Thursday, July 30, 2015

Bass Pro Got Your Money; Why Shouldn't a Baseball Team?

In case you missed it, good column in today's Trib from Joe Brown, opining that the monster crowd at yesterday's Bass Pro Shop demonstrates Hillsborough County probably didn't need to give the private sector $6 million to make it happen.

It's a topic I delved into quite a bit in 2013, writing the Rays are just like Bass Pro: a private business that creates the exact kind of job the county admits it shouldn't be subsidizing...yet it does anyway:
Bass Pro isn't all that different from a pro sports team: a big-time retail business that makes hard-to-prove and potentially misleading claims about its value as a tourist attraction.   In fact, a month ago...Rays' vice president Michael Kalt identified the team as a "retail business" that had trouble getting people to drive more than 30 minutes to visit.
Then, I asked if commissioners would also just roll over for the Rays the way they did for Bass Pro:
On Wednesday, the Hillsborough County Commission heard every argument imaginable against public subsidies for a new Bass Pro Shops complex.  Then they asked Bass Pro to more or less "open its books" and reveal its annual sales numbers.  And promptly after Bass Pro said "no," commissions approved the $6+ million subsidy anyway, 6 votes to 1.
After all, why should a private business open its books to demonstrate need, ROI, or job creation when elected officials could just take their word for it?

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  1. What would have happened if they didn't the $6Mn?

    What happens to so many businesses, retail or private like Investment Banks's back offices (as in Jacksonville or New Jersey) or manufacturing facilities or automotive companies - all for-profit companies - when they ask for Gov't subsidies or INCENTIVES to stay in an area? They leave if they don't get the money because there will always be a place that will see the fringe benefits of having them stay in place....

    What would have happened to the Marlins if Miami said no to Loria Stadium?

    The same thing that is about to happen to the Rays

  2. "But the BOCC passed the measure with a 6-1 vote, claiming it was a win-win for Bass Pro and the county because of its projected $130 million economic impact. Don’t ask me where they got those numbers, but it proves the retail giant didn’t need any “incentives” to build its new store."

    There's why.... *$130Mn* economic impact in the area - that's in addition to the profits the shop will make for itself presumably.

    The HCC heard the arguments and decided to give the money because the county and the area will stand to benefit from having Bass in the area. And you know darn well, that if they didn't, some other county would.

    1. How many assumptions are packed into those three paragraphs? 15?

    2. Should governments offer tax breaks to every company that promises to create new jobs then? If that's the case, businesses wouldn't pay taxes...and our governments would go bankrupt.

    3. Idk if you knew this, but it's called doing business! It's no different then "the South" attracting big businesses w/ low taxes & employer friendly laws. It's no different then what the US does to bring businesses here opposed to cheap China, etc....
      Let's just be thankful your (NO'ah) not in charge of business deals in Tampa Bay, because they would of ALL went to Orlando & Jax instead...

    4. Economists describe this flawed thinking as a "race to the bottom." Every state/city races to hand out more money to businesses/teams, and their individually-rational "competition" leads to collective bankruptcy.

    5. Say that to ALL the cities & towns that lose factories/jobs to other places or over seas...

    6. I forgot, progress is a 4 letter word... lol

    7. Dufala, if you want to look at all the sprawl problems the south has because it gave tax breaks to builders, developers, etc.......let's compare whether the south or the north has better infrastructure?

    8. Dufala/Doofus - where did you learn to write English?

    9. Look, I was just using "the South" as example, you can ask a lot of places in Michigan, Illinois, Penn., etc. on how they're doing without auto, coal, and steel factories. And, comparing NY or Bah'stun to places in south isn't a fair comparison because of history.
      Bottomline is "progress" is good, jobs are good, making money is good, and so on that companies & sports teams can bring to a cities or town, it's common sense!
      And to "annoy" that doesn't even seem to have a Gmail account to login here, which speaks for it self, it's really immature when your losing a debate or argument to correct grammar instead...

    10. Goodness gracious doofass, seriously, did you even attend school past the third grade?

    11. Only dumbass 3rd graders calls names & tries to correct grammar on a debated forum. #immature

    12. So, I take it you are in the 3rd grade? Anon (2:11 am) - seeing that you are calling someone else names?

  3. ROI for cities, states (governments) in sports is a tough call. This is why it all depends on the immediate impacts (economic impacts that can be calculated) and also the intangible ones over the years.

    Let's take the Montreal Impact example in the MLS. Saputo family invested millions of dollars over the years to build the club, a stadium, a credibility in the market. Government of Quebec helped them to expand the stadium in order to have the right size for the MLS.

    As of earlier this week, the Montreal Impact did not draw enough fans in the regular season but did draw exceptional crowds in the CONCACAF Champion League. This is a lot of exposure around the world for the club but also the city. But still not enough.

    Montreal Impact did a bold moved this week and signed Didier Drogba, a world class player and star. This is probably the most important news worldwide for Montreal for a long time. The media impacts are tremendous. And it costed nothing more (than the previous subsidy) to the governments to get such additional exposure that will generate more tourisms in the city over a period of few years. Economic impact that would probably be non-existent or partially existant without such announcement.

    Bottom line, yes, fair partnerships between governments and private company are possible and must follow some basic rules to make sure it's a WIN-WIN situation. When it's not, the public representative must be accountable.

    And it is also true if those public representatives are not cooperating to help companies to find solutions when there is a real problem (like the Rays are asking with the MOU). Because such behaviour is affecting the region image in the media and there are negative economic impacts related to that.

    And public representative must be accountable for those negative impacts. This is true for TB but also for any other cities in the world.

    1. This long post is mostly speculation, boiling down to Drogba's signing = moarrr tourist dollars. No numbers, no evidence. Just rosy assumptions and conjecture. Which is all very neat, but utterly useless.

    2. "No numbers, no evidence. Just rosy assumptions and conjecture. Which is all very neat, but utterly useless."

      Just like your non-existing IQ

    3. What is not useless? The way that the stadium saga is managed by St-Pete or your comments?

      Or both?

  4. Unfortunately, Montreal won't be getting a team. The Rays will be staying in the Tampa area and a new stadium WILL be built near Ybor City...Vous pouvez prendre cela à la banque!

    1. Better improve your french, because the translation is so bad.

      Just try to do what you wrote in french at a bank in Montreal. Good luck!

    2. BTW, don't exclude an expansion before the Rays get a new stadium. Both scenarios are possible at this time.

      Next steps, meeting between Coderre and Manfred, meetings between Montreal investors/Cromartie/Coderre and MLB owners and election in St-Pete.

      Restez à l'écoute!

      P.S. A new site in Montreal was brought up this week for a stadium. The Molson brewery plant, next to Jacques-Cartier bridge (that will get an exceptional lighting system, it was announced yesterday, $40M investment).

      Imagine a stadium next to the bridge (WOW!) with a Molson-Coors museum integrated. More than 220 years of history. It will add up so many tourists to the games. And just by the water, next to City Hall, Old Montreal and downtown.

      Does that mean Molson-Coors is another deep pocket investor that would be part of the group? They're already shareholders of the Habs with Bell. Let's connect the dots here.

  5. As long as municipalities keep paying for it the bidding war for big projects like this will continue.

  6. NO'ah, a hometown related article that helps the argument that tax breaks & investment helps grow your overall economy... "These tax agreements, McGilpin said, have played a key role in the city’s current economic boom by spurring residential and commercial developments."

  7. ... and another closer to our home!
    It's like buying a new car, why spend more on the same car the lot the next town over has for 2-3k less?

  8. It's called "doing business" or a "business partnership", like Tampa & the Rays will have...
    As for the new car dealership comparison, I sell cars, and lets just say Wesley Chapel lots make more $ selling cars for less, because they sell more volume, they get more kick backs for that from the manufactures, and then get more service in time then those "greedy" lots in some other places...
    Remember, 1 for the BAD - 2 for the GOOD

  9. The key to good return on investment is targeting incentives at:
    1) high-paying jobs
    2) projects that absolutely wouldn't be happening otherwise

    You can add avoiding bidding wars to that list. That's why stadium subsidies have provided such poor ROI overall in the last few decades.

    1. While I agree that P&L based ROI's are poor - one cannot argue about the unmeasurable benefits sports teams and stadiums etc bring to a community.

      The free publicity alone is worth millions - every news article, news coverage that mentions the team and city is free publicity for the city. And it's not just mentioning the name - it's show-casing the city as well through TV coverage... how much is that worth alone?

      Civic pride - when teams do well in their respective leagues, there's a huge amount of good-will and civic pride that citizens feel...

      Ancillary businesses benefit as well - restaurants, hotels, parking tickets etc... not to mention additional taxes collected from all of those ...

      There are other examples as well, as the used car salesman above pointed to (despite his poor grammar, he makes some valid arguments)

      But sure, let's just measure ROI on purely $$ invested by the govt and $$ extracted from just the game itself

      St Pete is being dense and obtuse in not allowing the Rays to look elsewhere in the area. There's no bidding war - the Rays want out of St Pete. Period. If they won't allow the Rays to look in Tampa, then the heck with it, let the Rays go to Montreal. It's not as though most of the region will care - they can follow along on the radio like they always have and read about it online. They'll be in the same time zone anyway.

    2. Established cities don't need free publicity. It's smaller cities that do.

      The beauty of "unmeasurable benefits" - is you can't measure them and thus, cannot easily-refute a team's claim :)

    3. In Montreal, we were able to measure/evaluate the impact on tourisms with a baseball team and without a baseball team. We lost one so we know exactly what were the impacts.

      Of course, some of the impacts of not having a team were offsets by new events and offerings. But saying it's not possible to measure them or it's not important for large city, that's maybe true for TB but not for Montreal.

      Each cities (small or large) and their location/region in which they are operating are different.

      Even two cities with the same population (let's take TB and Montreal) will not have the same economic impacts with or without a team. Even in Montreal, having a team in the AL East is not the same as within the NL East.

      A detailed study (in french) was performed a while ago on the economic impact of a baseball team in Montreal. Some numbers need to be revised but bottom line, the impacts are significants (for Montreal) and will not be the same for TB considering their location, the way tourist are attracted, the complement offering (festivals, other major events, attractions, other cities next to it).

      Montreal is an established city and there are positive benefits on tourisms and on the city notoriety that can be evaluated. And free publicity is an important part of the benefits.

      Montreal also lost the F1 race a while ago and impacts were measured at the time.

      Believe me, we can speak about it, we did loose a team.

      So rather than speaking about unmeasurable ones, decision makers and supporters should work on measuring the ones that have an impact. And if there are no measurable ones, then yes, let's talk about something else.