March 29, 2006
Lots of news to report, so let's get to it!
A while back I wrote about some erroneous comments made by Ron Abrams in the Sun Sailor concerning general obligation bonds vs. revenue bonds (and how the HC plan will only use revenue bonds). Anyway, Mike Opat has written a reply which also appeared in the Sun Sailor:
[Abrams'] assertion is absolutely not true. The Hennepin County Board has not and will not propose issuing General Obligation bonds backed by property taxes to build the ballpark. Hennepin County will also not pledge its property tax base as a credit enhancement for the ballpark revenue bonds.
As has been widely reported since April of 2005, the Hennepin County ballpark plan would be financed through tax-exempt revenue bonds that would be supported by a .15 percent county-wide general sales tax. We are proposing tax-exempt debt to keep interest costs as low as possible. In addition, we believe that sales tax receipts will grow over time and allow us to pay off the debt early and end the tax early. In the Denver area, a .1 percent general sales tax was used to finance Coors Field and the 20-year bonds were retired in less than 10 years.
Read the whole letter if you are interested.
Also a while back spycake and an anonymous contributor got into a "discussion" concerning whether or not the money raised from the revenue bonds could actually pay off the debt in less than 30 years. According to my anonymous contributor:
Hennepin County finance guys seem to be from the 'measure twice, cut once school'--meaning ultra conservative. Hennepin County has held a triple-A bond rating for 30 straight years. A 30% coverage ratio gets HC to that 'lowest cost' debt i mentioned in my earlier message.
In fact, HC's own website highlights their goal of 130% total debt coverage. According to this site:
Estimated Annual County Debt Service Payment - $21.5 (at a 4.75% interest rate)
Estimated Annual Tax Revenue Required at 130% Coverage - $28 million
Estimated Annual Sales Tax Proceeds at .15% - $28 million
So, the plan was clearly to pay off the debt early. I'm pretty confident they would have done it, too. But it seems we'll never know.
Finally (for now), New Ballpark, Inc. (NBI) is reforming to try to put pressure on the legislature to pass the Hennepin County plan. The original NBI was made up of high profile civic leaders, this iteration will be people with some more enlightened self interest (Real Estate, bars etc). Look for this group to get more attention as the weeks progress and the legislature continues to do nothing concerning this problem.
The group has also released a Call to Action (PDF) that you may want to peruse. It is interesting.
That's it for now.
Posted by snackeru at March 29, 2006 8:34 AM | Stadiums 2006
Thanks for the heads-up on New Ballpark Inc. I will be passing along the info to the appropriate parties. Also, as I was driving into work this morning around 2:15 am (gotta make the beer, gotta make the beer), I was listening to 'CC0 and their overnight guy, Al Malmberg, had a caller that insisted that while he was down at spring traing he talked to a person in management at another midwest major league team who insisted that he had been told that the Twins moving to Las Vegas for the '07 season was a done deal. He said Vegas had taken the proper steps to insure MLB that the gambling would not be an issue. There are alot of crackpots that call talk radio at 2 am but this guy souned legit. I am getting worried.
Posted by: jiminstpaul at March 29, 2006 11:23 AM
Surprised you didn't highlight Gollum's latest anti stadium screed. Granted it's about the Gophers stadium and the land swap deal. Some highlights:
He describes it as a backroom deal, I guess he missed the part where the deal was completely laid out in the media and is being debated in practically every committee at the Capitol.
It sounds like he wants an apology from the University for tearing down Memorial stadium. As a student of the U at the time the Gophers moved to the dome and a current U employee now, I extend my apologies to Gollum.
Two groups/interests that Gollum usually aligns himself with - students and the environment - don't get mentioned in his article. Funny, the new gophers stadium cuts in half the the student service fee that was going to help pay for the stadium and protects a highly sensitive area for generations to come. Why does Gollum hate the students?
Finally he evokes Kirby Puckett's name as being against any kind of stadium. Wonder what vitrolic words he would have flung at a ballpark supporter who was the first to mention Pucket's name in support of a ballpark.
Posted by: freealonzo at March 29, 2006 12:28 PM
Joe Soucheray also had a column against the joke of a U stadium deal. It seems everyone is seeing though this. Imagine that, one state entity gives another one money and they all spend it on garbage like stadiums. All that money is tax money. Hopefully it won't pass.
Posted by: Truth at March 29, 2006 3:50 PM
Obviously the Twins are free from the Dome lease after this year, but there just isn't a major-league-ready ballpark in Las Vegas, or pretty much any other potential destination. Would the league be willing to play the first few seasons (perhaps the best seasons for revenues) in a mediocre 10,000 seat minor league park, haphazardly expanded to 30,000? Probably not much worse than the Dome, some will say, but imagine if the Vegas Twins made the playoffs! For all its faults, the Dome is still a decent baseball facility on most days, just not as profitable as the team would like. Cashman Field in Vegas, I fear, would neither be serviceable nor profitable. Plus, with the ongoing Washington and Florida troubles, I think that MLB would need a guaranteed new ballpark proposal finalized and approved before it commits to another market. Can or will Las Vegas do this in time to move the Twins for 2007? Gambling should be the least of the league's concerns.
Of course, It would be nice to get the stadium issue settled soon anyway, but I still don't see a legitimate move or contraction scenario in the forseeable future.
Posted by: spycake at March 30, 2006 10:57 AM
Spycake is right. I don't think ballpark supporters can with a straight face argue that if a ballpark isn't passed the Twins are gone after the 2006 season. However, the odds get greater for each year after 2007, not strong odds, but they do increase. Also remember contraction can rear its ugly head in 2007 too.
Posted by: freealonzo at March 30, 2006 1:51 PM