Way Too Early For “I Told You So”

A Voice of OC story published this morning regarding news that Angels owner Arte Moreno had met with the City of Tustin about possibly moving his team to that fine city is basically a platform for Mayor Tom Tait to say “I told you so” (as the story headline says):

News that Angels owner Arte Moreno has reached out to Tustin leaders regarding a possible move did not surprise Anaheim Mayor Tom Tait in the least.

In fact, Tait said the inevitability of such hardball tactics from the billionaire team owner is exactly why he urged his City Council colleagues last year not to agree to extend the negotiating window on a new stadium lease, something they did anyway.

“To even be able to threaten leaving is only possible because the council majority unilaterally extended the time where they allowed the Angels to leave the existing lease to 2019 from 2016,” Tait said. “If they did nothing, then practically the Angels couldn’t go anywhere. And as I said when they voted on that, if the Angels do leave, you can trace it back to this vote.”

That’s one way to look at it, but by no means the definitive way or even the correct.

Critics of the MOU extending the opt-out date to 2019 claim leaving it at 2016 put the Angels over a barrel and the city in the negotiating driver seat. What leaving the opt-out date at 2016 would have done is increased the pressure on the Angels to make a decision quickly – and that decision could have easily been to exercise the opt-out clause, in which case the city would have found itself with a big, empty, fifty-year old stadium on its hands.

It’s a mistake to think leaving the opt-out date at 2016 left the Angels with no options. Finding a temporary home while building a new stadium elsewhere isn’t a herculean undertaking. The Angels could share Dodger Stadium, just as they once did. The Coliseum in Los Angeles is available during baseball season (and is where the Dodgers played until their own stadium was built).

Some critics claim the CEQA process would make it impossible to quickly build a new stadium. Again, not true. We have more than one example in recent years of the state legislature granting special CEQA exemptions in order to fast-track the construction of professional sports venues.

And Moreno isn’t the only one playing hardball. The mayor hasn’t exactly been using kid gloves during the vigorous campaign he has been waging against the negotiation framework.

Anaheim would be best served if an actual deal were brought before the council for consideration, debate and either approval or rejection – and sooner rather than later. The approved negotiation framework provides the parameters for a win-win deal that is to the benefit of Anaheim taxpayers – notwithstanding criticism of allowing a private investor to shoulder the risk of actuating economic activity on land that has been generated zero economic output under the city’s stewardship, while simultaneously requiring that private party to shoulder the burden of spending $150 modernizing the city-owned stadium. Yeah – that’s a real burn to the taxpayer.

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  1. Ughhhhhhhh. Where to start on this one.

    CEQA: Arte’s ability to get both the legislature and the governor to exempt application of the law is extremely limited, particularly since the projects you do reference had completed designs and preliminary impact reports already completed. That’s obviously not the case here. Furthermore, the two cases (Football stadiums in So Cal) STILL aren’t built many years later. What you’re suggesting that Arte could have done would have cost upwards of TWO BILLION DOLLARS to do on an expedited basis by 2016. Steel prices are still much higher than their historical averages, so assuming we don’t expedite construction, we’ll call it $1.3b by 2019, which is probably low.

    Alternative field locations: What’s the cost to Moreno to hold games in either location? Luxury box sales, ticket sales, rental fees, etc? How about replacing season ticket sales? Lost parking revenue? I’ll ball park it at $8 a seat or roughly $30,000,000. I think that’s pretty conservative. That assumes the Dodgers don’t vigorously oppose the move, which they would. If they do and Arte has to play his games out of market in Qualcomm or in facilities in Arizona, we’re talking hundreds of millions per year. So, while there are places Moreno could play on a short term basis, those options cost him a huge amount of revenue. He’s a smart guy. There’s no way he’d do that.

    So, at a conservative $30m a year, the council handed him a $100,000,000 concession for . . . wait for it . . . FREE. They got nothing in return.

    That’s stupid, Matt. Really, really, really stupid.

    Finally, how much does Moreno stand to make from developing the 155 acres, including ownership of the city’s train station and the Grove Theatre? Stating that he’s assuming privately owned risk to secure a privately owned benefit is LAUGHABLE. The majority of capital cost in that development is ownership of the land . . . like all development in SoCal. The public surrenders its property rights and its right to earn a return on its investment not for a primary public benefit, but for primary private enrichment.

    It’s properly termed private enrichment by pillaging a public asset. He’s gong to make billions off that deal. That’s the public’s land and the PUBLIC should be getting the lion’s share of the benefit– not the other way around.

    Oh, and by the way– that $150,000,000 that the stadium needs . . . Arte already owes that to Anaheim. The existing lease mandates that he maintain the asset. The city set up a revenue stream in the existing lease to provide to that effect. Clearly he’s in breach of that responsibility and it is a travesty that the council majority is agreeing to let him out of what he agreed to. Even if he leaves, he still owes Anaheim a $150,000,000 check.

    Maybe the city will throw in ARTIC and the Honda Center, too. I mean, why the hell not? What isn’t reasonable when you’re willing to fork over $100,000,000 for nothing?

    • Matthew Cunningham

      It’s late and I’m not inclined to respond to your voluminous comment, but a couple of quick needle points:

      – Are you in communication with the Dodger organization? At least, I gather you must be stemming from your claim to know their stance regarding sharing their stadium with the Angels. And exactly what prohibits the Angels from negotiating a deal with the Dodgers whereby Angels fans can buy season tickets, use luxury boxes, etc — since it is only on a few occasions when both teams will be in the stadium at the same time. They’re both businesse; they can probably figure something out.

      – The existing lease mandates the Angels pay for upkeep and maintenance — unless the Angels opt-out, in which case the taxpayers of Anaheim are on the hook – and monster truck rallies and the Harvest Crusade aren’t going to pay the tab.

      – I continued to be mystified at the opposition from some self-described conservatives at inviting a private investor to generate economic activity – which I assume my fellow conservatives still consider beneficial to the public — on city-owned land that has been doing exactly nothing for years and years. I don’t recall this level of concern for this public asset until the negotiation framework was approved. Then, suddenly, the usual suspects were fretting furiously over that precious asset to which they had heretofore given no thought.

      • Both the Dodgers and the City of Los Angeles denounced the Angel name change and went to far as to file briefs supporting Anaheim in court. I’m pretty sure my suspicion that the Dodgers would oppose a physical move to LA is well founded. Supposing it isn’t, again, the number I cite above is probably a conservative representation of Moreno’s lost opportunity. It’s not that season ticket sales or luxury boxes couldn’t be used (although existing season ticket holders at Dodger stadium way actually have rights being infringed, I’d have to see their contracts), it’s the delta in revenue capture that’s important. Arte currently gets 100% of the margin. He wouldn’t at Dodger stadium. Not even close.

        The existing lease does indeed mandate upkeep and maintenance– which means that if Arte is deferring maintenance beyond the tenure of his lease, he’s still liable for those costs. In addition to any deferred maintenance, he’d also be liable for a percentage of future planned maintenance based on the useful life of certain components he utilized during his tenure. This isn’t any different than having to pay for worn carpet at the end of an apartment lease, except in a residential lease a tenant at least gets credit for normal wear and tear. Arte gets no such shelter as he agreed to conduct maintenance himself and the city paid into a common fund ON TOP OF conceding revenue streams to which it was entitled under the previous lease. Of the $150m quoted, I bet an aggressive city negotiator could get all of it, if not more. But Anaheim don’t have one of those.

        Also, you’re not stating the “conservative” objection correctly. I don’t think too many people are objecting to the private sector generating investment and growth through a public asset. We’re objecting to the public getting screwed over solely for private enrichment. What you’re outlining above is significantly more in line with the 50/50 JV proposed by Mayor Tom Tait than it is with the blind gift being championed by give away artists Kris Murray and Lucy Kring.

        “No thought” regarding the existing undeveloped parking lot is misleading, Matt. The land hasn’t been developed because Arte Moreno has blocked its development though a condition in the existing lease– not because of public apathy. In fact, the land is already zoned and approved for development by the city, which took years of effort to complete.

        There is no business in the world that would make the decisions the council majority has made regarding this lease extension. The fact we’re paying someone $300/hr to negotiate to literally give away public land is a sorry cherry on top of this disaster sundae.

        Too early to say I told you so? Nah, we all knew this was inevitable as soon as the agenda was posted before Labor Day. Now is as good a time as any.

        • Matthew Cunningham

          “Both the Dodgers and the City of Los Angeles denounced the Angel name change and went to far as to file briefs supporting Anaheim in court.”

          And the Dodgers are under different ownership now.

          And please stop with crying “giveaway,” Ryan. It is literally untrue to say that.

          Please tell me what the city is going to do with that land? Do you want the city to go into the development business? Are you confident that would end well?

          Furthermore, Moreno doesn’t have a veto over any development on the 53-acres. Only housing can’t be built there without his OK. And that land has sat fallow under city ownership, year after year after year after year, with nary a peep out of the brigade of know-it-alls who now fawn like Gollum over their “precious.”

          • Literally untrue to call it a giveaway? Why– because the transaction involves ONE ACTUAL DOLLAR?

            No, Matt. Not calling it a giveaway is untrue. “Nominal” consideration might not meet the literal definition of giveaway, but it meets the substantial spirit of it.

            What I would want the city to do with the land is largely irrelevant: What i want is the city’s residents, the actual owners of the parcel and for whom the city holds the land in trust, to get a fair deal. I’m very confident that a fair deal would end well. I’m not sure if the split is 50/50, 70/30, or 30/70, but it sure as hell isn’t <01%/99/.99%.

            Regarding Sportstown, I'm afraid you've been misinformed. The Tenant has the right to approve development. Let's also not forget that parking structure, which is a bit pricey in the post-redevelopment era, but I digress . . .

            This is ultimately about what's fair. There's nothing fair about handing over 155 acres for a dollar because a billionaire demanded it to satisfy an obligation he's already conceded. That's not a partnership; it's abuse.

          • Nasty hobbitses stole the Precious!! Gollum! Gollum!

      • I don’t share your assumption that The Dodgers would leave the light on for Arte Moreno like Motel 6. I believe they know more about the Angels finances and the business of baseball than our City Council, and the Dodgers love of baseball only extends financially to DODGERS Baseball.
        The Dodgers still pay Frank McCourt $7 Million/ yr for rent on HALF of THEIR parking lot, on top of the Megabucks the New owners paid for the team, and have announced SELF FUNDED renovation plans for Dodgers stadium. Although credible estimates abound online, I haven’t seen Moreno’s OR Guggenheim’s books any more than you have, but with those expenses over their head, I really doubt they will accommodate Moreno with anything near the low operating costs he is used to at Angels Stadium, and that assumes they will even WANT to invite a competitor to share in ANY part of the money in the pockets of THEIR customer base. Why should the Dodgers be inclined to treat the Angels any differently, than the SF Giants do the Oakland Athletics, in THEIR near-homeless situation?? If I recall, LA JOINED Anaheim in the naming rights suit, feeling THEIR name was being infringed without their permission. When it is often alluded that the Angels began as tenants of the Dodgers, it is also ignored that being gouged by their landlord, was what brought them to Anaheim. So what’s new? “Bidness iz Bidness”. There may be ‘room at the inn’ but will an Angel owner who now gets (and complains about) Motel 6 rent, be OK with Ritz -Carlton prices? Events will tell.

        I believe the question was raised here or in a similar forum “Who would pay the $150M if Moreno left”? Well, if it’s a lease obligation, that would be Moreno, either before leaving, or after a suit for specific performance of his lease obligations by the City. And if without the Angels, WHY would the $150M, paid or unpaid, have to be SPENT? For whose benefit? Are motocross, concerts and Televangelist appearances under 20 year leases? I doubt they are booked very far in advance.
        And if an audit of the already collected funds, and an itemized list of the allegedly required repairs (by someone qualified and certified) exists, why hasn’t the public seen it? Where has it been hiding all this time, until lease ‘negotiations’ make it a potential but unsubstantiated club?
        Am I the only one who is puzzled why Moreno suddenly declares negotiations “at a standstill” with not even a vague syllable about the nature of the impasse? It is odd that inquiries are deflected by ‘secrecy’, but from WHOM? Moreno knows, Staff knows, the Council Knows, the ONLY folks (kept) thoroughly in the dark are the PUBLIC.

        • And lest we forget, there’s also a guy nobody mentions, who has LOTS more to say about where the Angels play than Arte Moreno, (as he has with the other teams mentioned above), by the name of Bud Selig.

        • ” . . . the ONLY folks (kept) thoroughly in the dark are the PUBLIC.”

          If Moreno isn’t going to respect the veil afforded to him through the benefit of closed session negotiations, perhaps it’s time the council revoked that privileged and debated the merit of a lease modification in open session.

          The city is barred from responding to Moreno’s leaks based on the current arrangement, and the public pays the cost of his misrepresentation. That ought to change. Quickly.

  2. Let’s not forget that Tom Tait was on the Anaheim Planning Commission when the Rams decided to leave Anaheim.

    Tait has a history for working to keep sports teams out of Anaheim. It will be interesting to see what the FPPC has to say about Tom Tait owning a building right across the street from Anaheim Stadium.

    He came up with some silly answer when asked about it. He said he “gave” the building to the his daughter.

    Which would mean his daughter, would have been required to pay taxes on the building.

    Looks like Tom isn’t the only Tait that is in trouble. I wonder if his daughter knows what kind of trouble Daddy has gotten her into?

    • Can you ‘reasonably’ explain what direct approval role the Planning Commission had in the Rams negotiations? Wasn’t that decision solely with the City Council,then, as it is now?

  3. I am not sure when Tom Tait bought his office building across for the stadium. That would answer your question.

    With his real estate interests directly across the street, it would matter.

  4. Stand For Anaheim

    Tait has business in Garden Grove and land across from the stadium…serving an the OCTA board when that board has awarded his firm contracts…really!!?!?

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