB team owner Rick Workman wants county land for a stadium, “I don’t think we should donate land to billionaires or to wealthy people. They, if anything, have to compensate the people for the land.” D.C. officials, see how it’s done, is that really so hard?
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Inside why Cleveland keeps having to throw good stadium money after bad

access_time personNeil deMause

One day after the Cleveland city council approved an additional $20 million in Cavaliers arena spending and Guardians stadium spending because the team’s leases say the public has to pay for it and the public repair fund had run dry, the Cuyahoga County council followed suit last night, approving $17.35 million in county money to buy the Cavs new elevators and a broadcast control room and buy the Guardians new HVAC units and repairs to a “subroof,” whatever that is:

Cuyahoga County will borrow $14.5 million to help Gateway Economic Development Corp. pay the repair bills at Rocket Mortgage FieldHouse and Progressive Field.

On top of that, the county is giving $2.85 million in General Fund dollars to Gateway, the nonprofit that owns the ballpark and arena and oversees repairs.

Those with advanced degrees in how money works will recognize that “borrowing $14.5 million” is not actually a way of explaining how one plans to pay for something, but it fills Gateway’s budget hole for the moment. Future generations of county officials will get to figure out how to pay it off, though one got a head start by explaining that really, at least paying for constant upgrades is better than build a whole new stadium, amirite?

County Council Member Dale Miller, in a committee hearing on the proposal in November, argued that spending on repairs was preferable to building new stadiums.

“The key to our continuing to be a big-league sports town is that we maintain facilities in good condition, so that we don’t have to replace facilities every 25 years or so,” he said. “I know they’re doing that in some other cities, but we don’t have that kind of resources here.”

(Ed. note: Cuyahoga County is currently considering whether to replace a Browns stadium that is exactly 25 years old.)

Yesterday I wondered aloud why Cleveland and Cuyahoga County are paying for constant upgrades, and today I have a partial answer to that: Former Gateway chair Ken Silliman kindly provided copies of the Guardians and Cavs leases, and it turns out they each have slightly different definitions of what the public is on the hook for:

This, needless to say, raises a lot of questions, some of which Silliman was able to shed some light on:

How come Gateway pays for all routine maintenance, capital repairs, and major capital repairs for the Guardians, but only major capital repairs for the Cavs? Both teams, Silliman explains, were on the hook for maintenance and minor repairs as of 2021. That was when the city and county approved spending $17 million a year on stadium upgrades in exchange for Guardians owners Larry and Paul Dolan extending their team’s lease through 2036; as Silliman puts it, “the Guardians were successful in assigning ALL ballpark capital repairs to Gateway as a byproduct of the lease extension.” So a blank check got considerably blanker, in exchange for the Guardians owners agreeing to stay put for an extra 13 years.

Why does anything over $500,000 count as a major capital repair? Doesn’t this 1) incentivize the Cavs to bundle repair items into bigger projects, in hopes of making them the public’s responsibility, and 2) mean that as inflation kicks in over time, more and more repair items would be expected to fall under “major capital repairs”? The $500,000 threshold dates back to the teams’ 2004 leases, and Silliman says he doesn’t know how that distinction between major and minor repairs was decided on. He says the team cheating by piling up small repair projects hasn’t been an issue — Gateway’s engineering consultant has to approve expenses — but inflation absolutely is.

Silliman also forwarded a memo he wrote last fall to the Gateway board in which he said:

This “elephant in the room” is the unprecedented post-pandemic two year spike in construction cost inflation which unfortunately coincided with Gateway’s obligations to fund two of its costliest capital repairs (Cavaliers’ vertical transportation/video production room and Guardians’ lower and upper bowl seat replacements). This perfect storm of events is a major contributor to Gateway’s present cash needs.

That’s potentially good news in that the post-pandemic inflation spike is now over. However, construction costs continue to rise, and sin tax revenues continue to fall, and that $500,000 threshold for which Cavs expenses the public is on the hook for is going to be a lower and lower hurdle, so, it’s not all that good news.

Finally, the leases say the teams can sue Gateway for damages if they don’t get their repair money on time. However, if Gateway runs out of money — which it would if the city and county stopped giving it more cash — it doesn’t appear that the Guardians and Cavs owners can sue the city and county, so it’s within the governments’ power to shut off the money spigot and dare the teams to break their leases and try to find better ones elsewhere, if they wanted.

Tl;dr: Cleveland and Cuyahoga taxpayers aren’t on the hook for all upgrades to the Cavs arena and Guardians stadium, but they are responsible for paying for an unlimited amount of a limited number of items. (Think of it like different infinities.) The city officials who first set this up back in 2004 are mostly no longer around, though the ones in 2021 who took on “ALL ballpark capital repairs” for the Guardians should be getting questioned about that, early and often.

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