Category: Portland Trail Blazers

Portland Trail Blazers owner Tom Dundon gave a long podcast interview on Friday in which he mostly talked about how he’s not a cheapskate, he just genuinely thought towels were a cooler giveaway than t-shirts because that’s how he thought it worked at hockey games. But he also said this:

“When I bought the Hurricanes, all I heard — because I was from Texas — we were going to move the team to Houston. Moving a team is difficult. We didn’t move the Hurricanes. We ended up getting a deal done. We went through the same thing in Portland. Before I even bought the team, I had an agreement with the city and the state. We had an agreement in principle. They’ve already approved half of it. Assuming that all gets done, then this is a non-story. For me, it’s never been really a thing. We didn’t buy the team to move it. We bought the Portland Trail Blazers.”

That’s news, you would think? Maybe not big news — Dundon is not outright promising not to move the team if he doesn’t get his entire $600 million demand in public funding for arena upgrades, he’s just saying “assuming all this gets done” then he won’t move — but still, it’s useful information about where the Blazers’ owner’s head and/or leverage play is at. But aside from one article on the basketball news site HoopsHype, it didn’t even make a single headline, and the Oregonian appears to be the only other publication that even reported on it, way at the end of an article.

Contrast that with Oregonian columnist Bill Oram’s statement last week that “losing this team, be it to Nashville, Austin or Kalamazoo, is not some hollow threat by a greedy billionaire.” Despite the fact that Oram appears to have pulled those city names out of his butt — or in Kalamazoo’s case, whatever part of his brain stores “cities with funny names” — it spawned a flood of press coverage, including a much-reprinted Sportsnaut piece on how “a new rumor suggests” the team could end up in Austin, and one on Michigan news site MLive on how Oram’s mention of Kalamazoo sparked “buzz across social platforms and Southwest Michigan.” (MLive declared that such a move wasn’t “likely,” but that “It’s a reminder that no city is too small to dream big for a day,” which, sure, so long as Kalamazoo accepts that eventually it’s going to have to wake up and realize it’s only in the 43rd largest U.S. TV market.)

The fact of the matter is that the possibility of the Blazers trying to move if Dundon doesn’t get his $600 million in arena money is a threat, yes, but a very vague one, in the “don’t make me come in there” category of things people threaten while hoping they don’t have to decide whether they’re just bluffing. Portland is a bit larger than Nashville, and its arena is only one year older — and Nashville likely doesn’t have the stomach to give an NBA owner major renovation money right after coughing up $1.2 billion for a stadium for the Tennessee Titans. An attempt to move to Austin would likely have the San Antonio Spurs owners up in arms, and other cities have other problems. It’s still conceivable that Dundon would try to move if he doesn’t get any arena money out of Portland; it’s also very possible that, if push came to shove, he’d settle for less than the full $600 million. It’s elected officials’ job to try to find the cheapest price point possible, which some at least seem to be trying to do — and the media’s to report on the whole game of chicken honestly, even if “Are the Blazers moving to Kalamazoo?” makes for better clickbait.

I don’t want to make too big a deal about this trend of elected officials taking their time before voting on sports subsidy deals — looking stadium and arena demands in the mouth is literally doing their minimum job — but add Portland, Oregon to Tampa and the state of Illinois as local governments doing their minimum job this legislative season:

City and county lawmakers are pumping the brakes, saying it’s better to take the time to get it right than to sign away huge sums of public money under pressure from Portland’s professional basketball franchise, which has called the Rose City home since 1970.

“We’re not going to be held hostage, we’re not going to sign a bad deal,” Portland Council President Jamie Dunphy told The Oregonian/OregonLive, echoing a position expressed by many of his colleagues. “We’re not going to be a blank check for an out-of town billionaire. We are going to support our team and our local economy in the way that needs to get done. But we’re not doing it at all costs.”

Trail Blazers owner/big bad Tom Dundon has already won approval of $365 million in state funding for upgrades to his 31-year-old arena, but is seeking another $235 million in city and county money to make it an even $600 million. A Multnomah County spokesperson said that county commissioners will spend “the next several months” negotiating their part in any arena deal, while city council president Dunphy said “the City Council is going to take as much time as it needs because getting this right matters.”

Right now, reports the Oregonian, local officials appear to be debating less whether to send Dundon the nine-figure check he desires and more which account to charge it to: Portland Mayor Keith Wilson’s proposal to use a city clean energy fund to pay for basketball arena zhuzhing has been especially contentious. But the council is also seeking a more taxpayer-friendly lease, possibly including the city getting a cut of arena naming rights, which in the unlikely case Dundon agreed to it would help defray the public’s costs.

Blazers execs, meanwhile, have continued their saber-rattling about moving the team if arena funding isn’t approved ASAP, though still without saying the words “move the team” out loud. (Team president Dewayne Hankins, in a tour de force of non-threat threat verbiage, declared, “The Trail Blazers have been deeply connected to Portland for more than 50 years and remain committed to this community. The fact remains: if city and county leaders can’t get a deal done, the Blazers’ lease at Moda Center will expire in 2030.”) And while city councilor Angelita Morillo called this “a massive bluff, and I think that we need to call them on that bluff,” Oregonian sports columnist Bill Oram, who had written in February that Dundon would move the Blazers without a deal, wrote essentially the same column again on Sunday, declaring:

The only thing that matters for the Trail Blazers this summer — really, truly, actually matters — is whether Portland’s politicians figure out that losing this team, be it to Nashville, Austin or Kalamazoo, is not some hollow threat by a greedy billionaire.

Kalamazoo, you’ve been mentioned on the telly! (Sorry, Greensboro, your time will come.)

Oram liked this point so much that wrote pretty much the same column yet again yesterday, this time listing Nashville, Austin, Kansas City, San Diego, Vancouver, Mexico City, and Raleigh as potential relocation targets. He also insisted that economic studies showing that public sports subsidies are a waste of money are irrelevant because what Portland is facing is “completely without precedent,” then snapped back at economist J.C. Bradbury for pointing out that Oram is literally doing the title of Bradbury upcoming stadium book “This One Will Be Different.”

Is any of this going to end with Portland forcing Dundon to provide a significantly better deal for taxpayers? Probably not — officials are also seeking concessions like promises to use union labor and a community benefits agreement, which are more likely to pass because they wouldn’t cost Blazers ownership much money. But this is where we are with sports subsidies, 40 years in from when they first became an essential part of the sports business model: Even being allowed to ask for the public to get anything in return for their gift of tax money to a billionaire owner is seen in some circles as tantamount to running your team out of town on a rail. All this is continuing to take longer than we thought.

The Oregon state house voted 43-13 late Friday to approve $365 million in state income tax funds toward a renovation of the Portland Trail Blazers‘ arena, a project that will ultimately cost $600 million, 100% of that coming from public coffers. And it did so before a lease extension with presumptive incoming team owner Tom Dundon, something that prompted The Oregonian to lead off its coverage like so:

While some legislators argued that it was unwise to volunteer Moda Center funding without first negotiating a lease, the Oregon House overwhelmingly passed a bill that clears the way for the state to pay for nearly two-thirds of the renovations that lawmakers hope will keep the Trail Blazers in Portland for at least two more decades.

Because The Oregonian is, by all evidence, a pretty bad newspaper, it then smash cuts to House Majority Leader Ben Bowman asserting that “the Blazers are proof that something can be emotionally meaningful and economically strategic at the same time.” (Say it with me now: “[citation needed]!”) But it did at least highlight the biggest problem with starting the ball rolling on a possible $600 million taxpayer subsidy for a man who made his billions in subprime lending before starting to buy up sports teams (and Major League Pickleball for some reason): Is “hoping” the Blazers will stay in Portland for two more decades enough of a return on that public spending?

This isn’t even a question of whether Dundon will spurn the Oregon taxpayer cash and refuse to sign a lease extension. Rather, as we’ve seen time and again, what a city actually gets out of a lease commitment depends very much on the details, as one cleverly worded state-of-the-art clause, say, can lead to either the team breaking its lease and skipping town or using the threat of that as leverage to gain even more taxpayer cash. The only way that $600 million in taxpayer money is useful, in other words, is as a carrot to extract good lease terms; if Oregon gives the milk away for free, Dundon has no reason to lease the cow, or something like that, it’s a pretty terrible proverb that doesn’t even make much sense where it originated in East Africa.

Still to be decided: another $235 million in redirected county car rental taxes and foregone city and county business taxes on the team’s sale to Dundon. It’s always possible that Portland and Multnomah County could hold out on those in order to try to bring Dundon to the lease negotiating table, but that’s an even smaller cow, more like a calf — you know what, I give up, abandon metaphor. The state of Oregon just promised a big bag of cash to a billionaire who’s buying the local NBA team in exchange for nothing, that’s the only thing you need to know here.

The Portland Trail Blazers are in the middle of being sold to Carolina Hurricanes owner/subprime auto loan baron/“glass chewer” Tom Dundon, and apparently the threat of the team’s expiring lease in 2030 and Dundon’s reputation for playing hardball has Oregon elected officials moving toward spending a ton of money on upgrading Portland’s arena to avoid the team from moving to (Oregonian staffers throw darts at giant wall map of the U.S.) Nashville or Kansas City. What would Oregon taxpayers give up, and what would they get in return? As usual, it’s complicated:

• According to a bill introduced on Monday by state Senate President Rob Wagner, the state would take all income taxes collected in and around the Blazers arena for the next 30 years and make them available for Dundon to use on arena upgrades. That would include not just taxes on Blazers players and staff, as team execs were previously reported to be seeking, but income taxes paid by any entertainers who perform at the arena, and even by the construction workers performing the upgrades.
• This income tax money would be used to pay off $360 million in state bonds, as part of an overall $600 million public funding package. The rest would come via $75 million from a city climate fund meant to be used on projects that reduce carbon emissions and help residents at risk of climate change impact, $75 million from county car rental taxes, and $50 million from city business taxes and $40 million from county business taxes on the sale of the team to Dundon. All of these look to be present value, meaning the nominal amount of taxes redirected over time would be considerably more, if you prefer to count that way (I do not); the bill itself helpfully informs us that it “may have fiscal impact, but no statement yet issued” and “may have revenue impact, but no statement yet issued.”
• In exchange, Dundon would agree to keep the Blazers in town for “a specified term” of time, which isn’t vague at all. If the Blazers’ eventual lease extension ends up concluding anytime before 2044, it could break the Charlotte Panthers record for the most expensive per-year lease extension in sports history.

That’s significant chunk of change for an arena that Portland taxpayers already helped then-Blazers owner Paul Allen build in 1995 and then took off the hands of Allen’s heirs in 2024, saving them about $1.2 million a year in property taxes. Oregon Gov. Tina Kotek is on board, though, calling the arena subsidy “an opportunity for the city and the state and the county to put their best foot forward and say, ‘Look, we want to be a partner with the new owner to keep the team'” and meeting with NBA commissioner Adam Silver last month to argue for the deal. Then there’s Oregon U.S. Sen. Ron Wyden, who took in a Blazers game on Saturday and wandered the arena telling anyone who would listen that he wants to “help anybody who wants to keep us in town” and calling the privately owned NBA team valued at $4.25 billion “infrastructure” and “a huge economic development opportunity” and “a big economic force in the state” when he wasn’t too busy exchanging hugs with former Blazers player Buck Williams.

The biggest stumbling block right now appears to be Multnomah County, where county leaders have expressed a desire to use their $40 million business-tax check from the Blazers sale to spend on actual resident services, or at the very least to backfill the car rental tax money the county would be giving up. That’s relatively small potatoes, though — the biggest piece, the $360 million in income tax money, is expected to be voted on by the Oregon legislature by the time it wraps up its session on March 8.

That leaves less than four weeks for public discussion, which would be plenty of time to go over the dubious theory that businesses should keep the income taxes paid by their employees because if they skipped town all that tax money would go away, which 1) it almost certainly wouldn’t and 2) pretty much defeats the whole economic purpose of luring and retaining businesses regardless. Tune in Monday at 8 am PT to watch the state senate rules committee discuss the income tax diversion bill, sorry, looks like no public testimony at this one as it’s a committee “work session,” but surely there’ll be time for the public to be heard, at least minutes before the legislature takes its ultimate vote.