The Tax-Free Zone: Where the REAL war begins

Consider, if you will, a baseball team in 2005. While its prospects on the field are bright, its economic future - its home, in particular - is uncertain. However, in less than a year, the landscape will change dramatically, and the team will be able to pick from numerous new homes and locales, with suitors falling all over themselves to attract the team.

Poor attempt to channel the spirit of Rod Serling aside, this is the future that awaits the A's should SB 4 pass. How is this possible? How could a simple piece of legislation impact the A's that much?

To find the roots of the answer, one has to go back to 1986. That's when the Tax Reform Act of 1986 was passed. In it was a provision designed to prevent teams from using tax-exempt bonds to finance stadiums and arenas. The provision called for no more than 10% of the required debt service on such bonds to be paid back using funds from the team or stadium-based sources. Instead of preventing teams from going after stadium deals, the exact opposite happened. Teams felt emboldened to construct deals with cities where the remaining 90% would be paid off using public sources such as sales taxes and tax-increment (TIF). The results were clear: 17 mostly publicly-funded new and renovated ballparks were built between 1986 and 2005. In the mid-90's, legislation was introduced by the now late senator Daniel Patrick Moynihan (D-NY), but it never went anywhere, and Moynihan soon retired from Congress.

Yet the trend now appears to be a reversal of sorts. While the DC Ballpark follows the normal publicly-funded blueprint, the new ballparks being planned or built for the Mets, Yankees, and Cardinals have a much higher private share. The Cards are relying mostly on privately issued, taxable bonds, while the Mets and Yankees will use tax-exempt funds, but they'll pay it off using stadium sources. How is that possible? Don't ask me. Like Field of Schemes' Neil deMause, I am not a bond lawyer. Furthermore, until someone actually sues to challenge such projects regarding their legality, Mets/Yankees-type deals will continue.

That's where SB 4 comes in. SB 4 actually comes close to the point of flagrantly violating the spirit of the Tax Reform Act of 1986. This is because its goal is clearly to create a statewide vessel by which tax-exempt funding can be made available to fund all manner of stadiums, arenas, and other venues. The key is that since all efforts would be initiated by the Authority and not a city, county, or the State of California, there would be no needed for messy, complicated mechanisms like, oh, voting or public hearings. That is an enormous hurdle that would suddenly be removed. It doesn't make it completely smooth sailing, however. There's still an issue of how the bonds would be paid off once they were issued. That's where multiple cities get involved.

Since it's likely that a ballpark built in Oakland, Fremont, Dublin, Sacramento, or San Jose would have the same rough costs due to small differences in land values and stable construction costs, it will be up to each bidding city to sweeten their respective bids to make them the most attractive to the Lewis Wolff and John Fisher. Here's how that could work:

A city/civic group's responsibility would be to package the terms of the debt service. The terms would include a mix of the following:

• Annual rent payments from the team
  
• Percentages of in-stadium revenues (tickets, concessions, advertising/signage, suites)
• Stadium naming rights
• Pouring rights (non-alcoholic and alcoholic beverages)
  
• Revenue from non-baseball events (club rentals, tours, concerts)
• Ticket taxes
  
• Sales taxes
  
• Gross receipts taxes (paid by the public on the backend as businesses raise prices to cover the tax)
  
• Usage taxes (utilities, hotel, car rentals)
• Tax-increment funds (or TIF, based on property tax revenue past a "frozen" assessment level, within a specified area or district)
• Existing redevelopment funds
• Reduction of the team's upfront investment
  

Assuming the market is relatively fluid in Northern California, the way for a bidding city to differentiate itself from the competition would be to make the terms more favorable for the team, by removing or reducing one of the above items from the final list of debt service sources. For instance, a standard practice is for a city to require a flat rent payment per year ($3 million for argument's sake), plus a percentage of ticket revenue above a threshold of tickets sold (5% of every full-price ticket past the 2,000,000 seasonal attendance figure). A city could reduce the required rent or eliminate that extra percentage. It could eliminate rent 10-15 years early, depending on how the well the debt is being serviced. It could give the team more flexible lease end or buyout terms. The catch is that in order to prevent violating federal law, the team's source really can't be more than 10% of debt service. It could become a Safeco Field redux.

But the big kicker comes from the definition of the word "facility." While "facility" has typically been defined as the actual stadium and little else, for SB 4 the definition has been expanded to include just about anything adjacent to or associated with the venue. In addition to the venue, "facility" includes all of the following:

• Offices, parking lots and garages, access roads, streets, intersections, highway interchanges, pedestrian walkways, tunnels,bridges, transportation facilities, monuments, restaurants, stores, and other facilities providing goods and services to persons attending performances, meetings, contests, gatherings, or events at a facility.

While building a parking lot or garage is expected, some of the other stuff in the bill is virtually uncharted territory. It could include a new or revamped transit hub, a mall or shopping center, office tower(s), or the most tempting scenario knowing Wolff's background, a hotel/conference center. Of course, history shows that mixed-use projects like these aren't always guaranteed successes, and sometimes, they don't even get off the ground. Interestingly enough, Wolff's downtown LA hotel project is being built on land owned by Anschutz Entertainment Group. As mentioned in a previous post, the leading sponsor of SB 4 is none other than AEG.

The problem for bidding cities is balancing the need to find a realistic mix of sources to pay off the debt against the desire to make concessions to teams. Should multiple cities get into a competitive bidding situation for the A's, it could escalate quickly, with each city granting greater concessions with each round of proposals.

And so the turf wars start...

According to a new article by Scott Wong of the Tribune/ANG, Oakland City Council President Ignacio De La Fuente and Alameda County Supervisor Scott Haggerty have gotten into a war of words regarding the future of the A's.

After an Argus story Friday about Haggerty's renewed call to bring the A's ball club to Fremont, De La Fuente called the newspaper to say the supervisor made that suggestion because he feels marginalized about no longer being able toserve on the board that oversees the Oakland Arena and McAfee Coliseum, the current home of the A's.

"Haggerty is feeling neglected and ignored, and sometimes you have to do things to get your name out there," said De La Fuente, who added that he didn't think the A's franchise is looking at any other Bay Area city outside Oakland to build a new ballpark. "I don't think Fremont or Pleasanton are in the picture, period. I don't think San Jose or Santa Clara are in the picture, period."

But Haggerty said that rather than respond to reports in the media about alternative sites for a baseball-only stadium, De La Fuente should be focusing his attention on Oakland's budget woes, which have forced the city to "dump" its jail population on the county.

De La Fuente replied that he settled the city's budget two weeks before it was due. "I'm taking care of my business," he added.

Haggerty, whose district includes most of Fremont, as well as Pleasanton and Livermore, said he was not intimidated by De La Fuente's "thug tactics."

I would have thought that such bile was reserved for online message boards, not the print media. So much for that. The worst part is, it's probably not going to get easier for De La Fuente and other Oakland-based supporters, especially when San Jose officially gets into the mix.

Fremont Photo Overview

I took new pictures of the two Fremont sites. Here they are, compiled into photo overview format (PDF). I will warn you, gentle reader, that you will probably get bored looking at them, simply because most of them look like this:



No, it's not a site that inspires the imagination. But it may very well be the best option when all is said and done. (If you look closely, you'll see the bales of hay in the background.)

One other note - I've added all of the photo overviews to the sidebar (right).

Fremont emerges again

From the Fremont Argus: With the number of ideal Oakland sites disappearing quickly, Fremont Mayor Bob Wasserman and Alameda County Supervisor Scott Haggerty have stepped in to start a dialogue with the A's regarding a ballpark in South Fremont. Here's a snippet:

"I'm not convinced Santa Clara County or San Jose is finished trying to attract the A's," said Haggerty, whose district includes most of Fremont, as well as Pleasanton and Livermore. "Knowing there are vultures out there, I want to do what I can to keep the A's in Alameda County."

Wolff was traveling Thursday and did not return phone calls, but he did indicate he was interested in sitting down with the supervisor, Haggerty said.

That certainly gets the ball rolling. The article notes that not only Warm Springs ballpark site is possible, but there may be opportunities at Pacific Commons, a new shopping center that opened last year. Pacific Commons is 2 miles west of the planned BART station, on the other side of I-880. I'll post pictures of both later today and post a Fremont photo overview.

The news is somewhat serendipitous, because I had no knowledge of the officials' efforts when I fired off an e-mail to Fremont's planning department yesterday. I asked about NUMMI, which owns much of the Warm Springs site. NUMMI's current plans are to build a warehousing and distribution facility to facilitate "just in time" delivery of auto components, though that certainly could change if the aforementioned officials got involved.

Updating my previous post on Warm Springs, NUMMI (as per the Warm Springs Specific Plan) has expressed its desire for Fremont to limit the types of development in allows in the area surrounding the plant. This could actually prove beneficial for ballpark supporters, as they also suggested to the City of Fremont that development plans shouldn't have housing built immediately north of the NUMMI plant, as residents may not enjoy living next to a 24/7-operating heavy industrial site with hundreds of trucks entering and leaving on a regular basis.

Pacific Commons is another matter. While there land there is vast and ripe for development, it's not within walking distance of the planned BART station, which is scheduled for completion sometime in 2010.

Update (8:30 AM): I called NUMMI this morning for more on the warehousing/distribution center. No official comment as of yet, perhaps none until late in the day or Monday.

SB 4 and Eminent Domain news

Two more newspapers have written about CA SB 4:

• LA Daily News: Bill offering tax breaks for sports, entertainment centers faces vote
• SD Union Tribune: New play is possible in stadium financing
  

As reported yesterday, SB 4 passed with no opposition in the AEST&IM committee, and is slated to go Assembly's Appropriations committee, then the floor for a full Assembly vote, and finally the governor's desk.

Moving over to the topic of eminent domain: The Supreme Court ruled that eminent domain is legal (for non-public purposes) by a 5-4 vote. This clears the way for the DC Ballpark land acquisitions to proceed, and may move the Florida Marlins' ballpark plans forward if they can bridge the funding gap. Much of the land near the Orange Bowl that would be used for the ballpark is residential, and if landowners aren't willing to sell, the city of Miami could turn to eminent domain to acquire property.

More on SB 4

Yesterday, CA SB 4 was approved in the Assembly Committee on Arts, Entertainment, Sports, Tourism, and Internet Media (I'll call it AEST&IM for short) on a 7-2 vote, with 1 abstention. The one local committee member was District 24 Assemblywoman Rebecca Cohn (Campbell), who was credited with the abstention.

The matter is being referred to the Assembly's Appropriations Committee, where local members include Leland Yee and Mark Leno of San Francisco, Joe Nation of Marin, and Johan Klehs of Castro Valley. From there, it's short trip to the Assembly Floor and then to the Governor's desk, since it's already passed the Senate. While the bill was in the Senate, it was approved by Don Perata (Oakland) on the floor and Elaine Alquist (San Jose) on the floor and in the Senate's Appropriations Committee.

Surprisingly, there's been little resistance to the bill, even though the ramifications are enormous. The Orange County Register is one of the few newspapers that offered an editorial on the bill. My read on it is that it gives this new Authority the power to use the state's credit rating and bonding ability without adding any liability to the state, which I find truly astonishing. If it passes, there will be a bread line at the Authority's door as every supporter for every conceivable stadium, arena, amphitheater, and concert hall project will be waiting with their hands out. Membership on the Authority's board will be one of the cushiest positions in the state, as members will be able to pick and choose which projects they'll support. I can't handicap the bill's likelihood of passage, but since the Governor is a pro-business guy with many links to the entertainment industry, I'd have to think there's a good chance he'll rubber stamp it. If the bill passes, there are some serious questions beyond the funding issue I brought up yesterday:

• What rules will they draw up on how to solicit funds?
• What criteria will they use to determine a project's worthiness?
• Will they demand minimum amounts of private investment in projects?
• What projects would be considered too small or large to fund?
• At what point would the Authority use or threaten to use eminent domain?

Stay tuned for more on SB 4 as it works its way through Sacramento.

State-funded stadiums?

The Chronicle (thanks, Ballpark Digest) mentions a bill making its way through the California Legislature that would create a statewide governing body that would help fund, construct, and run various types of public entertainment venues, namely sports venues. The bill is CA SB 4, introduced by State Senator Kevin Murray of Culver City.

Unlike most other states, California has left funding for sports venue projects entirely in the hands of cities and counties. With the budget crunch seriously affecting city coffers, most cities have had little financial wherewithal or interest in publicly financing any new stadiums or arenas. The bill aims to create a governing body called the California Public Performance Facilities Authority, that would acquire land, issue bonds for construction, sell personal seat licenses and naming rights agreements, build and maintain the facilities. In other words, soup to nuts.

The question to pose here is, "Can this type of authority work in a state as large as California?" The NorCal/SoCal divide is alive and well, and it shows up when large projects have to be debated, such as the Bay Bridge Retrofit or water diversion. First, lets look at the projects that could be undertaken by the Authority:

1. A's ballpark in Oakland/Alameda County
2. San Francisco 49ers stadium
3. San Diego Chargers stadium
4. Sacramento Kings arena
5. New LA football stadium to attract an NFL team
6. San Jose Earthquakes stadium
   

That's over $2 billion in projects right there. But that's not all. The Authority would also fund infrastructure associated with these projects. It could also fund the construction of practice facilities, theaters and concert halls, race tracks, and just about anything else associated with live performances.

Some other notes:

• The Authority would by administered by a nine-member Board of Directors. Five members would be appointed by the Governor (Schwarzenegger), two by the Senate President Pro Tem (Don Perata, Oakland), and two by the Assembly Speaker (Fabian Nunez, Los Angeles)
• Bonds would be issued by the Authority, with revenue from each facility used to pay back the debt. (I'm not sure if this works under federal tax law.) As far as I can tell, no other input from the state would be required, which gives the Authority a significant amount of unfettered power.
• The Authority could work directly with the California Infrastructure Development Bank instead of through the Legislature to obtain funds
  
• One facility's revenues could not be used to pay back another's debt.
• Debt incurred by the Authority would not be considered state debt (this is probably the federal tax loophole).
• There would be a 40-year limit on the term of any issued bonds.
• The bonds would be tax-exempt.
• There's no description of any remedies that would be taken should revenue shortfalls make it difficult to repay debt.
• The Authority would have eminent domain powers just like those of a city or county. Eminent domain is used at times for redevelopment purposes.
  
• The bill is supported by Anschutz Entertainment Group, which owns the privately-owned Staples Center, LA Kings NHL franchise, the LA Galaxy and San Jose Earthquakes MLS teams, and the SF Examiner. AEG has stakes in the LA Lakers, Qwest Communications, and other wide-ranging ventures. Finally, AEG has been actively involved in the effort to attract an NFL franchise to LA.
  

The Sacramento Ballpark Authority, which built Raley Field, was cited as a successful example of this type of governing body. But how well does it scale? If this bill passes, we'll soon find out. Proponents will say this gives California teams the ability to bridge the gap in funding between them and out-of-state competitors. Opponents will say this looks like a huge, state-mandated pork project authority with no real public oversight. For each Sacramento Ballpark Authority, there's also an Oakland Football Marketing Association.

The Trib is uneasy

Reflecting some fans' growing sense of unease about the Wolff's stadium efforts, the Oakland Tribune printed a new op-ed piece wondering if Wolff is really serious about keeping the A's in Oakland.

There is a question of whether this "paranoia" (their term, not mine) is grounded in reality. Frankly, a little "skepticism" (my term, not theirs) is healthy, since it tends to lead to a more realistic view of the situation. Unfortunately, there are some issues that can't be avoided, and they are contributing to this unease:

• Oakland is running out of sites. Counting Wolff's dismissal of the Coliseum south lot, there are now only two sites left from the original seven in the HOK study. Those are the Oak-to-9th site (issues detailed in last night's post), and perhaps Fremont (which has had no public discussion recently).
  
• Sites along BART corridors are disappearing quickly, as large mixed-use transit village developments are being constructed and planned near existing BART stations.
• The sites that have been discussed have high acquisition and remediation (cleanup) costs associated with them, which can drive up the cost of a ballpark tens of millions of dollars.
• There has been little discussion of the financing issue, which promises to be the most divisive and difficult of all.
• There has been no effort to raise awareness among the voting public. The closed manner in which Wolff and his development team is proceeding is partly to blame for this.
  
• Mayoral support is non-existent.
  

Wolff still has several months left to complete his local search, after which he'll make some sort of announcement. I personally feel that it is still possible to get some sort of plan moving forward, but the A's really need to involve the public more - and that doesn't just mean politicians, I'm talking citizens and fans.

There are, of course, the inevitable questions that I get daily about the A's moving to Vegas. Las Vegas has plenty of issues of its own, with the small TV market, the casino industry's influence (they aren't willing to take MLB games off the wagering boards, and they are opposed to a publicly-financed ballpark), and the lack of a good tentative ballpark situation (Cashman Field only holds 9,300 people and is not a good expansion candidate). Portland? Maybe, if they can get the financing details right (I have doubts about Portland's ability to contain costs, and the mayor is anti-ballpark).

Report from Measure DD Coalition Meeting

Just came back from the meeting at Lake Merritt's Lakeside Center. There were more than 20 people in attendance, all representing different interests and community groups. The Coalition was created to give the community a voice in how $198 million in Measure DD funds should be spent. A major focus for the past year has been the Oak-to-9th development, which is currently awaiting a completed environmental impact report (EIR). One of the agenda items was the approval of a set of recommendations regarding the creation of open space at the site, to be given to Oakland's Planning Commision, City Council, and others who could help shape the final development plan. The recommendation received all "yes" votes with three abstentions (one of which was me).

I was then given some time to open up the Oak-to-9th discussion to the subject of a ballpark, which is not in the current plans or EIR. Absent any kind of real proposal, I asked the only question that could be objectively answered by the Coalition members:

• Is it feasible to place housing (Signature Properties), open space (as recommended by the Coalition), and a ballpark on the site?

While some members refrained from rendering an opinion due to the lack of information available, many who did said a ballpark was definitely not feasible. The reasons listed were varied and numerous:

• Not enough space. Either the housing or open space would have to be sacrificed for a ballpark, and neither party was ready to give anything up to accommodate a ballpark. The ballpark itself could eliminate up to 75% of the open space in Signature's plan, and their plan has less than the ideal amount of open space according to the Coalition.
• Traffic. The Embarcadero is a simple two-lane road that will have trouble accommodating traffic from 3,100 new housing units (6,000+ residents) alone.Adding a ballpark could add ten times the number of cars to the area, which would create instant gridlock.
• Transit. The distance from BART is a factor. Not having BART there might push fans to drive to the ballpark, which would increase gridlock even more.
• Visual impact. After I was asked what a ballpark's footprint could be, I spouted off some numbers: 15 acres without parking, building at least 100 feet high without light standards. The response to that information was not positive, as the ballpark would significantly block the view from the freeway and parts inland, including Lake Merritt.
• Parking. There is no existing infrastructure for large amounts of parking in the development plan. Even the potential for under-the-freeway parking only yields a few hundred spaces. No open space could be used to develop parking, either.

Other comments were made about resistance to public financing (Raiders deal), Wolff's true motives in his ballpark search (Vegas?), and the suitability of the Coliseum site (prematurely dismissed, and not for a good reason). There was also a sense that this idea was just being thrown out there without much planning, especially considering Wolff and Ghielmetti haven't yet had any formal discussion about sharing the site.

So there you have it. These are the kinds of issues that any ballpark effort faces. While it's easy to view things through green-colored glasses and believe that everyone likes baseball, the reality is that it is often not considered worth bending over backwards to accommodate a team or owner. And it's clear from the meeting tonight that one or more parties, who have both been working over a year to get this project going, would have to sacrifice something significant to get a ballpark built at the Estuary. That's not going to happen quickly or easily, if it happens at all.

I'll have some commentary on this tomorrow.

Also, thanks to the Coalition for giving me ample time to gather comments. Considering I arrived there without advance notice, they were more than accommodating.

Wolff likes "neighborhoods"

CoCo Times columnist Neil Hayes spent some time recently with Lew Wolff and his family at A's games, and from all appearances, Wolff is getting more and more attached to the team with each passing day. There was little new on the ballpark front, except for a small nugget towards the end of the article:

(Wolff) envisions a new ballpark divided into "neighborhoods."

What exactly are "neighborhoods" in a ballpark? Generally they are distinct seating areas within the stadium that give them a separate, though not necessarily segregated, feel from other areas of the park. This can be accomplished by breaking up the grandstand in the multiple structures with varying heights, as was done at Petco (San Diego), Comerica (Detroit), Citizens Bank (Philadelphia), and Great American (Cincinnati). At field level, it's a little easier to foster neighborhood environments with the tiered pricing structure. The Coliseum, for instance, has always had distinct neighborhoods in the MVP sections which hold season ticket holders, and the left and right field bleachers, which are a younger demographic and unique unto themselves. SBC also has neighborhoods in the bleachers in straightaway left (Bonds Squad), center (family bleachers), and the arcade (party atmosphere).

The Coliseum and SBC's development of neighborhoods was more an organic, evolutionary process than Petco, where it's intentional. The Western Metal Supply building in the left field corner not only holds party suites, but it serves as an anchor for a party atmosphere. The Beachers section in center is the family-friendly spot with the big sandbox, while the seats that jut out into right field act as a soapbox for hecklers. Even the mezzanine club level is broken up into three sections: first base, home plate, and third base.

Whether or not the creation of neighborhoods will ultimately be successful is dependent on how fans take to the concept. A major goal is to get fans circulating around the ballpark to explore each of the different neighborhoods, sample concessions, and foster the larger ballpark community. Another goal is to get fans to find a place they can call home within the ballpark, get season tickets, commune with others in their neighborhood, and over time become fixtures or institutions as they pass the experience on to their children, grandchildren, etc. The potential upside is that those season ticket rolls may rise as a result. The downside is that the ballpark itself will have a natural sense of discontuity which might make it hard to foster an overall crowd energy, especially if fans are more likely to mill around than sit and stay focused on a game. In the end, it's seat pricing that's going to be the determining factor. It's not uncommon for fans to be priced out of being full season ticket holders, which then leads to becoming partial season ticket holders, then occasional patrons, and finally to not being able to afford a game at all. It's a difficult balance to strike, and there are plenty of examples of teams going the price-hike route (Red Sox, Yankees, Cubs, Giants) while few others have managed to keep prices reasonable despite having a new or renovated park (Angels).

Mired in Minneapolis' Mixed Messages

If you want to get an idea for what the media-based discourse on a publicly-financed stadium would look like, just visit the Minneapolis Star-Tribune's website for its coverage on the Twins' ballpark legislation. The open-air stadium would be 75% funded by a 0.15% sales tax raise in Hennepin County.

Columnist Sid Hartman has beating the drum for the Twins' stadium efforts for years, and he doesn't waver with his new plea, which claims that the project will revitalize downtown. Yet there's an article in the business section noting that the Twins have actually dropped the economic development argument.

Who's right? Read both and decide.

Notes on this week and next week

Next Monday night I will attend the Measure DD Community Coalition meeting held at Oakland's Lakeside Garden Center near Lake Merritt. Michael Ghielmetti of Signature Properties was present at last month's meeting to discuss the Oak-to-9th development. There's no indication he'll be at the upcoming meeting, but Oak-to-9th will be a discussion topic. Important note: I will try to ask questions related to the general opinion of the community about a ballpark on the site, but I will in no way be in any sort of advocacy role. Why? It's hard to rally for something that doesn't yet exist, for starters.

Speaking of not announcing a plan, Lewis Wolff was supposed to be touring around Oakland today to look at sites, according to Dave Newhouse's column from earlier in the week. Hopefully I'll have something to post about that later today. Wolff himself said he won't have any "solid ballpark information to announce for a month."

Going back to Oak-to-9th, the Measure DD folks also posted a blueprint for Signature's Oak-to-9th plan. It appears that I may have guessed right - the graphic I posted on Tuesday shows a ballpark on a patch of open space just east of Lake Merritt Channel. Based on what I've seen from the blueprint, it's the only space left that could possibly accommodate a structure like a ballpark. The downside is it would effectively eliminate most of the open space remaining there, and that may not sit well with the Measure DD folks. I do like Signature's use of parking under 880.

Finally, two more links on the state of the stadium-building industry, which was thrust into the spotlight with this week's announcements of new stadiums for the Yankees and Mets.

• Bloomberg: Full-Speed Ahead for Stadium-Building Juggernaut - A good column by Joe Mysak on the stadium boom's impact on public finance and the bond markets.
• Christian Science Monitor: Why America is seeing a new stadium boom - Ron Scherer and Anna Levine-Gronningsater recap the flurry of stadium announcements for New York area teams.

Newhouse throws his support behind the Estuary

Trib columnist Dave Newhouse checked out the Estuary and came away with dreams of Chavez splash hits. He recaps the situation, though the mention of the freeway being "farther away than at the Coliseum" is a bit puzzling.

Newhouse is right about it being a 15-minute walk from Lake Merritt BART, and while Newhouse thought De La Fuente joked about putting in a trolley system, BART and Oakland did a feasibility study for Jack London Square at the end of last year. BART was ruled out because of the expense, and the alternative that emerged as the favorite was in fact, a trolley/streetcar. No option has a route that runs to Oak-to-9th, but with the influx of residents, jobs, and tourists that would come with a new development there, it would make sense to include it in the final plan.

Wolff officially rules out Coliseum

It's not a surprise, but Wolff has dismissed the Coliseum as a potential ballpark site, due to the previously mentioned conflicts with existing tenants (Warriors, Raiders) and lack of available surrounding land. Of course, a quick drive down Hegenberger would make one skeptical about that...

When asked about the Oak-to-9th site, Wolff declined comment and didn't reveal information on any new sites. There are now grumblings from the those that believe Wolff is being less than upfront about his efforts, which could pave the way for an exit from Oakland.

While it's a bit disconcerting that Wolff isn't actively involving the public in the search, he does speak to De La Fuente every two weeks to update the situation. But even DLF can only do so much. As Don Perata once said, "No stadium project goes through without the support of the mayor."

Where is the Estuary again?

I've gotten a lot of questions on the Estuary, mostly along the lines of "where is it?" or "how close is it to BART?" To help matters, I pieced together this graphic. Points of interest including Jack London Square and Lake Merritt are clearly visible, so it's easy to see where Oak-to-9th is in respect to everything else. The two main sections of the site are in light green (5th Avenue Marina) and dark green (9th Avenue Terminal). The pink section within the 5th Avenue Marina is the Silveira property, which is the one privately owned parcel on the site and the one which presents the greatest legal challenges (owner J.W. Silveira is suing Oakland over the inclusion of his property in the redevelopment plan).

Click on the graphic for a larger version



A quick explanation of the photo:

• The I-880 5th Avenue Overpass is highlighted in blue because it's going to be rebuilt. Nearby land is being cleared away to accommodate the construction equipment and vehicles to be used. The freeway will be widened 40 feet to include carpool lanes, revamp local interchanges (which are considered dangerous), and seismically retrofit the span. Caltrans District 4 doesn't yet have a project page up, but one should be expected soon. The project is slated for completion in 2008.
• Clinton Basin is also known as Seabreeze Marina, and is in poor shape.
  
• The only direct pedestrian links to the site are on The Embarcadero from the west and 5th Avenue from the north. Measure DD funds will allow for trails to be completed from the existing developed channel to the Estuary Park and the mouth of the channel. The areas colored brown and orange are parcels of land that will be needed for this work. They will be needed for the overpass project as well.
• There is no current AC Transit bus service or other public transportation to this site.
• The BART route is highlighted in red, with the Lake Merritt BART Station in darker red. BART becomes a subway as it heads west just before 5th Avenue. It then tunnels underneath the Laney College Athletic Fields, Lake Merritt Channel, and the Laney College main buildings.
  
• Walking distance from the Lake Merritt BART Station to the site is about 0.8 miles.
• Jack London Square is 0.5-1.0 miles west of the site.
  
• A walk from the Coliseum BART station to Gate D at the McAfee Coliseum is 1/4 mile; to Gate A it's 1/8 mile.
  
• A walk from the 19th Street Station to the Uptown site is only 1/10 mile, from the 12th Street Station it's about 1/2 mile.
  
• The distance from San Jose's San Pedro Square to the HP Pavilion is also 1/2 mile.
• A ride on SF Muni's N-Judah from the Embarcadero Station to SBC Park (2nd & King) is 1.4 miles.
  

Because of the numerous diverse interests that have stakes in the Oak-to-9th development, it would be foolish to predict what will happen. However, I decided to try a hypothetical ballpark drawing to see how small a ballpark could be built on the site. The result looks like this:



Positives:

• It doesn't encroach upon the Silveira property
  
• It leaves the 9th Ave Terminal side to Signature
• The orientation of the field allows for a sweeping, panoramic view of Oakland's downtown, hills and Lake Merritt (from the upper deck).

Negatives:

• The ballpark's footprint (10-11 acres) eats into available open space, and some minimum of open space must be made available for the public. The original Estuary Policy Plan calls for a meadow to be created where the ballpark sits.
  
• Height will be over 100 feet at some points and may block views of the bay.

Much more to come.

De La Fuente says, "Build at the Estuary"

Glenn Dickey reports that Oakland City Council president Ignacio De La Fuente has proposed the Estuary site to Lewis Wolff as the place to build a ballpark now that the Coliseum is not being heavily considered. The Estuary has been profiled in depth over the past few months. Check out the following links for more information:

• Ballpark concepts continued... - contains quotes from the lead developer at the Estuary
• A sample Estuary development plan - includes an overhead photo and an assessment of the site with pros and cons
• Photo Overview (PDF, requires Acrobat Reader) - for those interested in what the site currently looks like
  
• Signature Properties corporate website
• The Port of Oakland's Estuary Plan (PDF) - keep in mind, it hasn't been revised in years
  

I would encourage anyone who may be nearby or passing through Oakland and has time to do so to head out to the Estuary and walk around for a bit. It might stimulate your imagination. The Estuary site, also known as "Oak-to-Ninth", can be reached directly from I-880.

Directions from:

• I-880 South, take the Embarcadero exit, make a right on the Embarcadero, which is at this point a frontage road. Drive back towards Jack London Square 1/2 mile, and it's on your left.
  
• I-880 North, take the 5th Ave/Embarcadero exit, which will wind underneath the freeway, intersecting with the Embarcadero. Parking should be available on the other side of the street.
• Downtown Oakland, take Oak St south (towards Jack London Square) and past I-880. Oak will end and merge with the Embarcadero (left or East). Proceed along the Embarcadero past the Aquatic Center for 1/2 mile. The site will be on your right.
  

If these directions are confusing, I apologize. Look up the address "1000 Embarcadero" or "1000 Embarcadero E" in Mapquest, Google maps, or your favorite address finder.

Uptown update: Forest City moving forward

An article from Tuesday's Oakland Tribune summarizes the overall development scene in the Uptown area, which includes the Forest City development among others:

The Oakland Planning Commission voted 6-1 on Wednesday to approve Forest City's design and landscape plans for 665 apartments in a series of five-story buildings, 9,000 square feet of commercial space, 533 parking spaces and a new public park, all spread over three parcels between 19th Street, Thomas L. Berkley Way, Telegraph Avenue and SanPablo Avenue.

Sadly, the actual number of apartments being built by Forest City seems to go down with every new announcement, but it's better than nothing I suppose. It would appear that the only thing that could seriously delay the project now would be the eviction and eminent domain proceedings that are left to take place for current tenants. Once that's out of the way, groundbreaking should occur soon thereafter. That would shut the door for good on a stadium idea, which still burns brightly for many A's fans but hasn't seriously been considered by the City of Oakland for some time now.

Neil Hayes' call for ideas, and my own

Neil Hayes' new column posits the idea of an East Bay ballpark serving as a place that serves the community and salutes the East Bay's unique history. Since it appears that an Oakland location is no given, it makes sense to go this route. I especially liked the mention of the almost mythical Neptune Beach, which was once Alameda's bayside response to SF's Sutro Baths or the Santa Cruz Boardwalk.

There are ways for a ballpark to accomplish these objectives while maximizing revenue streams. The best way is to limit the size of a ballpark. I just finished a conceptual drawing of a 38,000-seat ballpark that fits on only 10 acres. It's not really site-specific, so it should fit on a roughly square or rectangular lot. Features include:

1. 53 midlevel suites, 10 dugout suites, and 3 party suites
   
2. 3,320 club seats on two levels, mezzanine club level restaurant with field view
   
3. A simplified design that reduces costs by limiting ballpark's footprint
   
4. Outfield bleachers on two decks similar to old Comiskey Park and Tiger Stadium
5. Restaurant/bar in left field that seats 200+
6. Picnic seating in right field
7. Field set 23 feet below street level, main concourse on street level
8. Children's play area that could be placed in outfield (upper or lower) or near main gate
   
9. Pitcher-friendly dimensions with fences that could be moved in
10. Next-generation grass technology that allows for easy conversion for non-baseball events such as concerts and soccer/football games
11. Flexible seating plan that allows for up to 1,000 extra temporary seats to be installed for high-demand or playoff games
12. A grass berm in left-center for general admission patrons
13. At least 1.5% of seats are ADA-compliant
14. Dramatic entrances in centerfield and home plate that contain monuments and a museum devoted to A's history

For a messy conglomerate view of this concept, click here to download a graphic. Over the next few days, I'll put out other level-by-level drawings that detail all of the ballpark's features. One thing I could certainly use is some advice or help on doing artist concept-type drawings. This is not my strong suit, so any assistance would be much appreciated.

Ray Ratto column

The inimitable Ratto puts the A's and 49ers in a little game called "Survivor: Stadium Edition" which plays out less like the reality TV show and more like a rigged game of Monopoly. Whether you find humor in his column or not, the message is very clear: Getting a new venue for either team is not going to be easy, quick, or cheap. In the end, he still says to bet on the A's, despite the obstacles.

Uptown's price tag rising

From the this isn't exactly a big surprise department: the Oakland Tribune is reporting that new costs may force the city of Oakland to fork over additional subsidies to the Forest City Uptown housing development. Among the rising costs: escalating values of land to be acquired, and cleanup costs for a site that used to house a Chevron station. A Sears Tire and Auto Center also needs to be relocated, which may force Oakland CEDA (Redevelopment) to pay for additional land on which the relocated garage would be placed. The cleanup effort would cost the city $4 million, and the cost to relocate the garage could be as much as $12.5 million. That pushes the total cost of subsidies and ancillary costs to nearly $80 million, or about $80,000 per apartment.

Rising costs are common in projects of this magnitude. It is possible, though not likely, that the subsidies will run high enough to push the Oakland City Council and Mayor Jerry Brown to dump the project. Virtually every important politician in Oakland supports the Uptown project, and it would take some major revelations and negative political sentiment to turn the tide against it.

But what if it did? It could make the land available for a ballpark, since Oakland has already used eminent domain to acquire the majority of the individual properties, allowing them to sink the costs to an extent - though the public may demand the team pay for the land to reimburse the city. Previous property owners who were forced to sell because of eminent domain may have the potential to sue because the city would be using the land for a different purpose than originally intended. The cleanup costs mentioned in the article would still need to be covered, and it would be unclear who would foot the bill. Then there would be the political problem - no one associated with the city outside of Larry Reid has publicly supported spending taxpayer money for a ballpark. Proponents including the A's would probably have to wait until Brown left office and hope that a more friendly face, such as Ignacio de la Fuente, won the next mayoral election. Then the political machine would have to get in gear to line up other support, from the City Administrator Debroah Edgerly to State Senator Don Perata. Why? Because no matter how much many fans would like a privately-funded endeavor, it's much more likely that some public component will be required, whether it's 75% in the Minnesota Twins deal, 33% in the St. Louis Cardinals' new Busch Stadium, or 5% in the Pac Bell Park deal.

Giants, A's cable ratings down

From Steve Kroner's Chronicle article:

Ratings for Giants telecasts on Fox Sports Net Bay Area and KTVU (Channel 2) and for A's telecasts on FSNBA and KICU (Channel 36) are down approximately one-third from a similar point in 2004.

The Giants are averaging a 3.0 rating on FSNBA, the A's 1.5. While 3.0 is great for a sports broadcast, things would be much better with Barry Bonds around. As for the A's, they are suffering from a severe case of bandwagonism, with few signs of an end to the malaise in sight. Expect the trend to continue until either team goes on a significant tear.

Startup to timeshare luxury suites

A novel concept to the marketing of luxury suites was launched today by a startup called Owner's Pass. John Arledge and Peter Cochran created the Los Gatos-based firm, which will sell timeshare packages of luxury suites. The packages not only bring down the often prohibitively high cost of suites ($100,000 per year or more), but they'll also offer the opportunity to use a single fee to cover multiple sports. More details are available in an Oakland Tribune article.

When I first saw the article, I thought, "Why hasn't anyone done this before?" Then it occurred to me that the major pro sports franchises are often in competition with one another and do their best to lock their customers into annual or even multiyear deals. Sometimes it even appears that the market is oversaturated. As for the startup, buying leases for the 6 major franchises here in order to timeshare them can cost upwards of $500,000 a year, a risky capital cost for a business whose customer base has potential, but is yet unproven. Still, there are many firms who have a hard time justifying annual leases on suites, and this could very well open up the market significantly for them as well as smaller companies. If the Owner's Pass business model works, they will expand to other markets, and they may become a cornerstone of a huge secondary suite sales market. Good luck to them.

Ballpark concepts continued...

Fleshing out last night's news a little more is an article from today's Oakland Tribune. Along with talk of design and the architectural players involved, is more information about potential sites: the Estuary site and the now shutdown Oakland Army Base. At some point I'll try to take pictures of the base and the surrounding area. In the meantime, here's a snippet from the article including quotes from Michael Ghielmetti (the president of Signature Properties who met with Wolff over a month ago), regarding the Estuary site and Oakland in general:

Oak-to-Ninth has been discussed as a possible site because of its waterfront location. And Wolff met with Michael Ghielmetti, president of Signature Properties, the firm that owns Oak-to-Ninth.

"Oak-to-Ninth has challenges because it is not very close to transit, and the access to and from the site is very difficult, but I am not going to be the one that says absolutely not," Ghielmetti said Wednesday. "When we met with Lew and his son, we were talking in broad concepts about a variety of locations in Oakland and reasons to stay in Oakland."

Signature has a unique perspective because they've done or are completing 5 separate housing developments in Oakland of varying sizes. Since they were picked to develop the Estuary site, it isn't clear whether they are more interested in building their housing plan (which still has yet to be fully approved) or sharing the site with the A's (which hasn't formally been brought up as an option yet). The key may be Oakland city mandates regarding affordable housing. Debate surrounding minimum amounts of low-income housing are stalling the Uptown deal, and it looks like they might stall Signature's plans as well. For more on the Estuary including a mockup, check out my mockup plan and photo overview.

Wolff gives some details

The important stuff from John Shea's Chronicle article:

The owner has formed a venue development committee involving two team executives -- President Mike Crowley and Wolff's son, Keith -- and three outside firms, including 360 Architects, Gensler Architects and International Facilities Group.

Committee members have toured several newer ballparks, plus Boston's Fenway Park, and plan to check out other pro sports facilities, including basketball arenas. The mission is to gather information to be better prepared to design a new home, if it gets that far.

"They'll come up with a prototype, and they're thinking outside the box," Wolff said. "With venues, you want the next new one to be better than the last new one."

Wolff isn't as interested in building a park on the Coliseum parking lot and said a downtown site is "probably not in the cards," but he did say he's more open than ever to locations in and around Oakland, preferably with BART access. Public help, he added, is necessary.

Let's pick apart the statements made here.

• Touring existing facilities comes with the territory. Part of the process is evaluating the designs and architects associated with them, and crib some of the best ideas. Fenway is an unusual example of a refurbishment that is ongoing.
• Looking at basketball arenas is a good move. Philips Arena has a unique design with the suites stacked on one side of the building and the seating bowl cantilevered around them, making for better, lower sight lines. 360 designed Miami's American Airlines Arena, which is notable for a special innovation: floor suites. Jacobs Field in Cleveland has a version of this in their Dugout Suites, covered front-row seats between the dugouts at the same elevation as the dugouts. Behind the seating area are the individual suites, below the lower seating bowl. This type of seating would most certainly demand a premium.
  
• Gensler has a wide ranging portfolio, but little sports venue experience. My guess is that they'll work on concourses, public spaces, and fan-oriented areas. In an effort to escape the drab gray that dominates the Coliseum, a new ballpark would be bright and full of color.
• "With venues, you want the next new one to be better than the last new one." - The standard-bearer currently is Petco Park, though it's likely that the new DC and Minneapolis ballparks will be completed in the next 3+ years. Better also often means more expensive, which could drive up the price of the project. I can see Wolff trying to limit the amount of concrete that's poured, while maximizing revenue within the space as much as possible.
• The Coliseum's out based on the power lines issue and conflicts with the Raiders and Warriors. It may also be because he saw the limited development potential and balked, thinking the cost wasn't worth the return. Saying Downtown is not in the cards really means the Uptown site is not feasible. That's probably because it's too far along the development timeline to scrap it.
  
• What does that leave? The Estuary site for starters. Then perhaps the OUSD and Laney College sites. All 3 have been profiled here, and all 3 have development issues to overcome. The Kaiser Convention Center just closed down so it may become available, but the site's too small to house a ballpark unless other land is acquired. Howard Terminal is locked into a long-term lease agreement.
• The old Army Base in west Oakland is a possibility, but it would require a new BART station, site cleanup, and a buyer for the required property. Based on the activity that occured after the closures of Treasure Island, Alameda NAS, and the Presidio, it's not the most expeditious process.
• There are also sites that may be available that are currently active or in use, such as some of the light industrial area that lines I-880 between Downtown and Jack London Square. Acquisition costs for such properties would be the big issue there.
  
• I don't know what to make of the "public help is necessary" comment. I'll ask the reporter myself about that.
  

Oakland City Council Seat 2 Election Results

From the Oakland Tribune: Preliminary results indicate that Pat Kernighan won tonight's special election for the Grand Lake-Chinatown City Council seat. Though it's projected she will not receive more than 30% of the vote, there will not be a runoff, and Kernighan will be declared the winner. She was previously chief of staff for Danny Wan, who vacated the seat in January.

Kernighan will have some sway over the fate of the Oak-to-9th Estuary site, profiled here previously. While it isn't likely the property will be the home of a ballpark, it remains a viable option, should all interested properties come to an agreement.

Kernighan has commenteed publicly on development of the Uptown site for a ballpark. This is her statement, first published on the Greater Grand Lake Coalition website:

I am encouraged that Lewis Wolff has the potential wherewithal to finance a new baseball stadium without need of public money. A new A’s ballpark would make a lot of Oaklanders happy, but I am adamantly opposed to spending public dollars to build one when there are so many other unfunded public needs of much higher priority.

She hasn't publicly commented on Oak-to-9th's possible use as a ballpark site.

A harbinger in Florida, sort of

Since Florida's Senate legislators last week refused to take up the Marlins $60 million funding bill, the ballpark near the Orange Bowl is officially in limbo. In the few days since, that $60 million estimate ($30 million in today's dollars) has jumped 50% due to revised estimates for acquiring needed land near the Orange Bowl, which would have certainly caused much consternation on both sides of the divide.

Now MLB has let the other shoe drop. A letter from MLB President Bob DuPuy to Marlins owner Jeffrey Loria as well as the mayors of the City of Miami and Miami/Dade County gives the three until June 9 to "come up with a full financing plan by June 9 to ensure the Marlins move off the list of teams that receive millions in revenue sharing earmarked for financially strapped teams."

Why June 9, a seemingly arbitrary date? The legislative session for the year is over regarding the budget, so Governor Jeb Bush would have to call a special session to get a new bill debated, and since Bush has been steadfastly straddling the fence on this issue, it seems unlikely that it will be taken up anytime soon. MLB wants to push this forward so that if it fails, they can pull out the big guns and talk relocation, which may force one or more of the parties to commit the remaining money (preferably, not Loria or MLB).

Back to the revenue sharing argument. The Marlins, by virtue of less favorable rental agreements than other MLB franchises coupled with a lackluster baseball facility in Dolphins Stadium, reap in millions every year from revenue sharing. MLB's biggest motivation is to get the "welfare teams" (Florida, Tampa Bay, Minnesota, Kansas City, Oakland) who happen to also be playing in older or not ideal facilities off the dole via new stadium deals. The Marlins, Twins, and A's are in similar positions because of their revenue sharing intake, as well as their on-field success, which has probably made several other owners jealous ("Why should I finance ____'s wins, not just my own?").

No details have emerged regarding the A's plans yet, and for good reason - the better to not have any debate it. It is highly likely that the A's path will follow the Twins, Marlins, and Nats closely - don't reveal too many details, keep it out of the voting booth as long as possible. Since the A's won't have to worry about getting help from the Guvernator, any debate would be confined to localities, namely Oakland/Alameda County. That would mean that plans could be debated and approved/rejected much more quickly than if they went through some complex State scenario, but it also means that local opposition groups would wield much more say in the process. Unless the plan involves a Pac Bell Park-type financing structure, I doubt anything will go through on the first try. Shortly thereafter, the locals should expect a nice little letter from Bob DuPuy. That's when the ball will truly be in play.

Attendance Watch 5/13

The two upcoming series with the Yankees and Red Sox will be important because the six games will bring at least 1/10th of the season's total attendance through the Coliseum's turnstiles. The A's will have two other large-grossing series, June 24-26 vs. the Giants and September 2-4 vs. the Yankees. If the A's are in contention through August, they should be able to hit the 2.1 million figure at the very least. If not, they could drop below 2 million easily. Last season's 2.2 million is slightly off from 2003, and that small (1%) drop can be attributed to the A's losing the division on the 2nd-to-last game of the season.

Currently through 15 dates, the A's total is 309,117, with an average of 20,608 per date. That's down almost 108,000 from 2004, but through 15 dates in 2004, the A's had already played 3 games with the Yanks. This season's drop can be largely blamed on the poor weather seen so far this spring.

It'll be interesting to see how much the agressive season ticket marketing campaign has affected season tickets sales. This was considered Lew Wolff's #1 goal prior to getting a stadium deal in place. Even if the team drops in attendance due to poor performance, an expanded season ticket roll will be a very encouraging sign for the ownership group and peripheral investors as well.

Incidentally, the Giants' current total attendance is 758,618 through 20 dates, with an average of 37,931 per date. Not quite a sellout every game, but they're still on track to 3 million.

Coliseum Amtrak station to open 5/25

The grand opening for the Oakland Coliseum Intercity Rail Station just outside the stadium will be May 25, according to the East Bay Business Times. Yes, it will be more expensive than BART, but there is at least one nice thing to it: some of the trains have WiFi and Amtrak expects to roll it out further over time.

Three more Photo Overviews, and other notes

This time, as promised, I present the photo overviews for:

• Laney College Athletic Fields - Not feasible nor under consideration due to Peralta Community College District's desired land uses.
• Howard Terminal - Unlikely because of long-term lease with major shipping company Matson.
• Uptown - Small sliver of hope for a ballpark that requires much political work done over the last three years to be undone, and new political support to be lined up behind it.

Other notes:

• The East Bay Business Times put out an editorial in this week's issue that does not support large-scale public financing of a ballpark. It steps back slightly on its position towards the end, urging Oakland and Alameda County political leaders to "weigh the economic benefits of the stadium as an investment."
• On the sidebar to the right, I've added a new feature called The Scorecard. It's there to keep track of how different media outlets (TV, radio, print) and personalities (columnists, talk show hosts) are positioned on the ballpark issue. For now, it will show indicators for two specific public financing questions, though it is likely to expand. If you see, hear, or read anything that can help fill in the Scorecard, please send it in.

NY Times: Impact of a Stadium article

For those that want a non-propagandistic view of the economic impact of sports venues, take a look at Robin Pogrebin's May 7th article from the Arts & Design section of the NY Times. Several individuals from both sides of the divide were interviewed, including Jay Cross, who headed the Air Canada Centre and American Airlines Arena projects. He is currently working on the mammoth Jets stadium project on the West Side of Manhattan. Some interesting (and relatively refreshing) quotes from Cross:

Cross... cautioned that a stadium could not shoulder the entire burden of reviving a neighborhood. "One building can't do it on its own," he said.

-and-

The stadium's impact, he added, would take time to determine.

"You've got to give it 20 years," he said. "You've got to be patient. They can help neighborhoods," he said of stadiums, "but they're not instant panaceas. They will neither repel housing or attract it. There still needs to be a bona fide reason to build housing or commercial space as part of a well-thought-through package, because it's largely market driven."

"Times Square had all the good will to clean it up," he continued. "But it needed developers to make commitments."

Keep in mind that the Jets stadium is a multi-use facility which will also function as an extension of the Javits Convention Center, as well as a centerpiece should New York win the 2012 Olympics. Without those, the stadium would have only 8-10 automatically scheduled dates per year in the form of football games. A ballpark would schedule over 10 times that number - 81 games or more. However, even that expanded schedule has holes: 3 months of games spread out over a 6 month span, and what happens during the offseason? Without some guarantee of traffic during that down period in the fall and winter, developers will be hesitant to make commitments.

Diridon Site Acquisition Illegal?

Courtesy CBS-5 (KPIX)/Bay City News Wire:

Today's news tidbit comes from a recently constructed watchdog group from San José called Ballpark Tax Watchdogs. The group filed a rebuttal to San José City Attorney Richard Doyle's April 22 memorandum, which advised the city and the Redevelopment Agency on how it could proceed to acquire the individual parcels that make up the Diridon South site. The controversy revolves around whether or not the purchase of the Diridon South lots and related expenditures, when used for the eventual construction of a sports facility, requires a referendum.

Doyle's opinion is that the purchase of the land and related costs such as feasibility studies are not subject to a vote. Only actual construction costs, when financed by public means (bonds/taxes), are subject to a vote.

BTW believes that any costs, including site acquisition and exploratory expenditures, do require a referendum.

Who's right? Take a look at San Jose's Municipal Code Section 4.95.010:

4.95.010 Prohibition of the use of tax dollars to build a sports facility

The city of San José may participate in the building of a sports facility using tax dollars only after obtaining a majority vote of the voters of the city of San José approving such expenditure.

A “sports facility” for the purpose of this chapter is to be any structure designed to seat more than five thousand people at any one time for the purpose of viewing a sporting or recreational event.

“Tax dollars” for the purposes of this chapter include, without limitation, any commitment to fund wholly or in part said facility with general fund monies, redevelopment fund monies, bonds, loans, special assessments or any other indebtedness guaranteed by city property, taxing authority or revenues.

Nothing herein shall be construed to limit the city from allowing the construction of a sports facility funded by private investment.

If any provision of this chapter or the application thereof to any person or circumstance is held invalid, then the remainder of this chapter and application to other persons or circumstances shall not be affected thereby.

Where one stands on this issue is largely dependent on how one views sports facilities projects and similar redevelopment work in general. In the end, it appears that this ordinance, enacted in 1988, may have been specifically worded (notice the use of the word "building") to allow for planning-related work to occur. The real question here is, "Will the ballpark opponents take this to the next level?" That level, of course, is court. The last line of BTW's home page indicates this threat is possible. Whether or not they follow through on it remains to be seen.

Note: The BTW domain was registered only 2 days ago (5/2), and the rebuttal was submitted on 4/30.

East Bay Business Times article

Eric Lai wrote a good summary of the development climate in Oakland with regard to the ballpark situation. He contacted me last week, and while I didn't get back to him in time to be quoted, I did respond in time to give the paper permission to use my Coliseum South mockup on the front page. He interviewed Zennie Abraham of Sports Business Simulations, who is the first person I've seen actually discuss the use of redevelopment money (tax increment funds) to finance a ballpark at some length. That's important, because I think there's a misconception that an A's ballpark will be financed the same way that SBC Park was. The chances of that happening are not good. It's best to get the public educated as early as possible about the financial ramifications and costs. Proponents should start early to educate voters on how such a deal would be different from the Raiders' deal, and that kind of outreach could make a difference. At the same time, I will scrutinize such a deal myself to see if it is truly fair for the public. No polls have been taken of the populace, but I would speculate if one were taken now, poll results would be similar to those in the Twin Cities, where the majority of the public is currently against public financing of a ballpark. It would then fall on ballpark proponents to turn that number around in time for a June/November 2006 election.

New Site Photo Overviews

Just completed - three new site photo overviews. The finished overviews are:

1. OUSD (Oakland Unified School District) - This site was mentioned in Peggy Stinnett's column in the Oakland Tribune. She offers her take on a visit by Naoko Ezawa, who helped design Pac Bell (SBC) Park and represented developer KUD. KUD may very well be the Santa Monica firm hired by Lewis Wolff to visit and assess Oakland sites. Based on KUD's portfolio, much of their experience is in developing waterfront properties. I visited the OUSD site several weeks ago, and while it has positives (mass transit, location), there are definitely issues in its shape, size, and the lack of parking (you can see this from the aerial photo in the file). The lot is shaped like an inverted "J", and unless other surrounding blocks are acquired to round it out, it can't properly accommodate a ballpark's footprint. Also, putting it in a decidedly residential neighborhood may turn a ballpark there into Wrigley Jr.
   
2. Coliseum B-C Lot - This may or may not be the main option for building a ballpark. It's the least sexy option because it's the most difficult to foster other surrounding development, but it's also probably the cheapest to build because of zero land acquisition costs.
   
3. Diridon South - The main San Jose site is just a block from the train station and two blocks from the HP Pavilion. San Jose's Redevelopment Agency has been given the green light to acquire the site. Funds are a bit tight but it is expected that money to buy the site will come from the sale of other properties. There exists an issue with the PG&E substation on the west side of the site which probably won't be easily overcome or circumvented.
   

Next up: the Laney College Athletic Fields, and the Uptown and Howard Terminal sites.

Note to Lew: Buy a radio station

A small bit of news that flew under the radar last weekend was the announcement that Susquehanna, the parent company of KNBR (680 and 1050 AM), is putting their radio business up for sale. In the salad days of the late 90's KNBR and KTCT (1050, which later became co-branded as KNBR) were cash cows for Susquehanna. Lately they've become more of a liability to the parent company, as the 49ers' and Raiders' fortunes suffered, pulling away listeners and ratings. Susquehanna, based in York, PA, also owns the venerable KFOG and KSAN-The Bone rock stations in the Bay Area, and 20 more stations in 7 other markets.

It is unclear whether the stations will be sold as a group or as individual entities. Some, like KNBR-680, are the crown jewels and will fetch a pretty high price. 680 is one a handful of clear channel (not the company) stations throughout the country whose signal can be heard at night for hundreds of miles, in states as far as Utah and up and down the Pacific Coast. KNBR has had difficulty finding a good programming mix over the last few years for its lesser property (1050), sometimes going with edgier personalities such as Jim Rome and "J.T. The Brick." On the other hand, it would also simulcast some of its other shows, such as "The Razor and Mr. T." The morning drive-time slot has also been somewhat tricky, especially when KNBR brought a decidedly "morning-show" vibe to 680 in the "Not Just Sports Show," which was killed only last fall. The Raiders had been on 1050 for several years, but were not renewed last season and subsequently moved to KSFO-560. Most recently, KNBR announced a four-year deal with the San Francisco 49ers, who had seemingly been on KGO-810 forever, but were let go after KGO saw a ratings slide.

If 680 and 1050 were sold together, the buyer would be given a virtual monopoly on sportstalk radio in the Bay Area, but would also be saddled with having to program for two 50,000-watt stations, which can be expensive. Signing the 49ers when they did probably helped boost the asking price of KNBR, but it remains unclear how the sale would be handled. KNBR already has Giants baseball exclusively on 680 and Warriors basketball (which switches between the two stations). It's not unprecedented for a single station to carry three different teams, but that means that schedule conflicts could become a common occurrence.

This gives Lewis Wolff a potentially huge opportunity. As mentioned previously, the A's will be off KFRC-610 at the end of the 2005 season and their next radio home has not yet been determined. If Wolff were to buy KTCT-1050, he'd have a built-in sportstalk audience on a 50,000-watt station, along with immediate programming in the A's, who currently are relegated to vagabond replacement player status in local radio. Not only would the A's get more immediate exposure; they would also be able to do many of the same revenue-hiding tricks that only the big boys are able to get away with.

That's not to say that acquiring a station will be easy. Once any station goes on sale, literally hundreds of suitors line up for a shot. Existing behemoths such as Clear Channel (yes the company) and CBS/Infinity/Viacom have tons of cash to throw at any acquisitions. An open auction process could drive the price up for either or both stations. KNBR also has a 2% minority stake in the Giants, which further complicates things. Breaking the two stations apart and allowing them to compete would be good for the listening public and potentially reduce any conflict-of-interest issues. Buying KTCT would cost the Wolff/Fisher group millions of dollars, but it would guarantee the A's a stable home on local radio for years, if not decades to come. That can't help but raise the value of the franchise.

Comcast to O's & Nats: "Not so fast my friend"

You probably know by now some details about MLB's payoff to Baltimore Orioles owner Peter Angelos over the Expos' move to DC. MLB allowed the O's to set up a new regional sports network (RSN) called Mid-Atlantic Sports Network. MASN is to be run by the O's, with Angelos having complete control over broadcasts of most O's and Nats home games. MLB has a stake in the venture that will grow annually, but the stake is capped at 33%. The Nats get a "market share" price for the rights to broadcast such games; estimates had the amount at $25 million.

That all sounds well and good for baseball (unless you're a Nats owner who wants a little more control over the situation), but it appears that baseball forgot to consult with a company that's normally a big player in such deals: Comcast. Comcast is the dominant cable operator in much of the country, and it considers the mid-Atlantic area its backyard (it's headquartered in Philadelphia). Comcast also runs regional sports networks throughout this area, and its position as both network (Comcast Sports Net) and distributor (Comcast Cable) gives it some unique power.

What happens when you don't consult Comcast on these things? It's America, so Comcast sued MLB, the O's, and MASN. In the meantime, Comcast is refusing to show Nats games that would normally appear on cable (those home games again). This hardball tactic has worked before when negotiating per-user fees for carrying the RSN, or even carrying it in the first place. The cable provider holds most of the cards in these battles, and they can wage the PR battle that normally hits the teams harder than the cable provider.

Comcast isn't happy about not being able to bid on the rights to carry the Nats. Since MASN is an O's venture, the O's would leave CSN once their contract was up in 2006, leaving CSN in the lurch. If it sounds familiar, you don't need to go far to find similar examples.

Comcast can go a number of ways with this. They could win the suit and have open bidding for the Nats. They could ask for a piece of MASN. They could also choose not to carry MASN at all, or carry it only on expanded basic cable instead of cheaper basic cable. This may also be simply a ploy to get a favorable deal to carry the RSN. But based on their recent expansion, I'm led to believe that they legitimately wanted a chance to broadcast the Nats. This may end up in the courts for quite a while since there's no obvious middle ground. The losers will be the fans, and the eventual Nats owner as well since broadcast rights fees factor into the Nats' final purchase price.

That's a long-winded rant just to get to how this affects the A's. It comes down to one suggestion for Lewis Wolff: Play nice with Comcast. CSN opened up shop in California last fall when they got the nod to carry Sacramento Kings games. They've positioned themselves as the Central Valley's RSN, and they're poised for a bigger advance throughout California. They are on digital cable throughout the Bay Area (channel 401 if you're interested). They don't have any of the Bay Area's major pro teams yet, but you can be sure that as each team's contracts expire, Comcast will swoop in for the kill. They have the built-in advantage over Fox Sports Net because of that distributor position. It could turn out good for viewers as it may cause a sort of bidding war, and FSN, which has a difficult time carrying 4 teams (Giants, A's, Warriors, Sharks), may step away a bit, allowing for better coverage for all teams. That is, unless you like hunting for FSN+.

Comcast will be the ultimate roadblock for the A's if Wolff were interested in setting up his own RSN. Comcast could use the same tactics they used with YES/Yankees, or even drive an RSN out of business, as they did in Minnesota.