Thursday, December 18, 2014

Live Updates from Today's Rays Stadium Vote in St. Pete

Will the St. Pete city council approve Mayor Rick Kriseman's plan to let the Rays look at stadium sites in Hillsborough County?  That's the story I'll be following all day on Shadow of the Stadium's Twitter feed:

Here are some other reports and opinions this morning ahead of the 3 p.m. vote:

Times' Charlie Frago: "No rubber stamp from City Council for St. Petersburg's deal with Rays"
Today's vote will be close.  Potentially very close.  It's something I also talked about on SportsTalk Florida yesterday afternoon.

Times' Editorial Board: "Deal before St. Petersburg is a good one to keep baseball in the region"
The latest example of the paper's heavy pressure for a stadium deal contends the region needs to work together on a new stadium. It also seemingly contradicts previous editorials in saying the Rays may ultimately choose a suburban St. Pete stadium over one in a downtown core...and downtown land may be more valuable as non-baseball development, rather than a stadium.

Times' Romano: "Rays deal is a risk for St. Pete, but one that a city on the rise can handle"
The columnist writes St. Pete should approve the deal and may even have the leg-up in keeping the Rays.

Buckhorn to WUSF: "If you ask me now how we'd pay for it, I couldn't tell you"
This could have everything in the world to do with Jeff Vinik's need for city dollars, which I wrote about yesterday.

And here are the most relevant posts from this blog in the last 10 days since the proposed deal was announced:

Tuesday, December 16, 2014

What (If Anything) Vinik's Plans Mean for Rays' Stadium Dreams

This blog has long claimed that Jeff Vinik would prefer to build a Downtown Tampa entertainment empire without baseball.

In fact, as nasty comments from my beloved readers attest, I was in the minority for a long time. 

But today, the Lightning's owner unveiled his "master plan" for Downtown and the Channel District, and he drove one more nail into the coffin of a possible baseball stadium on his land:
Thalji and Ashley Kritzer from the Tampa Bay Biz Journal did a bang-up job this morning explaining Vinik's vision 140 characters at a time.  Follow them for more specifics.

But what does this all mean for those other potential sites in Tampa eyed for a potential Rays stadium?

Well, all roads to a Tampa stadium now go through Vinikville - even if it's not on Vinik's land.

See, any potential stadium revenue streams (tourist taxes, CRA/TIF money, etc) could also go toward Amalie Arena and/or Vinikville projects.  Which means all roads to baseball now go through Vinikville:
After he fronted more than $45 million of his own money to fix up the arena, Vinik indicated he wouldn't mind recouping some through the bed tax and/or Downtown CRA.  And he's in such good-graces of the elected leaders in Tampa/Hillsborough County that it's safe to assume any big retail/stadium project anywhere near downtown would all-but-require Vinik's blessing.

That's another challenging hurdle (in addition to that whole funding thing) standing in the way of a Tampa ballpark.

A Rays Stadium Question Worth Asking

Hypothetically, if the Rays/Tampa were to find a way to finance a new stadium on the other side of the bay, how could the city possibly draft an ironclad agreement if everyone seems to think the Rays won't be at Tropicana Field come 2027 no matter what?

It's a point raised in a Tampa Tribune letter to the editor today, as well as one I've raised on numerous occasions:
St. Pete's contract with the Rays is considered the strongest in recent memory of all the stadium controversies around the country, which led Trib reader Larry Thornberry from Tampa to write:
If the Rays are to be allowed to stiff St. Petersburg on the Trop agreement, how long will it be before the team stiffs Tampa/Hillsborough when attendance at a new ballyard here that could be publicly subsidized does not meet Sternberg’s expectations? 
Two years ago, I asked if "promises of an 'ironclad' lease (are) hollow?"

Thornberry also touched upon another point I've made - the Rays' frustrations stem from the region's unwillingness to suffer through the tiniest inconvenience for a MLB game.
If (Tribune columnist) Henderson finds this kind of driving (to Tropicana Field), in his word, “stifling,” then he’s been badly spoiled. He should try getting to major league ballyards in the Northeast. And if he’s up to a challenge, he also could try finding a safe parking place within walking distance of Fenway Park for $10, something that’s easily done near the Trop.

There are more attractive explanations for poor attendance than geography, chief among them being that tickets and such baseball accessories as hot dogs and beer cost way too much at major league parks. And the Rays have yet to develop the kind of fan base, nurtured over generations, that teams like the Red Sox enjoy. It’s very possible that Rays attendance in Tampa would be no better than in St. Petersburg. Then what? Do the Rays bug out again?
What can our region do - aside from doing everything possible to set a new stadium up to succeed - that would prevent a similar scenario in 2035?

Monday, December 15, 2014

Rays to Montreal? Fat Chance (Pt. III)

FLASHBACK Oct. '13: Rays to Montreal? Fat Chance
FLASHBACK Mar. '14: Rays to Montreal? Fat Chance (Pt. II)

It's time again to revisit a popular topic!  Except, this week, it's TSN sports legal analyst Eric Macramalla doing the dirty work, writing, "Forget it Montreal, the Tampa Bay Rays aren’t moving anytime soon."   One of his main reasons (as I've written about before): the Rays have a use agreement, not a lease.

An excerpt:
The reason the Rays aren’t moving ties into their deal with the city. The Rays never signed a traditional lease. Rather, it signed a “Use Agreement”, which prevents the team from moving out of Tropicana Field and calls for potentially catastrophic monetary damages should the Rays abandon the stadium before its deal is up in 2027. This is in stark contrast to a traditional lease, where a tenant owes the landlord what’s left on that lease after breaking it.
...
So that takes us back to the city suing for money – and lots of it – should the Rays fail to honor its agreement. It’s not clear what that amount would be, but the ask is likely to be exorbitant. The city could argue that it should be paid in excess of $100 to $200 million as compensation for the loss of the team and the intangibles that come with an MLB team in a city. Some of these are outlined in the Use Agreement, and include things like the “creation of new jobs, local employment opportunities, increased business prospects, direct and indirect tax revenues, enhancement of the community’s image and promotional opportunities, and an improvement in life and local pride of the citizenry”.
...
The city did its homework when it drafted the Use Agreement.
The attorney who negotiated that deal back in the 90s? John Wolfe, who remains St. Pete's top attorney.
(This month's) very limited negotiated settlement was Rays owner Stuart Sternberg’s only viable play. He simply had few options since he couldn’t pick up and leave without the threat of a major lawsuit.
This touches upon my most recent post, which details how little leverage the Rays have until St. Pete council agrees to let them look elsewhere.  Macramalla continues:
One more thing – major league baseball historically doesn’t abandon stadiums where the team is the anchor tenant. It sends a terrible message to cities that MLB teams don’t honor leases.

So for those fans hoping to see the Rays in Montreal in the near future, stop hoping. However, should the Rays fail to make progress on a new stadium by about 2021, they could at that point start negotiating with a city like Montreal to build a new stadium for the 2028 season. The Rays would then let the city know they intend to move in a few years with the hope of buying the city out in exchange for an early exit.

For Expos fans, expansion is more likely to land the city a team in the near future. MLB, however, hasn’t expressed an interest in adding teams at this time.

With enhanced revenue sharing, substantial revenue from media deals, a deep history of baseball in Montreal going back to 1897 and a city that is the 15th largest metropolitan city in North America, it seems inevitable that Montreal will get a team. The numbers line up in an MLB economic landscape that has dramatically changed since 2004. The issue, though, is when. And that doesn’t seem to be anytime soon.

Sunday, December 14, 2014

How the Rays Are Playing Hardball...and Winning

Great piece from the Trib's Chris O'Donnell this morning on how the Rays were able to negotiate the price of "making St. Pete whole" down to somewhere in the $20-30 million range (less when you factor inflation), despite a fairly ironclad contract with a whopping 13 years left on it. 

The story points out how Seattle ultimately got a $45 million settlement when the Sonics left their less-ironclad lease just two years early.  But this week's deal has been considered "fair" because St. Pete seems ready to move past baseball and the Rays weren't going to budge:
The amount of compensation is a compromise, Kriseman said — less than the city asked for but more than the Rays wanted to pay. Sports economists say the Rays bargained well.
“We have immense challenges ahead of us,” said Rays President Brian Auld. “Had these payments been significantly higher, they would prohibit us from being able to do a new deal; they could be crippling to whatever business needs we had going into a new ballpark.” 
Indeed, the more the Rays ultimately pay to taxpayers, the less money they make...and they more they'll need to ask of taxpayers in a new deal.  But "crippling" is poor descriptor given that MLB just hit $9 billion in revenue this year.

Judging from previous reports of what the Rays and former mayor Bill Foster were negotiating, it would seem the team's hardball tactics worked well.  The current mayor, Rick Kriseman, acknowledged at Tuesday's press conference that he would have loved to have gotten more, but he didn't feel like he had the leverage.  He couldn't even get the team to pay for the right to look at stadium sites in Tampa, one of his original campaign promises.

Reaction has been mixed: the Times' John Romano said the money stinks, but the deal was necessary.  SaintPetersblog's Peter Schorsch wrote St. Pete is basically getting screwed.

Of course, the revelation that the Rays won't consider a single change to the negotiated deal only bolsters the idea that they're going to keep playing hardball.  They're basically giving an ultimatum that they won't re-negotiate anymore and if council rejects this deal, they won't keep trying to make a new stadium happen over the course of the next 13 years?!?

That's silly.  Which is why the city may not realize it, but it still holds all the cards in this negotiation.

I've written ad nauseum about Kriseman's tough challenge of satisfying both his taxpayers and a team that doesn't want to compensate them.  He could have waited the team out until they caved to better terms...but the team played its public relations cards well and forced the city to bend.

How should council vote this Thursday?  I cannot say.  It's a big decision.

But this may be the last time a municipality has the upper-hand in negotiating with the Rays.  Even Tampa Mayor Bob Buckhorn acknowledged what's coming next:
You have to wonder if the Rays' setting their price, playing hardball, then letting public opinion turn in their favor will repeat itself in Hillsborough County too.

If the team/league finds a piece of land they like in Tampa, will they threatmonger and fearmonger because the city and county aren't immediately willing to hand over hunderds of millions of dollars?

It wouldn't be MLB's first time.

6 Brutally Honest Stadium Statements from Mayor Buckhorn

Tampa Mayor Bob Buckhorn appeared on Political Connections on Bay News 9 today, shooting from the hip on the Rays' Stadium Saga. Here are some of his quotes, including some very honest responses:
This is a terribly interesting idea most-recently floated by an Orange Co. commissioner looking to reduce taxpayer risk in Orlando City's new soccer stadium.

However, the profit-sharing idea was rejected by the team/league and taxpayers handed over tens of millions anyway.

Buckhorn continues:

Friday, December 12, 2014

A Brief History of Sternberg's Threats to Tampa Bay

There's been a lot of concern over the last few days about Stu Sternberg's latest non-threat threat:
So how much stock should we put in Sternberg's claim that he'll sell the team if council rejects next week's vote? First of all, refusing to re-negotiate sounds like "I'm taking my ball and going home."

What good does that do Stu, even if he decides to sell the team? The franchise's resale value is a lot higher if they re-negotiate and make any progress whatsoever on a new stadium.  Stu's too smart to sell low.
 
Furthermore, why start believing the threats now?

FLASHBACK:
  • January 2013 - Sternberg, mentioning contraction, says MLB wants out of Tampa Bay
  • October 2011 - Sternberg says MLB could "vaporize" the Rays
  • February 2011 - Sternberg suggests relocation is a real possibility with no new stadium
  • June 2010 - Sternberg says "five markets" are better than Tampa Bay
If we are to learn anything from Jerry Reinsdorf, we should believe none of them.



No matter how you slice it, this isn't a good situation.  The franchise's owner is taking an adversarial approach with the city his team plays in.

Even worse: the stadium complaints have put the Rays on a downward attendance spiral that is unlikely to reverse itself as long as they play at the Trop. 

This isn't the fault of fans - it's the fault of MLB.  And the league should step up and fix it, not threatmonger the region into action.

Thursday, December 11, 2014

Big Surprises from Thursday's Council Non-Vote

St. Pete's council unsurprisingly voted to postpone the decision on the Rays for a week, but there was one big surprise reveal today - city attorneys were kept largely out of the negotiation process until the end. That might explain this:
St. Pete's attorneys are in a bit of a sticky spot, representing both council and the mayor's office...and Wolfe is known around town as "Dr. No."  He's a conservative attorney who did such a good job drawing up the original contract in the 90's, the Rays are still locked into it.  So I'd love to be a fly on the wall and hear what he's saying behind closed doors.
But the other big surprise today was that councilmembers were told they could not request any "tweaks" to deal negotiated with Rays...the team would reject them.  It's a really really really hardball approach from the Rays, who at one point said they were a $122 million-dollar engine to the city/county...but are only offering around $2 million/year for the right to move.

Mayor Kriseman basically indicated this is as good as its going to get however, so we all now look ahead to next Thursday's council meeting to see how the important vote unfolds.

What Could a New Rays Stadium Really Cost Taxpayers?

Yesterday, I reported for WTSP on the potential tax implications of a new Rays stadium in either Tampa or Pinellas County.

In short, I looked back at some of the numbers the Tampa and St. Pete chambers of commerce came up with to address the perceived funding shortfall of building a new park:

The group concluded between $300 million to $400 million would be required to build a modern stadium, and the best mechanisms available for that funding in Hillsborough County include (with approximations):
  • Redirect a portion of the Community Investment Tax (CIT) from local road and infrastructure improvements to a new stadium. The local sales tax, of which a portion funds Raymond James Stadium, expires in 2026 and would have to be extended. ($70-$80 million over 30 years)
  • A new 5% surcharge on auto rentals, which would hit tourists more than local residents, but require a new law to pass through the legislature. ($140-$150 million over 30 years)
  • A new 6th-cent added to the tourist/bed tax. Hillsborough County isn't considered a "high-tourist" county, so state law prohibits it from charging tourists 6% tax on hotel stays. However, the law could potentially be changed, and Hillsborough might hit the "high-tourist" threshhold within the next decade. ($35-$45 million over 30 years)
  • Tax-increment financing (TIF) associated with Tampa's Community Redevelopment Areas. The funding mechanism earmarks property taxes from city and county coffers to specific neighborhoods for the purpose of economic growth. (tens or hundreds of millions over 30 years)
READ: Bay Area Baseball Stadium Finance Study
 
Pinellas County has an easier time getting to $400 million since its tourism coffers are more robust, thanks to beach visitors:
  • Existing revenue streams already paying for Tropicana Field. Most Trop bonds will be paid off by 2015, so leaders can either stop collecting the taxes, redirect the collections to other city and county needs, or re-direct them to a new stadium. ($115-$148 million over 30 years)
  • Re-direct a portion of the "Penny for Pinellas" local improvement tax to a new stadium. The tax sunsets after 2020, so its bonding capacity would be modest at best without another extension. ($35-$40 million over 30 years)
  • A new 6th-cent added to the tourist/bed tax. Pinellas County, unlike Hillsborough, is considered a "high-tourist" county, so the county could increase the tax on hotel stays from 5% to 6%. ($60 million over 30 years)
  • Re-directing a large portion of St. Petersburg's share of state sales tax toward a new stadium. The city currently receives more than $12 million/year from the state, and much of it could be leveraged into new stadium bonds. (tens or hundreds of millions over 30 years )
I'd also throw in $35 million in state money on either side.

Rays President Brian Auld said Tuesday he didn't know what kind of costs a new stadium would bring because the Rays wanted a "next-generation" stadium, and he was focused first on seeing the agreed-upon deal through St. Pete's city council.

Wednesday, December 10, 2014

DELAYED! Kriseman, Rays Push Stadium Decision Off One Week to Secure Votes

Every St. Pete insider knew Mayor Kriseman's controversial plan to let the Rays explore stadium sites across the bay in Tampa would meet some resistance in City Council.  Especially with former mayor Bill Foster lobbying councilmembers to vote "no" over concerns of weakening the city's ironclad contract.

Yesterday, we broke the news of several councilmembers leaning toward "no" votes...which led me to tweet this:
It also led Rays executives to lobby councilmembers today on the deal:
But sure enough, as the Tampa Bay Times first reported, tomorrow's vote has been delayed a week so Kriseman "can make sure that council had time to get comfortable" with the MOU.

Hooray!  Eight more days of speculation and giant headlines!

UPDATE: The Times editorial board has a quick response to the delay {link to site}, once again taking the opportunity to slam former mayor Bill Foster.  It's anything but their first time.  But they also seemed to put council on notice that a vote against the agreement may be a consequential shot across the bow of the editorial board too.