Sunday, March 31, 2013

A Bigger, Better Look at Marlins' Financials

In case you missed it, a Miami Herald reporter was provided access to a decade's worth of Marlins' financials, showing bad management can still somehow manage to turn public subsidies and revenue sharing into a loss.
Debt is eating into the Marlins’ income, and that is one of the reasons the team doesn’t expect to turn a profit despite paying players so little this year.

“Now it’s the same old low-revenue, low-cost scenario they’ve been running most of the past 15 years,’’ said Neil DeMause, of the popular blog Field of Schemes, which tracks stadium subsidies.

The Marlins do pay Loria. The 2009 financial statement published by Deadspin put the yearly management fee paid to a Loria company at $3.2 million, up from $2.8 million in 2008. It’s not known what the management fee is now. Loria also collects interest revenue on the money he loans to the Marlins. In 2009, the financial statement had the balance at $15.4 million, with interest expense at $1.1 million.

Even if his franchise loses money, Loria likely saw his net worth grow when his lobbying team convinced Miami and Miami-Dade in 2009 to provide the Marlins with a new stadium. A recent valuation by Forbes estimated the Marlins to be worth $520 million, 15 percent more than a year before and double the $256 estimate in 2008, when a stadium deal was uncertain.

Loria paid $158 million for the team in 2002. The latest financial statement put the team’s debt at about $200 million.
So Loria, like the Rays' Stu Sternberg, probably isn't getting terribly rich off revenue right now, but the value of his portfolio most certainly continues to grow.  And the Herald adds that the Marlins, like the Rays, also stand to make a lot more revenue later this decade when they renegotiate their television contract.

But the biggest takeaway is how bad Marlins fans have it.  Which is why the biggest threat to Tampa Bay baseball fans is not the possible loss of the Rays, but the possible loss of the Rays' valuable ownership group.

Read more here:

To the Critics of Critical Economists:

This blog routinely quotes economists who criticize professional teams' positive economic impact studies.  And every time I write about the topic, a loyal reader calls me "anti-Rays" or comments I've become "a parrot of irrational logic supported by untrue 'facts.'"

But more and more economists are putting their thoughts in writing, and - with no apparent business or political connection to the stadium discussion - their only motivation seems to be the public's welfare.

Sunday morning, the Tampa Bay Times wrote how there's little real evidence the Rays bring the often-quoted $100 million a year in economic impact to the region.

And I was also directed to a recent post that explains how pro sports teams in North America have evolved into "a very odd industry":
Typically we tend to think that firms need capital and labor to produce goods; and owners of the firm are responsible for providing the capital.  But in sports, much of the capital is provided by the state (see the Baade and Matheson study for how much the public subsidizes professional sports arenas and stadiums). 
Then there's the Greg Mankiw survey that shows an incredible consensus among economists (85%) that "Local and state governments should eliminate subsidies to professional sports franchises."

To show just how convincing the consensus is, the Mankiw survey indicates more economists are critical of sports subsidies than a large federal deficit!

It's Time for Opening Day (Stadium Stories)!

Every year at this time, the newspapers fill back up with optimistic stories about the Rays' opening day and not-so-optimistic stories about the Stadium Saga.  It makes great fodder for sports radio as well as this blog.

We've already seen a few Rays stadium/economimc stories in 2013, and Opening Day is still a couple days away (here's looking at you, John Romano). 

Joe Henderson with the Tampa Tribune wrote "we seem to be stuck with a story that needs to change, but never does," and that construction on I-275 in Tampa may drop attendance at the Trop even lower than last year's 19,255 average.

Then, the Times' Stephen Nohlgren wrote again about economists' skepticism about pro teams' economic impact:
But economists who study professional sports say such claims are overblown. Professional sports bolster an economy in some ways, but sap it in others.
In 2008, (Holy Cross economist Victor) Matheson studied sports projects from across the country to see if taxable sales rose after stadiums were built. The study also examined whether tax collections dipped when sports leagues shut down for strikes or lockouts.

"There was simply not any bump at all,'' Matheson said.

Tax collections were as likely to drop as rise when a team started play in a new city. And collections dropped during some strikes, but rose during others.
Nohlgren cites' St. Petersburg Mayor Bill Foster's estimates that the Rays mean $100 million a year.  But of course he says that; he is trying to preserve his legal leverage in case St. Pete ever ends up in court with the Rays arguing over damages of a violated contract.

But economic impact studies will say whatever the party commissioning them wants.

Just ask the 2009 Times article that all-but-lampooned how drastically different "experts" estimate economic impact.  (For what it's worth, Nohlgren's weekend story points out flaws in the various economic studies too.)

Or, just ask the Supersonics in 2008, who - in their attempt to break their lease with Seattle - filed a legal brief that read, "there will be no net economic loss if the Sonics leave Seattle. Entertainment dollars not spent on the Sonics will be spent on Seattle's many other sports and entertainment options. Seattleites will not reduce their entertainment budget simply because the Sonics leave."

One important thing that Matheson points out in Nohlgren's article, however, is that pro sports provide intangible value to a community:
"If someone says (a team) is a great amenity for local people and something that makes us happy, fine,'' said Victor Matheson, a sports economist at Holy Cross College in Massachusetts. "We do have flat out evidence that sports make people happy. Just don't claim it's going to make us rich.''
And that's why the real value of sports teams plays itself out in driveways all across America every single day.

Happy Easter, and Happy Opening Day!

Saturday, March 30, 2013

FGCU's NCAA Run Means Money...But Budget Still Balanced on Back of Students

As I've written about USF in recent years, it takes a lot of money to compete in big-time college athletics.  And unless you're a team like the Florida Gators, you're paying a lot of your bills with student fees. 

See, while football and men's basketball often turns modest profits at D-I schools, every other varsity program typically loses money.  It's simply the cost of doing business.

And schools like FGCU, which have neither football nor a rich history of alumni contributing booster bucks, the student fees make up an astonishing portion of the athletics budget.  Sure, the school has been killing it in the school bookstore.  And the Eagles can expect a bigger check from the NCAA.  And recruiting is about to get a lot easier

But check out these budget numbers from last year's annual NCAA filing:

MAJOR REVENUES ($11M total last year)
  • $5.16M from student fees - 47% of the school's athletic budget comes directly from student subsidies, or $567 per student.
  • $2.45M from direct institutional support - that's another $270 per student coming from general revenue
  • $778,000 from royalties/licensing (merchandise)
  • $571,000 from contributions (boosters)
  • $379,000 from ticket sales
  • $160,000 from endowment funds
  • $137,000 from NCAA distributions
  • $22,000 from program sales & concessions
MAJOR EXPENSES ($10.5M total last year)
  • $2.13M for coaching salaries
  • $1.85M for faculty/administrative salaries
  • $1.12M for team travel
  • $808,000 for facilities, support, & maintenance
  • $619,000 for equipment
  • $192,000 for recruiting
These are just the prices of doing business in big-time college athletics, especially for a young school.  And most FGCU students will probably tell you the last two weekends have been worth $837 in student loans.

But it's astonishing to put FGCU's 2012 revenue numbers alongside those of their more established (football-playing) Sunshine State counterparts:

UF - $2.4M (2% of budget; $80/student/yr)
FSU - $7.8M (8% of budget; $244/student/yr)
USF - $15.5M (36% of budget; $444/student/yr)
FGCU - $5.2M (47% of budget; $567/student/yr)

UF - $8.9M
FSU - $18.2M
USF - $5.2M
FGCU - $778,000

UF - $46.1M
FSU - $31.0M
USF - $3.1M
FGCU - $571,000

UF - $23.6M
FSU - $20.4M
USF - $6.0M
FGCU - $379,000

UF - $22.2M
FSU - $16.9M
USF - $9.6M
FGCU - $137,000

UF - $1.6M
FSU - $1.3M
USF - $633,000
FGCU - $192,000

Other interesting takeaways from FGCU's 2012 budget report:
  • The women's baseketball team accounted for 43% of the university's ticket sales, while the men's team only accounted for 40%.
  • Zero of FGCU's teams broke even in 2012;  it's unlikely the men's 2013 basketball run will be enough to change that this year.
  • There are 5,061 female students at FGCU, compared to just 4,040 males.  Not that the men's basketball team will have any trouble finding female fans upon their return to campus....
Finally, this wasn't in the university's budget, but FGCU conducted a football feasibility study in 2011, which basically said..."don't hold your breath...we can't afford it."  The study estimated football would lose $4.8 million a year, and cost the school upwards of $100 million.

Friday, March 29, 2013

Rays Experimenting More with Dynamic Pricing

The Rays have had tiered ticket prices for years, where better opponents will command higher prices.  And now, according to the Tampa Bay Times, the team is moving another step toward "dymanic pricing," where market demand will fluctuate prices, even up until the day of the game:
Under the old Rays system, a fan would pay more to watch a game against the popular New York Yankees than to see a struggling club such as the Houston Astros. The most desirable games were called "diamond" games, which cost more than "platinum" games, and those cost more than ones rated as "gold" and "silver."
The team has stopped using the labels, and now says it could change prices during the season based on team popularity or a special event at the stadium.
But as this site has pointed out before, the Rays' aren't interested in true dymanic pricing, where low demand creates huge bargains for fans.  With a small season-ticket base, the Rays don't want to totally dimish the value of their tickets.  And selling 15,000 tickets at $20 a piece is still more profitable than selling 30,000 tickets at $5 a piece.

The Rays' new strategy should help them maximize crowds on weeknights while allowing them to maximize profits on concert, weekend, and rivalry games.  And the message to fans?  If you're thinking about buying tickets to a popular date, do it now before prices go up.

Wednesday, March 27, 2013

Miami's Mayor: “Residents Of Miami Were Raped” by Marlins

My old colleague, David Sutta, now with WFOR-TV in Miami, spoke to the city's mayor, Tomas Regalado, about his comments in this week's Sports Illustrated about how "the residents of Miami were raped. Completely."

Sutta writes:
The nine-page article titled, “Art of the Deal Gone Wrong,” profiles Marlins owner Jeffrey Loria’s public relations disaster that just won’t go away. He’s slammed by everyone including auto tycoon Norman Braman who calls him a “jock-sniffer,” while Miami’s Mayor took it a step further.

Tomas Regalado, who hadn’t seen the article until CBS4 showed it to him, is quoted throughout including a line where he says “Miami has a history of bad deals, but I would rate this Number 1.
When asked about the quote, Regalado stood by it.

“I think it’s the truth. I think it was a very bad deal,” he said.

Miami-Dade’s Mayor Carlos Gimenez, another no-vote in the stadium vote several years ago, calls the Marlins carpetbaggers, tone deaf and, “The gift that keeps on giving.”

The Marlins have furthered his political career as well as Regalado’s.

Sports Illustrated also gives us insight into the Marlins. Loria’s former stepson and Marlins President David Samson is quoted saying of the team, “I would’ve sold it opening night. Just walk on the filed, say, ‘Thank you Miami, I love you, this is your ballpark, see you later.’”
Samson also admitted in the article the Marlins are having trouble selling tickets, down from 12,000 season ticket holders last year to just 5,000 this year. 

Probably explains why they're having to sell tickets to Opening Day on Groupon.  And why BizBallMaury predicts zero sellouts this year.  But don't worry, Loria & Samson are doing just fine.

Whoa: Rays value surges to $451 million

Whoa.  Despite the attendence troubles and stadium frustrations, it's been a good year to own the Tampa Bay Rays.  Or any MLB team, in fact.

According to the latest Forbes franchise rankings, the Rays are now worth $451 million, or 40% more than last year and 256% more than when Stu Sternberg bought the team in 2005.  The team's estimated revenues were $167 million and it's estimated operating income was $10 million.

But it's not just the Rays killin' it;  Forbes estimates the average MLB team is now worth $744 million, up 23% in the last year alone.  The publication chalks the success up to ballooning television revenues, the league's investment fund, and "climbing values of Major League Baseball Advanced Media."  The soaring values even negated a 9% drop in operating income for the league.

The Yankees dominate the rankings for a 16th straight year ($2.3 billion value) while the Marlins made another huge gain (to $520 million, from $450 million last year and $360 million in 2011).  And despite the Rays' huge value jump, they were still the lowest-valued MLB franchise.

That solidifies three theories:
  1. You can profit drawing 19,000 fans per game even without a playoff appearance....just not as much as MLB and its owners may like.
  2. Stu Sternberg is likely to be an even richer man if - and when - he ever decides to sell the Rays.
  3. Tampa Bay doesn't have an attendance or a revenue problem; it has a problem with MLB not sharing enough with small-market teams.

Tuesday, March 26, 2013

Jeter Calls Tampa Home; Slashes His Tax Bill

Derek Jeter took a big bite out of his tax bills, apparently, filing for a homestead exemption on his $13 million home on Tampa's Davis Islands, according to the Tampa Tribune
The New York Daily News reported in October that Jeter had sold his penthouse apartment in Manhattan's Trump World Tower for $15.5 million with plans to make Tampa his permanent residence. ...
At a total of 32,700 square feet, it is the largest single-family home in Hillsborough County and is worth nearly twice as much as the county's second-most valuable home.

Because Jeter finished his home in 2011, he paid $68,673.69 in taxes that year – the value of the unfinished property. When the house entered the tax rolls Jan. 1, 2012, Jeter's tax bill jumped to $265,554.77.
The homestead exemption should lower Jeter's contributions to Hillsborough County by about $1,000, but more importantly, it will prevent his home'x taxable value from climbing by more than the inflation rate, regardless of the housing market.

It will also allow Jeter to avoid paying state income taxes as he had been in New York.  Not a bad savings for a guy making $17 million a year.

Monday, March 25, 2013

Why a 15-Seed in Sweet 16 Was Only a Matter of Time

History was made Sunday night when 15-seed Florida Gulf Coast University (FGCU) upset 10-seed San Diego St., becoming the lowest-seed ever to reach the men's basketball Sweet 16.  But, really, it was only a matter of time.

See, since the NCAA chased big dollar signs in 2011 and expanded the tournament from 64 to 68 teams, the quality of the 15- and 16-seeds has gotten better.  Because of the play-in games, 16-seeds are no longer limited to the four worst teams in the tournament - now its the six worst teams.

And 15-seeds, which used to be the fifth-, sixth-, seventh-, and eighth-worst teams in the tournament are now the seventh-, eighth-, ninth-, and tenth-worst teams in the tournament.

Don't think the slight shift is significant?  Three 15-seeds have defeated 2-seeds in the last two years after just four teams had done it the previous 20 years.

And while no 16-seed has ever defeated a 1-seed in the men's tournament, the quality of the "best" 16-seeds is improving as well, it may only be a matter of time before we see more history made in March.

Friday, March 22, 2013

Roger Goddell-Related Weekend Reading

Good read for you this weekend over at the Man, Economy, & Sport blog about how Roger Goodell defends sports subsidies as a community's investment, not to mention how it builds its self-identity.  He doesn't say it's a good investment, necessarily....but that's for you, the reader, to decide.

Speaking of investment, here is some more interesting reading on the Falcons' new subsidies, courtesy of The Sports Economist blog.  Skip Sauer ponders, "What are the Falcons worth to Atlanta?"

You'll get no argument from me that sports teams provide valuable return to communities - but it's not infinate return, so at some breaking point, a region's investment outweighs the value returned.  Just where is that breaking point for Atlanta?  Where is it for Tampa Bay or Miami or Minneapolis?

And, as you continue to waste man-hours this weekend watching NCAA basketball, you can read Neil deMaus' post, "No, the NCAA tournament isn’t an economic boon, next question."

Happy weekend!

Wednesday, March 20, 2013

MLB May Eliminate Working-Class Pensions

MLB has a mini-controversy on its hands this week and it has nothing to do with another failure by Team USA at the World Baseball Classic.  ESPN's Adam Rubin reports:
Major League Baseball owners, despite boasting $8 billion in annual revenue and climbing, are moving toward eliminating the pension plans of all personnel not wearing big league uniforms, sources told

The first attempt to do so, initiated last year by a small-market owner, never came to a vote after Chicago White Sox owner Jerry Reinsdorf chastised his brethren for being petty with the lives of ordinary people given the riches produced by the sport. A vote, which was intended to be kept secret, is now scheduled to take place at owners meetings May 8-9 in New York.

A majority of owners now favor the abolition of the pension plan, a source said.

MLB executive vice president Rob Manfred acknowledged that candid discussions on the topic have gone on for "several years," but he disputed that pensions will go away entirely.
The potential impact of eliminating the pension plan would affect much of the MLB family: front-office executives, trainers, minor league staff and scouts. Some of those personnel, particularly on the minor league level and in amateur scouting, make less than $40,000 a year and rely on pensions in retirement.

Tuesday, March 19, 2013

Rays Release 2013 Marketing Strategy

Tampa Bay Times business writer Robert Trigaux reports this morning that the Tampa Bay Rays are targeting their fans' strong "regional affinity" in trying to sell more 2013 tickets.  The slogan is "Welcome Home."

Trigaux reports the team's huge "market," which essentially extends down to Naples and East to Orlando, creates opportunities for growth and the Rays already have strong support over the airwaves. 
In an interview Monday at the Trop, (Rays President Matt) Silverman said the team will encourage the 700,000 to 800,000 unique visitors to Tropicana Field to add just one game to their season total. If half attend another game, Rays home attendance would bump from 1.5 million to over 1.85 million. Based on last year's numbers, that would vault the Rays ahead of five of the 30 Major League teams.

One print ad for the April 6 game against the Cleveland Indians features Price and this quote: "It's not just me on that Cy Young Trophy. It is a little piece of everybody."  

"The idea of the campaign is that a fan can settle into a Rays game whether they are in the ballpark or on the couch at home and feel like they are in a familiar place," said Silverman.
Trigaux identifies the stark contrast in the Rays' on-field performance and their box office performance without getting too deep into the Stadium Saga debate.  But a polished business writer, he also identifies attendance isn't always indicative of a team's bottom line:
The Rays can still make money off fans who never enter the Trop via merchandise sales and TV contracts. The Rays, whose games used to be seen sparingly in television markets outside Tampa Bay, are now viewable statewide about 150 times per season. That reach makes the Rays the most-watched pro sports team in the state.

But Rays executives and, of course, the players agree. Nothing beats the thundering thrill of a sold-out stadium.

Thursday, March 14, 2013

Next in Line for Spring Training Funds: Houston Astros

If you offer it, they will come.

It's not just the Toronto Blue Jays anxious to tap into Governor Scott's new spring training retention funds;  now, according to, the Houston Astros are saying they'll start shopping around too:
“I have been looking at an area in southeast Florida for about a year now, and have also been exploring options in Arizona,” said Giles Kibbe, general counsel for the Astros.
Of course, the Astros suggested they might move to Arizona to create the required leverage to land a new spring training stadium.  But they apparently want to end up in Palm Beach County:
"We are interested in making something happen there (Palm Beach Gardens), but we are a long way from getting that done.”
"A long way from getting that done" means the Astros are waiting for someone else to figure out the financing.  And in the meantime, the team may shop around other cities to create leverage and expedite the process.  It's hardly a secret; it's simply the blueprint.

It may also help expedite the spring training financing bill, which hasn't even been signed into law yet.  TCPalm continues:
In an amendment to a larger economic incentives bill, a Senate budget subcommittee voted Wednesday to offer cash for upgrading or building spring training facilities. Stadiums that host one team could apply for up to $20 million over a 30-year span. Facilities with two teams could receive $40 million. Local governments would have to match the state money, and payouts would start in 2015-16.

As points out, the Astros want to be first in line in Tallahassee; they just hired uber-lobbyist Brian Ballard to grease the legislative wheels.

Wednesday, March 13, 2013

Blue Jays First in Line for Florida Spring Training Funds

It didn't take long after Governor Scott announced new state money for spring training parks that MLB teams started to line up at the teller window.

First up: the Toronto Blue Jays, who have five years left on their contract in Dunedin, Fla., and just a few weeks ago were quoted as saying, "we love Dunedin," and they aren't looking for a new home because they're not "on the low end of the totem pole as far as facilities were concerned."

But now that more public money is on the table, it could be a different story.  Toronto's Globe and Mail is reporting the Blue Jays' "situation in Dunedin no longer up to par (and the team) will use the next 12 months to shop for a new spring training home, and may consider sharing a facility with the Washington Nationals or Houston Astros."

"Possible destinations," the article continues, "could include Naples, Fort Myers and Pasco County on the Gulf Coast; Vero Beach, Daytona Beach and Palm City on the East Coast."

Spring Training is a huge economic driver in Florida and plenty of stadium subsidy advocates will say "this is exactly why we need to commit state funds to stadiums."

But the cart came before the horse on this one; the Governor's mere suggestion of committing more money to spring training stadiums is going to open the floodgates of Florida cities bidding against other Florida cities with stadium subsidies.  And even though the Blue Jays show no indication of possibly moving to Arizona, they are about to cost Florida taxpayers a lot of money.

Tuesday, March 12, 2013

Times Hates Corporate Welfare; Except for Maybe Pro Sports Teams

The Tampa Bay Times editorial board penned another piece this week calling for a "Crack Down on Corporate Welfare."  The paper suggested an end to tax-exempt bonds for private corporations, which provide companies low-interest loans at the expense of the government tax rolls:
For instance, Chevron Corp., a company that made $26 billion in profits last year, has been the biggest single beneficiary since 2003. And it is far from alone. Tax-exempt bonds have been used to fund a golf resort in Puerto Rico, the construction of the Goldman Sachs Group offices and the Bank of America Tower in New York and even a winery in North Carolina.
The piece follows another Times editorial last month criticizing the soon-to-be-approved Bass Pro Shops subsidies.  The February editorial criticized a $6.25 million subsidy to lure the outdoor retailer to Hillsborough County:
Bass could indeed be a welcome addition. But there is nothing here that cries out for special treatment. Bass should be held to the same standard as others in the business world who pay their own way to compete in the private market, and the County Commission should reject this one-sided deal.
So how does any of this relate to the Stadium Saga?

In January, Shadow of the Stadium pointed out that tax-exempt bonds are one of the leading mechanisms to fund baseball stadiums.  So of course, you would think the Times - against "corporate welfare" and "special treatment" - is against public subsidies for private sports teams.

Except the editorial board has been nothing but a cheerleader for the Rays' efforts, even after a group of local businessmen analyzed stadium funding options in Tampa Bay and said the region would need to rely on tax-exempt bonds and other government help.

In fact, the Times has done very little to explain why it supports the attempt by a private corporation (the Rays) to escape its contract with the City of St. Pete, presumably, so other municipalities could help build it a new stadium.  The paper even celebrated the Marlins' controversially-funded new stadium.

Yes, pro teams provide a civic boost to the communities that support them, And yes, MLB's $7.5 billion in revenues pale in comparison to Chevron's $26 billion in profits.  And no, neither the Rays nor MLB have officially asked for public dollars since the waterfront stadium plan blew up in 2008. 

But while the Times hasn't officially supported public dollars for a new Rays stadium yet, either, there seems to be a disconnect in their editorial logic.  Since it's pretty clear to everyone this side of the Floribama line that public dollars would be required to build a new Rays stadium, it's surprising the paper has taken such a different approach to a professional sports corporation.

The Trib's Inexcusable Mistake on Spring Training

The Tampa Tribune really should know better.

Trust me, in these days of shrinking media budgets, I understand the fact-checker/researcher has gone the way of the evening paper.  But there's no excuse for the Trib's lead editorial this morning to feature a giant fib - one that could have easily been corrected with a Google search or visit to Wikipedia.  Or heck, even reading Shadow of the Stadium.

In support of state funds rehabbing Florida's spring training facilities, the Trib writes:
As (State Sen. Jack) Latvala, a Pinellas County Republican, points out, 15 years ago every MLB team held its spring training in Florida.  Now, Arizona, which has aggressively sought to take teams from Florida, hosts half of the majors' 30 teams for spring training.
Except as this blog pointed out last month, not every MLB team was training in Florida 15 years ago.  In fact, in 1998, only 20 of the league's 30 teams trained in Florida.

In fact, six teams have never trained in Florida.  In fact, the Trib carelessly lifted the claim from an incorrect press release and based part of its pro-subsidy argument on it.  It's a mistake that needs fixing.

The Times isn't afraid to post corrections based on Shadow of the Stadium discoveries.  Is the Trib?

Sunday, March 10, 2013

Update: Maybe the Rays Can Afford David Price?

While the chic speculation amongst sportswriters these days is how the Rays may have to trade away David Price, it's been the contention of this blog that the team's financial future may not be as grim as some paint it.

In fact, Rays' owner Stu Sternberg was quoted today saying, "there is no question that we can handle a contract like David's, but what are you able to put around him?

"We haven't had (thoughts of trading Price)," Sternberg continued.  "Others have speculated. There's been speculation but we haven't had those thoughts at all."

According to Roger Mooney at the Tampa Tribune, Sternberg added that he's "optimistic" about the stadium situation after his February meeting with St. Pete Mayor Bill Foster.  And the team offsets "higher-than-expected" payrolls (such as 2013's expected $60+ million figure) with years where it's "lower than expected."

Saturday, March 9, 2013

Not Enough Room for New Aquarium & Stadium in Pinellas County (Budget)

Two years ago, Pinellas County Commissioners made the controversial decision to extend tourist taxes past 2016 when Tropicana Field is paid off.  Now, a battle could be brewing over what to do with those available dollars. 

Those of us in the Tampa Bay media have been covering the recent $160 million expansion push from the Clearwater Marine Aquarium, which assumes the availability of bed tax dollars.  But few people outside the newsrooms have discussed how funding an aqaurium would eliminate Pinellas County's advantage over Hillsborough County when it comes to financing a stadium.

Now, the Tampa Bay Times puts it in the mainstream:
Aquarium officials note that the construction bonds for Tropicana Field that are backed by bed taxes will be paid off in 2015, potentially freeing up millions of dollars for other projects.

However, the Tampa Bay Rays want a new stadium sometime in the next decade, an endeavor that could top $600 million.

With the team and St. Petersburg Mayor Bill Foster at loggerheads, nothing concrete is in the works. But stadium backers have always counted on the bed tax as a bedrock starting point if Pinellas County has any shot at cobbling together new stadium financing.
"We want the Rays to stay. I hope they do," said former Clearwater Mayor Frank Hibbard, who's on the aquarium's board and is a former TDC member. "But if no progress is made on a stadium, is that money just going to sit there in perpetuity? At some point you're going to move forward." 
There's also the need for more beach renourishment money too, since Pinellas County's beaches will draw more people than an aquarium or stadium ever could, but that's a discussion for another day.

The bigger takeaway is how the aquarium's request could expedite the baseball stadium discussion.  Last November, the St. Pete and Tampa chambers of commerce said "we don't have a lot of time":

"In this environment, when the economy is tight (and) nobody wants to increase taxes," chamber spokesman Chuck Sykes said, "when that debt is paid off, (available money) is not going to sit there. It's going to be claimed."

There's probably not enough room in the Pinellas County budget for a new aquarium and a new stadium....unless, of course, Pinellas and Hillsborough cooperated and pooled their resources to help the Rays.

Friday, March 8, 2013

Odds & Ends: Stadium Subsidies for Falcons, Dolphins, & Spring Training

While Atlanta fans celebrate "only" paying $200 million for a $1 billion stadium (that isn't necessary), Neil deMaus from Field of Schemes rains on the parade with news that it will likely cost taxpayers $400 million or more.  Local media outlets may have championed using bed taxes to pay for up-front construction costs, but deMaus identifies a number of other concessions the city/state will have to make.

Oh, and almost falling under the radar - more leaked financials from Deadspin.  Much like the Marlins' leaked financials, the Carolina Panthers appear to have been raking in the cash ($112 million over two years) while crying poor.

Meanwhile, in Florida's capital, legislators tacked a controversial amendment onto the Dolphins' bill to land subsidies for stadium improvements.  According to the Miami Herald, foreign banks in Florida could lose a long-standing tax break to pay for the stadium.  No indication if that would help or hurt a referendum's odds, which at this point, appear long.

Read more here:
As for Florida's spring training stadium subsidies, which could grow in the next few years, Deadspin argues the Sunshine State shouldn't fall for the MLB "hustle":  "With big-league stadiums, teams can plausibly pretend to need new event technology to catch up...But with spring training games, fans are content, literally, to plop themselves down on the outfield grass. All they want is baseball and warm weather, the same old things they've found in Florida, every March, for more than 100 years."

Finally, the Tampa Tribune reports the Tampa City Council wants Mayor Bob Buckhorn to pursue foreign EB-5 investors.  The program has been used to help jump-start stadium financing in other cities.  But its bonding capacity is usually limited, and Buckhorn - citing SEC investigations into EB-5 in other cities - pushed back against council, saying, "I'm not going to put the city at risk in any form or fashion...we've got to make sure we safeguard the city's reputation and protect it against litigation."

Grass-Roots Tampa Stadium Group Calling for Commitments

Build it Downtown Tampa, the grass-roots group advocating for a Rays stadium in Tampa the last three-plus years, is stepping up its effort a bit, calling for "commitment cards" from new stadium supporters.

The group's website asks Rays fans, "When the Tampa Bay Ray’s move the stadium to downtown Tampa, I will commit to purchasing?"  The options are various full- and partial-season ticket packages.

The commitment is non-binding of course, but could be used to argue Tampa residents are much more willing to support a stadium than their counterparts in St. Petersburg.

Rays Land State Contract to Promote Children's Nutrition

According to my WTSP colleague Andre Senior, the Tampa Bay Rays are getting a $160,000 Florida Department of Agriculture contract to promote children's nutrition locally:
The team would use professional baseball talent, the team mascot and other representatives to help promote food nutrition and wellness among children and families within the Bay Area.

But the Rays team is not the only one getting a healthy dose of government cash from the state organization, which exists on tax dollars.
Miami Dolphins Limited was paid $135,724.60 for its partnership in the "Eat to Compete" initiative to promote food, nutrition and wellness, while the Miami Heat was offered $129,999 for similar services.

According to document, the Jacksonville Jaguars received $133,917 for contributions to a similar partnership.

But couldn't the Ag department just give the money to local schools instead of private business?

A Florida Department of Agriculture spokesperson told 10 News that they have a budget of $10 million to spend on educating children to eat better, and what is being spent now to hire sport celebrities to spread the message is only a fraction.

And- while a half million dollars is a lot of money to use, not everyone thinks it's a bad thing.

"With the way kids eat nowadays; they got too much junk food, the vending machines in the schools- I definitely think are wrong," said St. Petersburg resident Jeff Gbur.

Thursday, March 7, 2013

Cal Ripken Jr. tries to explain seemingly-failed promises in Sarasota

Cal Ripken Jr. spent Thursday afternoon delighting Orioles fans and autograph seekers at Ed Smith Stadium, but he still had no answer for Sarasota residents who wonder when his namesake youth baseball academy will expand to Southwest Florida.

When the Orioles agreed to move their spring training to Sarasota in 2009, part of their promise - in exchange for a $31 million stadium subsidy - was a youth baseball academy.

Ripken even issued a statement - read to commissioners - expressing excitement over the development. When a deal was struck, the Orioles touted the academy in a press release.

But somehow, the promise, which was in the initial Memorandum of Understanding (MOU), disappeared prior to signing the final lease. Four years later, there is no sign of any progress on the youth academy.

Ripken told 10 News that the economy, which has hampered donations for a youth complex, is partially to blame for the lack of progress. Ripken has also spent the last year talking to Sarasota's neighboring Charlotte County.

Sarasota County officials tell 10 News that the Orioles' deal was a win-win since the refurbished Ed Smith Stadium is breaking attendance records and the county is reaping the economic benefits. And while commissioners say they had to drop the youth baseball requirement during final negotiations of a stadium deal, they're confident they can build some sort of youth baseball development in the near future.

The Orioles had no comment on the story, but Sarasota officials acknowledge they are still talking to the team about a new facility, even if Ripken builds his own in a different county.

For more on this story, including the WTSP video report, click here.

Wednesday, March 6, 2013

Forbes: Glazers Now Worth $4.4 Billion

Thanks to a $3 billion valuation of Manchester United, Malcolm Glazer & family are now the 286th-richest billionaires in the world, according to Forbes.  Their $4.4 billion value is second in the state of Florida, as well as second among NFL team owners.

Seattle Seahawks owner (and Microsoft co-founder) Paul Allen (worth $15 billion) is keeping the Glazers from the top of the NFL list, while Miami Heat owner (and Carnival Cruise Line chairman) Mickey Arison tops the list of Sunshine State residents at $5.7 billion.

It's good financial news for the Glazers after a few years of less-than-stellar headlines, but as loyal reader Scott Myers points out, the family could have avoided all of their 2012 Buccaneers blackouts by spending a paltry sum of $750,000.  That's less than .01% of how much the family's value grew since September, according to Forbes.

Tuesday, March 5, 2013

Mets Want Spring Training Company in Port St. Lucie

Paging Rick Scott, Paging Rick Scott....

Florida's governor doesn't love newspapers, but hopefully he read today's New York Times article on the Mets' desire for some spring training company near Port St. Lucie:
(T)he Mets could end up more isolated if the Washington Nationals and the Houston Astros, which are nearing the ends of their leases in their current stadiums, move their training camps to other parts of Florida or to Arizona, where there are more teams.
The Mets, who are celebrating their 25th anniversary here, are seeking a second team to share their facility because it would generate more revenue and ensure another team does not depart the region. St. Lucie County spent $2.5 million last year to update and expand Tradition Field, the Mets’ spring training home, including space for a second clubhouse.
To keep teams from leaving, Gov. Rick Scott announced last week that he would ask the Florida legislature for $5 million a year to improve Major League Baseball facilities in the state.
You can read more about Governor Scott's baseball re-investment plan here.

WBC Underway; Not in St. Pete

The World Baseball Classic is underway and there are exactly zero WBC games scheduled for Tampa Bay.  This isn't a huge surprise - especially given Major League Baseball's relationship with the region - but two years ago, Mayor Bill Foster thought the introduction of international teams training in St. Pete might lead to hosting some WBC games.

2013 WBC venues include Phoenix, Miami, and San Francisco.  Roger Dean Stadium in Jupiter, Fla., got six play-in games last fall.

Sunday, March 3, 2013

Times Explores Trop Redevelopment; But Major Question Lingers

The Times' Stephen Nohlgren reported today on prospects and ideas for redeveloping Tropicana Field.  Rays' VP Michael Kalt told Pinellas Commissioners in January that they were basically sitting on a goldmine by shackling baseball to the 85-acre piece of land that's "lying fallow."

Nohlgren spoke to business leader and former ABC Coalition member Craig Sher, who was excited about the redevelopment possibilities.  And acknowledged - as Mayor Bill Foster confessed recently - that redeveloping in today's economy may not be as easy as the Rays imply.

But one important question remains, as this blog pointed out a month ago: If St. Pete is foolish to house baseball on a piece of downtown land that could be used for other uses, why would Tampa want to do the same thing in its booming downtown?

Rays-to-Orlando Chatter Fired Back Up

Major League Baseball and the players' union doesn't always see eye-to-eye, but when it comes to getting the Rays out of the Trop, they're on the same page.  According to the Times' Marc Topkin:
"I think everybody is curious what would happen or could happen if you had a stadium that was on the other side of Tampa that is accessible to Orlando residents as well as Tampa residents," (MLBPA chief Michael) Weiner said. "I guess the bet was that going south would expand the market. It hasn't really worked as expected."
Weiner went on to share this blog's view of contraction (not on the table at all) and said he wished the Rays drew more fans (b/c more revenue for the league is good for the players!)

But what was Weiner trying to suggest?  Not a stadium in Orlando, which would be a bad, bad idea.  Obviously not stadium in Lakeland, halfway between Tampa and Orlando.  So he meant near Tampa's Fairgrounds, where Orange County fans would still have to drive 60+ minutes to get to the game.

Tampa Mayor Bob Buckhorn told me recently the Fairgrouds/I-4 area is a non-starter and a new stadium would have to be downtown.  Especially since all the Rays talk about is how important a 30-minute commute is to attendance.  Is hard to imagine slightly better proximity to Orlando - in a state without high-speed rail or modern transit - would help the Rays that much.