Category: NBA

Friday roundup: Spurs owner wants arena subsidies so he can be “scrappy,” A’s owner gets closer to unlocking county stadium cash

access_time personNeil deMause

Some weeks, when all the work of this website feels like an endless repetition of the same stories over and over and over again, I try to remind myself that while the general shape of the stadium swindle has remained the same over the last 30 years — boy meets stadium dream, boy uses standard playbook to demand that someone else to pay for stadium dream, elected officials cough up the dough to boy — there have been some discoveries and innovations along the way: The Casino Night Fallacy. The grift that keeps on giving. The kitchen sink gambit. Reusable entourage. Sure, it would be nice for whatever showrunner is in charge of this accursed timeline to quit reusing the same plotlines — helicopter registration fraud was a surprise season-ending twist, but that was three years ago already — but if nothing else we’re getting a deeper understanding of the intricacies of how sports billionaires funnel taxpayer money into their own pockets, and who can put a price on that? Other than the literal price of “billions of dollars of tax money a year,” obviously, but enlightenment doesn’t come cheap.

Also, no one has taken away our god-given right to point and laugh (yet), so may as well enjoy it. And on that note, here’s some fresh meat for your inner Nelson Muntz:

  • San Antonio’s KSAT-TV asked Spurs owner Peter Holt why he can’t just pay for his own arena his damn self, and Holt said “it’s a great question” and San Antonio’s small market size has “pushed us to be scrappy” and “the underdog” and “we want to continue [our] partnership with the county and the city” and the arena project will use “visitor taxes that have no impact on our local citizens” and “there’s no extra fees.” That’s neither really an answer nor exactly true, but Holt is already off and not-answering whether the team would potentially move without a new arena: “You know, we’re not focused on this election not passing. I mean, I think our belief has always been, whether it’s on the court or off the court, we have excellence and we have winning in our DNA. And so we’re confident and optimistic that this will pass, and that’s our plan.” It’s easy to be confident when you’re spending $2 million on ad campaigns to convince voters to go your way, but just in case, may as well employ the “You don’t want to find out what’ll happen if you make Dad mad” strategy as well.
  • The Clark County Commission officially approved the Athletics‘ ballpark development agreement for Las Vegas(ish), which is mostly notable because it allows A’s owner John Fisher to finally tap into $380 million in public funds that was approved way back in June 2023. Or at least Fisher can get the money once he sets a guaranteed maximum price for the stadium and spend $100 million out of his own pocket first, maybe that’s what all the concrete pillars are about? Would Fisher really shell out $100 million of his own money in order to get $380 million in public money in hopes all that will somehow unlock another $1 billion or so of somebody else’s money? He’s done dumber things before, don’t put it past him!
  • Interim Jackson County Executive Kay Barnes says she doesn’t see herself as “taking on any kind of strong initiative” on major issues during her short time back in office, but that’s not stopping her from saying she wants to see stadium projects for the Kansas City Chiefs and Royals move forward, she’s not made of stone, people.
  • The St. Petersburg city council is looking at ending the city’s Community Redevelopment Area (i.e., a TIF that kicks back property taxes to developers) for the Historic Gas Plant District now that the Tampa Bay Rays aren’t using it for a stadium development, probably. “I was very hesitant to do this,” said council chair Copley Gerdes. “More and more, I’m becoming open to it.” What’s next, hugging?
  • A couple of big-market MLB teams might be showing openness to increased revenue sharing to make MLB TV deals more like the NFL’s, which would reduce budget disparities between rich and even-richer teams but also make it easier for teams to threaten to move from big markets to smaller ones like in the NFL. Color me skeptical — big-market team owners have never willingly given up revenue before, and this could all just be openness to new kinds of TV deals while still trying to preserve the biggest slice for themselves, but we’ll see where things go once negotiations for the next collective bargaining agreement begin in earnest after next season.
  • Yes, the latest owner of the Ottawa Senators is still hoping to build a new arena at LeBreton Flats and still hoping for a taxpayer “investment” to help him along, let’s all check back in another decade or so and see if anything has changed.
  • Camden Yards’ public owners won’t get any money from the Los Angeles Rams renting out the stadium for practice before their game in London, just like they didn’t get any money when Paul McCartney played there, who needs money when you have a pro baseball team whose owner wants money more than you do?
Share this post:

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.
Share this post:

Top county official says giving Spurs owner $150m for arena would have “zero impact” on locals, needs to go back to tax school

access_time personNeil deMause

With a public referendum on around $150 million worth of county funding for a San Antonio Spurs arena up for a vote five weeks from today, KSAT-TV had Bexar County Judge Peter Sakai, the county’s top executive because Texas, sit down for a Q&A on the subject. This was decidedly a choice: Sakai is a proponent of the ballot measure, on the grounds that “establishing a new downtown arena will expand our economic development and commercial activity in a way that will benefit the entire community” and also he wants to “do everything I can to keep the Spurs in town“; I might have found a guest who didn’t have a rooting interest to do my explainer, but you do you, KSAT.

And how did Sakai do Sakai? Some highlights:

  • “I need to clear up some misinformation: This is not Project Marvel. That is a city of San Antonio project. … Proposition B is whatever balance of money, we put a cap, 25%, up to $311 million, and that is what is going to go to the new Spurs venue, wherever they want to put it. As far as Project Marvel, the county is not connected at all. So I hope that clears it up for the voters.”

True, the county money — $311 million collected over many years, so worth more like $150 million in present value — would only go toward paying 25% of the construction cost of an arena. But that arena is the centerpiece of the larger mixed-use Project Marvel development that is set for hundreds of millions more in public subsidies, so saying “this isn’t Project Marvel” is fairly disingenuous, and almost certainly not best described as “clearing things up for the voters.”

  • “This is not a homeowner property tax. It is zero impact on homeowners and renters. … If one were to say in a hotel for $200 a night, I’m not good at math, but 200 times 1.75 is $3.50. To go to 2% increase, that’s a 50 cents a day tourist tax.”

That’s fine math, but terrible economics. First off, the vote is not just on raising the county hotel tax but also on extending its 5% car rental tax, and local “homeowners and renters” absolutely do rent cars, even if not as much as tourists do. Higher car rental taxes also risk discouraging tourists from visiting at all — if this were really free money, Bexar County could just raise its car rental tax to 100% and soak all the tourists into paying for two arenas for the Spurs, plus free ponies for all local residents.

Also, while both the car rental tax and the hotel tax can only be used for promoting tourism, that can include lots of other things like supporting the arts and museums, which might have more benefits for locals and less for one sports owner — or which at least might allow the county to replace other public spending on those areas, freeing up less restricted tax money to use for all kinds of other things.

  • “Let’s make sure the Frost Bank Center does not become the next Astrodome. Anybody been to Houston? That place is sitting there rotting.”

Uhhhh, the Astrodome is sitting vacant because it’s a state historical landmark that can’t be torn down, but Houston paid to build new stadiums for the Astros and Texans. Spurs owner Peter Holt hasn’t threatened to move the team and doesn’t have many great options to do so, but that hasn’t stopped elected officials like Sakai from strongly implying that voters had better approve the arena deal, and Project Marvel in general, or else you don’t wanna know what’ll happen to your NBA team.

All in all: pretty bad explainer, at least if you want anything actually explained and not just spun. The KSAT anchors did push back slightly on Sakai saying that the Spurs arena isn’t Project Marvel when it’s part of Project Marvel, but they nodded along with all the rest. Sorry, Bexar County voters, looks like you’re on your own for understanding the consequences of the upcoming Spurs arena vote better than your elected officials do — the good news is, that’s a pretty low bar.

Share this post:

Friday roundup: Browns stadium gets airport okay, San Antonio mayor seeks cut of Spurs’ arena revenues

access_time personNeil deMause

First things first: The Ohio Department of Transportation changed course yesterday and granted a building permit to the Cleveland Browns‘ proposed stadium in Brook Park, one month after declaring it would not do so because the stadium would “impact the airspace of the Cleveland Hopkins International Airport.” What changed? An outside consultant hired by the department reported that “the proposed stadium would have no adverse effect on the safety and efficient use of the aeronautical environment,” so ODOT gave the go-ahead.

This leaves the Browns stadium facing only two lawsuits over whether the team’s move from Cleveland to Brook Park violates the state’s Modell Law (the state attorney general says nuh-uh), plus additional suits over whether it’s illegal for the state to use unclaimed property to fund the deal and whether negotiating a move violated the team’s lease, plus $600 million in proposed city and county spending that hasn’t yet been finalized. Details!

In other news this week:

  • San Antonio Mayor Gina Ortiz Jones says she thinks if the city is putting up money for a new Spurs arena, taxpayers should get a cut of naming rights, concessions, and parking revenues as well. Which, sure, it worked for the Minneapolis Metrodome, so well that the public ended up recouping its entire $68 million contruction cost over time. Admittedly, the Twins and Vikings hated this deal so much that they immediately started lobbying for new stadiums where they would keep all the revenues and eventually got them, but it’s nice to see some elected officials learn the lesson that so many sports team owners live by: You can’t get if you don’t ask.
  • USL Championship expansion team Buffalo Pro Soccer is still looking for a place to build a stadium so it can actually become an expansion team. “I think we could make the decision today if we chose to,” said team president Peter Marlette, “but we want to make sure we’re getting everything right and that we are considering every possible factor and whatever site we end up going with.” The team owners have said the stadium will be privately funded, but we’ve heard that before in other cities, let’s see how things look after any hidden costs like land subsidies or tax breaks are accounted for.
  • The libertarian Mackinac Center for Public Policy is suing to repeal Michigan state funding for stadiums for the minor-league Lansing Lugnuts and the Utica Unicorns, Eastside Diamond Hoppers, Westside Woolly Mammoths, Birmingham Bloomfield Beavers of the United Shore Professional Baseball League (which all share a stadium in Utica), on the grounds that “private or local” projects require a two-thirds vote of the state legislature, and these only got a simple majority. State court of claims judge Brock Swartzle said he’ll make a ruling on an injunction by the end of the year.
  • The Philadelphia Phillies want hotel tax money from Pinellas County to upgrade their spring training facility in Clearwater, more specifics to come when they’re good and ready.
  • The Athletics‘ stay in Sacramento may not be drawing many fans, but it’s apparently drawing enough to cut into attendance at Sacramento River Cats minor-league games, especially now that resale prices on A’s tickets are cheaper in many cases than River Cats prices.
  • Sports economists Dennis Coates (who organizes the annual sports economics conference in Baltimore County) and Brad Humphreys have had a research award named in their honor, here’s a nice article about them and it, see how many of the economists in the photo at top you can identify!
  • Columbus Fury pro volleyball team seeks $1 million in cash from the city of Columbus and Franklin County to keep playing in town next season, now I have officially seen everything.
Share this post:

Detroit could levy tax on tickets and not give that money to team owners, stop the presses

access_time personNeil deMause

One of the basic concepts that economists and budget experts like to try to point out about sports funding deals is that taxes are fungible — that is, if you don’t use them on a stadium or arena, you can use them to pay for something else. So if your city is, oh, I dunno, proposing to funnel off hundreds of millions of dollars in stadium sales taxes and car rental and hotel taxes on the grounds that those are “tourism-related,” it’s important to remember that once you give that money to the owner of the local sports team, you can’t use it for anything else.

Which brings us to Detroit, where local politicians and budget watch groups are looking at a common means of funding sports venues — a ticket tax — but for a very different use:

A new Citizens Research Council of Michigan study found an admissions tax on Detroit sports and entertainment venues could raise between $14 million and $47 million annually, depending on the tax rate. … The extra revenue could offset a property tax cut between 1.7 and 5.7 mills.

Detroit is one of only a handful of cities without a ticket tax, notes the report, and there’s a reason for that: The city used to impose a 10% tax on tickets at Joe Louis Arena when the Red Wings played there, but that was eliminated as part of the deal giving team owners the Ilitch family a new arena plus $261.5 milion in state and city funds to build it, plus $400 million in subsidies for development around the arena, plus another $783 million for in subsidies for more development when the first development didn’t happen, plus possibly another billion dollars more. Clawing back $47 million a year from a new 10% ticket tax wouldn’t make Detroit taxpayers whole on all the tax money they’ve pumped into sports projects (including those for the Tigers and Lions) over the years, but it would at least be a start.

All the ticket tax talk is being spurred by a mayoral race between council president Mary Sheffield, who favors one, and pastor Solomon Kinloch Jr., whose position appears to be that it’s a bad idea because Sheffield came up with it. (Both Sheffield and Kinloch, incidentally, have expressed enthusiasm for continuing to hand out tax breaks in order to promote development.) It does at least look like there’s nothing in the teams’ leases that would block such a tax — Bridge Detroit reports that if the state legislature passed a law allowing cities to impose them, then the city council enacted an ordinance, then a majority of Detroit voters approved it, it could happen.

The report does also raise the issue of whether it’s fair to create higher ticket prices in order to fund city priorities, but doesn’t appear to have examined whether in other cities that have ticket taxes, team owners have largely ended up eating the cost because they’re already charging the most that the market will bear, as economists project that they should. I did some initial asking around and found that while it’s really hard to calculate the effects — if a new stadium opens with a new ticket tax and prices soar, who’s to say if it’s the fault of the tax or of all the shiny new cupholders? — the best study of this appears to be by Stefan Szymanski of Soccernomics fame: He looked at what happened when to soccer ticket prices when the United Kingdom added a 10% VAT sales tax in 1973, and found that around 25% of the cost was passed through to ticket buyers.

More research needed, clearly, but this supports the general idea that ticket taxes mostly hit the wallets of sports team owners, unlike other taxes that can be passed along more fully to regular consumers. Whether ticket taxes should be used for property tax relief is another question, but at least we can dispense with the idea that this would be charging sports fans to bail out property owners — it would mostly be charging sports team owners to do so. Michigan and Detroit legislators and voters, take note.

Share this post:

Friday roundup: Browns airport standoff continues, Spurs threaten voters with mascot appearance

access_time personNeil deMause

Before we get to the news, a quick note for any site supporters who are still waiting on swag: I haven’t forgotten you, I just have to restock on mailers and stamps, which I have penciled in for tomorrow morning. Thanks for your patience, and I assure you that your fridge magnets will still be timeless when they do arrive. (Because nothing ever changes in the world of stadium schemes, ha ha ha! Ha! Ha.)

But first, here’s the week’s remaining sports subsidy news to entertain and/or depress you:

  • The Ohio Department of Transportation has extended indefinitely its September 1 deadline for the Cleveland Browns owners to appeal their verdict that a new Brook Park stadium can’t be allowed as currently designed because it would infringe on airspace for a neighboring airport. Cleveland airport director Bryant Francis isn’t backing down on his insistence that the current design is a no-go, however, saying, “The FAA confirmed that the proposed height would intrude into protected airspace surfaces by 58 feet,” while adding, “We remain open to collaborating with all parties to find solutions that allow for growth while protecting the airport and the region it serves.” This is hardly the biggest problem with the Browns stadium project — that might just have to do with the at least $600 million in public money it would get from state checks that people haven’t cashed — but in America sometimes bad ideas get rejected because they’re bad, and sometimes they get snail dartered into submission.
  • The Browns’ proposed move is also now facing a second lawsuit charging that it would violate the Modell Law, with the law’s author, former mayor and state senator Dennis Kucinich, adding on to the lawsuit previously filed by the city. It’s actually the third lawsuit over the law, since the Browns owners are also suing the city to block the enforcement of the law, plus the state legislature moved to retroactively make the law not apply to in-state moves back in June, this is going to send a whole bunch of lawyers’ kids through college.
  • The San Antonio Spurs owners are holding a rally tomorrow in support of their campaign to be gifted around $750 million in city and county money for a new arena, and the key guest will be their mascot, who I’m just assuming will threaten to come to your house if you don’t vote for the subsidy.
  • Louisiana is planning to spend $7 million to bring a LIV golf event to New Orleans next summer. To put New Orleans on the tourist map. After spending tax money this year on a U.S. Bowling Congress Tournament, an Ultimate Fighting Championship event, the 2026 Southeastern Conference Gymnastics Championship, and the U.S. Gymnastics National Championships. “In a just world, politicians would have to come up with some reality-based justification for their desire to blow public money on what are effectively sports-adjacent parties,” notes Pat Garofalo in Boondoggle, almost wistfully.
  • The Athletics have submitted a development agreement for their under-construction (?) Las Vegas stadium while securing a permit to pour $87 million worth of concrete to support the lower seating bowl, tipping Schroedinger’s armadillo about 3% more into the “mostly not dead” category.
  • The Baltimore Ravens‘ $489 million stadium renovation, mostly funded by the first of a potentially bottomless pool of state tax money, is providing the team owners with more than a dozen event spaces that they can rent out for business meetings and the like. Will taxpayers get a cut of these new windfall profits, given that they’re paying for the bulk of the cost of building the event spaces? You must be new around here, kid, I’ve got some bad news about this timeline…
Share this post:

What’s the deal with the new Boston Celtics owner wanting his own arena maybe?

access_time personNeil deMause

Ever since private equity goon Bill Chisholm and his goon pals bought majority ownership of the Boston Celtics for $6.1 billion in March, there have been little burbles of speculation here and there that Chisholm might seek to build a new arena somewhere in Greater Boston. This started right after the sale, when NBC Sports Boston asked Chisholm if he’d want his own arena, and Chisholm demurred in that well, you know my birthday is coming up way that sports owners seem to specialize in:

“I really haven’t put much thought into that,” Chisholm said Thursday. “I mean, there have been a lot of banners raised in that location that the Celtics are in right now. So that’s a pretty important part of the history. We’ll get to thinking about that. But it’s also a decision that’s down the road.”

Then, in a blind item in July, Boston Globe basketball writer Gary Washburn upped the ante from “haven’t thought about that” to “is believed to be thinking about thinking about that”:

It’s believed that soon-to-be governor Bill Chisholm will look into the construction of a new arena since the Celtics do not own TD Garden. The most profitable means for an NBA owner in today’s landscape is arena ownership.

This Sunday, the Globe’s business section chimed in, with a long article by columnist Shirley Leung about possible arena sites in Everett, South Boston, and other sundry outskirt locations, anchored by similarly non-sourced assertion that this is surely something that Chisholm would want to explore:

It might seem a long shot that the Celtics would ever leave TD Garden and the North Station neighborhood they’ve called home for close to 80 years. But the team’s new owners are keeping their options open.

Sure, a new arena would be a hefty investment, likely $1 billion or more. But it might be worth it, especially if Boston gets an WNBA team that could fill a decent block of nights alongside the Celtics.

That “might” is doing a lot of work, clearly: Yes, having a WNBA team in addition to the Celtics would add more home games (22 per year) to go with the Celtics’ 41, plus however many playoff games each team ended up hosting. But that’s still going to leave close to 300 nights a year where a new arena would need to book concerts or what have you, assuming Chisholm wants to repay that $1-billion-plus price tag. (Which would likely be considerably more, since he would need to acquire land for the arena as well.)

Washburn’s line that “the most profitable means for an NBA owner in today’s landscape is arena ownership” needs some unpacking as well. (It also needs a better subject noun — “means” of what? — but the Globe isn’t paying us to copyedit.) Yes, all things being equal, it’s better to control your own arena than to rent someone else’s, because you get all the proceeds from concerts and other events. But it’s also better not to be left holding more than a billion dollars in arena debt — which is exactly why the Celtics have shacked up with the Bruins for the last 80 years, so as to split the cost of a single arena rather than duplicating efforts.

We’ve just seen this exact scenario play out, in fact, in Philadelphia, where the owners of the 76ers announced that they would build their own arena to compete with the Flyers‘ one — and then as soon as it was approved, quickly negotiated a deal with the NHL team to instead build a new shared arena. The reason, according to one news report: NBA commissioner Adam Silver “believed that having two competing Philadelphia arena projects in the same timeframe would be detrimental to both the city and the teams.”

Outgoing Celtics majority owner Wyc Grousbeck (he’s still holding on to a minority stake), in fact, said something very similar back when he sold the team to Chisholm in March:

“Honestly, there’s room for one arena in Boston, not two. Because you need to have concerts and events to fill out the bill. And if we ever talked to the Jacobs – we all decided to renovate the Garden very seriously; there have been huge, hundreds of millions of dollars of renovations – but if we ever decide to do anything, I’m sure we’d do it together and have both teams playing there.”

Arena glut is a thing! We’ve seen this in places like Minnesota, where a series of arenas have been built and then torn down when it turned out there weren’t enough concerts to fill all the dates; and even in a market as large as New York City, where the opening of new arenas in Newark and Brooklyn led to the closure of the Meadowlands Arena for lack of business. Boston and Philadelphia are similar-sized metro areas, and it’s not out of the realm of possibility that either could support two arenas — but the fact that Sixers owner Josh Harris backed out of a dueling-arenas scenario makes it less likely that Chisholm would attempt it in Boston, and in what would almost certainly be a less central location for transit as well. (Philadelphia, incidentally, will apparently have no problem fitting a WNBA expansion team in with NBA and NHL teams and concerts all in one building.)

So what’s going on here, exactly? It could be that Chisholm is legitimately kicking tires on the idea of a new arena, either to see if he can bigfoot the Bruins by building an arena that would be the first choice for concert promoters or to see if he can shake loose some public money (or at least free land or infrastructure or tax breaks) to help him turn a profit on his Bruins-killer. (Massachusetts hasn’t historically been the most generous when it comes to sports handouts, but you can’t fault a guy for trying.) Or he could be pulling a Harris by hoping that the mere threat of a competing arena can arm-twist Bruins owners Delaware North into giving him an ownership stake in either the current arena or a new shared one.

Or this could be just newsroom gossip that won’t go anywhere at all. So many options, when you’re dealing with stories with no cited sources! The best advice remains, as always: When elephants fight, keep your hand on your wallet.

Share this post:

Explaining the explainer on the San Antonio Spurs arena funding plan

access_time personNeil deMause

It’s fair to say that media coverage so far of San Antonio Spurs owner Peter Holt’s plans for a new arena district paid for partly by taxpayer money hasn’t been very good: The San Antonio Express-News has advocated against letting the public vote on how public money will be used, while News4SanAntonio had a reporter point to a chart showing how tax money would be used on the project and say “this doesn’t come from your tax money.” Meanwhile, local news outlets keep beating the drum to threaten that the Spurs could move without a new arena, even while acknowledging that Holt doesn’t have any great options to move to.

Against that backdrop, it’s nice to see a local news outlet, the nonprofit San Antonio Report, attempting an analysis of how the money would work for the Spurs deal. How’d they do? Let’s take a look:

Soon voters will be asked to weigh in on a portion of the NBA arena’s public funding, $311 million in county venue tax dollars, on the Nov. 4 ballot.

Another $489 million is expected to come from the city, which says it can spend the money without a public vote. And the remaining $500 million-plus would be paid for by the Spurs’ ownership.

That’s basically right, though it’s worth noting that the $311 million in county tax money would arrive over three decades, so it would only cover about half that in up-front arena expenses. Present value matters!

Unlike the city, which is using tax reinvestments, Bexar County’s taxing entities will enjoy the growth in taxable value from both the East Side developments and the new downtown sports and entertainment district — money that’s needed for a budget that relies heavily on new growth.

This is a mouthful, and it’s mostly wrong or at best misleading. So let’s unpack it bit by bit:

One part of those city “tax reinvestments” would actually come from a Project Finance Zone, a Texas-specific subsidy where state sales taxes are in and around a redevelopment area are siphoned off to help pay for the development itself. Since this is money that would otherwise go to the state treasury, one could see it as free money for the city — though, obviously, San Antonio residents are also Texas residents, so draining the state budget to help pay for a new Spurs arena isn’t exactly a free lunch.

Another part is from a Tax Increment Reinvestment Zone, which is just a TIF, redirecting any increase in city property taxes in the redeveloped area back to the developer. And as the Report reports, that’s not free money either: “New housing and development within the zone requires city resources, like police and fire, but the growth in property tax revenue is being directed toward special projects within the zone, instead of boosting the general fund for the entire city.” Translation: The new Project Marvel development that would include an arena would come with lots of new city costs, but the taxes that would normally pay for those added costs will instead go back to Holt to pay for building the arena.

The county money, meanwhile, would come from an existing car rental tax and an increase in hotel taxes, neither of which have much to do with a new arena — it’s unlikely Spurs fans will rent more hotel rooms or cars just because they’ve bought tickets to a sparklier home court — but which are revenue streams the county has available and if you squint they kind of have to do with “tourism,” so they’re getting thrown into the pot. Or will assuming that Bexar County voters approve them on election day in November, which no one appears to have done any polling on of late, but earlier this year support was deemed “tepid.”

And on top of all this, there’s the possibility of a city “infrastructure bond” — to be voted on separately, likely next spring — to provide $220-250 million toward new bridges and highway ramps to support the arena project. (The Report’s explainer doesn’t explain where the money to pay off the bonds would come from.)

So that’s more than $750 million worth of tax money going to the Spurs owner, in exchange for getting a big new downtown development and relief from any fears that Holt will move the team to Greensboro. Is that, like, a good deal? A bad deal? Better than a poke in the eye with a sharp stick?

Here’s the entire cast of characters quoted by the paper in its attempts to explain the situation:

  • Rena Oden, an “activist with the COPS/Metro group that opposes the program”
  • Bexar County Judge Peter Sakai, who wants to “do everything I can to keep the Spurs in town”
  • Pro-arena councilmember Marina Alderete Gavito
  • Houston Chronicle business columnist Chris Tomlinson, who is concerned the promised increased tax revenues may never arrive
  • San Antonio Mayor Gina Ortiz Jones, who wants an independent analysis of the project
  • City of San Antonio Chief Financial Officer Ben Gorzell, who says the arena plan is “predicated on not using existing city resources or funds”
  • John W. Diamond, a tax and finance expert at the Baker Institute for Public Policy, who fails to really explain the infrastructure bond beyond calling it “the whole process on steroids”
  • Councilmember Teri Castillo, who doesn’t want to see money diverted from the city’s general fund

That certainly checks all the boxes of citing both proponents and critics, though it’s worth noting that most of the quotes are recycled from past public statements, so the Report’s reporters didn’t spend much time picking up the phone for this one. And they absolutely didn’t call any of the people who would be the most useful: sports economists or local budget analysts who could discuss what return on investment, if any, San Antonio and Bexar County can expect to get from $750 million in Spurs arena subsidies. Bothsidesing may make your news outlet look “neutral,” but what readers need going into public ballots is information on what exactly they’ll be voting on and how it will affect what government money they’ll have available. Without that, it’s all too easy to see this as a simple referendum on whether the Spurs leave town — which it very much isn’t, but if Holt gets to play it that way without ever having to threaten to leave, it’ll be a win-win for the Caterpillar dealership magnate.

Share this post:

Dumb reasons to build a stadium with public money just got even dumber

access_time personNeil deMause

Way back in the early days of this site, I used to do an annual “dumbest reasons of the year for building a stadium,” which I eventually stopped doing because they were all just variations on the same theme: the team will move without one, it will bring economic riches to your city, etc. But I may have to revive the tradition for 2025 if things keep going like they are this week, because hoo baby.

First up, we have this from Sports Illustrated, or at least from “Tennessee Titans on SI,” the rebranded FanNation network of blogs that aren’t really SI articles but look like them if you aren’t paying close attention:

The Tennessee Titans are opening a new and improved Nissan Stadium opening in 2027, which will feature a retractable roof.

The new stadium will help the city of Nashville’s chances at hosting a Super Bowl in the near future. … [Titans president and CEO Burke] Nihill believes hosting a Super Bowl will elevate the Titans as a franchise.

“Why not us? In terms of taking a place on the Mount Rushmore of NFL franchises and cities? I mean, you think about what our current reality has been up until now, which is an aging building built pretty basically, surrounded by parking lots, to that future where I think a lot of the energy of our city, especially for locals, will be right out our front door, and we’ll have a lot of ability to play into that,” Nihill said via Freeze.

“If the football team is sustainably great, which I believe it will be, and we do all of these things right? We’re a completely different organization than we are today.”

Like, what even? Yes, new stadiums get Super Bowls, sometimes, at least once before going back to the back of the line. The usual argument for wanting a Super Bowl is that it is a huge boon to the local economy, which is very much is not, but at least we’re used to hearing that.

But the idea that “taking a place on the Mount Rushmore of NFL franchises” — which would be a pretty damn big Mount Rushmore, with 17 cities on it — would make the Titans “a completely different organization” … that’s breaking new ground in stupid. The Nihill quote turns out to be from a longer interview by A to Z Sports, a company whose founding mission was essentially “talk radio, but made entirely of internet, that should go well,” and the Titans CEO wasn’t even talking about Super Bowls so much as how “we’re going to activate that thing like crazy with movie nights in the park and yoga and farmers markets and little concerts” — but honestly the word salad is so intense that I can see where the On SI writer could have gotten lost, though he might have wondered at what kind of sense it was supposed to make. (Ha ha, no, that’s not what he’s paid to do, if he’s paid at all.

Moving on to San Antonio, where the Express-News has been beating the drum for Spurs owner Peter Holt’s Project Marvel development project for a while now, and today the paper’s editorial board takes on the question of whether city residents should get to vote on spending $489 million in tax money on the arena project, and comes to a novel conclusion:

This would be a city election, likely in May 2026, on dedicating $489 million toward the $1.3 billion project.

It would follow a November election in which Bexar County voters will decide whether to increase the county’s hotel occupancy tax and maintain its car rental tax to dedicate $311 million toward the arena, which is proposed to be built on site of the Institute of Texan Cultures at Hemisfair.

To be clear, the city’s contribution is contingent on this vote. If voters reject the county funds, they are rejecting the entire project, city funds included. For this reason, we don’t see a need for a second vote on the same issue.

It’s far cleaner to simply have a vote and let the chips fall where they may. Let the voters decide and then let the world spin.

First off: No, the “entire project” doesn’t die if the $311 million in county funds (really more like $150 million in present value) is rejected; Holt could still take his $489 million in city funds and try to supplement it with some other funding source. But more to the point: Express-News editorial board, you do know that Bexar County (2.2 million people) and San Antonio (1.5 million people) are two distinct places, right? So just because voters in the county but outside the city vote for (or against) using county money on the arena project doesn’t mean that voters in the city will do the same with city money — it’s why they have separate elections for county and city positions, and don’t just let the county judge appoint the San Antonio mayor on the grounds that that’s “far cleaner.”

In both of these cases, the arguments being made are less reasons than pretexts — the Titans CEO wants a stadium so he can make more money on it, not to be on some “Mount Rushmore” of Super Bowl hosts, and the Express-News wants no arena vote because it really wants an arena for some damn reason, and waiting till next May and then letting voters have their say would be subjecting the Spurs owner’s desires to the whims of democracy, and we can’t have that. And hey look, there’s a headline in the San Antonio Business Journal about how San Antonio needs to build an arena for the Spurs because the Seattle Supersonics moved to Oklahoma City, though it’s paywalled and not available on either Wayback or archive.ph, so I can’t determine what exactly its case is. It’s going to be a competitive race this year for Dumbest Reason to Build a Stadium, so get your dumb reasons in now!

Share this post:

Friday roundup: San Antonio okays $489m arena subsidy to prove “love” for Spurs, plus: invasion of the soccer zombies

access_time personNeil deMause

First things first: As expected, the San Antonio city council voted yesterday to move ahead with plans to give $489 million in tax revenues to Spurs owner Peter Holt to use toward a new arena. The actual council action was two votes: One to reject Mayor Gina Ortiz Jones’s proposal to pause arena talks until an independent economic review could be conducted, and one to allow the city manager to “complete negotiations and execute a nonbinding Term Sheet,” notwithstanding that a term sheet already exists — it’s unclear what the city manager is authorized to negotiate going forward from here, not to mention exactly what the council has actually committed itself to given that the term sheet is nonbinding. Councilmember Edward Mungia said that “we still have the ability to get out of this deal at any point before other project deals are signed,” but didn’t specify if the council would have to vote to withdraw from the deal or still needs to vote on a binding agreement or what.

Jones, who votes as a member of the city council because San Antonio has that kind of city government, voted against the arena subsidy, as did councilmembers Teri Castillo, Ric Galvan, and Leo Castillo-Anguiano. Mungia and the “more business-friendly” councilmembers, as the San Antonio Report put it, voted in favor: Sukh Kaur, Marc Whyte, Marina Aldrete Gavito, Misty Spears, Ivalis Meza Gonzalez, and Phyllis Viagran. As Viagran explained her vote: “You either trust this team … or you don’t. I’ve heard so many people say, ‘We all love the Spurs.’ … But do you really?”

There’s still some possibility of an independent economic analysis down the road, or more hearings to see if public support for the project is still as “tepid” as it was earlier this year. (Jones is also pushing for a public referendum on the city’s spending next spring, but we’ve seen how her proposals go over with the business-friendly councilmembers.) And, of course, Bexar County voters can still throw a wrench into things in November if they vote down the ballot measure that would give Holt around $150 million worth of county tax money on top of the city funds. Regardless, in the first round of the Project Marvel arena battle, the San Antonio council has spoken, and its verdict is “Nothing says ‘I love you’ like half a billion dollars in public money so you can boost your sports team’s profits.”

Who else is loving who this week and how? Never thought you’d ask:

  • Like everyone else, I’m still trying to wrap my brain around MLB’s new set of TV deals that are supposed to be finalized soon, with Apple out and Peacock in and ESPN in on some things but out on others. As far as what it will mean for teams’ media revenues — and, by association, how footloose teams can be about moving into smaller media markets to seek more lucrative stadium deals — it sounds like teams’ cuts of media revenue won’t change much, it’ll just be that ESPN will increasingly be the ones selling the right to watch games, and they’ll be making you pay for an ESPN subscription on top of an MLB.tv subscription to do it. Only 17 years until the last World Series, get your baseball-watching in now!
  • Buffalo Bills owner Terry Pegula bought his $100 million superyacht in 2021, the year before he got $1 billion in state and county tax money for a new stadium, but people aren’t any less unamused at the juxtaposition. One wonders if this might even have become an issue in New York state legislative hearings on the stadium subsidy, if there had been any.
  • Manchester United seeking public money for their planned stadium project isn’t new news, but it did just get the attention of the Guardian, which called the team’s plan to seek hundreds of millions of pounds to clear land for the stadium a “sinister US tactic.” Which is fitting, given that Man U is owned by sinister Tampa Bay Buccaneers owners the Glazer family, though maybe not for much longer.
  • What would happen if a minor pro sports team — say, the Pittsburgh Riverhounds of the USL Championship — wanted to issue renderings of their proposed stadium expansion (to be “paid for with public and private funding, although details have not been provided“) but couldn’t afford the Pro version of Microsoft Stadium Wizard? We have the answer, and it is a hellscape of identical featureless soccer zombies, please enjoy your nightmares:
Share this post:
Field of Schemes