A’s approve City-revised lease, await County vote

No drama this week. The A’s approved the last-minute changes the City of Oakland made to the lease agreement. When Alameda County approves next week, everyone should be square. The A’s put out a press release, in short:

The Oakland A’s have come to an agreement with the JPA on all outstanding points regarding a new 10-year lease at the Coliseum. The Alameda County Board of Supervisors, are scheduled to vote on the lease July 29.

We appreciate the cooperation and efforts of Oakland city officials in this process and are optimistic that our negotiations have led to a fair and mutually-beneficial relationship. Most of all, we are happy for our great fans who, pending the county’s vote, will know that the Oakland Athletics will continue to play its games at O.co Coliseum.

More coverage is available from SFGate and BANG.

With the lease issue very close to resolution, the NFL is once again talking about a football team in LA – at perhaps a league-owned stadium, no less. Curious timing to say the least.

Still, there will be those who keep saying to never trust Lew Wolff, don’t give in, etc. I’ll just leave this snippet from another East Bay legend here:

If I speak at one constant volume
At one constant pitch
At one constant rhythm
Right into your ear
You still won’t hear

Wake up, Oakland

“Better a diamond with a flaw than a pebble without.” – Confucius

There are any number of ways to rephrase the idiom above. Some might use “A bird in hand is worth two in the bush,” though the meaning is not the same. Voltaire coined the phrase a little more directly.

The perfect is the enemy of the good.

As I listened to Don Knauss make yet another sales pitch about the virtues of Howard Terminal (and Damon Bruce’s softball handling of it), I started to write a point-by-point rebuttal of everything he said. Then, thanks to BANG’s Matthew Artz, I read a 6-page letter from Lew Wolff to Oakland Interim City Administrator Henry Gardner. The letter outlined Wolff’s desire for a lease extension at the Coliseum before leading into the questions surrounding the future of the Coliseum.

Two pages of the letter are devoted to a section called “The Raiders”. Instead of pointing fingers at the Raiders or Mark Davis, Wolff mostly pans BayIG, the Coliseum City plan, and all of the work that has gone into it so far.

I contrasted words from both Knauss and Wolff. The Clorox CEO talked about a transformative project that could hugely benefit downtown Oakland, which it could. A similar description has been made about Coliseum City by its proponents, comparing it to LA Live among other developments. Then there was Wolff, going detail by detail about the process, the difficulty, tedium, and the obstacles. He even lashed back at “Negative Forces” agitating at every possible turn, which could be construed as a critique of Don Knauss or others allied with Knauss.

The argument, which has stretched as long as Wolff and John Fisher have owned the A’s, comes down to Voltaire’s quote. Wolff’s #1 job this entire time has been to get a ballpark. Let’s understand some of those efforts.

  • 2003 – Wolff was hired by Steve Schott and Ken Hofmann to be the VP of Venue Development. During that brief tenure, Wolff proposed building in the Coliseum’s A Lot and at the Malibu/HomeBase lots. The A Lot option went nowhere because Schott was only willing to put up $100 million for the ballpark. The Malibu option was not available because it was not JPA-owned land. Eventually the JPA bought the land in order to assemble a larger complex for what would be become Coliseum City.
  • 2005 – Wolff exercises an option to buy the team, phasing Schott & Hofmann out and bringing Fisher and numerous associates of Wolff in. Wolff soon proposes the Coliseum North (66th/High) plan, which would redevelop a large swath of industrial land north of the Coliseum complex into a ballpark and mixed-use (residential, retail, commercial) plan. The plan received great fanfare at first, but quickly died as numerous existing landowners showed no interest in selling.
  • 2006 – The Fremont Baseball Village plan is proposed in south Fremont near the Santa Clara County line. A compromise plan of sorts, the idea was to court Silicon Valley corporate interests without crossing into the Giants-held territory of Santa Clara County. Again, there is great immediate enthusiasm, this time from Fremont city leaders. This time, a combination of the Great Recession and big box stores vetoing any developments they didn’t approve of killed the plan. Another attempt in 2010 was made to put the ballpark near the NUMMI (now Tesla) factory across the Nimitz. That was met with hostility from well-heeled residents on the other side of I-680 and fell apart quickly.
  • 2009 – San Jose becomes the next plan, with a partially-acquired site downtown, major corporate and civic support, and a certified environmental impact report ready to go. Again the plan stalled as the Giants remained intransigent about their held territory. A lawsuit filed by people associated with the San Jose Giants (eventually a SF Giants-owned property) threatened the project and is still ongoing. The City of San Jose became frustrated and launched its own lawsuit in 2012 against MLB. That too is ongoing.
  • 2009 – Let’s Go Oakland launches with support of three sites in downtown Oakland: Victory Court, JLS West, and Howard Terminal. Victory Court becomes the preferred site in 2010. LGO promoted Victory Court as much as possible, backed by local developers. No significant activity occurs in 2011, and by the beginning of 2012 the site is dead due to the death of redevelopment and spiraling site acquisition costs.
  • 2012 – Not long after Victory Court goes away, murmurs about Howard Terminal becoming the new preferred (not by A’s ownership) Oakland site begin. In 2013, the Port of Oakland negotiates a settlement with SSA Terminals to vacate the site in order to consolidate facilities and kill a lawsuit against the Port. That allows the Port to look into non-maritime uses such as a ballpark, which it does in spring 2014. A new investor/support group, OWB (Oakland Waterfront Ballpark), emerges, led by Knauss and former Dreyer’s CEO T. Gary Rogers.
    While Wolff has been trying to deal with the on-the-ground demands of planning and building a ballpark, many in Oakland have been fixated on grand concepts like Coliseum City and the far-off promises of Howard Terminal and Victory Court. Even yesterday, Knauss couldn’t help but bring San Francisco into the discussion, talking up how a HT ballpark would have better weather and views than AT&T Park. Coliseum City would be a transformative project that could attract Super Bowls and give Oakland new cachet.

Oakland’s desires to become something bigger and better are completely understandable. But they’ve been so pie-in-the-sky, so big, that there’s always been huge doubts about what, if anything, the City could pull off. I’ve mentioned before that Oakland has never built anything by itself, and that it needed the County and the business community to come together to make the Coliseum work nearly 50 years ago. That need hasn’t changed, but the sense of teamwork has. In Oakland’s attempt to keep all three teams in place, it has gotten away from what got them the teams in the first place: strong partnerships and sensitivity to the teams’ needs. Nowhere is that more evident than in Coliseum City, where the County is playing the realist role in questioning the project and in looking to the A’s, while the City brings in big names with no commitments, entirely footing the bill along the way.

Oakland keeps searching for the perfect project, the ultimate solution, the one that will finally vault them past the City beyond its rival across the Bay. Some politician(s) would take credit when it gets done, a legacy-defining moment. So they keep dreaming, keep hoping, clearly not worried about the little details that need to be addressed or the problems that arise when undertaking big projects. At some point, someone in Oakland will recognize that the dreams need to be tempered with what can realistically be done, and understand the work that will be required to get it done – establishing partnerships with the teams and stakeholders for starters. If not, the teams will get frustrated and give up. Those dreams will die. The biggest pro sports Oakland will be able to get will be minor league (which for some is okay). And the Coliseum, home of six world championships, will end up unused, even more unloved, and ultimately, something generic like a shopping center. That’s what happens when the well-intended keep pursuing the ever-elusive perfect instead of understanding that good is actually pretty great.

Lew Wolff is getting ready to offer what could be a pretty good deal. If Oakland wakes up, they may be able to react in time to take it.

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P.S. – I’m removing comments from the site for the time being. It’s not because of the commenters or specific comments – although they can be especially inane at times – it’s because those comments and the constantly attacking spambots (which you don’t see) are causing heavy server load, for which I’ve been warned by my provider. I hope that by having no comments there will be less server load. Thanks for your patience.

Oakland City Council approves amended lease 5-2, now goes back to JPA/County/A’s for approval

A lease agreement was passed tonight. Not the lease agreement the JPA sent to Oakland’s City Council. Instead the Council voted 5-2 (with 1 abstention) to approve an amended lease that included fairly minor changes. Among those changes:

  • A clarification on how the A’s use their termination clause. Example: If the A’s provide notice on January 1, 2016, the lease ends on December 31, 2018. If they provide notice after 1/1/16, termination doesn’t occur until 2019. This was not actually a point of dispute, it’s just that the language was somewhat confusing so an example was provided.
  • A typo in the the agenda document indicated that the the developer fee/deposit for continuing redevelopment at the Coliseum (Coliseum City) was both $10 million and $20 million. This was clarified as $10 million, and was agreed upon in the lease approved by the JPA on July 3.
  • A new section 42.7 that codified lease practices defined in the 2013 (current) lease.
  • A section on Licensor (JPA) default was removed for some reason. It has been added back to the agreement.
  • If the A’s are sold, there is a clause (16.1) that explains how the team transfers the lease to the new owner without requiring JPA approval. The requested change is to include the fact that new owner must be MLB-approved.
  • Removal of language that makes the JPA liable for Raiders’ acts/omissions that are approved by the JPA. The language now solely deals with the A’s revenues and benefits going strictly to the A’s, not to any third party.
  • There’s also a need to clean up language, which is customary in contract negotiations. It’s unclear what those cleanups are.

All in all, there’s little reason for the A’s to decline the lease. On the other hand, these changes are so minor it’s a wonder why they had to be debated in public, with the exception of the typo in the second bullet point.

Council President Pat Kernighan put forth a motion early on to consider the lease with these amendments. That caused CM Larry Reid, who is also a JPA board member, to put forth his own substitute motion that would have the Council vote on the lease as is. At the end of the session, Reid’s substitute motion lost 4-3. Kernighan’s won 5-2. After the votes the Council tried to clear up whether or not the JPA or the Alameda County Board of Supervisors would have to vote on the revised agreement. Naturally, the answer is YES. The BoS will meet on July 29 to go over this new lease and perhaps the old lease two, so they may end up voting on both. The JPA will have to take another special session vote shortly thereafter, and A’s ownership will also have to sign off.

A’s President Mike Crowley was on hand to witness the festivities. After JPA counsel Jon Streeter presented the lease in great detail and asked questions, Crowley was asked to provide a comment on the amended lease. Kernighan was concerned about putting Crowley on the spot, while Reid encouraged Crowley’s opinion. Crowley said that he preferred the original lease as is, though he allowed for the typo correction. After the vote he said he was “disappointed” by the Council’s action. Whether he’s disappointed in the terms or in the fact that everyone’s in for 2 more weeks of gestation over a lease wasn’t clear. Crowley reserved further comment until he had a chance to review the terms.  Kernighan mentioned that she talked with Lew Wolff earlier in the morning, and with a caveat that she wasn’t representing him, revealed that the changes didn’t seem like showstoppers.

There was plenty of time for grandstanding, so several Council members took turns doing it. CM Desley Brooks considers the lease a regression from terms outlined last November. Streeter rebutted that, explaining the back-and-forth of the lease talks that dated back to a year ago. Streeter’s main points were that the A’s are paying double the annual rent of the pre-2013 deal, were guaranteeing $20 million even if they stayed less than the full 10 years, and provides flexibility for all interests (A’s, Raiders, BayIG, JPA, City/County). CM Dan Kalb was unusually high-strung,

Kalb went on to chastise the A’s in advance, in case the A’s don’t approve the deal with the changes. Reid and Noel Gallo were the dissenters, instead voting for the original agreement. They both sowed FUD in their comments, Gallo was more restrained while Reid pulled the full “do what you want, it’s not my fault” card.

Libby Schaaf’s comments were noticeably brief, calling an approved lease (without saying which one) a crucial step towards keeping the A’s in Oakland. Both Schaaf and Rebecca Kaplan opened with some campaign speak, which I necessarily tuned out. Schaaf, Kaplan, Kalb, Kernighan, and Lynette Gibson McElhany provided the Yes votes.

A bizarre moment came late when Alameda County Supervisor and JPA President Nate Miley took time to explain to Gallo how the City of Oakland’s Coliseum City discussions with BayIG worked. At least an hour was spent explaining details that the Council not only should’ve known weeks ago. Current former JPA members such as Reid, Kaplan, and Brooks talked up their knowledge of the issues, yet the rest of the Council seemed inexplicably in the dark. Before Kernighan made her motion, Brooks asked for a full presentation, this after Streeter answered numerous questions about the lease and negotiation.  Communication between the JPA, City, and County is so broken that it’s hard not to be skeptical about the group’s ability to work out a deal as large and complex as Coliseum City. The lack of preparation on the Council’s part was on full display and it wasn’t pretty.

Nearly 30 public comments were given. They included Raiders fans like Dr. Death and Bauce, who raged against the Council. Lil Bartholo spoke first about the team’s and MLB’s blackmail and extortion techniques. The anti-lease, generally anti-Wolff crowd was well represented. However, interspersed among them were several A’s employees who mostly spoke about simply keeping the A’s in Oakland. Out of the five employees I observed, only one overtly called for the lease to be approved. They talked about how they were both fans and employees, about how some of them had union jobs, about how they were trying to collectively bargain for benefits, but the lease fiasco puts such negotiations on hold. An SEIU rep even called for the lease to be tied to a 10-year labor agreement, which is probably an overreach. Regardless, the image of employees coming forth to stand for their jobs was powerful.

Also present was a rep from the scoreboard installation company that could be contracted to work on the Coliseum. The man (whose name I didn’t get) emphasized that the lease had to be approved soon to allow for the equipment to be ordered and installed in time for the next baseball season. Emperor Nobody got some good anger at the system in, though he ran out of time (he’s on the KTVU clip so that’s good, right?).

Attorney Streeter acquitted himself well, handling all of the questions that came his way. He had to explain the rent provisions at least twice, and covered all of the major lease aspects well. It took 2 hours and 10 minutes, but the $200 million debt elephant finally came up. There’s no obvious answer as to how it the debt gets retired. Miley mentioned that the A’s are looking to buy the Coliseum land. Those who distrust Wolff don’t believe that. Streeter then boiled down the whole point of the lease. 

Streeter addressed the A’s-Oakland parking fee dispute. Arbitration is pending. Oakland is asking for $5.4 million. If the City wins they could also be reimbursed $600,000 in legal fees. The amount that the A’s are willing to pay was not disclosed. Streeter factored a discounted amount of a potential arbitration award into the lease. Why? There’s the inherent risk that the City could lose the arbitration. That makes the lease a sort of hedge.

Finally, as further questions were asked about the leases of both the A’s and Raiders, especially the ongoing operating subsidy. While I’ve always known about the subsidy, I’ve never heard it explained in such simple terms. Basically it goes like this:

  • The A’s pay for all gameday operations: power, water, groundskeeping, security. This is for a 180-day season.
  • The A’s pay $1.5 million in rent per season.
  • The A’s receive revenue from pouring rights, stadium advertising, and a chunk of concessions.
  • The A’s keep parking revenue with the exception of the tax that has to be paid to the City & County.

Contrast this with the Raiders

  • The Raiders pay $400,000 per year in rent.
  • The Raiders split parking revenues with the JPA, their share being roughly $1.75 million for the 2013 season.
  • The Raiders pay for zero stadium operating costs, and are subsidized to the tune of $7 million per year, including the costs to convert the stadium between baseball and football (and vice-versa).

Late tonight, word came that the Raiders may want a year extension, though it wasn’t clear if that’s on top of the 2015 option year or something else. I hope the Raiders’ lease gets the same kind of scrutiny the A’s lease gets. It’s the painful yet needed part of the ongoing adult conversation.

P.S. – Wolff met with San Jose Mayor Chuck Reed yesterday at the SJ Fairmont. The meeting was described as a “check-in.”

Oakland City Council Meeting 7/16 Open Thread

If, like me, you can’t make it to the meeting tonight, you can watch the stream here. You’ll need Silverlight or Real Player to watch. If anyone knows how I can embed one of these old Granicus streams, I’ll post it here.

The comments are open if you want to have a civil, on-topic discussion. I’ll also be live tweeting and mirroring here.

Reference documents (PDF):
Agenda
Coliseum Lease

Selig’s Tortures of Hell and Splitting the Baby

Update 8:50 PMJean Quan is trying to delay the vote, supposedly to get further concessions from Lew Wolff. Wolff’s comments today don’t sound like he’s giving any additional concessions. 

During today’s customary pre-All Star Game media session, Bud Selig addressed the A’s stadium situation for the umpteenth time. Not surprisingly, Selig’s answers yielded little for fans to be optimistic about. Selig answers that were actual answers were mainly confined to the ongoing lease negotiations at the Coliseum, with no hint as to what would occur in the future whether the lease was approved or not.

Somehow I doubt these were Selig’s personal tortures of hell. After all, he knowingly has created these conditions. It’s been much worse for A’s fans and even local media for being forced to report on this never-ending charade, not to mention little old bloggers who try to make sense of it all. Coupled with Selig’s imploring the Oakland City Council to get the deal done was the presence of Lew Wolff beside him at the Home Run Derby last night, as well as today during the session. It was a not-so-subtle reminder of who the commissioner will side with if Oakland can’t come to an agreement on Wednesday, when the City Council will hold a special session at 5:30 to consider the lease. Meanwhile, there continues to be an epic amount of finger pointing within the Council, as the mayoral candidates take stances for or against the lease and then pull 180′s days later. Those who aren’t running for mayor are sick of the politics. While MLB’s threats seemed to have cowed the Council enough to approve the deal, there’s no telling with could happen in the next 24 hours or so. Selig also acknowledged the success of the exhibition games held in Montreal in the spring, while shooting down Montreal as a potential A’s relocation target.

If anyone feels like they’re in hell, it has to be the members of the JPA board, the Oakland City Council, and the Alameda County Board of Supervisors. The mistrust and lack of communication all point to the JPA’s eventual demise, as the two City and County partners have differing visions for how to move forward. The City has been working with BayIG and Colony Capital, and for months has not expeditiously informed the JPA on the process. The JPA decided in recent weeks to figure out a potential deal with the A’s, which could threaten the Raiders’ future at the Coliseum as much as the Coliseum City deal threatens the A’s.

Last week I wondered if the idea of one party buying out the other would come up again from Nate Miley, and sure enough it has. About the only thing that the City and County can agree on is that there are too many cooks in the Coliseum’s kitchen. Miley even brought up a split-the-baby proposal.

“I would say if we could have one party responsible out at the Coliseum and the (Oracle) Arena, that would be the preference,” Miley said.

If there could be an easy way to break up the JPA, that’s it. The arena and stadium have separate financing and debt repayment structures. They’re even separate when it comes to the assessor’s rolls.

 

Most of area is the Coliseum complex, jointly owned by the City and County. Inset within is the arena land to the left. Not shown: additional land acquisitions to the east and north.

Most of area is the Coliseum complex, jointly owned by the City and County. Inset within is the arena land to the left. Not shown: additional land acquisitions to the east and north.

The County would probably be willing to take on the arena and let the City handle the rest of the complex and the development within. If Coliseum City or Wolff’s plan required the arena land, it would be a simple deal to pay off the estimated $70 million owed on the arena after the Warriors leave, assuming that the W’s aren’t liable for the remaining debt. All the County would require is a minimum amount of parking spaces (5,000 or so) to be available and continued access to the BART station via the bridge. That’s a much more manageable situation than the stadium’s $100 million owed after 2017 ($138 million after this year) and $100-400 million in infrastructure costs required to build out a complete development.

The downside of splitting the baby in this manner is that Oakland will find itself in a much riskier position. It alone will have to figure out what to do with the remaining Coliseum debt. It would also have to finance all the new infrastructure without the County’s help. Some state or federal grants could prove helpful, but are increasingly scarce. There’s very little hope of refinancing either the arena or stadium debt in the future if neither is going to have a tenant, so it’ll be up to the developer to pay it off, else the City & County eat it.

Let’s say that the County, as Miley suggests, wants out of this project altogether. Without knowing what the A’s are planning, it’s likely that their Coliseum redevelopment will be similar or smaller in scope than Coliseum City. The problem there is the mutual distrust between Wolff and the City. The City has only been working with the Raiders/BayIG, and would presumably have them as their preferred partner. But if the A’s lease extension is approved, it could jeopardize the existing Coliseum City relationship. Mayor Jean Quan and CM Kaplan can characterize this is not having to choose all they want. MLB and NFL (through proxies) are forcing that decision. Can’t dance with two partners the whole night, Oakland. Sooner or later, one of them’s gonna up and leave, or at least find a new partner.

Another sign controversy

It all started a few weeks ago, when the Oakland Fan Pledge guys reported that they had to take down their sign at a game. Was this a technicality at work, or the A’s putting the hammer on signs they don’t agree with? Since then, it appears that the takedowns have been more frequent. Sign makers are crying First Amendment violations, while defenders of the takedowns say that A’s games are private functions. Of course, they’re held in a publicly-funded venue, so there’s a gray area here*. This fans-with-signs vs. management battle has gone on for decades, and it has never failed to make management look bad. Let’s look at the A’s sign policy.

Banners and Signs:

Management reserves the right to remove any signs or banners at any time. Each sign and banner must comply with the guest code of conduct. Signs and banners may be displayed at games as long as:

• They do not obstruct the sight line of another guest

• They are not larger than 3′ tall x 6′ wide

• They are not in the field of play.

• They do not cover up any existing signage.

• They are not commercial in nature.

• They do not contain obscene or inflammatory language

• They are not paraded around the stadium.

Nothing in there explicitly discusses critiques of management, or even players. If the A’s are going to have a sign policy, they better stick to it and not go beyond their stated rules. Otherwise they’re asking for legal trouble. The backed down in 2010 after John Russo threatened to sue the A’s. Now that Russo has left the government he described as “morally corrupt” (on the way out, of course), is Barbara Parker or someone else going to step in? The only remotely sports-related opinion Parker has rendered so far has been about the City Council’s voting procedure with regards to JPA matters.

At the very least, OPD shouldn’t be helping with the takedowns. Leave Coliseum private security to do it. If someone in the legal field wants to take up the sign makers’ cause, let the chips fall where they may.

* Reason why I say the publicly-owned stadium principle is a gray area is because private isn’t always completely private, nor is public always completely public. AT&T Park is a privately owned and built stadium, yet it’s on public land. Does that make AT&T Park more or less suitable for similar protests?

BayIG backs down on lease term, Quan endorses deal, Wolff denies move out of Bay Area

Ray Ratto has been giving the stadium situation a constant read this week. Wednesday’s piece may have been the best of all, though it can mostly be summed up by this:

halfass

Can we even give the City of Oakland credit for half-assing? May be generous.

Meanwhile, on the news front, the City received another letter Wednesday from BayIG’s lawyers, which indicated that the development mean could be onboard with a plan to provide the A’s 2 years’ notice if a replacement Raiders stadium came to fruition. That’s a backpedal from their original stance, which was to tear down the Coliseum immediately after the A’s 2015 season in order to make way for the new football venue. BayIG suffered a little blowback in the media and from fans, which may have led to this softening.

In that same article, Oakland Mayor Jean Quan continues to believe that the city can continue to host both teams, while endorsing the lease extension approved by the JPA last week. Quan doesn’t get to vote on the deal unless the 8-person City Council is deadlocked. Said Quan,

“I absolutely want the City Council to sign this agreement so that we can get on to negotiating a new stadium (with the A’s).”

We’ll see if she’s forced to break a tie. Several of the council members are undecided, perhaps hoping for concessions from the A’s that probably are not coming.

Word came yesterday morning from The Game’s Chris Townsend that the A’s could be willing to buy out the County’s portion of the JPA, which would allow the team to work on a new development plan for the Coliseum complex. I’m looking into the legality of such an arrangement. The bond issues are heavily tied into specific revenue streams and the property is jointly owned, not divided, so it’s unclear how a private developer could legally replace a public entity. It’s also important to note that BayIG has an Exclusive Negotiating Agreement (ENA) with the JPA for any Coliseum development. That agreement doesn’t expire until October, so any developer whether the A’s or a third party can’t formally engage in talks with the JPA until the ENA expires, assuming it’s not extended. Correction 5:37 PM – As was pointed out in the comments, the ENA is only between BayIG and the City of Oakland, not the JPA. Because of this, Miley or other JPA members could engage in discussions with the A’s over the future of the Coliseum complex.

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Once again, Lew Wolff had to speak publicly about someone else’s suggestion that the A’s could leave the Bay Area. CM Larry Reid suggested the team could go to Montreal or San Antonio, places that coincidentally had hosted exhibition games in March. As I’ve said before, MLB may wield the move threat, but it’s largely toothless without a deal for a new ballpark in a target city. No rumored candidate like Portland, Montreal, San Antonio, or Charlotte is close to having such a deal in place. In fact, Charlotte just opened its AAA ballpark, surviving numerous legal challenges by a local attorney who wanted to aim for MLB, not AAA. Sorry, no Timbuktu.

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A couple other blog posts are worth reading and come from completely different angles. The first is a piece by the Motley Fool advocating for a move to San Jose. It’s a skin-deep analysis, but may portend future San Jose articles in the media, especially if Oakland continues to be a circus. The other is from Death of the Press Box writer Andrew Pridgen, who calls Wolff the “last great owner in baseball.” Mind you, he sets the post up by calling Wolff a prick.

Miley and Reid stir up A’s relocation talk

If you’re Bud Selig or Lew Wolff, sometimes you don’t have to play your own cards when others play them for you. Case in point: Oakland CM Larry Reid and AlCo Supe Nate Miley both brought up the specter of the A’s leaving Oakland, perhaps for San Antonio or Montreal. Nevermind the likelihood of it happening, it’s part of the threat, and the City of Oakland should take it seriously. Even sports economist Andrew Zimbalist says so, though the relocation doesn’t have to be as far as Canada. Zimbalist:

“What they could do is make a short-term arrangement to share AT&T Park with the Giants, and you know that could go on for a couple years until they found an alternative stadium situation.”

MLB wielded the move-to-AT&T card last November and the Giants were mum about it. MLB could move the A’s there temporarily while something was worked out elsewhere. Over the last few weeks I saw some discussion about whether the Giants’s Charter Seat License program could muck things up because CSL holders may have first dibs on any regular season games at China Basin, not just the Giants. I’m not so sure about that, since the license agreement indicates that “Home Games” are specific to the Giants. There’s a gray area in how another home team’s games would be handled, but since there are already provisions for offering and distributing tickets for non-Giants game events (“Classic” events), I figure this isn’t a huge obstacle.

That aside, relocation outside of the Bay Area should be taken much less seriously. Field of Schemes’ Neil deMause lays out the difficult cases for each market and includes San Jose, which has the Giants’ territorial rights claim as its because hurdle. If MLB wants to go through the same charade for the A’s as it did for the Expos, there isn’t a huge pot of gold at the end of the rainbow. Oakland is in no position to give up a publicly financed stadium to the A’s. Portland, San Antonio, Charlotte, and Montreal can be best described as mid-level markets, and while some of those cities don’t have problematic stadium T-rights situations to deal with, a relocated team will still be invading existing TV territories, which are arguably just as valuable if not more so. Hell, it’s been a decade and MLB is still trying to unwind the O’s-Nats TV mess.

So for now, there’s nothing to see here. There’s little real action, only theatrics on the part of the JPA and Oakland. If the City calls the Wolff/Selig bluff and sends back a revised offer, then we’ll see the threats fly in earnest. Or not.

P.S. – Keep in mind that until November and last week, MLB has been playing nice with Oakland. They allowed Oakland to entertain the Howard Terminal concept. They didn’t nudge Oakland to choose the A’s over the Raiders. Now all of that has changed. Howard Terminal has been shut down via the lease talks. MLB is waiting for Oakland to partner with the A’s after the dissolution of Coliseum City. If that doesn’t happen, MLB will have a clear indicator of how Oakland wants to proceed.

 

Why would Mark Davis want to build at the current Coliseum site?

Infrastructure costs, plain and simple.

Ever since people have talked about building another venue on the Coliseum site, that talk has gotten shut down by the costs associated with relocating utilities, most famously the power lines that run through the complex. While such costs are a low percentage of the overall project cost, the fact is that they would have to be dealt with upfront. And since upfront costs often have to be borne by the team while the public financing piece gets squared away, it’s a budget item that no team owner wants to deal with if he can avoid it.

CC-easements

Utilities running through the Coliseum area. Orange are power lines, green are sewer

According to the infrastructure study released in the spring, the estimated cost to relocate the power transmission lines is $15.8 million. Another $1.4 million would be allocated towards relocating a sewer line (green dotted line). Both of those changes would be necessary to accommodate a football stadium on the D lot south of the existing Coliseum. The good thing is that the relocations would help a ballpark in the A lot as well, so it’s a one-time project cost.

A stadium built within the existing Coliseum footprint would require none of this infrastructure work. Should Coliseum City be developed down the road it would have to be addressed, but that would be the within the purview of the developer, not Mark Davis. There would still be the cost of demolishing the Coliseum, which is unknown at this point (could run into the $10 million range), which would be done whether the stadium was built on the site of the existing Coliseum or adjacent to it.

The cheapest alternative would be to re-do the Coliseum. Even then there would be an unknown cost of partial demolition of the Coliseum, so there’s a cost there. Ever wonder if Davis would be okay if the Coliseum simply didn’t have a baseball infield on it?

Selig pulls out move threat card, Oakland folds like cheap tent, JPA approves lease

Today had me driving from Toledo to Pittsburgh, so much of the time I was out of pocket or unable to catch up on news. Fortunately, I arrived at my planned midpoint as the JPA was convening for a vote. This is the place I visited:

The Ohio State Reformatory

The Ohio State Reformatory

Look familiar? It’s not a college campus or an old hospital. It’s the old Ohio State Reformatory, located in Mansfield, Ohio. It’s better known as the site for the filming of The Shawshank Redemption, the great Stephen King-Frank Darabont picture that no one saw in the theaters but everyone saw on cable. I toured the prison, which would’ve been demolished if not for the film’s production and belated popularity. Like the Coliseum, much of OSR is in a steady state of decay. And like the film’s climactic scene, our own green-and-gold clad heroes at times have forded a river of sewage to escape the facility. I recognize that forcing a team of millionaires owned by billionaires to stay in mediocre conditions is nothing like actual prison. The point is that writing this blog at times is my own personal prison, one that I seemingly can never escape (especially the comments section or fools on Twitter). However, I made a promise to see this through, so it’s being done. Every so often I allow myself to feel a little hope, the dangerous concept that Red cautions Andy to squelch. Even after 9 years and with no end in sight, I still hope. I can’t allow myself to be completely consumed by cynicism. There’s already one Miserablist in the Bay Area, no need for two.

My own vacation activities aside, there is reason for hope to come out of today. First, let’s recap.

  • Yesterday, the prevailing sentiment was that the City representation on the JPA board would form a bloc and oppose proposed lease agreement, killing the deal and allowing the City to provide a counteroffer.
  • That tactic was quickly trumped by last night’s letter from Lew Wolff to the JPA, which was reported during the JPA session. Wolff indicated that if the JPA did not approve the lease, Bud Selig would grant Wolff immediate permission to move the team out of Oakland.
  • In fear of Selig’s threatened reprisal, the JPA board met in closed session to discuss the lease. Eventually the lease was approved 6-2, Rebecca Kaplan (who helped construct the lease terms) and Aaron Goodwin (who dissented on the current lease).

Now for the deal terms. The redone lease includes concessions made by both sides. Note: the deal must be ratified by the Oakland City Council and Alameda County Board of Supervisors before August 1.

  1. The A’s will be in the Coliseum through at least the 2017 season, with opt-outs available to both the team and the JPA until the 2024 season.
  2. $5 million in back parking fees that were up for arbitration in the fall are now wiped away.
  3. The A’s will pay $1.25-1.75 million in annual rent. They will be obligated to pay this through the end of the lease, unless they are able to work a deal to build another stadium in Oakland.
  4. The A’s will pay at least $10 million for a new scoreboard/ribbon board package. They will keep all revenue from the boards during A’s games. The JPA/Raiders will get revenue for football games. If the new system costs less than $10 million, the remainder will be paid to the JPA.
  5. The JPA will put together a $1 million/year maintenance fund, for use when things break. The JPA is not obligated to spend $1 million every year if maintenance spending is not required.
  6. A’s will have good faith discussions about building a future ballpark at or near the Coliseum, depending largely on what the Raiders do.
  7. The Coliseum area is the only site under consideration for a ballpark, with Howard Terminal dropped.

However you feel about the parking matter, this is a large number of concessions from the A’s. As Interim City Administrator Henry Gardner pointed out, this won’t stop the big subsidy that the City and County have to pay to keep the Raiders and A’s at the Coliseum. Then again, the counteroffer wasn’t providing any relief for that subsidy either.

The A’s have also asked for any developer interested in the Coliseum to put up $20 million towards a redevelopment project. You can call this “earnest money.” It may sound like a lot, but it’s an important form of skin in the game for the developer, something that Colony Capital isn’t providing right now. Wolff certainly isn’t afraid of dropping that kind of coin, since he bought some Fremont land in advance and paid for the CEQA study work in advance. $10 million is a good amount to keep pretenders from engaging in talks.

This type of deal was available in November, before the last time the A’s and the JPA hit a stalemate. Selig and Rob Manfred then stepped in and negotiated the to-be-superseded short-term deal. For whatever reason, the City of Oakland hasn’t recognized that until now, Selig has treated the City with kid gloves. That explains their shock and outrage to Selig’s power play. Sorry Oakland, this is how Selig normally operates. It’s part of the standard commissioner’s playbook. At some point the hardass version of Selig was going to show up and back his owner. To expect different wouldn’t just be unrealistic, it would be downright delusional.

Things are not going to get better for Oakland. The other shoe to drop will be the reactions of Mark Davis and the NFL. Since the Raiders and A’s are effectively competing for the Coliseum, both leagues are likely to play tug-of-war with the City in order to get them to commit to either entity. That should provide Oakland with some amount of usable leverage, but that’s negated by the City’s lack of non-land resources and their concerns about the feelings of the other team/league. What you’re seeing right now is Oakland in paralysis. The NFL and MLB are only happy to shake Oakland out of it. Both leagues are gearing up their preferred and contingency plans. If Davis decides this is it and gives up on Coliseum City, the complex is all Wolff’s to negotiate. If Davis truly wants Coliseum City and sees a way to make it work, Oakland will have a tough decision to make. Which team, league and developer should they partner with? It’s a decision that no politician wants to make, especially during an election year. Yet that’s Oakland destiny. Get busy living? Andy Dufresne had to decide that he had enough of Warden Norton’s hijinks in order to plan his escape. Oakland has two Warden Nortons, and it will have to screw one of them. Otherwise Oakland could find its teams, like Norton’s money, all gone.