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July 12, 2010
How to split a hair, Sacramento department
The Sacramento Press headline is "Arena plan moving forward," but there are few new details on the Kings land-swap plan. To me, the most interesting bit is what it reveals about sports-facility salesmanship:
"The city and the state are not in a position to invest anything into these properties," [developer Gerry Kamilos] said. "The idea is to have the private sector come in and provide the capital to increase the value of those properties that both the city and state would benefit from."
Financing is proposed to come from land sales, parking fees, lease revenue, special districts to collect sales and property taxes from the properties, and bond proceeds generated by setting up tax increment districts, refinance districts and bond districts, Kamilos said.
So let's see: Sale of public land, special sales- and property-tax districts, tax increment financing (which is basically another form of property-tax kickbacks) — yeah, there's no way any of that could be construed as the city and state "investing anything" in the project.
Now, Kamilos would no doubt say that he doesn't mean no public involvement at all — the city and state just aren't going to directly pour any cash into developments at that site. But that's not how most readers are going to take it when they see "no city and state investment."
In fact, this has become one of the standards of the stadium-grubbers' handbook: Claim that you won't need public money, then look for ways to use public money. And this tactic becomes much easier when the journalists reporting your statements are too credulous, lazy, or financially illiterate to call you on it.
"And this tactic becomes much easier when the journalists reporting your statements are too credulous, lazy, or financially illiterate to call you on it."
I'd add to that when the journalists work for media outlets that stand to make money off of a stadium/arena, there is a pro-stadium bias introduced in reporting. Neil, your FAIR article did a good job of discussing this.
'Financially illiterate' - I had one journalist during the 49ers campaign ask me what 'net present value' is. Perhaps journalism students should be required to take a business math class in college.
Posted by SantaClaraTaxpayer on July 12, 2010 02:05 PM
Sacramento benefits in many ways from this arena being built. Many want an arena, but don't want to pay taxes to do it. That is the difference here.
There is no direct tax or other source of public revenue needed to do this arena. That is what Sacramento voters wanted so what is your beef?
Also, I think that many will understand that this plan is much different than the bond they tried to get passed by voters. The developers have been very upfront about this taking the sale of public land and some other arrangements.
This deal can be done and is feasible. They got a developer to invest a lot of money upfront in times that are tough economically. How is that a bad thing?
I just don't get the negativity. Are all Sacramentans that want an arena "stadium grubbers"?
Posted by MBS in Sac on July 13, 2010 01:41 PM
"There is no direct tax or other source of public revenue needed to do this arena."
Only the revenue they would've received with the sale of the public land.
If I sell my house to buy a car, am I getting that car for free? Not exactly.
Posted by Brian on July 13, 2010 02:43 PM
MBS blathered:
"I just don't get the negativity. Are all Sacramentans that want an arena "stadium grubbers"?"
Sorry, but yes, in this case, they are. They are one of two things: Ignorant as to how this deal works, or grubbers. There is no third choice.
This deal depends almost entirely on public funding. Re-read the post a few times and see if you can spot it. Trust me, you'll probably see it the first time, but if you need to re-read it, that's fine, I'm patient.
Hint: Find out what a TIF is.
Posted by MikeM on July 14, 2010 11:32 AM
Repeat this over and over all nay sayers. Make it your mantra. This is where most of the funds are coming from.
Macquarie Capital, would invest $600 to $700 million in private equity
Posted by The old school conservative Sacramentan who doesn't want change will never be pleased., and alwasy try to find a reason to bash a plan on July 15, 2010 11:20 AM
Major problem here.....The Arco Arena site is far smaller than Cal Expo.
Why would the state agree to swap Cal Expo for a much smaller site in Natomas? That is the part where this will collapse.
Then on top of all this the City of Sacramento has to "donate" the 9.5 acres from the rail-yards when it is tied up in a dispute with the current Thomas Enterprises owners?
This doesn't make sense, you can't swap land when one parcel is far larger than the other. Also traffic to the Cal Expo area is horrendous and that needs to be addressed as well if they plan on developing the area for anything.
I feel bad for the Kings...this is a glorified "shot in the dark" effort here.
Posted by Sid on July 15, 2010 03:10 PM