Posts Tagged Port Authority
Game Being Played by Larry Dolan and Gateway
Posted by Roldo Bartimole in Economic Development, Media, People, Politicians on May 20th, 2010
May 20, 2010… It was a pleasure to see The Plain Dealer’s front page today. The PD for the first time in my memory asked a question that needed to be asked: “If Progressive Field needs improvements, who will pay the bill?” It was played prominently on Page One.
If there is any other board that needs PD probing besides the Port Authority it is the Gateway Economic Development Corp., the entity Cuyahoga County set up to own and operate the baseball field and the basketball arena (Progressive Field and the Quicken Arena).
It too has operated in vacuum, unwatched and unattended.
The answers to question about the so-called improvement at the baseball field are evasive both from the Cleveland Indians and from Gateway. True to standard.
Here’s what Indians PR spokesperson Bob DiBiasio said about the big but undisclosed plans, “We’re not there yet. It’s not a question that needs to be asked yet.”
Doesn’t need to be answered? That is strict PR bullshit from someone who never gets challenged by the news media. A happy face he has but not a trustful one for me. If you believe him on this one I have some special mortgage bonds to sell you.
“The Indians have not made any requests for alterations or payments,” was the answer from Gateway’s top operating official Todd Greathouse. Equally evasive. But not unexpected.
Don’t you think that the owner – Gateway – might want to inquire and have that information, especially when it has been in Crain’s Cleveland Business, online in my posts and now in the PD? And it could cost you millions of dollars? Oh why get testy.
It’s the disgusting proof – long tradition – that the owner are not in control of their facilities. The tenants are.
The question is WHO WILL PAY – THE TEAM OR THE PUBLIC?
Let me tell you. You will pay.
The PD – and I hope this ends the marriage the paper has had with Gateway – has been wed to Gateway and its desires from the beginning.
But the writing was on the wall.
Here’s what I wrote in the City News in April 2005:
“Gateway Economic Development Corp. Chairman Bill Reidy let it drop quietly, almost nonchalantly, during a non-eventful quarterly meeting a week ago.
“Reidy said that ‘the city and county would have to step in’ and put up money for Gateway’s capital fund when major repairs are necessary at Jacobs Field and Gund Arena (the original names for the two facilities
“What?” I wrote. Did I hear that right?
“Haven’t taxpayers paid enough for Gateway? Now Reidy wants the taxpayers to dig into their pockets for possibly hundreds of thousands of dollar in capital expenses that Gateway should have been putting aside itself,” I continued.
“Gateway, however, can’t put money aside because it has never charged the teams enough to maintain Jacobs Field and Gund Arena,” I went on.
“What’s so upsetting about this is that at that same meeting new representatives from the city – Chris Ronayne, Mayor Jane Campbell’s chief of staff – and Dennis Madden –Cuyahoga County Administrator – said nothing about this raid on their respective treasuries.” Somebody wake up our officials.
Let me tell you what I expect is happening.
Larry Dolan – and I expect Dan Gilbert won’t be far behind – has set in motion “improvements” at Progressive that will cost in the millions of dollars.
It will take some time.
But there will be money around. The sin tax extension of 10 years has a stipulation that the revenue up to $116 million will go to help pay for Browns Stadium for the City of Cleveland. However, once that total is reached the money – some $68 million had been the estimate – will go to the County. The tax has raised $94.3 million. So it’s not far from the $116 and is coming in at some $13 million a year.
The new money is not to go to Gateway. It is supposed to go to the County general fund. Where it is needed, I might add.
Watch County officials for the rest of this year. They must not be allowed to make any revisions that would send this money to Gateway.
At the time of the Reidy statement, I quoted a County official and wrote:
“’This is our money,’ said a County official. He went on to say, the County has paid an extra $100 million on other bonds and has to continue to paying. Now, it should derive the benefit from the 10 extra years of the sin tax, he said.”
So that’s the game – using more public dollars to boost the revenue of the teams.
My other suspicion, Dolan will use the improvement to help the revenue for the team and make it more valuable for sale purposes. Forbes in assessing the value of MLB teams puts the Indians at $391 million team value. Dolan bought the team for $323 from Dick Jacobs.
Do you think we ought to put a Dolan in as the County Chief executive to help rule whether the Cleveland Indians should get a helping of that $68 million coming due.” Matt Dolan has moved into Cuyahoga County to run for chief executive. Who would he represent in such a deal – his family or county taxpayers?
I think I know the answer.
My question is whether the Plain Dealer will deal with this money grab honestly. I hope so. But the PD’s record on this score is about as good as guys named Hagan, Dimora and Russo.
Here is the PD story:
Here was my take on the improvement deal: click here.
Subsidies Cause More Problems Than Cure
Posted by Roldo Bartimole in Economic Development, Media on March 7th, 2010
March 7, 2010… The Plain Dealer reported Sunday about the troubled downtown commercial properties. Empty and emptying buildings. It’s a shame.
“Turmoil in commercial real estate,” says the article by Michelle Jarboe here:
http://www.cleveland.com/business/index.ssf/2010/03/commercial_real_estates_challe.html
Yet The Plain Dealer – with business and political leaders – has been pushing for more and more subsidies to build new. That’s just one of the major reasons there are so many empty buildings. We are helping to create excess.
You can’t build new when you can’t even keep the old relevant.
At the same time retail and commercial properties go into foreclosure Cleveland political leaders are using hefty subsidies to produce more retail and commercial. Why?
You can’t have everything you want. Isn’t that what we teach children?
Why then isn’t that good advice for developers.
As business declines downtown the answer we seem to get is to open new property for development. As buildings are emptying, we are providing very heavy – in the multi-tens of millions of dollars – to the Wolstein project on the East Bank of the Flats.
The Port Authority wants to open land on the lakefront to the same kind of development. Now there’s a push to get rid of Burke Lakefront Airport and open it for development.
Cleveland, in a dirty deal, opened more than 500 valuable acres in Chagrin Highlands two decades ago. Now, Eaton Corporation will move out of downtown to Chagrin Highlands. So will University Hospitals with a new hospital facility. And other business have been attracted to the open spaces at the Highlands, city owned land that never should have been opened to greedy speculators. But then Mayor George Voinovich, tied to the project via his old Calfee-Halter law firm, and then Council President George Forbes, tied to Dick Jacobs, worked a deal that has hurt the city and will continue to damage downtown.
You can’t have it all. We seem to be urged by major institutions to grab more, however.
The Port, of course, has gotten itself into trouble with its attempt to serve more as an economic development body than a port. Its desire to open up land on Lake Erie is self-defeating. Developers, led by John Carney of the Port board, push this direction.
The Plain Dealer has been doing a good job of being critical of the Port Board and how it does business. However, the PD has been a chief cheerleader in the past. It helped push the Port into being a financial conduit, starting with its financing of the Rock and Roll Hall of Fame.
Again, you can’t have your cake and eat it too.
Corporate and civic leaders (aren’t they same?) and The Plain Dealer have pushed and applauded the politicians into thinking they are developers. More and more various levels of governments are acting as economic development entities. As if they know what they’re doing. They don’t. They do what developers tell them.
For years and years the politicians have been using public funds to subsidize almost any project that came to them for handouts. I don’t believe they know what they are doing. They obviously don’t care since it helps them, sometimes with campaign dough, sometimes with kudos and pressure from the totally undiscriminating news media, and sometimes, I’m convinced, via the greased hands of corruption.
How do we stop it?
Citizens have to more and more tell public officials upfront that they dislike all this welfare to business.
Tax abatement and tax exemption have produced some development. However, it’s rather clear it also has damaged other business.
At the same time the public services that cities, counties and state should provide its citizens declines. Cleveland can’t even pave its roads. Not enough money. That has to change.
Here are some links with evidence of what I’m talking about: