Category Archives: Athletics
The City of San Jose fired a salvo in the appellate court case against Major League Baseball. In the reply brief submitted yesterday, the City asserts that a decision by the Ninth Circuit court should be made before the land option agreement expires in November.
A decision on the antitrust issues concerning the Athletics’ move should be made before November 2014 or the Athletics may choose another site for their new stadium. Reed Decl., ¶22. If that occurs, San José will suffer irreparable harm because an eventual judgment in the City’s favor will be too late to allow the Athletics to successfully relocate to San José.
While damages for the economic harm caused by MLB would still offer some remedy to the City of San José, such a remedy is inadequate. Ultimately, MLB’s illegal conduct would have been successful in preventing free competition in the baseball market. Dkt. No. 1, ¶ 133; Gregory Decl., ¶2, Exhibit A. The only true remedy is an expedited briefing schedule and hearing with a final decision from this Court prior to November 8, 2014 in order that the Athletics will be permitted to exercise the option set forth in the Option Agreement.
This seems like a hollow stance for the City to have, since the land won’t necessarily go away just because the option agreement will expire. It will still be there, waiting for development, whether from a ballpark or something else, and in the future the land could easily be negotiated at the same price, as long as Santa Clara County and the Successor Agency signed off on it.
The other takeaway is the phrasing in the first paragraph: “…or the Athletics may choose another site for their new stadium.” Well, that would certainly be a November Surprise, wouldn’t it?
In addition, the City argues that MLB has delayed long enough – which it certainly has, but MLB has responded time and time again that it can make a decision on whatever timeline it chooses thanks to its antitrust exemption. If the judge rules in the City’s favor, that would be an indication that there’s substance to San Jose’s argument about economic damage.
Speaking of the antitrust exemption, another lawsuit was filed yesterday against MLB. This time it’s a potential class action suit in federal court alleging that baseball fails to pay minor league players minimum wage. At Fangraphs, Wendy Thurm wrote an examination of the lawsuit and its ramifications. With this suit and related ones, attacks on MLB’s broadcast blackout policy, and the City going after territorial rights, the antitrust exemption is defending itself on at least three fronts. Essentially all of these lawsuits go after the outdated notion that baseball is not a business, but rather a number of recreational exhibitions. As an $8 billion enterprise, you have think that at some point that notion shouldn’t hold water.
The A’s sold 20,000 tickets to FanFest this year, double the number of last year’s total. Not wanting to put too much strain on the concourses, the team announced a cutoff at 20k and considered it a sellout. Yes, the event was to be held in both the stadium and arena, but as the even larger lines this year showed, the facilities strain when trying to accommodate people on the concourses instead of the seats.
While the player introductions continue to be held inside Oracle Arena, most of the rest of the festivities took place inside the Coliseum, particularly the Eastside Club. Lines for autographs and photos with the World Series trophies stretched through the length of the club and along the concourse outside the club. If you were there solo, chances were that you wouldn’t be able to get both a picture with the trophies and an autograph unless you waited in line the entire time. Yet the use of the club was important since it’s the only space in the entire stadium that has enough space to handle such lines. The old, rain-soaked part of the Coliseum has terribly narrow concourses, and there were leaks in the Westside Club and elsewhere in the bowels. While I was just walking around, I happened upon the batting cage and heard constant dripping on the Astroturf inside the netting. There was even a garbage can set up next to the netting to catch additional rainwater. The whole experience felt a bit like rain delay theater, which is something California baseball fans are generally not familiar with.
As a media member, I’m not allowed to get autographs, so I didn’t bother trying. A handful of bloggers, including me, hung out for the first couple hours before we were whisked to one of the centerfield plaza suites. The suite had a green A’s backdrop in front of the fixed seats and was ready to serve as our interview room. Our interview subjects were David Forst, Bob Melvin, Jim Johnson, and Sonny Gray, in that order. I asked questions of everyone, but I really wanted to have Forst field a question germane to the the $ side of running the A’s. So here’s our exchange.
NBP: How much did the influx of national TV money have an impact on Coco’s extension, the payroll for this year, and perhaps the next several years?
Forst: There’s no doubt that payroll this year will be higher than, well, probably ever. We’re significantly above where we were last year. That’s what allowed us to get Jim (Johnson), knowing that there’d be $10 million price tag on him. To sign Kaz (Scott Kazmir), even a move like signing Eric O’Flaherty, where you’re only adding a little for this year but we’ve already bumped up against our number. Lew Wolff and Mike Crowley were open to what we were trying to do with Eric for half a season and backload the money. So there’s no doubt that whether it’s TV money, the success of the team – all these things have gone into ownership being very willing to let us do some things this season that we wouldn’t have been able to do otherwise.
NBP: You guys were so clear in the past about not having long-term commitments – whether that’s happenstance or a philosophical belief.
Forst: It’s a little bit of both. We’ve benefited from a lot of flexibility over the past few years. There’s re-signing Coco, but other than Yoenis and Kaz there’s nobody signed past 2015. Look, we don’t necessarily want to recreate the team every year – because fans like the players that are here and we like the certainty of players that we know – that we’ve given ourself the ability to do it is a huge factor in our success. With Coco we know the guy, we know the player, we know that this is the right dollar amount to commit to him over the next few years.
Melvin continues to be a solid, honest interview, and Jim Johnson lived up to his reputation for dry humor. Sonny Gray still seems like a kid, as he was spinning in his chair while waiting to be interviewed. Youth is served, and the team certainly has gotten younger since October.
Lew Wolff visited the JPA on Wednesday. Staying consistent in his stance from last month, Wolff was seeking a lease extension, up to 10 years in length. Matt Artz’s Tribune article references the lease but not Coliseum City.
If Wolff is willing to hear out CC plans, chances are that he won’t make any kind of commitment unless a lease is in place first. Last month, the A’s put out a press release in response to a Matier & Ross column claiming Wolff’s interest in CC.
We are only prepared to meet with our landlord, the JPA, or elected and designated officials of Alameda County and the City of Oakland, to discuss any aspect of our venue or lease.
Remember that before lease extension talks broke down between Wolff and the JPA last summer, Wolff was seeking a 5-7 year extension with an out clause should the Raiders’ new stadium plans interfere with the A’s being able to play at the Coliseum. Two years at the Coliseum is only somewhat helpful, since there’s no way a ballpark will be ready at the end of the lease. Wolff will continue to ask for a lease extension as long as this uncertainty post-2015 remains.
Shortly after the press release I wrote a lengthy post about Wolff’s motivations, should they extend beyond merely getting an extension. Area A of Coliseum City (east of 880) is divided into three phases, starting with the new Raiders stadium, then the ancillary development designed to support the stadium, and finally the remaining surrounding development and a ballpark in the A Lot.
As part of Phase III, the A’s ballpark couldn’t come earlier than the end of the decade unless there was a major reshuffling of priorities. That’s where a 10-year extension could come into play. If Wolff wants to partner up on Coliseum City and the schedule can’t be significantly altered, the A’s would have to play at the Coliseum for the full length of that extension until the new ballpark was in place. MLB may have wielded the AT&T Park threat against Oakland successfully when it inserted itself into last fall’s lease talks, but sharing AT&T Park for any length more than a season or two will create enormous logistical problems for MLB, the Giants, and San Francisco.
Impacts from construction have to be minimized, which is a big reason for the phased approach. Not only does Coliseum City include new venues, it has tons of new infrastructure, including a new BART pedestrian overpass, new bridges over 880, and the “spine” that links all of it together. To understand those impacts, let’s compare the Coliseum complex now and what’s envisioned.
The above image has the new stadium slightly overlapping the current Coliseum footprint. Previous images had the stadium turned slightly and oriented further away from the spine, which could allow the current Coliseum to remain in place – or at partly demolished as was the case with Cincinnati’s Riverfront Stadium. To accommodate the football stadium where Mark Davis wants it (and where it’s shown in the image), the Coliseum would have to be demolished. That’s unavoidable, even though the new stadium’s footprint isn’t exactly on top of the old Coliseum. That’s also not a huge problem for the Raiders, since they could room with the 49ers for a couple years in the interim. It’s a huge problem for the A’s, who would be displaced. That’s why Wolff wants to get the lease in place. The A’s face eviction in this plan, even though there’s little chance for a new ballpark at CC or at Howard Terminal after the A’s are evicted. The lease would at least force BayIG and the Raiders to work around the A’s and the Warriors, who would be tenants for some time to come.
Another piece of infrastructure could be a huge factor: the power transmission lines running through the south parking lots. A big reason for building where the current Coliseum exists is that the power lines can be avoided. The cost of moving overhead transmission lines could be several million dollars, and easily double that cost if the lines were rerouted underground. In the end it may be best to move the lines underground, as it would free up land for other uses. Whether the lines remain overhead and are relocated down the road or moved underground, it’s a big infrastructure cost that has to be accounted for. Earlier renderings had the stadium displacing the power lines, so if there’s a consensus to avoid the lines, you’ll know it was a big factor. Besides the cost, PG&E and the Public Utilities Commission would have to be involved in the process, which could create delays.
Going back to the A’s and Wolff, as long as Wolff keeps some sort of dialogue going, he can have skin in the game. That disappears this summer, when BayIG is expected to have its anchor tenants signed on to the project, the Raiders being the first (I expect the deadline to slip). If Wolff can get an extension first, he’ll continue to have a say in how Coliseum City is developed. If not, and BayIG and the JPA can’t figure out a way to keep both the Raiders and A’s happy, Wolff can turn to MLB and force them to come up with a solution. That solution can’t be Howard Terminal in the short-term, since we don’t know what can be built at the Port site right now or in the future. Then there’s the possibility I wrote about in December:
If the Raiders stadium proves too costly, the A’s could easily slot right in with a much less expensive stadium option that has a much smaller funding gap, say $200-300 million. Plus with only one stadium there instead of two, there would be additional land to develop or reassign as needed. Wolff’s in a good position to wait and see how the market analyses work out for them and the Raiders.
Wolff can play this multiple ways, but the #1 issue is ensuring the A’s a home for the next several years. The rest is all process that should work itself out over the next 6-9 months. Lew may claim constantly that there’s no Plan B. I’ve never believed that. He’s not going to explain his contingency plans until he absolutely has to. That’s business.
The lovely city of Portland, Oregon, expressed renewed interest in a MLB franchise this week. It’s been a decade since Portland lost out to Washington, DC, in the race to land the relocating Expos. In the offing, Portland traded its AAA baseball team for an MLS franchise, to rousing success. At the same time, multiple sites that were considered for a permanent baseball home ended up being developed for other uses. While a short season A team started up in the nearby suburb of Hillsboro, until now there has been little momentum towards attracting an MLB franchise.
Tracy Ringolsby has details on a renewed effort. New mayor Charlie Hales supports a site next to the two arenas at the Rose Quarter. Instead of an open air stadium, the plans now call for a retractable roof park with a smaller, 35,000-seat capacity. A funding mechanism that could pay for much of construction remains in place, though rising costs and the including of that retractable roof probably would cause PDX advocates to majorly revise the plan.
Most importantly, Portland interests have inquired with A’s ownership to see if they’d be willing to either move the team to PDX or sell to PDX-aligned interests. As expected, they were told no on both counts. Sacramento, Portland, and maybe in the past Las Vegas have inquired. Lew Wolff and John Fisher remain focused on the Bay Area, refusing to play the stadium ransom game. Someone had to temerity to brag about swindling the public earlier this week:
#Marlins prez Samson in his “Survivor” bio page: personal claim to fame is getting $350M in public dollars for ballpark in a recession
— Eric Fisher (@EricFisherSBJ) January 23, 2014
The Portland effort bears striking similarities to Montreal’s recently launched efforts. Both underestimate the cost of the stadium and the cost to acquire a franchise. Montreal’s study pegs the total cost at just over $1 billion, which would’ve been a better bet three or four years ago, during the recession and before the new national TV contracts. It’s hard to see any team being available for less than $600 million, maybe even $700 million because the revenue streams are so attractive. That would put the total cost at a combined $1.2 billion, maybe $1.3 billion when including infrastructure and land. Both cities also appear to be dependent on a rich investor group or corporation to fund the private side. That’s a lot to ask for, essentially a subsidy to be borne by a company. Guggenheim Partners made the overbid work because they had two things in their pocket: a to-be-negotiated local TV deal and 100 acres of land with huge development potential at Dodger Stadium. Neither Montreal nor Portland have such potential. Both teams stand a good chance of being future revenue sharing recipients, even with new ballparks in place.
With both the Rays and A’s entrenched in their current stadium malaise, it’ll be up to the next to the next commissioner to determine if Portland or Montreal gain entry to MLB. The new TV contracts are in their infancy, so the owners are only starting to see the benefits. At this point, it’s unlikely they’ll want to split up the pie 32 ways instead of 30.
Last year’s FanFest expanded to include the Plaza of Champions in between the Coliseum and the Arena. This allowed for extra space to accommodate autograph lines and other potentially concourse-clogging queues. The arena itself was still a little cramped, but at least the crowd was broken up a bit.
This time, the A’s announced that the Coliseum will also be in use for this year’s edition on February 8. The team introductions piece, which has players on a stage on the arena floor, will kick off the proceedings at 10 AM (Doors will open at 9). The Coliseum will open at 10:15. Like last year, fans will be able to access the A’s clubhouse for tours. Tickets will be $10, $5 for season ticket holders, free for children 6 and under.
BlogFest will also be held, which will allow us digital media types to interview Bob Melvin, David Forst, and an assortment of players (TBD). I intend to be there to ask a question or two and take some pictures.
Earlier this month I found out that longtime concessionaire Aramark had been replaced by Ovations. I’m curious to see if we’ll get to see or sample some of Ovations’ offerings at FanFest.
Having the general player interview piece in the arena continues to make the most sense, since there isn’t a nice, large video screen at the Coliseum for fans to watch. (It’d be nice if they did.)
I’m looking forward to FanFest/BlogFest this year, as it will provide a brief tease before spring training. I’m really looking forward to Arizona – more on that later.
We may finally have some deadlines. We may have a framework from which important questions can be answered. We may finally find out if Howard Terminal makes sense once and for all.
A group calling itself Oakland Waterfront Ballpark L.L.C. sent a letter to the Port of Oakland last week, asking for an exclusive negotiating agreement (ENA) for Howard Terminal. The ENA would run up to 12 months, allowing OWB to negotiate a long-term ground lease for Howard Terminal. A second period would be used to obtain permits from the City, Bay Conservation Development Commission (BCDC), and State Lands Commission (SLC) as needed. That time would also be used for the environmental studies (EIR, others) that would be required to secure such permits. After that’s done, the actual ground lease would be exercised, potentially leading to the construction of a ballpark on the site – pending club and league approvals and buy-in.
OWB is made up of mostly familiar faces: Clorox CEO Don Knauss, former Dreyer’s CEO T. Gary Rogers, Signature Properties principal Mike Ghielmetti, Baseball Oakland leader Doug Boxer, and a new entrant, developer Seth Hamalian. Hamalian’s planning a high-rise residential building in Uptown.
Howard Terminal’s still in a state of evaluation by the Port, as the Port is considering three other bidders for short-term use as longtime operator SSA departs for Middle Harbor. A group assembled by the Port to study future uses will not complete its work until the end of this quarter at the very least, and the Port is bound by the SLC to ensure that the land is used for maritime purposes as long as possible. A ruling in favor of OWB would help pave the way for a non-maritime use such as a ballpark. It’s possible that maritime uses could be arranged as a temporary use while the details of the ballpark plan are worked out.
A key item in the letter is the notion that OWB could come in at any time do testing of soil or groundwater at the site. While that’s good, that’s really only a continuation of monitoring that’s already in place by law. The big issue is what happens to the site as it’s modified to accommodate a ballpark (and ancillary development). That includes potential cleanup or contamination that may occur with a breach of the asphalt cap at Howard Terminal.
OWB would be obligated to deposit $50,000 with the Port for the original six-month ENA, with another $50,000 due if a six-month extension is required. If they two sides can’t come to an agreement on the ground lease, the deposit is refundable. OWB would have the right to assign the ENA to current or future A’s ownership if they came around to liking the site.
Oakland Mayor Jean Quan, for her part, keeps pushing an idea that zoning should be easy at Howard Terminal because the site was considered for a convention center long ago. It’s a strange claim, we’ll see how well it holds up. At least OWB acknowledges the roles of the BCDC and SLC. Those two bodies are going to impact the scope and final approval on the project, there’s no way getting around it. Among the matters to resolve: Where is the shoreline technically and how close to the shoreline can they build?
One thing missing from the KTVU and EBX links above is the ever-persistent question of cost. Cost sank Victory Court before ($240 million), and it threatens to sink Howard Terminal. 2001′s HOK study had Howard Terminal’s site cost at $177 million, and that was without any new transit infrastructure such as a nearby infill BART station or a streetcar to bring fans from existing BART stations downtown. A 2004 Caltrans feasibility study commissioned to investigate such options estimated that a new BART station along the West Oakland alignment between Market and Filbert Streets would cost $250-300 million, and that other options at Brush/Castro or Washington Streets were not doable due to the incline of the track, more than the 1% grade required for BART platforms.
Neither OWB nor Oakland has to start a feasibility study or an EIR until the ground lease with the Port is worked out, which is a shame because we’ve been wanting to know the cost for many years. There’s absolutely no reason why such work couldn’t start today, as long as one party budgeted money for it. It’s a chance to delay the reveal until circumstances force a decision, which is the way the mayor’s painting the situation. Quan mentioned on KTVU that the Raiders’ stadium deal at the Coliseum could be done by the summer. That assumes that everything goes well, including the all important determination of how to bridge Coliseum City’s funding gap. The adult conversation comes with many steps. This is a big step.