The "Template" Hillsborough Wants to Use for a Rays Ballpark is Breaking the Bank in Georgia

The Atlanta Journal-Constitution took a look at what Cobb Co. residents are paying - and getting in return - for the Braves' new stadium.  And the numbers aren't pretty, as Field of Schemes succinctly summarizes.

Basically, Cobb Co.'s absolute best, most liberal accounting scenario is a $5.2 million boost in revenue related to the ballpark.  Unfortunately for taxpayers, they're paying nearly $9 million a year out of their general fund for the stadium, plus tens of millions a year in associated financing costs, and tens of millions more in transportation costs associated with the stadium.

That's not good ROI to simply lure the team from an Atlanta home they weren't threatening to leave.

And the kicker, is that Cobb County just doesn't have that kind of money available:

Cobb County is currently in a fiscal crisis — as Lutz notes, “Since the first pitch in April, fees for everything from senior centers to business licenses have gone up. Libraries are in danger of closing, and there’s talk of a new penny sales tax to fund the police.” None of that is solely the fault of the stadium, as she notes, but starting each year with an extra $20 million-plus hole in your budget does not help at all.

Let's remember that the Rays' biggest stadium cheerleader in Tampa, Ken Hagan, has called the Braves' secretly-negotiated, more-expensive-than-anticipated stadium a "template" for a new ballpark in Hillsborough County.

Hagan suggests Cobb Co/Braves deal shows #Rays stadium talks need not be bogged down by things like public input: http://t.co/TeKulWaeDN

— Shadow of Stadium (@StadiumShadow) July 5, 2015

There is no price too great for some politicians to get a new stadium where they'll eventually get free tickets.

And not to dismiss the certain intangible value of having big-league teams in your community...but out leaders really should be asking more questions about the ROI on the Rays' nine-figure "ask."

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Forbes' #SportsMoney50 List

Just to toot my own horn a little bit - but also in an effort to share some outstanding resources out there on Twitter - I point you to Maury Brown's annual #SportsMoney50 List on Forbes.com, which includes some of the must-follow accounts for sports fans and sports business fans.

It's the third year in a row he's included Shadow of the Stadium, calling it this year, "indispensable", and "keeps reporting on course and doesn’t get caught up in homerism. For good or bad, Shadow of the Stadium presents it unvarnished."

If only we could now remove the homerism from all sports and sports business reporting!

Regardless, tons of good accounts to follow in that article, so check 'em out.

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USF Sells Just 12% of Ticket Allotment for Birmingham Bowl

Don't expect a lot of green in the stands Saturday at the Birmingham Bowl...or in the USF Athletics budget after they have to eat the cost of 8,800 unsold tickets.

 

With the Bulls spending a second straight bowl season in Birmingham, not exactly a desirable vacation destination for the already-sparse USF fan base, the school has sold just 12 percent of its required 10,000 ticket allotment for the game, as the 10-2 Bulls will take on 6-6 Texas Tech.

 

It means USF will eat the cost of more than 8,800 tickets, likely worth hundreds of thousands of dollars. 

 

According to USF Associate Athletic Director Brian Siegrist:

• The school sold 1,162 tickets;
• Distributed 1,635 tickets internally to the band, staff, and guests of players/coaches;
• Distributed 4,505 to Birmingham-area charities;
• Gave 2,698 tickets back to the bowl as unused.  

The bowl pays teams for appearing in the game - approximately $1 million each, according to published reports - but the money gets shared with the American Athletic Conference (AAC).

 

It's also not cheap sending hundreds of players, staff, and band members to a bowl game; according to athletic department filings with the NCAA, USF spent $627,371 on last year's Birmingham Bowl.

 

However, football and men's basketball are the only sports at USF that run a surplus on annual revenues and expenses, due to substantial television money coming in through the AAC.

 

I've previously covered the university's growing problems balancing its athletic budget, as teams in small-conferences find it harder and harder to keep up with big-spending teams in the country's five major conferences.

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Tallahassee's Leading Stadium Supporter Resigns

Although his scandal is related to sexual harassment, powerful State Senator - and onetime gubernatorial hopeful - Jack Latvala has resigned his seat after just about everyone had called on the Pinellas lawmaker to step down.

The news comes less than a day after a retired judge released his investigation into sexual harassment claims against Latvala, finding probable cause and potential criminal violations.

Latvala's departure strikes a blow to pro sports teams in leagues in Florida hoping to curry favor in Tallahassee, as he helped rewrite laws in their favor, preserve funds for new stadiums, and was expected to champion state funds for both the Rays and Rowdies.

In exchange for his favorable treatment, Latvala has routinely received big campaign checks from teams and their wealthy owners.

Recently, legislative leadership has been very anti-stadium subsidy, and its unlikely to change in the near future with Latvala out of the picture.

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Sarasota County's Multi-Million Dollar Timing Hiccup with the Braves

With the U.S. House attempting to finally eliminate the federal subsidy of bonds used to finance stadium construction, Sarasota County bit the bullet and took out $21.6 million in bonds to help pay for the Braves' new 8-week-a-year home in North Port.  The bonds were sold on Dec. 13 at a 3.7% rate.

Unfortunately for Sarasota taxpayers, the Senate erased the proposal from the federal tax plan two days later, meaning the county failed to take advantage of the subsidized rate that sports owners - and the governments that support them - typically enjoy when financing stadium construction.

But a county spokesperson told me Sarasota had no choice but to take out the taxable debt due to "uncertainties" related to the tax cut bill, including the possibility of the stadium subsidy elimination going into effect retroactively, from the date the legislation was first introduced, Nov. 2.  The county had to meet a closing date on the deal of Dec. 21.

In essence, that means instead of having all Americans subsidize their stadium debt, Sarasota County will fund its portion of the debt all themselves.  And that bad timing likely will cost taxpayers of Sarasota County several million dollars, as the difference in financing charges on tax-exempt bonds and taxable bonds is substantial.

That said, there's good news to the North for Rays fans, as the tax exemption basically remains in place for all future U.S. stadiums (note: Montreal is not in the U.S.), and it won't cost Hillsborough or Pinellas quite as much should they decide to try and bust their budgets to make a new stadium work.

But, before I go, some final irony:

In the same editorial the Tampa Bay Times criticized Congress' new tax plan as raising debt and primarily benefitting "businesses and the wealthy over the poor and middle class," the Times also applauds the abandonment of the tax-exempt bond reforms.  Which is kind of befuddling, since the tax exemptions for investment profits related to pro stadiums is another handout that benefits the rich, not the middle class.   Hmph.

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Pinellas May Give Blue Jays Free Pass on Lease Guidelines

PINELLAS COUNTY, Florida – In a lucrative deal to renovate and expand the Blue Jays’ longtime spring training home in Dunedin, county commissioners appear likely to waive county guidelines that suggests only contributing to expansion projects that lock the tenant in for 30 years or longer.

The Blue Jays and city of Dunedin have been negotiating only a 25-year extension in exchange for an $81-million project, funded mostly by county and state taxpayers. The failure to meet the county’s minimum guidelines for length of lease was first brought up on this blog more than a year ago, but the length of the extension has not changed.

County staff tells me the guidelines can be waived by commissioners, who have now affirmed their support for the project three times in the last year or so;   however, the Blue Jays and city of Dunedin have not yet locked down all the specifics of the deal, so it will still require one more commissioner sign-off.

That means the good people of Dunedin and Pinellas County are still waiting to enjoy all the made-up economic benefit the project will bring.

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Ybor City Coalition Concerned about Rays Stadium Funding

The Ybor City Development Corporation (YCDC), a citizen advisory board to Tampa's Community Redevelopment Agency, sent a letter to Mayor Bob Buckhorn last week expressing concern that taking land for a proposed new Rays stadium off the county tax rolls could have adverse impact on property tax revenues that help fund local projects in Ybor City.

"The YCDC Board of Directors looks forward to being a part of the process and welcomes the opportunity to weigh in on stadium discussions that pertain to the Ybor City National Historic Landmark District," the letter wrote.

RELATED: 14 ways taxpayers could be asked to fund Rays stadium

While the city of Tampa - and the Community Redevelopment Agency - would both have to be involved in funding discussions, it has been Hillsborough County staffers and Commissioner Ken Hagan who have taken the lead.

Mayor Bob Buckhorn's office said Wednesday they had not responded to the YCDC letter.

RELATED: Hillsborough's chief stadium negotiator mum on details...time and time again

Read the text of the entire letter here on WTSP.com.

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Some Perspective on the $61 Million Deal Between Hillsborough Co. & the Lightning

So you probably saw that Hillsborough staffers have lined up a deal that would extend the Tampa Bay Lightning's deal at Amalie Arena for an additional 16 years, through 2037.  The cost?  $61 million dollars worth of renovations, or $3.8 million per season.

Field of Schemes' Neil deMause acknowledged it wasn't the worst stadium deal in recent memory, especially since many teams (like the Bucs, for instance) get cash without a promise of extending their lease at all. 

However, deMause also makes a good point about Hillsborough's ROI:

"(Vinik) already has innumerable reasons not to flee town, even before handing him $61 million as a bonus. Far be it from me to tell Hillsborough County officials how to do their job, but are you guys sure you’re good at this whole lease negotiations part of it?"

Two days later, deMause added:

The Tampa Bay Times insists that giving the Lightning $61 million in tax money to upgrade their arena in exchange for a lease extension isn’t really a subsidy, because it’s tax money that couldn’t have been spent on teacher pensions anyway. Seriously, guys, how many times do we have to point out that money is fungible, so the hotel-tax money could be spent on some other tourism-related expense, and that could be used to free up cash for other things, including, sure underfunded teacher pensions?

This is actually something I've written about extensively, as stadium cheerleaders have consistently mislead the public on what bed tax dollars can be used for - far more than just stadiums.  In fact, Attorney General Pam Bondi recently opined that it is legal to use tourist tax dollars for things like transit, since duh, tourists can benefit from that too. 

Also, Hillsborough has been paying for things like the cross-bay ferry and certain events with general revenue funds, when they could be using bed tax money.

There is even momentum in Tallahassee to remove all restrictions on bed tax funds, so they can be used on things like police or roads or even, heck, schoolteachers too.

So by inking a new deal with Vinik now, Hillsborough might prematurely commit away funds that could soon be eligible for more pressing needs.  Of course, that's part of the reason why the Lightning want the deal now.

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Rays Sue Former Concessionaire Centerplate

ST. PETERSBURG, Florida – The Tampa Bay Rays have filed a federal lawsuit against its former concessionaire, Centerplate, for a breach of contract, alleging they “surreptitiously cut corners, underreported gross receipts, concealed performance issues, underpaid the Rays, and underperformed under the Concession Agreement to the detriment of the Rays and their fans.”

The Rays did not renew their contract with Centerplate, owned by Volume Services Inc., after the 2017 season. In August, a Sports Illustrated article ranked Tropicana Field as the major league’s worst when it came to concession health inspections.

The lawsuit, filed Friday, alleges “Centerplate consistently failed to perform and neglected its obligations despite the Rays’ repeated calls for improvement” and failed to “deliver the requisite quality of service and standard of performance required…to properly operate and maintain the concessions equipment and facilities…to keep or provide accurate records to the Rays regarding revenues and commissions owed… to pay the Rays its agreed-upon share of the revenues from concessions (and) to indemnify the Rays for Centerplate’s negligence.

“As a result of Centerplate’s frequent contractual violations, its pattern of misconduct, and overall mishandling of the Stadium’s concessions, the Rays have suffered significant harm. Centerplate’s inappropriate actions and glaring failures sullied the Rays’ brand and reputation, shorted the Rays on considerable revenue and other sums due and owing, caused significant lost profits, and inflicted extensive out-of-pocket costs.”

The lawsuit also alleges:

• Despite complaints from the Rays following critical 2010 ESPN and 2013 ABC News stories on the stadium's concessions, Centerplate failed to remedy problems and demonstrated a "pattern of inadequate senior level oversight and accountability."
• Disputes over revenue include "Centerplate further admitted owing over $200,000 for
  credits that were 'incorrectly recorded' from 2007 to 2009."
• "Not only did Centerplate cause significant damage to the Rays’ brand and reputation through its operation and management of the concessions and resulting media  attention, Centerplate’s chief executive created additional backlash and brought further harm to the Rays through his personal misconduct" when a video surfaced of the man, Des Hague, kicking a dog in a Vancouver elevator.
• Centerplate has refused to pay legal bills related to a concession sign falling on a fan's head.
• "In early 2017, the Rays learned that Centerplate had incorrectly advised employees
  of zoning laws and attempted to serve alcohol at the Stadium before the time allowed by local law."
• "In cleaning up Centerplate’s latest mess, the Rays have found countless new cleaning and maintenance issues, damaged equipment, and concealed neglect requiring extensive repairs, replacement, sterilization, and other out-of-pocket expenses," including to stadium beer lines.

This story was first reported on WTSP.com, and I will continue to post developments, as well as the lawsuit, there as I wait for the Rays and Centerplate to return comment.

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