Times Editorial Board: Save Pinellas Tax Money for New Stadium

In case you missed it, the Tampa Bay Times editorial board took another crack at the Stadium Saga this weekend, arguing Pinellas County should dismiss any notion of rehabbing Tropicana Field...yet it should still preserve bed tax revenues in case a possible new Rays stadium can be built on the West side of the bay.

The editorial called for Mayor Rick Kriseman and the Rays to step up their game on advancing the stadium talks before Pinellas' bed taxes are distributed to other possible worthy projects {link to Times' site}.  An excerpt:

Too many years already have passed without directly addressing the Rays' obvious need for a new stadium to replace the outdated Trop. Kriseman and Rays officials have been meeting privately to negotiate an agreement that would enable the team to look for potential stadium sites in both Pinellas and Hillsborough counties. The signals are encouraging, and a deal should be possible by the end of the year. Then the Rays presumably would need about two years to evaluate sites in both counties. While the Rays clearly would prefer to be in Tampa, the team has not ruled out Pinellas.

"By the end of the year" may be wishful thinking...or it may just be an extention of the Times' deadline for when it loses patience with Kriseman.

Yet St. Petersburg and Pinellas could play themselves out of contention if county officials divide up the bed tax money that now pays the Trop bonds. Without it, Pinellas would have no hope of cobbling together the revenue streams to help pay for a stadium that could cost more than $500 million.

I've always maintained Pinellas is in far better position to pay for a possible new stadium since its bed tax revenues are far greater than Hillsborough's.   Not to mention, land is plentiful in the Gateway/Mid-Pinellas region.

If the consensus is the Pinellas bed tax money could be better spent on other projects besides a baseball stadium, that's one thing. But don't let that decision be made by avoiding any talk of baseball. And don't play games by trying to peel off bed tax money for a roof on an outdated stadium.

There's nothing wrong with pressing for more productive talks...unless you don't think taxpayers should pay for a new stadium at all with 14 years left on the current stadium contract.

But the latest chapter in the Stadium Saga, including Mayor Rick Kriseman's half-hearted suggestion of renovating The Trop, is indicative of his difficult position between a rock and a hard place.  If he allows the Rays to break their contract, he very well may be doing his constituents and city a disservice.  But if he doesn't, he'll get the "Bill Foster treatment" from the region's largest newspaper.

It's also interesting the Times suggests taking such a close look at Pinellas' tourist tax monies.

If the editorial board really thinks Rays want to be in Tampa, then preserving the revenues does nothing more than preserve the inevitable bidding war between Pinellas and Hillsborough Counties - something devastating for the taxpayers, but ideal for the Rays.

If the editorial board really thinks the Rays could end up in Pinellas' Gateway region for the long-term, then it would seem to be a slightly new take from the group that has always pushed for St Pete's mayor to let the team explore its Tampa options.

Unless its a combination of the two prospects...and the Times just wants Pinellas to save its pennies up to help pay for a new Rays stadium in Tampa?

Rays Add Second P.R. Director to Focus on Off-Field Developments

There was news this week that the Rays have hired Rafaela Armador as new Senior Director of Corporate Communications.  She comes from Tampa PR/crisis management firm Tucker Hall, to basically handle all off-the-field public relations.

That means she'll coordinate stuff like business outreach, community appearances, as well as - most likely - people like me, reporters covering the Stadium Saga.

So, welcome aboard Rafaela and buckle up, it's a fun ride!

Franchise Owners Building Entertainment Complex Next to Arena

No, not Jeff Vinik this time....it's the Orlando Magic building year-round retail and entertainment to compliment its downtown Orlando arena.  Although sports arenas are considered "retail" too, this further illustrates how owners are ready to foot the majority of the bill when its a profitable development...and not so much when its a stadium that ultimately costs more revenue than it creates.

That's why all those folks hoping Vinik and the Lightning get into the MLB stadium game shouldn't hold their breath...he stands to make a lot more money rebuilding Channelside Bay Plaza into a great entertainment venue rather than anything that would compete with hockey.

This:

Happy 4th anniversary, Stu Sternberg ultimatum: http://t.co/hjtkzVF0XP #Rays
— Shadow of Stadium (@StadiumShadow) June 21, 2014

Tribune Thinks St. Pete Should Build 18,000-Seat Soccer Stadium to Replace Baseball Team That's Only Drawing 18,000 Fans

In case you missed it this weekend, the Tampa Tribune editorial board called for St. Petersburg to work toward building a long-term home for the Tampa Bay Rowdies of the North American Soccer League:

The Rowdies are drawing several thousand fans with a sub-par facility. A more suitable one would bring more fans and, possibly, a step up to a Major League Soccer franchise that could add thousands of more fans filling the pubs and restaurants near Al Lang....Baseball at Al Lang appears to have run its course. And by every indication, the Tampa Bay Rays are destined to go down in history as the team that left St. Petersburg. To fill that void, professional soccer just might be the ticket.

The stance is baffling.

It was less than a year ago that the Trib blamed poor Rays attendance on the lack of a "centrally located stadium, such as downtown Tampa."  So if St. Petersburg is a bad place for a pro baseball team, why is it a good place for a pro soccer team? 

It certainly has nothing to do with demographics, since only 8% of Pinellas County is Hispanic, versus 25% of Hillsborough County.

Then again, maybe the better question is, if a few thousand attending a Rowdies game at Al Lang proves downtown St. Pete is a good place for a team, why isn't it a good place for the Rays?

The hypocrisy is glaring; if what the Trib says about the Rowdies is true - that they simply need some state money and a rebuilt stadium, then why would the editorial board "like to see the Rays move to Hillsborough, particularly downtown Tampa?"

And, while we're on the topic of that state money, the same editorial board wrote this spring that the increased stadium subsidies made sense because "successful teams generate sales tax revenue and attract overnight visitors who pay bed taxes."  Well, let's not kid ourselves that the NASL - or even an 18,000-seat MLS stadium - attract a lot of overnight visitors....and the Trib shouldn't kid itself either.

This week's editorial makes one last contradiction with a penultimate paragraph that stresses time is short on making decisions about soccer, then following it up with this closing argument:

Baseball at Al Lang appears to have run its course. And by every indication, the Tampa Bay Rays are destined to go down in history as the team that left St. Petersburg. To fill that void, professional soccer just might be the ticket.

So in conclusion, the Trib thinks downtown St. Pete is too remote of a location for pro baseball and the Rays, who have a contract at the Trop through 2027, may one day leave.  Therefore, the state and county should help build a 18,000-seat soccer stadium in downtown St. Pete to fill the void of a team drawing a disappointing 18,000 fans a game.

Romano: Trop May Be Empty This Summer

Columnist John Romano writes today, "It could get mighty quiet in the Trop this summer" {link to Times' site}:

The kids are out of school, the Rays are usually in contention and the thought of spending a hot, muggy night inside an air-conditioned big-league stadium sounds wondrous.

But what happens when you remove the part about the Rays being in contention?

In other words, should you be concerned that Tampa Bay's notoriously underwhelming attendance figures are going to get even uglier now that the Rays are sinking on the field?

The short answer?

Yes, but don't panic.

(At least not for now.)

Romano explains how the Rays enjoyed second-half attendance bumps in 2008, 2010, 2011, and 2012 (I haven't fact-checked those numbers), but shouldn't expect one this year if they don't go on a crazy winning streak.

He probably has a point - but it also doesn't change the fact that the Rays will continue to profit, the team's value will continue to grow, and the best front office in baseball will likely have the team in contention again very soon.

UPDATE: The Tampa Bay Baseball Market blog has responded with some criticisms - and facts - of its own.

World Cup Economic Realities Hit Brazil

Know the best thing about the World Cup?

Writers across the world wake up to the fact that publicly-funded stadiums can leave global-sized holes in a country's economy:

• Field of Schemes: $14 billion in stadia investments really only designed to capitalize on economy from the World Cup wont' get stadia done in time for World Cup.
• Wall Street Journal: With stadia unfinished, hopes wane that World Cup spending could spur long-term growth.
• John Oliver (HBO): The world's most-expensive bird toilet...oh, and FIFA doesn't have to pay taxes.
• Field of Schemes: Amid World Cup awakening, cities pulling Olympics bids.

Vinik Gobbling Up More Downtown Tampa Land; Still Not Building a Stadium

Richard Mullins had a story in this morning's Tampa Tribune (couldn't find the link online) about Jeff Vinik's attempt to buy a few small parcels sitting in the middle of his budding empire in Downtown Tampa. 

These stories always get the Rays-to-Tampa crowd excited, but we must always remember - Vinik is a businessman and a developer first.  It takes a special kind of owner (namely, one willing to lose a lot of money or at least "play the lottery" with hundreds of millions of dollars) to build a stadium on his/her own dime.

Why Owners Don't Build Stadiums By Themselves

You can count on one hand how many teams have built stadiums in the last 50 years without a dime of tax dollars - three, by my count, actually - the story of the Columbus Blue Jackets' disaster shows why teams don't offer to build grand facilities on their own - it's just not worth it.

The Blue Jackets, privately-owned by an Ohio family, built Nationwide Arena in 2000.  When the expense nearly forced the family into bankruptcy, the city bailed the arena out.

Now, according to Field of Schemes, the city is the entity losing money annually on the arena, while the owners of the Blue Jackets keep the profits from not just hockey games, but also the other events hosted at Nationwide.   That's the business model franchise owners desire, of course, at the expense of taxpayers.

Tampa Bay Sports Commission Responds to Super Bowl Demands Story

All-around good-guy Rob Higgins, Executive Director of the Tampa Bay Sports Commission, responded to the controversial leak of the previously-secret NFL Super Bowl subsidy worksheet:

@noahpransky While we'll never publicly discuss details of our bids/process, the SB's incredible ROI greatly exceeds the investment (1/2),
— Rob Higgins (@RHiggins_TBSC) June 9, 2014

@noahpransky (2/2) which is why so many communities jump at the opportunity to bid & it gets exponentially more competitive every year.
— Rob Higgins (@RHiggins_TBSC) June 9, 2014

Agree or disagree, Higgins is very good at what he does and "gets" the importance of heads-in-beds. 

More on Rowdies' March to MLS, New Stadium

Christopher O'Donnell's front-page piece on the Rowdies this morning should serve as another reminder as to what this blog first alluded to six weeks ago: Bill Edwards' plans to get a new soccer stadium built in St. Petersburg and lift the Rowdies to the MLS.

O'Donnell also asks some important questions about the benefit to taxpayers (even if he doesn't get answers):

But would investing in soccer pay off for St. Petersburg?

Economic impact studies typically are based on estimates of attendances and how many people a stadium attracts from outside the area for events.

...

But whether the investment in stadiums pays off for cities is harder to quantify.

Roughly $100 million of public money was used to build PPL park, home of the MLS team Philadelphia Union in Chester, Pennsylvania. The city has seen little economic benefit, said Eckstein.

“The money cities invest is rarely recouped given the current dynamic of professional sports where revenues nearly always go to the teams,” he said. “If they are thinking it would provide some activity that would define the community together and give them some common purpose, they might think that’s worth it.”

However, not even a bully pulpit-wielding St. Pete Mayor Rick Kriseman is likely to stop the Edwards juggernaut, propelled by former St. Pete Mayor Rick Baker.  Edwards/Baker have already demonstrated how a couple million in donations/lobbying investment can pay generous dividends.

And it may only be a matter of time before the juggernaut convinces not only St. Petersburg to open up the checkbook, but also the state...because as we all know, Major League Soccer draws millions of fans from all over the world to spend millions of dollars they otherwise never would have spent {tongue firmly planted in-cheek}.

MUST READ: NFL's Secret Super Bowl Demands

I've long lamented the secret guarantees made to sports leagues when cities land big events, suggesting at some point, the costs of something like a Super Bowl outweigh the benefits.

But a story in the Star Tribune about the NFL's secret demands in negotiating Super Bowl 2018 will make you cringe.  Or shake your head.  Or throw up.  I guess it depends where on the stadium subsidy spectrum you reside.

Regardless, it's a must-read.  Just the tip of the iceberg:

Free police escorts for team owners, and 35,000 free parking spaces. Presidential suites at no cost in high-end hotels. Free billboards across the Twin Cities. Guarantees to receive all revenue from the game's ticket sales — even a requirement for NFL-preferred ATMs at the stadium.
                                       

Those requirements and many others are detailed in 153 pages of NFL specifications for the game. An official on the host committee that successfully sought the game — Minneapolis beat out Indianapolis and New Orleans — said the panel had agreed to a majority of the conditions but would not elaborate.

There are no shortage of critics who ask why a publicly-financed stadium can operate in secrecy - with profits going to the league, not the owner of the stadium.

The NFL also requests (insists?) upon a ton of tax subsidies that, for the most part, have never been disclosed before.  So in addition to the cost of a stadium and police and city-run events during the Super Bowl, there are also at least tens of thousands of dollars in various taxes the league wants waived. 

You don't see those in economic impact reports, do you?

Now go read the whole thing.

Pro Sports Owners Should Learn From Ballmer: It's Not About Profits

The proposed $2 billion sale of the L.A. Clippers is a reminder of the new reality in pro sports: that owning a franchise is a privilege, not a right.

With more billionaires than teams in America, it's clearer than ever that any owner upset about his/her team's profits should have little trouble selling said team (at a massive profit) to a new owner who will squawk a lot less.

NewBallpark.org sums it up well:

Ballmer may simply view the Clippers as a way to park $2 billion. Surely there are better growth strategies available, but when you have $20 billion and you have to diversify anyway, why not take on a franchise where you can reasonably expect the franchise growth to outpace inflation, where you’re virtually guaranteed to not lose money? Plus he’ll have a nice toy to play with.

The post goes on to caution that the "new reality" may really just be a "bubble," but I have little doubt that franchise values - bolstered by not just competition among billionaires, but also soaring TV contracts - will continue to grow.  And that trend renders annual operating figures relatively moot.
 

Unfortunately, these new realities are unlikely to convince local governments from halting their open-checkbook policies on stadium subsidies.  Because a convincing owner who cries poor + fearmongering of possible relocation still adds up to taxpayer handouts in most cities.

Bollywood Economic Impact Report Released

And there it is: "Bollywood Oscars delivers $26.4 million impact."

The Bollywood Oscars — with its celebrity appearances, packs of screaming fans, a free concert for 8,000 and green carpet events — generated an economic impact of $26.4 million, close to original projections for the April 24-26 event.

Conveniently, an economic study was commissioned to prove a major event lived up to expectations.  Of course, you can make an economic study say anything you want...and Bollywood's big promises/expectations had to be tempered several times,

And for those of you keeping score at home, the Tampa Bay Times noted important disclaimers about the study (it failed to take into account economic displacement, for instance)...a vast improvement from its 2013 debrief of the bloated RNC economic impact study.

For what its worth, Bollywood's supposed $26.4 million economic impact ($19.9 million in direct spending) didn't displace nearly as much economy as the RNC did.  And heck, Tampa got some good exposure and "heads in beds" at a reasonable cost  ($1 million local, $700k state).

As my colleague Mike Deeson says, big events like these are "loss leaders" in helping a city like Tampa break into the world spotlight.