Jeff Mosier wrote this article in response to Brett Shipp's biased investigative piece written this week.
Jeff has the integrity to tell the truth about the contract with the Rangers. His article follows:
People nationwide are wondering if
the proposed $1 billion Texas Rangers stadium is essentially a scam of
Arlington taxpayers after investigative reporting this week by
WFAA-TV (Channel 8) bulldog Brett Shipp.
His
story — picked up nationally — said the city-team contract features a secretive
provision that increases Arlington taxpayers’ share of the deal from 50 percent
to 80 percent. Shipp described this as something they didn’t want
“you to see and aren’t eager to talk about.”
Popular
sports website Deadspin picked up Shipp’s story and
concluded: “Spending public money on stadiums to give to billionaires is bad.
Stop. [Expletive]. Doing it.”
The
story was also aggregated by Yahoo News, NBC Sports blog Hardball Talk and
conservative website Breitbart.
The
report brought up both long-running concerns about stadium financing but missed
the mark in several aspects when it comes to the details, including the basic
math.
This
story doesn’t go into the debate about public financing of stadiums; that’s
another story entirely. But here’s what you need to know about the stadium
deal.
What are the parking and ticket taxes?
The
story’s gotcha element is the possible parking and ticket taxes. Those taxes haven’t
officially been added to the deal, but they seem likely to happen.
If
approved, the city would create a tax of up to 10 percent on Rangers stadium
tickets and up to $3 on Rangers stadium parking. But the revenue would count
toward the Rangers’ share of the debt rather than the city’s.
Using
as a template AT&T Stadium — which has the same parking and ticket taxes —
Shipp estimated this could raise about $300 million for the Rangers’ portion of
the debt. When adding that chunk to the city’s $500 million share of the debt —
where the report said it belongs — he estimated Arlington taxpayers would
be hit with $800 million in debt or about 80 percent of the stadium cost.
But
city officials pointed out this fails to take into account interest.
That
$300 million Shipp calculated would actually pay off $120 million in debt,
not $300 million. He said this city’s deal isn’t even close to 50-50. But math
says it isn’t close to 80-20.
Arlington
taxpayers’ debt load
The
report also misses by continually referring to Arlington taxpayers and their
share of the debt burden.
The
parking and ticket taxes would be paid by those who go to the game. Some are
Arlington residents. Some live outside the area. Also, roughly half the city’s
sales tax money comes from nonresidents. While that $500 million debt is on the
city’s ledger, about half will be paid by outsiders.
Precise
numbers weren’t immediately available. But it’s possible that Arlington
residents will pay for about 30 percent of the stadium, even when factoring in
the parking and ticket taxes.
The
numbers can tell varied and contradictory stories.
Reason
for the taxes
The
Rangers could have generated the same amount of money by raising ticket prices
and parking fees by an equivalent amount. But doing it this way allows them to
get a lower interest rate, since the bonds are backed by a dedicated revenue
source.
The
city considers this part of the team’s debt since the Rangers on the hook for
the debt, not the taxpayers. If the revenue falls short, the city would
charge the Rangers additional rent to make up for the shortfall.
That
actually happened early on at the Cowboys’ new stadium. The parking and ticket
taxes didn’t initially generate enough revenue so the Cowboys paid extra rent
to meet the bond’s obligations. Those taxes are paying for nearly $148 million
worth of bond debt for that football stadium.
There
are many, though, who think this is sneaky math on the part of the city and the
Rangers. They argue that these are taxes that are being handed over to a
private business.
Same
story, different team
The
same complaints were lobbed against the Cowboys stadium project about a decade
ago. The opposition to the use of those taxes was covered extensively back then
by The Dallas Morning News and Fort Worth
Star-Telegram as well as by Shipp.
Here’s
an excerpt from a 2004 Dallas Morning News story I wrote
shortly before early voting started for the Cowboys’ new stadium:
Q:
Is this a 50-50 deal between Arlington and the Cowboys?
A:
To borrow from past presidential politics, it depends on how you define
the question. The city would pay $325 million or half of the cost,
whichever is less. Supporters say that means that if there are
cost overruns, the city is protected. Opponents have criticized that
assertion, saying that the Cowboys will have part of their debt
funded by an additional tax on tickets and parking. Also, they explained
that the Cowboys would get almost all the revenue from the
stadium.
Was
the city trying to hide these taxes?
Shipp
also popped on the Dennis and Friedo show at KESN-FM (103.3) Wednesday to
discuss the stadium deal and said he knew when the Rangers stadium was
announced that there would be a similar tax provision.
“Guess
what? I found it,” he told the hosts. “Hell, it’s on Page 2. They didn’t even
try to hide it. It’s just nobody decided to read it. But I read it, and I did
the math. And the math means essentially that the citizens of Arlington will
being paying for 80 percent — at least 80 percent — of that stadium, if it gets
built.”
Arlington officials said the use of the parking and ticket taxes for the
Rangers’ portion of the stadium debt wasn’t a secret. It wasn’t mentioned in
press releases, but the information was widely available to the media and
public.
Those
taxes were featured in a pair of PowerPoint presentations Arlington City
Manager Trey Yelverton gave to the City Council last month, when the deal
was approved.
The
taxes also were mentioned in the stadium deal frequently asked questions on the
city’s new Rangers stadium web page.
In
addition to other sources of funding, the Texas Rangers plan to utilize user
fees to support construction of the new ballpark. These user fees could include
a tax on admission tickets, a parking tax, and revenue from the sale of
individual ‘Stadium Builder Licenses’ that enable the license holder to buy
tickets for certain seats in the new ballpark. The City would issue these
bonds, which are backed solely by ticket and parking taxes and not by any other
source of tax revenue.
City
officials initially ignored Shipp’s report but assembled this public statement
after questions from The News.
“The
city has endeavored to be as transparent as possible by providing all documents
on a public website and making public announcements and presentations about the
deal well in advance of a City Council vote to call an election,” Marketing
Communications Manager Jay Warren said in a written statement. “Additionally,
this was announced six months prior to a possible election, giving the public
ample time to make an informed decision.
The
statements from the city were measured. A press release issued Thursday
afternoon from the Arlington Chamber of Commerce was a little less so,
describing the story as “grossly inaccurate.”
“There
has been a steady stream of biased coverage about the new Rangers ballpark from
Dallas media,” wrote Michael Jacobson, president and CEO of the Arlington
Chamber. “I am sure they have their motives, and it is possible that they are
not in the best interests of Arlington. But the good news is outside forces
will not make this decision. We are fortunate that Arlington’s future rests in
the hands of our citizens on November 8th who will vote yes to keep our beloved
Rangers in Arlington.”
In
a way, they can agree on that.