Thursday, September 30, 2010

Cubs Boosters Bite the Bullet on Cost of Mesa Spring Training Project

For months, press reports have stated emphatically that the total public investment in the proposed new Chicago Cubs spring training facility would be capped at $84 million. Any required funds in excess of this were supposed to come from the wealthy owners of the baseball team. Additionally, this was yet another important fact which the “Keep the Cubs – Yes on 420” campaign has stressed in recent correspondence as part of a ten point manifesto urging residents to vote yes on Proposition 420.

On September 29th, City Manager Chris Brady was quoted in the Arizona Republic as saying the new working number for capped cost to taxpayers is $99 million. This 18% increase came about because the city decided to estimate the cost of infrastructure which the city is required to provide for this development. Although the City of Glendale spent $37 million for infrastructure on their Cactus League project, Mesa officials say the cost for the Cubs facility will be far less than the Glendale total. Time will tell.

Is there anything else omitted from the new cost projection? Well, there is the matter of a parking lot for thousands of cars, specifically mentioned in the Memorandum of Understanding signed back in January, as being a cost the City of Mesa must absorb in addition to the $84 million and in addition to the infrastructure. Add in the expense of financing all of this, and you are looking at a really, really big number.

Wednesday, September 29, 2010

Yes on 420 Campaign Touts Stadium Rent as Big Plus

Yes on 420 Campaign Touts Stadium Rent as Big Plus

According to recent E-mails and letters distributed by those in favor of a yes vote on Proposition 420 this fall, there are ten significant reasons to approve development of a new spring training facility for the Chicago Cubs baseball team. Since there is much at stake in making an informed decision on this matter, it is probably best to examine these claims one by one.

Among the important facts the “Keep the Cubs – Vote Yes on 420” people would like everyone to know is that the Cubs will pay rent for use of the stadium and other improvements. Since the Cubs and the City of Mesa have not revealed what the rental amount will be, a little research dug up the industry standard for Cactus League teams. Available for all to see on the internet is the agreement between the City of Glendale and the Los Angeles Dodgers and the Chicago White Sox regarding the terms of use at the new Glendale-owned facility on west Camelback Road. This project has won numerous awards and has been described as the “Taj Mahal” of spring training facilities. So, how much rent can you get for such a state-of-the-art facility.

It turns out each team pays the City of Glendale a total of one dollar ($1.00) per year in rent, for a grand total of $2 annually. The good news here is that the rent is payable in advance, meaning Glendale can draw interest on these funds for twelve months. No wonder Mesa politicians are so anxious to spend vast sums of taxpayers money on this concept. Where else could you get $2 per year rental income on an investment of $200 million?

Sunday, September 26, 2010

City of Mesa Stands by Wildly Optimistic Numbers to Support Cubs Deal

As time draws closer for voters to make a decision on the proposed new Chicago Cubs spring training complex, the City of Mesa remains steadfast in claiming an economic activity benefit of $138 million annually due to the Cubs presence. This number is based on the results of January, 2010 study paid for by the city. A close look at the basis of this claim reveals that the study assumed that every person who attended every Cubs game, home or away, was a Cubs fan. In other words, nobody came to see the other team. Obviously, that is ridiculous. Even at the Cubs home games, some people are fans of the opposing team and some people are simply baseball fans who favor neither team.

Comparing the bloated Mesa assertion to some other recent claims by public agencies in support of spring training makes the $138 million number look even sillier. Here in Arizona, the City of Peoria has begun negotiations with the Mariners and Padres regarding upgrading their spring training facilities. Peoria says the two teams combined contribute $60 million of economic activity annually. And, despite the fact that attendance at the Peoria stadium outdraws the Cubs by 40%, Mesa still thinks the Cubs have an impact over twice as great. Meanwhile, over in Florida, Lee County has just decided to build the Boston Red Sox a new spring training complex. The county says the Red Sox have an impact of $21 million annually. Putting this in perspective to the Mesa claim, the Cubs generate seven times the spending of created by the Red Sox. This is really unlikely.

Finally, the City of Mesa economic activity number is based on statewide economic impact. How much money will be spent in Mesa? No one knows, including the city. But since half the spring training games are played elsewhere and no one can control where fans stay and eat, it is a safe bet that the real number is only a fraction of the public hype.

Thursday, September 23, 2010

Escalating Costs Fail to Dim Mesa Enthusiasm for Cubs Deal

Imagine being a prospective buyer searching for a residence and finding an attractive home in a desirable neighborhood with an asking price of $260,000. Since that price falls within the range you had planned to spend, an offer is made to buy the property. Unfortunately, another buyer has swooped in ahead of you and bought the home. Because you liked the location and you liked the house, you proceed to search for a similar residence nearby. Though there are other homes for sale in the neighborhood, they are quite a bit more expensive. Nevertheless, you decide the extra money is well spent and end up buying a property virtually identical to the first home for a cost of $840,000 or more than triple what you had originally planned to spend.

The City of Mesa is on the verge of making a similar decision. Back in February of this year the city issued press releases stating that Mesa residents would pay $26 million toward a new Chicago Cubs spring training facility. Today, the same city officials say Mesa residents will pay $84 million toward a new home for Cubs spring training. Yet, despite the ballooning costs to the taxpayers, city officials steadfastly maintain the economic viability of the deal. All those taxpayers who believe in grossly overpaying should favor the Cubs development, while those with any sense of value will be against the project.

Sunday, September 19, 2010

Opposition Grows to Cubs Project as Indecision Prevails

The lack of definite information on key elements of the proposed new Chicago Cubs spring training facility has caused an increasing number of Mesa residents to wonder whether the upcoming November vote on the issue is premature. While month after month goes by, press reports have continually changed focus on the location of the development as well as the way in which it will be finance. Still, at this late date, there is apparently no final agreement between the two parties as to who pays for what. The general feeling is that neither the City of Mesa nor the Cubs have really spent enough time to think this thing through

So, why not take the time to finalize all the loose ends involved in the deal and postpone the vote until next year? While this could very well resolve a number of matters of concern to Mesa residents, the Cubs and the city appear destined to push forward with ballot Proposition 420 regardless of how well informed the voters may be.

Friday, September 17, 2010

City of Mesa Tries to Broker Deal for Cubs at Waveyard Site

With time running short before a November election on the matter, the City of Mesa is in the midst of an effort to squeeze both the proposed Waveyard project and the proposed Chicago Cubs spring training facility in a site located at the southeast corner of the Loop 202 and Loop 101 Freeways in west Mesa. The only way this can happen is if the Waveyard water park folks scale back their land usage to a shadow of the original plan or the Cubs settle for less room. There simply is not enough space to accommodate both developments as they were conceived.

It seems the city is more enthused about the possibility of this event actually occurring than is the baseball team. A current news report quotes a Cubs executive as saying “the team needs to know more before endorsing the idea.”

Wednesday, September 15, 2010

As Election Nears Details about Mesa/Cubs Deal Still Lacking

While the campaign signs encouraging residents to vote yes on Proposition 420 are sprouting all over the City of Mesa, details are sadly lacking about this ballot measure which would authorize a new Chicago Cubs spring training project. Where will it be? How much will it cost? What will it look like? Well, nobody knows. Apparently, the idea here is – “Trust us. We know best.”

Although certain sources within Mesa have said a draft final agreement between the Cubs and Mesa has been floating around for weeks, officially there is no agreement between the parties. The mayor says there will be ample details on this matter revealed to the public well before the election. Since early ballots go out the first week of October, one would think now is the appropriate time to disclose those details.

Tuesday, September 7, 2010

Hidden Costs Add Up Fast on Cubs Spring Training Complex

While the City of Mesa works hard to convince voters of the economic soundness of a plan to construct a new spring training facility for the Chicago Cubs baseball team, little is being said about the costs involved in the project that go beyond the often repeated $84 million mentioned in the Memorandum of Understanding signed back in January. Specifically, above and beyond the $84 million, the city is obligated to pay for all infrastructure related to the development, the city is obligated to provide stadium parking adequate to accommodate 15,000 fans and the city has to deal with the cost of obtaining the funds. Another item seldom mentioned is the value of the taxpayer’s land that will be given over to the Cubs for their exclusive use. If, for example, a city-owned site of 100 acres with an appraised value of $10 million were utilized for the practice facility, the Cubs would receive a benefit in excess of $5 million versus buying the land. This comes about because the Cubs have the sole year-round use of over one-third of the training area, including two practice fields, the club house, batting and pitching cages, etc. as well as the exclusive use of the balance of the project for three months of the year.

To paraphrase the late U. S. Senator, Everett Dirksen, “A million here, a million there, pretty soon, you’re talking real money.”

Saturday, September 4, 2010

No Spring Training Agreement in Force between Mesa and the Chicago Cubs

While the City of Mesa and the Chicago Cubs gear up an aggressive campaign to rally voters to their cause, a positive position on Proposition 420, some taxpayers are wondering whether even having Proposition 420 on this fall’s ballot is premature since there is a definite lack of information on the question at hand. Cheerleaders for the proposed new Cubs spring training complex point to the Memorandum of Understanding signed by the parties back in January as providing the substance of their agreement on the issue. However, people who understand the meaning of the words “Not binding” and “Not legally enforceable” look at the matter differently. In fact, whatever little validity this memo had has long since expired. More than one drop-dead date has come and gone, including the July 12, 2010 to have a signed final agreement in place.

Proposition 420 merely asks voters to agree to authorize the City of Mesa to spend in excess of $1.5 million on a Cactus League baseball facility. How much more than $1.5 million? Well, no one knows. Could it be $200 million, $300 million, or $500 million? Yes, yes, yes. There is no maximum amount, only a minimum amount. How about mentioning the location of the stadium and practice fields? No, that’s the sort of information that is apparently best kept a secret until after the election. The proposition doesn’t even mention the Cubs. Could it be the stadium and practice fields are being built for an expansion team? Based on what little Proposition 420 says, yes, that could be the case. Maybe those guys from the Field of Dreams can be enticed to relocate.

Proposition 420 is literally a blank check which will be signed by the taxpayers of Mesa.

Thursday, September 2, 2010

Mesa Mayor Waffling on Cubs Deal Promises

Over the past several months, the mayor of the City of Mesa, Scott Smith, has repeatedly promised voters there would be a definite site identified for the proposed new Chicago Cubs spring training facility prior to a fall vote on the issue. At a Town Hall meeting in July of this year, the mayor pledged to pull the issue off the ballot if a specific site were not identified. Recent press reports, however, seem to contradict the mayor’s previous statements. A report in the Arizona Republic on August 31, 2010, quotes the mayor as saying “there is almost no chance of a definite site being on the table when Mesa voters decide to approve the Cubs project.”

While it is not a surprise to find out that yet another politician may weasel out of prior commitments to voters, this does bring into question virtually everything else involved concerning this particular deal. What about the mayor’s statements regarding the dollar amount of economic activity? What about the mayor’s assurance that costs are under control? What about the mayor’s statements that nearby residents will be afforded an opportunity to have input on the site decision? What about the mayor’s claim that there will be no new tax increases because of the Cubs deal? What about the mayor’s claim that the adjacent commercial development, dubbed “Wrigleyville West”, will contribute big bucks to city coffers?

Well, there is a good possibility the mayor meant what he said on all of these occasions: at least to the same extent he meant what he said about the site location.