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SK Baseball: How About Letting Someone Else Have a Piece of the Pie?

When SK Baseball first announced the Reno Aces stadium was being built downtown, I was ecstatic, like much of the community. Then I learned the details of the stadium being built, and while it seemed like a lot of concessions to hand over to SK Baseball for a stadium being built, I was still in favor of the stadium, and envisioned the long term benefits to this moribund neighborhood.

Then I watched and read the details of the amendments to the original deal in order to build Phase 2A, which is currently under construction and attached to the stadium itself, and this is where I started to become a bit concerned about the obligations the city would be under for this amended deal. This is also right around the same time a growing wave of dissent hit my inbox from people not at all pleased with what was going on. I never realized the fierce ongoing debate over public-subsidized stadiums. There was a particularly ugly battle with the Florida Marlins stadium. These days, the trend is to not build sports stadiums with public subsidized money. The new Giants Pac-Bell/ATT/SBC/Whatever Park in San Francisco started this trend.

Nevertheless, myself and thousands of Aces fans enjoyed the first season of the Aces. It's awesome being within walking distance of the stadium, and I made it to 17 games last year, not bad for someone who isn't a big baseball fan.

Now, SK Baseball is negotiating with the city for STAR Bonds, and they've also sent letters of interest for Recovery Zone Facility Bonds at the City and County levels, according to City of Reno Staff Report documents. Recovery Zone Facility Bonds are tax-exempt bonds specifically designed for private businesses.

In this recent Reno Gazette Journal article, it's mentioned that the city is negotiating with SK Baseball over part of that sales tax (the STAR Bonds) in order to help pay for other projects. So here is my question...why are we negotiating at all? With the way the city council comments in that article, they make seem as though they are obligated to issue Star Bonds simply because they formed a STAR Bond District. Just to make things clear, the city council is in no way currently obligated to issue STAR Bonds to SK Baseball. This was asked by Jessica Sferrazza during the meeting where they formed the district, and the answer by the Deputy City Attorney was No, it doesn't obligate the city.

I've watched SK Baseball in city council meetings, and Jerry's a bit sensitive and defensive, and often lashes out at the city council whenever they question any parts of deal involving him, so he'll probably think I am 'stabbing him in the back' by writing this, but that's the furthest thing from the truth.

From Past, to Present, to Future

I just want the city council and SK Baseball to know there are other priorities downtown as well, and perhaps now is the time to back off the ballpark phases, and focus on projects that will help Reno over the long term become a destination again. No offense to SK Baseball, but I can't think of a Triple-A stadium project that actually turned a city into a tourist destination. Particularly since Sacramento and Fresno both have Triple-A teams as well. Nor do I think a Triple-A stadium and some retail stores surrounding it will help in reversing a 13 year decline in tourism. Do I think it helps our downtown for locals? Yes. Do I think it changed the face of that neighborhood for the better? Yes.

I understand SK Baseball's desire to build something fresh and new each season to keep Aces fans coming back, but when I look at the larger issues of Reno and tourism in general, I wonder if expanding a ballpark district is the best use of STAR Bonds. I like Illinois' wording of their pending STAR Bond legislation, and their use of the phrase 'destination project.'

Think about it: I wonder if in retrospect, knowing the condition the economy is in now, the city council would have been so agreeable with the baseball deal? What if SK Baseball had phrased his baseball presentation more like 'First, we're going to use TIF Financing to build Phase 1 and 2, then we'll STAR Bonds financing to build Phase 3, and then we'll try to get our hands on two different sets of Federal Stimulus Funding to continue building Phase 3 and 4' Would the city council have reacted differently? I watched all those meetings, all of the presentations.

The City Council was consistently more excited about the retail 'catalyst' development the baseball stadium would create than the stadium itself, but I don't think they anticipated every single phase of this development would need to be publicly subsidized, or that the cost to reach the stage where retail can be built around the stadium would be so high to the rest of downtown...but it is. SK Baseball already held additional TIF Financing over the city council's head, basically saying they couldn't get a bank loan to build Phase2A unless the City Council committed more tax increment financing. Is this how the remaining phases are going to go down as well? What if the City completely denied STAR Bonds to the baseball developers, what would be their reaction? I bet you $20 their reaction would be 'well, then we cant continue building out the baseball district.' Well, SK Baseball, if that is going to be your requirement toward future expansion, then I don't want your expansion. You presented this project to the council as if when the stadium was built, it would magically produce all this catalyst development around the rest of the stadium. That's the best thing about taped city council meetings, you can go back and watch them again. The Mayor mentioned that with a partner like Herb Simon, the 'most prominent mall developer in America' this project couldn't go wrong. Yet now it seems as though this development will only happen if we continually feed SK Baseball this kind of bond and that kind of bond etc. If Herb Simon has built megamillion dollar malls, why does he need STAR Bonds or federal stimulus money to build out some simple, detached retail buildings?

Displacement

And what about the rest of downtown? If both Tessera and the Ballpark District are built out as planned, we're talking blocks and blocks of new retail. If you were a prospective tenant looking for a space downtown, would you pick a shiny new retail space, or an old crumbling one downtown? Building blocks of new retail doesn't address the the empty Woolworths and JC Penney buildings downtown, it doesn't address all of the vacant retail along Virginia Street, or the vacant retail in the Palladio, Montage, Riverwalk Towers, nor does it address the fact THAT OUR PRIMARY STREET RUNNING THROUGH OUR ENTERTAINMENT DISTRICT LOOKS LIKE A FREAKIN' CIRCUS LEFT TOWN! (Hello, facade improvement program!)

I am pretty certain that tourists to this region won't mind the empty parking lots that currently surround the ballpark, but I do think they mind dodging scary people when downtown in the casino district, and I do think they mind looking at ugly, half-used or shuttered buildings like the Virginian and Cal Neva Tower and Fitz and Kings Inn. Until THESE things change, I don't see Reno's tourism numbers changing for the better. I mean, seriously, we're now one of the nightmare scenarios mentioned in a Freecreditreport.com commercial. It's because the majority of folks who haven't been to Reno in the past 5 to 10 years feel Reno is a joke, a burnt-out dead casino town where old ladies go to gamble. RSCVA's own research backs this up. This perception won't change until we change the core of our entertainment district significantly, and I think that means building more than just retail stores on what is now empty parking lots and paved lots. The City of Witchita is using STAR Bonds to do a massive facade improvement program to their downtown.....why can't we? Beautifying Virginia Street was a great start, but one look at the buildings that line Virginia Street, and it quickly turns into a lipstick on a pig scenario.

I know this article is kind of long, and I am freeforming it a bit as I write this and thoughts arise. But this is important to me, I care about this city and its future....and I feel that giving SK Baseball further subsidies, or any of the federal stimulus money in order to build simple retail structures around the stadium is not the right way to improving downtown. In fact, it could hurt it, as more new retail is built encircling downtown's vast vacant buildings. We have a DISMAL RETAIL VACANCY RATE, we should be encouraging redevelopment of existing spaces downtown.

I'll conclude with saying that I am excited we have a ballpark....I love going there, I'll continue to go to games, and I'll continue to photograph subsequent construction. What's done is done, and if we don't support the stadium already built, the city will be in even more hot water. I think it would be foolish to boycott the stadium because of past deals...but enough is enough. Put further development around the ballpark on hold, and focus on central downtown's massive list of issues. Turn Reno back into an entertainment destination.

Comments:

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Posted by: urbanblog - 1/26/2010 10:06:46 AM
Preach on, dude, I wrote about this today as well. I think it's not going to take a genius to see that the ballpark developers shouldn't get more in public subsidies for their future expansion phases. No amount of public subsidy is ever enough. The phase 2A needs to get finished and the city needs to follow through on its obligation, and having learned what a bad idea it is (financially) to sign up for those kinds of things, should stop signing up for them. (and be happy to be proved wrong when the economy improves) Reno's lack of attractiveness as a visitor destination is tied to the faded Virginia Street, and you're right to call for some actual investment there. How about getting a group of investors together and create a STAR bond project to get the Fitz project done? But there's also a social and cultural problem which is tied to the city's own lack of identity and unwillingness to embrace the vestiges of its own historic and present culture. That's not something a water park can fix. You're right to use your soapbox to insist that we fix and fill old buildings before putting up any more new ones. There's a lot more to this, too much for one comment here. Keep yer stick on the ice.

Posted by: truthiness - 1/26/2010 10:55:39 AM
Your opinion has the tone of a eulogy, but you're right: stop this. Reno's been snookered again. Before we spend another penny we don't have, we need to examine the financing methods being used by redevelopment. Property tax, sales tax and any other taxes they could tap into were always intended to provide a revenue stream for these developers. If city council members couldn't figure that out, they aren't qualified to serve in public office. Original subsidy requests outlined in the Meridian report were in the $200m - 300m range for the baseball district, and about the same amount for tessera. Where they stand now, who knows? How much are we into this? Who knows? The city's mum, the newspaper has little curiosity and the taxpayers are in the dark. It's a mess. The whole scheme requires perpetual tax revenue to finance perpetual construction, as well as to accommodate old construction debt and redevelopment agency operations. A drop in property tax values was not unforseeable. The city council, including Dwight Dortch and Dan Gustin, who claim conflicts of interest regarding SK baseball, owe this city an accounting.

Posted by: MattO - 1/26/2010 11:53:38 AM
Mike I have to say you couldn't be more right. I think exactly as you do. Your thoughts have to be heard, email the council, the mayor, the news media, ANYTHING to get the word out that DOWNTOWN SUCKS! I hate to say that because like you, I love this city but it's true. I too, enjoy going downtown to enjoy the ballpark but sorry, a ballpark is just that, a ballpark, it's not gonna change the perception of Reno. And you're right, building aimless new retail, even though it would like nice, would not change the perceptions. It's like you said, a REAL attractions may it be a Vegas style casino resort or waterpark would be the true cataylist, but also like you said, some MAJOR overhauling of the Virginia Street corrdior has to be done. It looks really bad, period. The closed buildings and casinos and shoddy people are the worst thing a city can have. Is the city blind to this? What is being done to adress the real issues? I can tell you this, probably NOTHING because the people who run this city are airheads who just think Reno is this small, little town that is quant and all that. BULLSH""", okay first of all Reno hasn't been small since the 60's so get over it. Foremostly, I think to see some real change, we need some people who know real change. Not Reno people because obviously, they don't know how to do it. Let's bring in some property developers from San Francisco or even Sacramento to adress our issues and help us truly create a new image for this city and the next elections, let's oust every single member of the council because if they really cared about these issues, they would've something already instead of spoon feeding SK Baseball, c'mon people. Reno's future is at stake here. I have to say the casinos are trying, the Silver Legacy has a big poster in it's lobby flaunting newly remodeled rooms for the summer. That's good but again, it doesn't change perceptions. I hold out hope that one day Reno again will thrive, someday someone will come in here who actually gives a dam. Until then, we have to suffer with a crappy economy and dumb city government

Posted by: Kelly S - 1/26/2010 1:02:53 PM
I saw that story on my lunch break. Some people have a lot of nerve. I say, cut off the money train to them. Great article, had no idea any of this was happening. Getting a deal like that is unheard of in the sports-arena world. Probably the sweetest deal of any minor league stadium built. Do you by chance have a link to the original deal points prior to the amendments?

Posted by: Erica Platt - 1/26/2010 3:42:33 PM
Other projects should receive this stimulus money. It's hard to believe the city council had the foresight to locate a major baseball stadium and future entertainment complex next to the homeless shelter and tent city. Is Disneyland next to a homeless shelter? Is the Space Needle located next to a homeless shelter? Are there homeless shelters in NYC right off the Broadway entertainment strip? Have you walked through that neighborhood since the shelter opened? Ask Lincoln Lounge about it.

Posted by: Reno Navy Guy - 1/26/2010 3:56:18 PM
MattO, You are 100% correct and hit the issue square on the head. We need new vision for the city of Reno and especially Downtown ASAP. Kick out the current city council and maybe even the Mayor ASAP and get some New Blood in the city of Reno that has the will, motivation, business savy and know how to properly re-design and re-image the City and Downtown Reno without delay. Time is wasted money folks! How many times do we have to tell these elected officials what needs to be done? They do not listen to the smart citizens of Reno on what needs to get done for the city and downtown. They are not getting the job done so lets kick them out of office. Maybe one of the Reno council members has the guts to respond to these concerns on what they plan to do to get things turned around. I'm calling out all Reno City Council members to respond and make something happen to fix this problem and move Reno and the downtown area in the right direction.

Posted by: William Puchert - 1/26/2010 4:04:51 PM
At a time when the City of Reno is laying off its public safety staff, can it really afford to give out more developer subsidies? Furthermore, behind the baseball stadium lies an outdoor encampment of homeless people with only tents and tarps for shelter. Perhaps its time for this SK Baseball to spend its own money than relying on scarce taxpayer dollars. Of course, this will never change because the baseball stadium employs one of the city council members, while the others, I'm sure, are paid off with nice campaign contributions.

Posted by: wiley_n_reno - 1/26/2010 4:29:57 PM
I still think the ballpark district was/is a good idea but perhaps was a bit too ambitious. We are in the biggest downturn since the Great Depression, and banks don't appear to be loosening their loan strings either. I agree that the downtown has had some progress but Virginia Street near the arch still looks crummy. Rightly or wrongly that is what tourists will consider the Reno signature area.

Posted by: MotorHead - 1/26/2010 5:03:57 PM
I think what The Dude is trying to say and summarize is he loves the ballpark, is neutral regarding current expansion and wants city officials to focus on the mess that is Virginia Street instead of building more retail. Fair enough, but are there any developers willing to develop downtown if the same funds became available to them? Who owns all the closed empty buildings downtown? Maybe we should be thankful someone wants to develop here at all

Posted by: Gorilla - 1/26/2010 5:09:40 PM
Alright well I certainly agree and disagree with certain stuff said. One obviously if the ballpark has and was a huge success last year -then bingo-they for sure have brought more tourism into this town than many old downtown rundown casinos, which many dumb casino owners don't realize their casinos look like crap and thats why they dont attract tourists. So maybe the facade improvement program is a GREAT idea. Second of all, true if Simon malls millionaire guy is so much of a millionaire then why is he asking for so much money(star bonds), but now lets not get too greedy after all he is converting this shithole of downtown we have in place into a tourist fascination. The solution to this is simple give him the ballpark bonds he now needs, but make them have commitments too that they have to follow through with such as: as soon as the full build out is complete then a percentage of the earnings he makes goes towards education here in town. So its a win win situation for both the developer and the CITY Or maybe handing him less star bonds and having him come up with the rest would be SUCH A BRIGHT IDEA. after all the ballpark district is a positive thing for our community and I would hate to not see the other phases of this project not get built, THEY(the city) and the developer just simply have to reach a better deal. Another thing too is that they certainly need to get STARTED with the Tessera project. With the state of the economy at the time this project would definitely create hundreds of good jobs out there-starting with putting construction workers back to work-and trying to get renewable energy companies downtown would create much more enthusiasm, along with retail, and residential units. whats going on with that does anyone know? WHy i ask myself have they not issued them those star bonds before the baseball developers - I certainly dont want to see those old downtown weekly motels anymore and those empty lots that create even more danger just stand there.

Posted by: Concerned - 1/26/2010 5:52:34 PM
The Baseball Stadium and Freight House District, using STAR Bonds, were funded because the redevelopment agencybelieved they would attract tourists, thereby putting heads in beds and seats at machines... making the downtown properties more profitable which would result in more tax revenue to pay the developers and if anything was leftover, begin new redevelopment projects. Same with the Legends at Sparks Marina. So the question is, are they really bringing in tourists? Is there quantitative date or just anecdotal evidence (i.e. the guy I sat next to was from Fresno). and if the tourists aren't coming in - then what? And if reno can't repay the $1 million this year, then what? It just can't keep rolling over. How does this all play out? these are unprecedented times - use your imagination.

Posted by: Sammy - 1/26/2010 5:56:02 PM
Well-said. Ever think of running for office? You say what needs to be said without trashing the involved LOL. I think you were too gentle but that's me. I do not want Dwight, Jessica, Bob, Dave, Sharon, Pierre or Dan to blink an eye at STAR Bonds, for a ballpark district, water park (sorry DTM dude) or otherwise in a climate experiencing double digit sales tax declines for 13 months straight.

Posted by: DowntownMakeoverDude - 1/26/2010 6:48:15 PM
Gorilla brings up good points about the jobs created. To Concerned, no STAR Bonds have actually been issued yet...only tax increment financing based on property tax revenues. The City is in negotiation right now with SK Baseball regarding STAR bonds, and SK has sent letters of interest for the Recovery Zone Facility Bonds on both the county and city levels. MotorHead (love the name) is correct. I do love the stadium and I don't want the city council or SK Baseball to think this is a criticism of the stadium itself...if I was against the project I wouldn't spend so much friggin' time photographing the construction progress for yall. We need to continuing supporting the Aces and I hope to see you all out there in season 2. I just feel it's not necessary or prudent at this time to give them any ADDITIONAL financing tools. There are other parts of downtown in worse condition, other projects that could use that Recovery Zone Facility Bond money. That's it. Simple. It's easy for locals to avoid the casino corridor and stick to the river corridor, but for tourists...well, this is where the majority stay when they visit Reno. Then they'll walk straight down Virginia Street, past all the closed casinos, 22 liquor stores, faded casino facades and vacant retail spaces, and reach the riverwalk, where they'll find some semblance of civilized life. I'm not kidding. Every walk I take downtown north of 2nd Street is more and more frightening, even in broad daylight on a weekend...and I'm a grown man with an 80 pound German Shepherd who grew up in downtown L.A. Have you all noticed this too? It's particularly bad in the Virginia Street/Train Trench/Lake/Evans/4th Street area.

Posted by: MattO - 1/26/2010 8:18:09 PM
yeah Mike you're right, it's really bad in those areas. It's really sad to see all this plight, but you know, I went downtown last weekend and walked around and I have to tell you, I was impressed, the Riverwalk area is great! I really enjoyed it but still the closed casinos and all that is really sad to see but if you can somehow just get past that, it's okay. Downtown is "okay" not great, not horrificly bad like some cities just "okay" for now

Posted by: Concerned - 1/26/2010 10:03:13 PM
still interested in seeing real numbers for locals vs tourists - and we need real live businesses that attract shoppers and diners - a facade improvement doesn't create pedestrian traffic so then the bums take over. This past summer I walked from Circus to West Street Market at 10 am on a weekday - and I agree - it can be frightening. Things were really getting better - but now we're coasting downhill again.

Posted by: average guy - 1/26/2010 10:28:30 PM
You are so on the mark .This project has been pushed thru with so much of our tax money going directly to subsidize the developer .From what I remember , Ms. Sferrazza was the only one questioning this project .Yes, Mr. Dortch works for the Baseball Company ,the Mayors son was part owner of a condo project and the Fitzgerald and who knows about the staff and other special friends . Only Ms. Sferrazza voted against this last trick for $1,000,000 .Staff lied. If you remember, Ms. Zadra stated in the 1 st meeting this year that staff had misrepresented to council in the earlier approvals and she was very mad. Funny now both the City Manager and the Finance Director have both gone away. Oh the Redevelopment Director is also gone. Did you notice the Mayors smile on his face tonight, as he tried to explain what he pushed thru? Makes me sick --- bet Ms. Zadra will not be pushed by the Mayor into voting for these tricks in the future .But now we are broke. Yes, you are right on Thanks for stating it .

Posted by: Rachel - 1/28/2010 5:55:07 PM
I agree, thank you for this article. Downtown is very scary, I cannot walk down Virginia Street anymore, cause I was mugged the last time I did, I was on my way to the Truckee River, where it is beautiful. Instead I had to flag down cops to help me, which after talking to 4 cops on bikes, the 5th cop actually wanted to help me. So now I am afraid to go anywhere near downtown, especially seeing as the cops down there are doing nothing. The empty buildings are horrid to look at, Woolworth's is a big building, not far from the Baseball park, why don't the Baseball park owners just use this, remodel it, there you go. I am glad that these star bonds have yet to be issued to the owner of the park & that the city is not bound to them. The owner can afford to pay for his own park & he should, no one pays for anything I need/want but me. Reno needs so serious overhauling, with it's buildings already laying in decay. keep up the great reporting on this, I look forward to reading up more on this, cause I had no idea it was going on.

Posted by: Old School Guy - 1/29/2010 8:14:06 AM
I am a Reno visitor and have been for four decades. It is good to see all this concern for downtown makeover projects. However, I don't think any tourists will travel to Reno to attend a minor league baseball game, it just doesn't offer enough magnatism to attract out-of-town visitors. Nice to have it for the locals, though, so it is a beneficial improvement in that regard. Solving the visuals and human interactions along Virginia Street should be priority number one, in my judgment. Otherwise, no matter how grandiose a renewal plan, out-of-town people won't make a second visit, after the experience of their first. To do this, two objectives must be addressed: First, provide an off-site `assistance zone' for the homeless, and put the tent city, clinics, food and shelter, and social services, in that district ONLY. Also, those services should be modest, not provided at the level where the service center becomes a magnet to the homeless in other cities. These folks do travel around and the word gets out. Second, the areas sought to be improved, along the river and along Virginia Street, should be given the police resources to provide quick, strong enforcement. Once it becomes known that these are not peaceful loitering area, they will not be favorites any longer for such activities. As to crime, once the word gets out that the peace officers on patrol are using strong enforcement methods, the petty hoodlums and muggers get the word, and will leave for better hunting grounds. As one local taxi driver here in Los Angeles once commented to a police officer known to me, complaining about crime against his passengers in the downtown area, "If you fellas on patrol would blast a couple of these guys, that would stop all this stuff." Then with the area starting to feel safer for visitors walking about, business owners and investors would feel a greater comfort level in spending money on improving appearances and amenities. Until then, nobody is going to want to invest another dime, better to just milk the business and run it down further until it is time to walk away. So the course of action should be move the injurious element to a special purpose area, provide strong patrol enforcement in the target improvement area, then private capital will step up and make improvements.

Posted by: MikeO - 2/1/2010 2:51:21 PM
DTMO Mike, you are so spot on. I would seriously vote for you if you ran for a city planning position. My main problem is that downtown wants to build a new shopping district when the current CalAve is so pathetic. It COULD be great. It has so much potential but lacks so much at the same time. Reno promotes it as a true shopping street but it has more law offices than actual shops. It's sad. But that's kind of the story for all of downtown - it has so much potential but isn't quite there yet and lacks the focus and dedication to bring it up to all it could be. I agree with you 100%, the focus should be on improving what already exists, not building new and detracting from all the potentially great neighborhoods and streets and districts that are already in place.

Posted by: Blake Crosby - 2/3/2010 11:41:32 AM
STAR stands for Socialists Transferring Assets to the Rich. Now everyone is against them? I was arguing against them from the start. It's a corrupt, internal system with no accountability where influential people not market forces determine allocation of resources. Isn't that the definition of Socialism? Look at Cal Ave. Any STAR bonds there? Any massive redevelopment convention center built there? Yet, it's doing a heck of a lot better than downtown. Is there a lesson there? Cal Ave, free market Capitalism, independent, local owners, versus downtown, socialist redevelopment mostly corporate owned and half the store fronts are empty. Any lessons here folks??? Finally, it's not the homeless that's the problem downtown, it's the aggressive panhandling. There's nothing wrong with homeless people. They're human beings and they have every much as right to be downtown as some condescending yuppie with a dog. Panhandlers wouldn't be downtown if it weren't for stupid people giving them change. It's like stray dogs. You feed them, guess what, they start to rely on you for food.

 

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