10.20.13
by

Port of Oakland points out numerous Howard Terminal issues in RFP proposal

Two competing narratives define Howard Terminal at the moment. The first, proffered by Oakland ballpark boosters, insists that because of the summer move to attain “site control” over the Port locale, getting a ballpark built should be a mostly a matter of procedure that can quickly result in HT being shovel-ready. The other narrative, promoted by this site and other skeptics, argues that because of the land’s heavy industrial and maritime uses over the last several decades, it could be prohibitively expensive and time-consuming to even attempt it.

Adding to the information fog surrounding Howard Terminal are suggestions that the permitting and CEQA processes for the site could somehow be streamlined. One Twitter follower even explained to me a few months ago that the site wouldn’t need rigorous environmental review because HT was somehow zoned for a convention center. That’s not true, and even if it was that’s a wholly different use and set of impacts compared to a ballpark. No, HT is zoned as heavy industrial, Port land. No commercial uses are allowed there. I’ve also heard that there’s a way to build at HT without breaching the thick contamination cap already there. That’s patently ridiculous. Now if someone wants to offer up some great technology that allows for building a code-compliant, earthquake-safe, 10-story tall permanent ballpark whose foundation doesn’t require digging out some dirt, I’m all ears. Pardon me for being cynical.

Or if you don’t want to pardon my cynicism, take it from the Port. In the aftermath of the SSA consolidation deal inked between the Port and one of its bigger operators, Port staff prepared a report for a forthcoming RFP to find bidders who could use HT in the short-term. The concern is that the Port is losing $10 million a year while Howard Terminal remains vacant post-consolidation. I’ve bolded some of the more noteworthy language, and summarized the issue below each quoted graf.

Urgency of Revenue

With the loss of about $10 million/year of revenue at Howard Terminal starting October 1, 2013, finding a new tenant that can quickly establish operations and pay rent to the Port is critical. Because the property is already generally permitted and entitled for maritime and maritime-related uses, maintaining land use consistency will help expedite occupancy. However, it should be noted that even some maritime uses may require additional entitlement work; for example, construction of extensive break bulk facilities may require some California Environmental Quality Act (“CEQA”) analysis and permitting work. This work, however, is expected to be relatively limited as compared to non-maritime uses of the property.

Issue #1: The Port is trying to maintain maritime use so that they can get a tenant in there tout de suite. That doesn’t mean that the Port is against a ballpark, but it’s clear that a non-maritime use like a ballpark is bound to be tied up in red tape for some time to come.

BCDC Seaport Plan

Howard Terminal is included in the Bay Conservation and Development Commission (“BCDC”) Seaport Plan as a “Port Priority Use” area. This designation is based on a Bay-wide study performed by BCDC periodically to determine whether enough capacity exists across all Bay Area ports to accommodate anticipated cargo growth in the long-term future. Using Howard Terminal for non-maritime uses conflicts with this designation, and de-designation of lands from Port Priority Use requires a Seaport Plan amendment, which is a fairly lengthy and involved process. To pursue an amendment, the Port would be required to provide evidence that sufficient capacity exists within the remaining Port seaport properties, or elsewhere within the Bay Area Port priority lands, to support the long term maritime growth demands for the region. BCDC would then independently analyze that information before proceeding with an amendment.

Issue #2: In order to accept non-maritime reuse of Howard Terminal, that red tape would include a Seaport Plan amendment, proof that the consolidation properly makes up for HT’s lost cargo handling capacity. If the consolidation doesn’t prove enough, more capacity would have to be found elsewhere, even somewhere outside Oakland city limits.

Tidelands Trust Compliance

Howard Terminal is currently encumbered by the Tidelands Trust. Uses of the property are therefore generally limited to water oriented commerce, navigation, fisheries, and regional or state-wide recreational uses. Approval from the State Lands Commission would be required for any uses of the property that are not Tidelands Trust compliant. Many non-maritime activities are not considered Trust compliant uses and thus may require lengthy negotiations with the State Lands Commission, and potential legislation, before the Port could proceed with such non-Trust uses for the property.

Issue #3: This is a very similar situation to what the Warriors face with their planned arena at San Francisco’s Piers 30/32. Howard Terminal is on the water, on the bay, thus any plans there mandate special consideration of the effects of such a project. Since that process could take years to shake out, project proponents have pushed local legislators to write “streamlining” bills that can cut down review time normally associated with EIR-challenging lawsuits.

Other Entitlement, Environmental & Regulatory Issues

Howard Terminal is subject to a complex set of regulatory permits and deed restrictions related to the hazardous materials in the soil and groundwater underlying the property. Development of new structures that penetrate the ground surface or changes in land use will require notices to regulatory agencies, and compliance with existing health, safety and soil management plans. Non-maritime uses will likely require extensive and expensive clean-up or other protective environmental measures, precluding expeditious turn-over of the property to a new rent-paying tenant. Further, non-maritime uses will likely require numerous land use entitlements including local land use permits, an amendment to the Oakland General Plan, and CEQA review. These activities could take several years to complete. 

Issue #4: The cap problem.

Remarkably, there was no mention of a ballpark anywhere in the proposal for the RFP. There was also no mention of an EIR for a ballpark or any other Howard Terminal-related project. That makes sense when the goal is simply to get a tenant in there in the next year. No chance that can be anything but a shipping concern. Staff’s recommendation is to carry forward an RFP focusing only on maritime uses. That could change if City Hall leans hard on the Port to formally open up HT for non-maritime uses. Then again, as staff pointed out, Broadening the RFP scope further would complicate the evaluation process. SSA’s transition was originally supposed to complete at the beginning of this month. Now it may slip until January, which seems more realistic considering the work involved.

When it comes to Howard Terminal, you can read this site or listen to some story that some people are selling. Or you could disregard both and read Port staff’s own words. Don’t worry, I won’t be offended if you do. Mayor Jean Quan has been claiming for some months that some good news would be coming by the end of the year regarding HT. Hopefully the news isn’t limited to announcing that the Port has identified a new operator at the site for negotiations. That’s what happened with the Coliseum City RFP. In February 2012. The Port of Oakland has is semi-autonomous. It has to be fiscally responsible and self-sufficient. A $10 million hit per year is a big hit no matter how long it lasts. The Port also has another project, the Oakland Army Base reuse plan, which may now be counted upon to replace the jobs lost if Howard Terminal can’t find a new tenant. All of these issues and others are why I suggested caution when Howard Terminal came into play again. Now let’s see what site proponents can do about all the obstacles in their path.

—–

P.S. – Don’t forget, the issues identified by Port staff don’t include issues that could arise specific to the construction of a ballpark: pedestrian and vehicular bridges needed over the Embarcadero railroad tracks, and potential resistance from Oakland residents over the prospects of a tall stadium on the waterfront.

10.17.13
by

The limits of the NFL’s G-4 stadium loan program

Last week at the NFL owners meetings, the assembled owners approved a raft of small G-4 loans for current NFL stadia. The recipients include the Panthers ($37.5 million), Redskins ($27 million), and Browns ($62.5 million). Combine that with the $58 million the Packers received last year, and you’ve got nearly the amount of one full slots ($200 million) awarded to a team building a new stadium. The fund, a continuation of the G-3 program started with the previous CBA, has already assigned full slots for the 49ers, Falcons, and Vikings. All told that’s around $800 million. When the 49ers were starting construction, I figured that there was about $1 billion available, making for 4 new stadium slots and the rest for renovation work.

Since the CBA was signed, the NFL’s revenues have risen at a 5% annual clip. 2011 produced $9 billion, 2012 yielded $9.5 billion. It stands to reason that the league will eclipse $10 billion either this year or next year. That’s a point of pride for commissioner Roger Goodell, who envisions the league reaching a whopping $25 billion in revenue by 2027. It’s that growth that may allow the NFL to loosen some pursestrings and provide more G-4 money.

Rules are well set, with all projects falling into specific tranches of potential funding. After the $200 or $250 million limit, the NFL provides access to banking syndicates that provide much of the gap funding. So far the 49ers and Vikings have utilized this access. It’s definitely no giveaway. Team owners have to pony up at least $50 million to get started, and the NFL provides matching funds depending on the amount a team owner is willing to provide. Of course, there’s also a public share that comes into play, since the NFL will only provide access to G-4 loans if it sees what it considers a viable public-private partnership.

The G-4 program has a set limit of 1.5% of annual revenue to fund various projects. In the first year of the current CBA, that amounted to $135 million. The loans are for as little as 15 years, so the annual payments can be quite high. For a $200 million loan at 7-9%, that’s up to $25 million per year. That translates to 4 full slots and the remainder for renovation work. However, if annual revenue rises above $10 billion that limit rises to $150 million, or 5 full slots and the renovation remainder. That could be huge for the remaining teams that haven’t yet finalized stadium deals, such as the Chargers, Rams, and Raiders. If the NFL chooses to base G-4 availability on initial revenue projections, the limit may be set at 4 slots, the same way the G-3 program slammed the door shut after 4 $150 million slots were awarded (DAL, IND, NY x 2). If the owners are comfortable with expanding the program, another slot just might open up. Three teams competing for two slots is a lot more comforting than all three competing for one award.

Still, time is of the essence. Given the league’s previous history it seems unlikely that they’ll make huge loans in the back half of the CBA. The incentive is there for the owners and municipalities to act quickly. For now, the NFL has chosen to control the funding process through G-4, public funding, and the banking syndicates, instead of allowing a third party like AEG to buy its way into taking some revenue or a piece of a team. If you’re Goodell it makes sense. What he doesn’t want is for outsiders to chip away at what it considers “pure” revenue streams, nor does he want to set a precedent that team stakes are easily available in exchange for a stadium. With the three remaining teams, we may be coming to a point where he has no choice. The best way for the Raiders to stay in Oakland may be to exchange a minority share for a new Raiders Coliseum.

Tim Kawakami had another chat with Mark Davis this week. Davis continues to play good cop with Oakland officials, while unnamed sources (league? team?) assume the bad cop role via Matier & Ross. Davis may not be negotiating through the media in public, but someone is. Davis say that Tuesday’s City Council vote is a “positive step” but there are many moving parts in getting the deal to work, whatever form it takes. If, as Kawakami surmises, Davis considers this the last chance to stay in Oakland, the bowl-cutted one is certainly giving the appearance of due diligence. Davis’s previous comments about the team’s share of a new Coliseum indicate that he’d be interested in one of the G-4 slots, since it would involve club seat and suite revenue. Davis will get to see everything develop right in front of him, which will inform his decision. Instead of deciding right after the current season ends, he could take a page out of his late father’s playbook. Al didn’t finalize the deal to move the Raiders back from LA to Oakland until July 1995.

I remember that summer being a whirlwind of activity for the Raiders and A’s as I spent much of that year in the locker rooms. I wonder if we’re due for another whirlwind.

10.16.13
by

Negotiating Extension and Investor Group Approved for Coliseum City

Two weeks after a potential investor group headed by Colony Capital and Rashid Al Malik’s HayaH Holdings was revealed, that same group was formally approved as part of the master developer team. With that approval comes a 12-month extension on the ENA (exclusive negotiating agreement) to figure out all most of the details, plus a 6-month administrative extension if needed.

That’s the news. Now let’s try to understand what has to happen next.

The City of Oakland has about $250,000 remaining in money it assigned towards Coliseum City studies. Bay Investment Group (BayIG), the Colony/HayaH partnership, will put in $500,000 towards a market study to determine the viability of Coliseum City. This is important since BayIG is expected to push that study to its own individual investors, who as a group will decide if/how to move forward. The forthcoming study is not to be confused with AECOM’s feasibility study, which was made available during the summer.

Over the next 12 months, the public and private sides have to make good on a set of deliverables. Some within the City, especially CM Larry Reid, wanted a shorter 6-month + 6 month extension instead of the 12 + 6 deal that was approved. Reid’s concerns, aired last week in a committee meetings, were that 12 + 6 was too long a period and didn’t show the necessary urgency to the NFL and the Raiders. Raiders owner Mark Davis has indicated that he wants a lease/stadium deal in place shortly after the NFL season ends.

Nevertheless, Coliseum City will move forward on its own timeline because BayIG asked for 12 + 6 in order to get everything in order. A short list of deliverables looks like this:

  • November – Estimate on cost of remaining pre-development work
  • February – Assessment of new infrastructure costs
  • April – Letter(s) of intent from team(s) who choose to sign on with plan
  • May – BayIG market analysis
  • Summer/Fall – EIR and Specific Plan

These items, along with additional smaller ones, should lead up to preliminary project approval in whatever form it takes, plus a DDA (disposition and development agreement), the contract fine print on how Coliseum City is built, including costs, financing, and timelines. Zennie Abraham caught up with Oakland Asst. City Administrator Fred Blackwell at the meeting to summarize what’s next.

Simply put, BayIG just bought the City of Oakland and Alameda County some time. However, it’s easy to see how the list of deliverables doesn’t exactly line up with the timeframe that Davis is trying to dictate. Moving forward, the issue is whether the dev team can show significant enough progress to get Davis to sign on and sign a separate lease at the Coliseum that would keep the Raiders in Oakland throughout the transition. Then again, that part’s a little confusing too. When Raiders uber-fan Dr. Death asked JRDV’s Ed McFarlan when the earliest groundbreaking could be he received this rather optimistic response.

That seems unlikely given the scope of the project and all the little details that need to figured out. Is that groundbreaking for a new stadium alongside the existing Coliseum? Certainly it couldn’t be demolishing the current Coliseum and building on the same site, since the demo itself would take months and would displace both the Raiders and A’s. While BayIG indicated that it will reach out to the A’s and Warriors to gauge their interest in Coliseum City, it’s extremely unlikely that either team will commit. Despite recent setbacks, both teams are focused on their San Jose and San Francisco plans, respectively. Plus they’d have to commit without all deliverables in place, especially that market analysis. If you think that Lew Wolff would sign a short-term lease without knowing the development’s impact on the A’s, you’re crazy.

For the next 12 months, BayIG has control over most of the process. They could press the deal if they see encouraging signs, or they could kill it if the market analysis looks bad. They’re in great shape considering that they’ve only committed $500,000 towards the project – chump change for billionaires. Just as important, they don’t have to adhere to a specific vision of Coliseum City, though they’re positioning themselves to have at least the football stadium in place. Consider last night’s report on the agenda item:

The Coliseum City Master Plan is providing the basis upon which the City is currently under a separate contract with a specialized planning consultant firm to complete a Specific Plan and CEQA/EIR analysis. The Specific Plan will also identify alternatives to the Master Plan and will consider different development scenarios that will envision zero up to three sports facilifies at the site. Pursuant to CEQA, the separate planning contract will prepare an EIR to address the potential physical environmental effects of the Coliseum City project.

There’s nothing new there, but BayIG is positioned to take advantage of it. There could be a single football stadium, a football stadium and a ballpark, even an arena. At this early stage, it looks like it’ll just be the Raiders stadium, though even that is far from a given. BayIG could find that the best thing to do is to minimize its investment in the stadium, or seek out revenue streams from the stadium or team that could help pay back their investment. The infrastructure cost, which will be borne by City/County, could also prove prohibitively high on top of the remaining debt to be carried at the Coliseum. BayIG could even go with zero venues at the Coliseum. Such a plan would probably not get approval from City since it would represent a white flag. Yet it remains a distinct possibility – if not now, within a few years.

The upside, regardless of your optimism or skepticism of Coliseum City, is that things are coming to a head. Coliseum was introduced more than 21 months ago, and has shown only the most tentative progress until a few weeks ago. Now’s the time to put up, to see what results Coliseum City can yield. No more stalling, and for that we can all be glad.

—–

Note: The only local mainstream media coverage of yesterday’s news came from CSNBA’s Scott Bair. Seems like everyone else was preoccupied with transit strikes and some other multibillion dollar development in the South Bay which is a lot more than vapor.

10.13.13
by

Happy Anniversary Shark Tank!

Saturday, September 7 was a fairly ho-hum day at the newly-renamed SAP Center, formerly HP Pavilion, Compaq Center, and San Jose Arena. There was an event, a mariachi festival called Vivafest. Preseason hockey wasn’t scheduled to start for two weeks, the regular season for a month.  It seemed like there wasn’t much to celebrate.

Shortly after the first puck drop on Saturday night at SAP Center

Shortly after the first puck drop on Saturday night vs. Ottawa at SAP Center

Oh, but there was. September 7, 2013 marked the 20th anniversary of the opening of the arena, affectionally known as the Shark Tank (the Sharks would play their first home game on 9/30/93). Though it’s 20 years old, the place still looks nearly new and spiffy, with Sharks ownership and the San Jose Arena Authority committed to maintaining the venue to ensure its place as a premier sports and concert venue, and to keep up with rival franchises. Even though the structure is mostly precast, poured and block concrete, the glass entries and color highlights make the place feel more friendly and inviting than a largely concrete structure should. The steel cladded façade proved to be an aesthetic mistake, though it shimmers nicely at night. I joked shortly after the arena opened to some friends that the City needed to figure out a way to keep the arena in the dark all the time.

Since its opening, the Tank has hosted multiple NCAA basketball men’s regionals, the women’s Final Four, the US Gymnastics and Figure Skating Championships, pro wrestling, boxing, and MMA, and countless concerts. While in my relative youth I had reservations about the publicly-funded nature of the arena, the fact that Sharks ownership (led by the late George Gund at the time) spent a good sum of money upfront to ensure the arena would an industry leader, and the venue has held its place as a highly competitive, well-run NHL arena ever since. Unlike most other arenas, the team ran the venue themselves, parlaying that experience into the acquisition and operation of other venues in the area.

Circulation was always simpler at the Tank than at Oracle Arena thanks to wider concourses.

Circulation was always simpler at the Tank than at Oracle Arena thanks to wider concourses and a simplified layout.

SAP Center didn’t mention the moment on either its Facebook page or Twitter timeline. There was no special event. Maybe this was because the Sharks franchise celebrated its own 20-year anniversary in 2011, which would’ve made this celebration a bit much. Perhaps it’s a mark of the Hasso Plattner’s ownership. Whatever the case, San Jose should’ve celebrated the anniversary. It’s the best thing San Jose’s now shuttered Redevelopment Agency has accomplished. It’s worthy of praise, so I’ll do it here, admittedly in belated manner.

Happy Anniversary, Shark Tank! Here’s to 20 more years of great events at the arena. San Jose wouldn’t be the same without you. Take a bow.

The new SAP Center sign, installed Friday, replaced the HP Pavilion moniker.

The new SAP Center sign, installed Friday, replaced the HP Pavilion moniker.

10.11.13
by

Judge partially sides with MLB in antitrust lawsuit, allows San Jose to argue interference claims

UPDATE 2:07 PM – I’ve uploaded a copy of the ruling. It’s worth a read.

Additionally, San Jose Mayor Reed’s office released a statement in reaction to the ruling:

I am pleased that the judge has allowed our case to move forward. Major League Baseball’s unfair and anti-competitive actions are costing San Jose residents millions of dollars in annual tax revenues that could go towards paying for more police officers, firefighters, libraries, road repairs and other critical services.

San Jose filed this lawsuit after waiting patiently for more than four years for a decision from Commissioner Selig. The court’s decision this brings us one step closer to paving the way for San Jose to host a major league ballclub.

Carry on.

—–

Update from the Merc’s John Woolfolk on San Jose’s antitrust lawsuit against MLB:

And other tweets:

During the hearing last Friday, Judge Ronald Whyte gave indications that he would back MLB based on the standing issue, while allowing San Jose to rework its case and try it in a state court. MLB had pushed for Judge Whyte to dismiss all claims, including those that could be covered by California’s more stringent antitrust laws. San Jose hoped Judge Whyte would rule that the City had standing, which would move the case forward and start a potentially damaging discovery phase for MLB.

Assuming that the tweets above are correct, baseball’s antitrust exemption remains immune to a legal challenge. Instead the case will be about tortious interference, or MLB’s stalling that has prevented San Jose and the A’s from getting a ballpark built. San Jose claimed initially that this amounted to $1.5 million per year in tax revenue, and could be awarded treble damages as a result. Over 30 years that comes to $135 million, not adjusted for inflation.

If San Jose can force discovery into the dealings of its “Blue Ribbon Commission” and other activities related to San Jose and Oakland, it could also force MLB to make a deal since they’re against any kind of opening of their books. There’s a lot more to the TI argument than standing.

A press conference may be in the offing. If it happens I’ll see if I can head out to City Hall.

For now I’ll end with this Bill Shaikin tweet:

Hooray for inertia!

10.11.13
by

A Puncher’s Chance At Best

Sisyphus, by Titian (mid-16th century)

Two weeks from today will mark the 10th anniversary of the last team to win a World Series with a payroll under $70 million. The winner in 2003 was the Florida Marlins, a team chock full of prodigious young talent (Miguel Cabrera, Josh Beckett, Dontrelle Willis) and wily veterans (Pudge Rodriguez, Jeff Conine, Mike Lowell) who shocked the world when they beat the Yankees in six games. In 2003 the Yankees’ payroll was nearly $153 million. The Marlins’ payroll was a shade over $45 million. This year the team the wins it all will have a payroll anywhere from double to more than triple that of the teams that were just eliminated.

Atlanta was the first to go, seemingly powerless against the Dodgers’ Puig-powered juggernaut. Next was Tampa Bay, who fought bravely before succumbing to a superior Red Sox squad. Wednesday night it was the Pirates, who did about as much against Adam Wainwright as the A’s did against Justin Verlander. The Opening Day payrolls for the eight postseason teams were as follows:

  • Los Angeles – $216,753,286
  • Boston – $154,555,500
  • Detroit – $148,693,600
  • St. Louis – $116,790,787
  • Atlanta – $90,039,583
  • Pittsburgh – $66,805,000
  • Oakland – $61,964,500
  • Tampa Bay – $61,928,975

Atlanta’s $90 million is somewhat deceptive. It includes $25 million for Dan Uggla and B.J. Upton. Uggla was left off the Braves’ NLDS roster, and Upton had a grand total of 3 pinch-hitting appearances during the series. Essentially they’re dead money, mistakes made by the Braves’ longtime braintrust. Those mistakes were possible because Atlanta has the revenues to make them. Take the ability to make those mistakes away and suddenly the makeup of the Braves is similar to the other eliminated teams, as is the payroll. The other three teams are small market/have not/50-feet-of-crap-then-us teams. When they make a free agent mistake, it affect everything else. The big market teams not only can afford to mistake those mistakes, they can keep filling their lineups with veterans who habitually have good at bats, and relievers who have tons of experience.

Big markets respond to mistakes or issues by buying depth. Victor Martinez injured for the year? Get Prince Fielder. Dodgers and Red Sox having clubhouse and performance problems among their stars? Bundle them up and trade them for each other. Even a mid market team like St. Louis has options. Don’t think Albert Pujols is worth a long-term deal anymore? Take that money and spend it on calculated risks like Carlos Beltrain and Chris Carpenter, while locking up Yadier Molina.

For have-nots it’s far more grim. David Price expects to be traded from the Rays in a month or two. The Pirates are fortunate to be in their second year of a six-year window, after which they’ll have to figure out how to afford to keep Andrew McCutchen, Gerrit Cole, and Starling Marte. The A’s are in a similar situation, with decisions forthcoming on extensions for Josh Donaldson and the young guys in the staff, including Brett Anderson perhaps as early as in a few weeks. Whether the future with Coco Crisp in green and gold is one more year or three, Billy Beane and David Forst eventually have to find his replacement. The have-nots’ options are more linked to their GMs’ resourcefulness than a smorgasbord of big money, franchise cornerstone players.

Whether you think the A’s postseason came down to one or two plays, the fact is that for the A’s to win any ALDS and then advance to the World Series, everything has to go right. They need error-free ball and a ton of luck. Effectively, all have-not teams have a puncher’s chance of winning it all. Depth-wise they are no match for the haves. Maybe that’ll make it taste sweeter when one of the have-nots eventually gets the baseball gods to shine on them all the way to winning the World Series. It also makes the situation feel more desperate when they get eliminated early.

Why is 2003 important? It’s the first year of the modern revenue sharing agreement among MLB’s 30 clubs. While it has been tweaked in the last two CBAs (2006 & 2011), the fundamentals remain the same. Teams take a third or so of their locally-generated revenues, pool it together, and split it equally. Teams that end up paying the luxury tax see that money redistributed among the have-nots. Teams in the 15 biggest markets are prohibited from receiving revenue sharing receipts (net payment from the pool if the share they paid is lower than expected). 2003’s also the first season after the publication of Moneyball. Since then local TV money has become a much bigger factor, far outpacing the small adjustments being made to the revenue sharing formula to compensate.

Technically, the A’s are one of those 15 big market teams. They get an exemption for now because they play in the Coliseum, a poor revenue generator as a ballpark. Should they move into a new ballpark somewhere in the Bay Area, they would immediately lose the exemption. That realization raises the stakes on the future for the A’s. Like the Giants, they’d have to pay for their own stadium and and can’t rely on revenue sharing. The owners, cognizant of this, purportedly have qualms about the A’s ability to avoid massive debt and manage the club in a sustainable way. Sure, they could dump payroll or make cash calls if things got tight, but that would run counter to the purpose of having the A’s in a new ballpark. MLB’s 2000 Blue Ribbon Panel (not the one working on the A’s) made recommendations that could have helped competitive balance, such as sharing of 50% of local revenue and the allowance of strategic franchise relocations. The owners decided to keep revenue sharing a limited affair.

Yet if MLB is destined to have its top 10-12 franchises in their own contention bucket, shutting out everyone else, then the only way the A’s can truly compete is to get into that group of top 10-12/13 payrolls. Even with a $100 million revenue boost for the A’s touted by Lew Wolff, the A’s would be at the bottom of that list. That might be fine, since the A’s would continue to have spend/rebuild cycles. They’d still have to rely on their resourcefulness. The A’s have a nice boost from CSNCA and they have more national TV money coming, but the biggest windfall would come from that new ballpark, even net of debt service. Without substantive progress made on that front, the A’s will forever remain a team with a puncher’s chance that loses by decision in the end. That’s baseball in the new millenium.

10.09.13
by

Raiders to play London home game in 2014, NFL not impressed with Coliseum CIty

The Raiders and the NFL announced yesterday that the team will one of three franchises to host “home” games next season in London’s Wembley Stadium. Jacksonville, which has done this before, and Atlanta will also be “home” teams. It’s an expansion of the NFL’s exposure in Europe. Previous seasons often had only one London fixture, this season has two. Both of this season’s games are sellouts, which likely convinced NFL brass to expand the program.

CSNBA’s Scott Bair notes that the Radiers’ current lease, which ends this season, has a requirement that the Raiders play all home games at the Coliseum. A lease extension would have to be amended to reflect the new arrangement. Of course, the Raiders and the Coliseum Authority first have to agree to basic terms of a new lease, and there are no indicators that the two sides are close to completion of that yet. Owner Mark Davis has made it clear that he wants to tie a lease to a long-term deal that produces a new stadium for his franchise.

Enter today’s Matier & Ross item, which described the NFL as not impressed in Oakland and the JPA’s efforts regarding Coliseum City.

‘The NFL came in a couple of months back to see how the city and county were coming along with their plans and basically rolled their eyes,’ said a source close to the Davis camp, who asked not to be named because of ongoing negotiations in Oakland over a possible replacement for the Coliseum.

Surprised? You shouldn’t be. Davis has chided the JPA about an apparent lack of urgency on their part. Last week’s news that big-pocketed investors including Colony Capital helps their cause. The structure of the deal that pushes out the JPA’s study another 12-18 months doesn’t. That’s probably why the NFL isn’t impressed. They can see right through the public officials’ moves, which are mostly stalling tactics until something drops into their lap. The NFL has not shown patience with that in the past. They want results. Plus they’re fine with Davis talking to anyone who will listen, whether that’s in LA, Concord, wherever.

Moreover, Matier & Ross bring up the idea that if Colony is asked to help subsidize the stadium, they’ll want something out of it. Maybe that means a piece of a team or even a controlling share. That’s not likely to happen on Davis’s watch, as he’s been buying out smaller ownership stakes to further strengthen his hold over the franchise. Perhaps that’s for the purposes of flipping a small minority stake in exchange for a stadium, but no more than that. As we’ve seen with the NFL’s discussions with AEG over Farmers Field, no owner nor the league has any interest in swapping a major ownership stake for stadium rights. I wrote previously that Colony will want to pay as little as possible for a stadium since it’s money pit. This is the opposite of such an arrangement. Whatever the case, Colony didn’t grow to its current size and status by giving things away. The JPA can keep studying the issue until the cows come home. The NFL will remain unimpressed.

10.09.13
by

The Kid

I know we’re all hurting from Game 4. Let’s just take a minute to appreciate this.

Tomas Hertl is 19 years old from the Czech Republic. He scored 4 goals against the Rangers. He’s the youngest to score four goals since 1988. He’s already a Calder Trophy (rookie of the year) candidate. Once in a while we’re blessed to see truly transcendent talents like Joe Montana, Rickey Henderson, or Barry Bonds. Like Yoenis Cespedes, Hertl speaks little English. Like the aforementioned legends, this kid can carry a team, sell tickets, do the unthinkable. He’s that good. Just drink it in, and know that he’s probably going to be a Shark for a long, long time.

10.07.13
by

Time lapse Coliseum conversion

If you attended the game on Saturday, you probably noticed that the only thing faster than the A’s running onto the field after Stephen Vogt’s walkoff single was the Coliseum’s conversion crew, getting ready to do the big switch. As I hoped, someone captured the entire thing on time-lapse video. Claiming credit is SF media company Evolve Media.

The conversion was announced as complete around 3 PM Sunday, 5+ hours before the rescheduled Chargers-Raiders game. That means it took 18 hours to complete the change, a very impressive figure for sure. For now it looks like the crew has been granted a well-deserved break, as they didn’t tear down the seats immediately after the Raiders won. However, a decision will have to made soon on if/when to switch back to baseball, perhaps as soon as after Game 3 ends. The issue for the Coliseum Authority is that there isn’t a Raiders game at home until October 27, a good three weeks from now. If the A’s don’t advance and the Authority decides not to pull the trigger on the conversion, they could save themselves $500,000. If they wait until the last minute and the field ends up extra crappy because of it, the teams playing Game 5 and MLB will not be pleased. Here’s to hoping the A’s can force the issue.

10.06.13
by

Raiders explore Concord Naval Weapons Station for stadium site

Matier and Ross report that Raiders owner Mark Davis took a tour of the decommissioned Concord Naval Weapons Station last week, in search of a potential stadium site for the Silver and Black. Sure, Davis has stated publicly that his preference is to stay in Oakland, but he has been looking around the Bay Area and Los Angeles to see what kinds of deals he can dig up.

Last year Davis made the local political rounds in Dublin, as he had an eye on the Army’s Camp Parks facility. Like CNWS, it’s very large and is in the middle of a transition. At both Camp Parks and CNWS, there’s valuable land available remarkably close to freeway access and even public transit. In theory, it just needs to be cleaned up, planned accordingly, and redeveloped.

The military branches – in this case the Navy – are in control of the remediation (cleanup) process. They also control the price of land sales, and given the trend of military cutbacks, they’re not going to give away free land. Municipalities also have a say, because in the end they’ll need to properly integrate these massive tracts of land into their own long range plans (link worth reading if you want to understand the process).

One of the City of Concord's CNWS planning maps

One of the City of Concord’s CNWS planning maps

In the map above, the gray area is devoted to different types of development. Closest to the North Concord/Martinez BART station is expected to be high-density, transit-oriented development: office and residential towers and the like. Further east and south may be office parks and lower density residential. Greenbelts wrap around the various districts. A golf course and open space preserve largely cover the area east of Mt. Diablo Creek. These 5,000 acres, dubbed the Inland Area, are the most ready to develop because they were decommissioned over a decade ago. The other part of CNWS, the 7,000-acre Tidal Area, is still in use. The Tidal Area is the portion north of Highway 4 along Suisun Bay.

Davis’s interest in CNWS seems to run counter to his stated desire for urgency at the Coliseum. It’s unlikely that anything substantial can be built at CNWS before the end of the decade, and no one’s going to make an exception just for a football stadium. That must be why Davis hired Don Perata as a consultant. Perata, the former State Senate President and Oakland mayoral candidate, who now works out of Orinda. Perata could grease the skids as a lobbyist in Sacramento, which could result in a CEQA-sidestep bill similar to the ones executed for the Sacramento and San Francisco arenas.

The best spot for a Raiders stadium is probably the salmon-colored area next to Highway 4

The best spot for a Raiders stadium is probably the salmon-colored area between Highway 4 and the planned Delta Rd

Besides the literal mess that needs to be cleaned up at CNWS, a stadium needs to be compatible with Concord and Contra Costa County’s growth initiatives. Preferably the stadium should be within walking distance of the BART station. That use – a big stadium with acres of parking around it – doesn’t fit with any TOD plans. The City of Concord will want some federal grant money to assist in building infrastructure for the TOD section, so they won’t allow a stadium to jeopardize that. The salmon-colored area in the map above is roughly 1/2 mile from the BART station, about as far as you’d want to walk from the station to attend a game. 100 acres of parking would have to be found somewhere in the vicinity. For environmental impact reasons, the stadium couldn’t be located adjacent to the planned preserve area. Freeway access is another matter. I can’t imagine how awful the traffic on CA-4 would be for a Monday Night game. CA-4 and I-680 are the main highways in, with CA-242 providing a shortcut from the south. Sunday afternoons shouldn’t be so bad, but if a lot of fans are coming in from eastern Contra Costa County and Stockton, it’s not going to be pretty.

Obviously, a lot of issues would need to be figured out before Davis even had a prayer of making CNWS a good relocation site. Like Coliseum City, it has a number of costs associated with it that have major funding question marks. Yet it’s also clear that Davis is not content to sit and wait for a deal to fall into his lap. If he wants to get something done somewhere, that’s the kind of proactive work ethic he’ll have to show. In that sense, the apple doesn’t fall too far from the tree.