City Protects Land in Hopes of Baseball Stadium

Pulling a page from the “if you build it, they will come” playbook of the late 1980s, when San Jose broke ground on an arena before a sports team signed up to play here, the City Council three weeks ago created a new quasi-public entity and transferred several large chunks of real estate to its control.

The new San Jose Diridon Development Authority now controls nine parcels that the city purchased over a 15-year period for more than $25 million. Seven of them lie directly adjacent to Diridon Station and south of HP Pavilion. Like a runner on third base when the pitcher’s back is turned, the city is charging forward to claim more pieces of land for the stadium grounds.

Slated to become Bay Area’s transit epicenter—including the region’s high-speed rail gateway to Southern California—Diridon Station’s surroundings almost certainly will grow well beyond their current value. That’s why the city and the Redevelopment Agency took the unprecedented—and, some believe, legally questionable—step. Gov. Jerry Brown’s threat to shutter the state’s 400-plus redevelopment agencies to shore up California’s broke state government prompted San Jose’s hardball play.

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Josh Koehn is the news editor for San Jose Inside and Metro Newspaper. Email tips to josh@metronews.com or follow him on Twitter at @Josh_Koehn.

24 Comments

  1. “…Mayor Chuck Reed, who has not heard from MLB in nearly two months and is running out of patience.” Ooooh, I’m sure that has Bud Selig and the MLB owners shaking in their boots. Reed’s arrogance may work for him when bullying his employees or some citizen speaking at a council meeting, but I have a strong feeling that MLB sees him for the minor-leaguer that he is.

  2. Great here we go again…..

    Another “Team San Jose” to mismanage City and Taxpayer funds. 

    I bet that Mayor Reed appoints Dan Fenton to lead the quasi-public entity as CEO.  If this happens you can guarantee that more fiscal problems will pop up. 

    Your inept City leaders in action again.  Oh yeah during this trying fiscal time the City Manager chose to layoff hundreds of needed employees, but the promotes Hans Larsen to Director of Transportation.  Great move Deb… Just what the City needed another Administrator to pay.

    My god this is horrible, ooops!  My two minutes are up, Chuck don’t turn off the mic…. “Click”….. muffled voice at the podium, Frank walks away in disgust.
     
    Old Frank

  3. $1 billion for City Hall, $2 billion for Convention Center, Theaters, Museums and free events, $250 million for HP Arena, Ice Center and parking

    So $120 million for Baseball Stadium, streets and other city paid improvements is not so much when all costs, interest , yearly general fund puyments are totaled

    Ops, forgot that is City Hall funny accounting not the new jobs, sales taxes, and property taxes minus the to nbe given away to sport team owners yearly additional city paid from general fund services, sports promotion, staff time and cheap parking lot leases worth %3-8 million per year unless stadium costs go up. fanss don’t buy enought tickets, BART doesn’t come to downntown

    Then City Council will add a few more millions free services, give team stadium naming rights, pay for stadium maintenance, advertising signs, reduce stadium and parking rents and provide free shuttles to Beressa BART so owners are happy and make their expected many millions profits like San Jose Sharks owners got

    “AT THE TIME THE CITY originally signed the management deal with Sharks owners George and Gordon Gund in 1991, it was widely regarded as the “sweetheart deal” of the decade.

    For one thing, the city paid for the bulk of the development costs for the Arena—at least $147 million. But that wasn’t all. City leaders, led by then-Mayor Tom McEnery, gave the Sharks and its alter-business ego, the Arena Management Corp., total control over building operations and revenues. That meant the Sharks got money from all Arena events, including non-sporting events like Disney on Ice and the recent Dixie Chicks concert.

    The 15-year lease didn’t actually go into effect until the Arena opened in 1993. The team has three five-year options to renew after the first 15 years.”

    ” THE ONE-INCH-THICK, 106-page management agreement between the city of San Jose and the San Jose Sharks is a monument to athletic franchise worship. Among its contents: section after section ceding the hockey team almost absolute control over operations and revenues at the city-funded San Jose Arena, which cost local taxpayers nearly $150 million to build.

    The agreement was created in 1991, in the city’s flush of excitement about gaining its first-ever major professional sports team, and officials willingly gave away future bargaining chips with their future tenant like they were tossing chum into the ocean.

    http://www.metroactive.com/papers/metro/06.22.00/sharks-0025.html

  4. San Jose should take the advice of the experts instead of the council’s whim.  A ballpark makes no financial sense. A Contra Costa Times column noted “And please don’t tell us about how sports teams boost the economy. The Cato Institute. . . debunked that notion in 2004, . . . `Our conclusion, and that of nearly all academic economists studying this issue, is that professional sports generally have little, if any, positive effect on a city’s economy . . . The net economic impact of professional sports in . . . cities that hosted professional sports teams over nearly 30 years was a reduction in real per capita income over the entire metropolitan area.’” These times require investments with return. More mismanagement while claiming poverty!

  5. Repeat many times and you will understand the simple concept ” Follow the Political Money ” that why Sam Jose City Council is buying land for a ballpark stadium makes no financial sense and high rise housing since political insiders want

    - union construction jobs, dues and political contributions

    - housing developers want more low and market rate high rise housing profits and political contributions

    - Lew Wolff wants new A’s stadium and customers for his money losing sports teams and downtown hotels and political contributions

    - downtown association want anything to draw paying customers to money losing downtown now that Santana Row, club problems and no more city money have made downtown empty after 6 pm

    - downtown property and business owners who bought the downtown dream and are underwater are hoping for a downtown miracle to bail them out

    - Baseball Stadium and more high rise housing is latest in City Hall’s wonderful 30 year long list of wonderful political jobs and money losing government downtown economic and redevelopment projects trying to get paying customers and businesses to go or live downtown

    Most people avoid downtown and companies will not invest even with million dollar city downtown subsidies since they will lose customers, money, employees and banks will not finance high risk money losing downtown projects

    - ” What have you lost all common sense – invest in San Jose downtown, this isn’t a April’s Fools joke is it ? ”

  6. Here we go again! Another no win waste of money at a time when the city wants to layoff public safety officers and other city employees.  MLB will not approve a move to San Jose, if by an act of God Bud does, San Jose voters will not approve it as they voted down the Giants before.

    This city council is out of control and needs to get it priorities in order.

  7. We can always build an airport for the little planes on the land.  After all, we all know what a great benefit airports are for both the economy, and everybody else. 

    Obviously, this will not conflict with the San Jose International airport.  After all, only an idiot would build an open air stadium under the flight path of landing or departing jets.  And we do not elect idiots to the City Council.  Do we?

    • I guess those New Yorkers are idiots, building Shea Stadium, the USTA Billie Jean King National Tennis Center and then Citi Field all on the LGA flight path. Ever been to a Mets game? you can listen to aircraft all night long. Funny how the 1986 Mets won the World Series anyway.

  8. > Slated to become Bay Area’s transit epicenter—including the region’s high-speed rail gateway to Southern California—Diridon Station’s surroundings almost certainly will grow well beyond their current value.

    THIS is an EXTREMELY dubious prediction.

    It is EXTREMELY unlikely that the high-speed rail will ever need a gateway to Southern California, because by the time it ever gets funded, people will be commuting to Los Angeles ( a large city in northern Mexico ) by anti-gravity belt.

    • By the time a high speed rail is complete, the arena and ‘Stadium’ will be as old as a roman coliseum.

      A stadium does not equate to a mega city. There are plenty of cities that have courted teams and they soon split for a more enticing venue. That’s the current trend in sports. Look at the Sacramento Kings. A few years ago it was the hottest ticket in the NBA. Now the plan is for the team to move to Anaheim and stick Sacramento with the bill and a vacant arena.

      History will repeat.

      THis is san jose, not SAN JOSE…jeesh

  9. I think the problem is that our civic leaders have low self esteem and think they have to chase down fancy sports teams.

    Why not try the opposite approach.  Make them come to us.

    Pass an ordinance BANNING the location of any commercial sports team franchise premises within 25 miles of any building with a dome used by the city and costing more than a half a billion dollars.

    Also ban any sports franchise premises within a hundred miles of any potential future high speed rail station.

    As soon as this is done, lobbyists from big sports and high speed rail will flock to San Jose and stuff the pockets of our city fathers and mothers with all kinds of emoluments and compete with each other to offer San Jose the sweetest, plumpest deal.

    “If you build it, they will come”.

    But if you tell them they CAN’T build it, they will BUY their way in.

  10. Lew Wollfster announced that “ Major League Baseball has after 2 years of study given today given Giant ‘s San Jose territory to A’s for $ 1 to be paid to World Champaign Giants today April 1st

    Giants will get Oakland and East Bay along the BART line as their new territory “ 

    Happy April Fools Day

  11. I personally stopped following baseball and football a while ago.  The ridiculous salaries, the steroid use, the other media grabbing headlines (drug use/DUI/rape/etc etc).  I stick to hockey now (Go Sharks!), but I know the Bay Area was proud when the Giants won the series.  While San Jose does not have MAJOR league baseball, it has the San Jose Giants. It has people actually playing the sport for what it is, to try and get the opportunity to advance to the Big Show. It bothers me anytime I hear about the Mayor spewing forth his “A’s” plan for salvation of the city of San Jose, without even acknowledging what the San Jose Giants do for the city.  They provide a great family venue to showcase hardworking athletes.  And at least THEY still do a fireworks celebration for the 4th of July.
    ……And GO SHARKS….

  12. Mayor Read It and Weep on steps of City Hall issued a short statement saying:

    “ Darn and here I thought Bud was going yo hold A’s hostage until I left office with newly elected Mayor Liccardo announce MJB decision to have A’s move to San Jose   Like Iranian’s did to Carter with Reagan announcing embassy hostages release “

    April Baseball Fools Day

  13. Well, we are a week away from opening day, when both the Merky and Metro gave us perfectly times stories about the A’s. For both stories, Lew Wolff was the incubus, the cloud/spirit, hovering over the reporters, breathing into their air space. Just a couple of examples to show how “sports journalism” is truly a contradiction in terms. The Merky’s story ran in reverse. You had to read to the bottom —or read it in reverse—to find the real story, what is so relevant to taxpayers. In the final paragraphs we learn that the city has already put $24 million (maybe) into land for the ballpark and will put millions more (nobody knows this number) into more land and infrastructure for this the dubitable venture. So much for “no public money for the ballpark,” a real stretch.The Metro story was a hash, a rehash, full of everything we already know and have heard over and over. (How many times do we need to hear that Bud and Lew were roommates in college?). Neither paper bothered to interview any opponents to the ballpark, although Metro at least acknowledged their existence but not any of the reasons for their opposition. I don’t know who those opponents are and would like to hear more, given the amount of opposition I see in these comments. I’d also like to know more about the lobbying group for the ballpark. Who are they? Where is their funding coming from? What are their own financial interests in the park? All those who, what’s, where’s, when’s and how’s—missing in action.

    Finally, will the real Lew Wolff please stand up? In the Metro story,Wolff is quoted thusly:“It’s the difference between a big-league cith and a non-big-league city. I wouldn’t spend five mintues on any other city besides San Jose.” (Hey, I’ve got 76 trombones I can sell River City!)

    Just in case you think that Wolff really loves San Jose, consider this quote from yesterday’s Chronicle,which did a piece about Wolff on the front page of their business section. One of the biggest luxury-hotel owners in the U.S., he is now is making a major effort to divest himself of his hotel properties, given that values that slumped are now recovering. (Many of those hotels, I’m sure, were made possible with redevelopment money like the millions that went into his San Jose Fairmont.Wolff never does anything like this without a public subsidy.)

    In the story, Wolff is quoted thusly: “I have no emotional attachment to any property.They are inanimate objects.That’s the only way we can be fair to our long-term investors who trust us to do what’s best.” The quote nails his priorities perfectly, and San Jose’s well-being is not on the list. (His lifestyle certainly is. The story also had a great description of Wolff’s big house in LA, his private plane, yada yada.)

    Amazing that the skeleton staff left in San Jose’s RDA will probably be spending most of its time on the ballpark (on your dollar, friend), because there’s nothing else left. We’re at the bottom, the very bottom.

  14. Thanks, Downtown Girl, for the thoughtful post. I wish more people would read it; maybe you could post it into the comments section of the Mercury News article.

    Everyone needs to remember that “In the final paragraphs we learn that the city has already put $24 million (maybe) into land for the ballpark and will put millions more (nobody knows this number) into more land and infrastructure for this the dubitable venture” the next time Tony D comes on here and tries to tell us that this boondoggle won’t cost taxpayers a cent.

  15. why all the negativity? who wouldn’t like some baseball within walking distance? quit whining and support the place where you live.

    • Read above. As a taxpayer, I don’t want the city to give a millionaire $24 million in free public land for his vanity project. The $24 million should go toward keeping city services and holding the line on tax increases.

      • yeah, i still don’t get it. baseball would be awesome and i’d wouldn’t mind paying for it. the land around the proposed site is a vast eyesore that san jose should be ashamed of… and the economic benefits clearly outweigh the cost of the land purchase, transfer or whatever.

        • Lewis Wolff is rich enough to buy the land from San Jose if he wants to. I have no desire to subsidize him, though. If you really want to watch baseball in San Jose, go to a SJ Giants game.

        • Not when we are being told it won’t cost us anything and no public money will be used.

          If and when the City is honest about the costs of this project then I might consider supporting it. As long as this campaign of dishonesty continues, even though I am a baseball fan, I will oppose this as will many others.

        • Jon, if you really love baseball, go out and join an amateur team. You’ll feel so much better than just sitting around, drinking beer on the couch and developing your paunch.

          I don’t want to pay for a ballpark which will mostly benefit a bunch of rich shareholders. This ballpark is not about baseball, it’s about businesses—primarily, liquor, clubs and gaming (underground). Besides, given the behavior of the clubs, I don’t want them and their values in my community. Believe me, in the long run, the economic benefits are minimal. But you need to do some real homework.