In the windup to revealing financing details for the Sounds' proposed ballpark at Sulphur Dell, the Dean administration promised a "significant" contribution to the project by the team.
"Significant," it now appears, is in the eye of the beholder.
On Monday, the complex financing plan was unveiled. Factoring in land acquisition, the stadium will cost the city — and taxpayers — $65 million over 30 years, about $4.3 million annually.
Metro Finance Director Rich Riebeling said the impact to the city's bottom line will be $345,000 after the offsets: $700,000 in annual rent from the team; increases in sales and property taxes; the renewal of a development district; the elimination of Metro's $250,000 annual payment to the Sounds to maintain the aging Greer; and a $410,000 lease payment to the state for the Tennessee Preparatory School property that will disappear. (The TPS property will become Metro's, as part of the numerous land swaps between state and city.)
But the plan includes a lot of assumptions. For one, the site has to generate $650,000 in sales taxes — an estimate Riebeling characterized as down-the-middle, neither too rosy nor too conservative — for which, of course, there is no guarantee. The new property taxes include $675,000 from a multi-family project by San Antonio developer Embrey — a project, by the way, that was planned before the stadium announcement, and is only part of the conversation because the company had an option on what is now planned to be left field.
It also includes $750,000 from a $50 million mixed-use development the Sounds owners — developers by trade — promise they will build.
Promise based on what? According to Mayor Karl Dean, little more than their word. There is not, and will not be, a contract pledging the Sounds to build this project. Pressed on that, Dean said if the Sounds didn't build the development, somebody would. Probably.
For the city — any city — to make a three-decade, $65 million commitment based on a handshake arrangement with absentee ownership is head-scratching at best and mind-numbing at worst.
But if that's the level of commitment the city is already willing to make, why not go whole hog?
Why not just buy the team?
The value of the Sounds is hard to pin down (though, presumably, it's gone up with the promise of a new stadium). But Forbes' recent estimate of the 20 most valuable minor league teams did not include the Sounds. The 20th ranked team on that list — the Oklahoma City RedHawks — came in at $21 million.
For, say, $20 million, the city gets the team ... and it gets the revenue. Not just the increased sales taxes budgeted in the financing plan — all of it. Ticket revenue, beer money, parking costs. All of it.
And if the mayor is to be believed, the city doesn't even need the Sounds for the $50 million ancillary development. It's going to happen anyway.
Right now, the city is spending at least three times the total value of the Sounds — that's being generous — to build a stadium. Doesn't it make more sense to own the entity outright?
It's not a wholly insane idea. In 1995, the city of Harrisburg, Pa., developed a downtown revitalization plan centered on a new minor league stadium for the city's popular AA team, the Senators. But the Sens' new ownership was gravitating toward a taxpayer-funded stadium in Massachusetts, so the city ponied up, buying the team for $6.7 million — a steep premium over the $4.1 million the owners had paid just a few months earlier.
The city built the stadium and ran the team for a decade. In 2006, with the city facing a tough budget situation, it sold the team for an Eastern League-record $13.25 million, more than twice what it paid 10 years earlier.
Should cities be in the business of sports? Certainly not. But in Nashville we already are, with both the Titans and Predators receiving tax breaks (if not straight-up handouts) from the taxpayer.
Minor league baseball is the perfect venue for municipal ownership, because all the on-the-field decisions are made elsewhere — in Nashville's case, by the Milwaukee Brewers.
With total city control, the Sulphur Dell stadium could host other events — big high-school football games, for example, or outdoor concerts. And all of the profit would roll into Metro's coffers.
There would be associated costs. For starters, someone has to actually run the thing. Presumably, in this scenario, Metro would contract the day-to-day operation to some venue operating company — but there would also be a damn sight more revenue.
Plus, with a gleaming stadium, Metro could eventually sell the team back into private hands, garnering enough profit to retire some of the long-term debt.
One of the many arguments against taxpayer-subsidized sport is that the city — and thus the taxpayer — sees very little actual return, with the benefits of new stadiums flowing into the already well-lined pockets of Croesean owners.
A Metro-owned team would mean the taxpayer sees all the return.
The financing plan — constructed on top of a vague promise with no clawback — means Nashville taxpayers aren't just in for a penny, they are in for the whole pound already. Metro might as well make it official and buy the team. It's the only way to rescue the bad deal the city is making.