IN THE END, it may all come down to some dumplings.
When City Commissioner Nick Fish went to grab lunch with Randy
Leonard at Steamers Asian Street Bistro across the street from city
hall on Tuesday, March 10, Fish remained undecided on which way to vote
on Leonard’s proposed Major League Soccer (MLS) deal. By press time on
Tuesday night, Fish was still tight-lipped about his voting intentions,
but it’s likely that whatever Leonard said about political loyalty over
lunch will weigh heavy on Fish’s mind when it comes to council’s big
vote on Wednesday.
Leonard and Mayor Sam Adams have agreed to give Timbers and Beavers
owner Merritt Paulson access to $60 million in city-backed loans to
renovate PGE Park for an MLS franchise, and build a new Triple-A
baseball stadium in the Rose Quarter. Paulson will pay back the loans
even if his team or the league fails. Now, all that Leonard and Adams
need is a third vote out of five on council to make the deal fly. But
there are problems.
“Part of it is, any politician is very excited about having his or
her own monument that they can point to,” says economist Eric Fruits,
who sits on the mayor’s economic cabinet. “They can say, that’s my
stadium, I built it. That’s my legacy.”
The problem, for Fruits, is that the numbers just don’t add up. For
example, Paulson is projecting an average ticket price of $33.65 in
2011. Fruits, meanwhile, thinks $21.50 is more realistic for 2011, and
points out that slashing the MLS team’s projected 2011 revenues to
account for this difference would result in the team going from an
annual projected profit of $1.8 million to an annual loss.
“It shows you don’t need to have too big a change in some of the
fundamental figures to have this thing not pencil out,” he says, adding
that projections about MLS bringing money to Portland from outside the
region are wildly optimistic: Numerous studies have shown that MLS has
only local appeal.
There’s also the reverse Robin Hood problem, of robbing from the
poor to subsidize the rich: The deal seeks more than $15 million in
urban renewal money, which is supposed to be allotted through the
creation of urban renewal districts in “blighted” areas, according to
the law.
“Every dollar that goes into urban renewal includes 26 cents that
would otherwise be going to Multnomah County’s general fund in taxes,”
says Multnomah County Commissioner Jeff Cogen, who is currently looking
to fill a $45 million hole in the county’s budget for things like
social services, jails, and schools.
“Urban renewal is supposed to be a tool for turning blighted
neighborhoods into viable ones,” says Cogen. “But if you look at PGE
Park, it’s between the MAC [Multnomah Athletic Club] and the sparkling
new Civic condos. Urban renewal becomes meaningless if you use it
everywhere.”
“This is quite literally taking money that funds social services in
Multnomah County, and school days, and uses that money to build a
soccer stadium for a multi-billionaire,” says State Representative Nick
Kahl, another outspoken critic of the plan.
It was an irony not lost on Commissioner Dan Saltzman when asked on
Tuesday whether he had any concerns about the deal that might prevent
him from voting in favor.
“Yes, I do have some concerns,” he said. “I haven’t made my decision
yet. But my concern relates to the imagery of the whole deal as it
relates to urban renewal areas, and the many moving parts to the deal,
almost too many moving parts.”
Commissioner Amanda Fritz listed a whole series of negatives to the
deal last Friday in an email to local print media—from the
creation of a new urban renewal area without an “orderly, independent
process,” to more obscure concerns about the gender equity of MLS
executives.
Nevertheless, Saltzman is unlikely to vote against the deal and be
on the losing side of a 3-2 vote with only Fritz for company, whatever
his concerns. So in the end, barring unprecedented independence of
thought on Fish’s part, the success of the MLS deal will have less to
do with what’s best for Portland, and more to do with whatever was said
Tuesday between two commissioners over a fateful plate of chow.
“For example, Paulson is projecting an average ticket price of $33.65 in 2011.”
Repeating a lie doesn’t make it any more true.
Follow-up to this story here:
http://blogtown.portlandmercury.com/Blogto…
If by follow up, you mean regurgitating yesterday’s news as more advanced than today’s article which was the same reporting as a 2-day old blog post.
Too busy talking about your love affair with O’Douls to get another cell phone pic of Saltzman’s email box, I guess.
Wow, looks like lil’ Matty was really wrong.
Good ridance.
A subsidy for sports arenas, tell me how this is for the general good? Our money, not the cities, should go into infrastructure and such. A gamble on a private industry which has as much to do with social service as a bank. If a bank can’t stay afloat let them sink, if you don’t have enough dough to start a franchise don’t ask for mine. This should not even be on the table, and any money syphoned from our pockets to other sports industries should be returned with interest if it has not already. Go Blazers!
So what is Paulson’s exit strategy when both teams are losing money hand over fist? If he’s actually planning on covering cost overruns, he could be bankrupt long before the projected cash-flow turns positive. Do we really think a former Treasury Secretary is going to underwrite his son’s losses no matter how large they get (remember this is his money now, not the taxpayer’s)? If they are willing to let Lehman Brothers fail, I’m guessing that Peregrine LLC isn’t going to merit a blank check.