Wednesday, December 3, 2008 City of Seattle still in pursuit of NBA

The Washington State Task force Local Financing Options for King County did meet on Monday to accept proposals for capital investments in King County, paid for primarily by an existing sales tax on hotels and motels. Among the proposals was a presentation from the City of Seattle's Deputy Mayor, Tim Ceis.

The city's proposal was set in a presentation on the Seattle Center Master Plan, describing Key Arena as a part of the bigger site efforts.
The city's 75 million dollar proposal was presented right after the Washington State Convention and Trade Center proposed, a 766 million dollar expansion of its facility, dwarfing the city's request. The city and the convention center have agreed that there should be enough revenue to build both projects. These two projects are looking at a revenue stream that is drawn within Seattle.

The other groups requesting funds are looking at a slightly different fund that are drawn in King County. Those two revenue sources are separate, and are viewed as separate by the state committee members. The committee will produce one of two things within the next few weeks; a recommendation of which projects to move forward on if the committee is able to reach consensus, or a report to the legislature on all of the different options if consensus can not be reached within the committee.

Eric Williams of the Tacoma News Tribune posted some of his audio he used for his newspaper report. It is on his blog titled, City of Seattle still in pursuit of NBA. The deputy mayor explains in the audio how he views the presentation, and one of the co-chairs of the state task force, Ross Hunter, gives his view and preference that local governments should have more control of how locally derived taxes are allocated. That's a good thing.

The presentation that was the focus of the local media was the request from the University of Washington for 150 million dollars to match 150 million in private contributions to remodel the football stadium. The stadium is 93 years young. That proposal brought harsh criticisms from Washington State University alumni. In a way this is good for the Key Arena proposal, it keeps the media busy with the dog and cat fight.

For all of these desires for funding the biggest risk is the state raiding the fund and using it for general fund obligations, even though they passed a law 5 months ago to keep that very thing from happening.

Here are the links to the city's presentation, click the meeting date to go to the state page for the rest of the agenda links:

Meeting Material
December 1, 2008
4 Culture Presentation - Jim Kelly, Executive Director 4 Culture and Friends
University of Washington 1 - Scott Woodward, UW Athletic Director and Ron Crockett, Major Gifts Chair
University of Washington 2 - Scott Woodward, UW Athletic Director and Ron Crockett, Major Gifts Chair
Youth Athletic Facilities - Kaleen Cottingham, Director, Recreation and Conservation Office
Washington State Convention Center - Frank Finneran, Chair, Board of Directors, Washington State Convention and Trade Center
Seattle Center 1 - Tim Ceis, Deputy Mayor, City of Seattle
Seattle Center 2 - Tim Ceis, Deputy Mayor, City of Seattle

Have a great day,
Mr Baker
Sent from my iPhone


Anonymous said...

Did you have a chance to catch the Bill Simmons Podcast with Stern on ESPN? Simmons grilled him pretty good.

Mr Baker said...

I listened to it last night. I understand why some people in Seattle hate him. When I get past that, get past his opinion of what happened, and what he said was that there are no plans for expansion, the downturn in the economy will present some opportunities to relocate some teams, and they are keeping Seattle in the loop.

He says many things I do not like, but he does say what he thinks.
Plenty of people think we will never get another team, or it will be a very long time.
I think that wheel is in motion as soon as the state approves funding, 2011 is not out of the question.
Ross Hunter said he would be "astounded" if Ballmer contributed to the project without a team, I agree, but I do not think he knows just how quickly that could happen.
I would not be shocked now to have Ballmer commiit in private to the state, or at least let them know the likely time frame.

Anonymous said...

It's been relatively quiet on the arena front and I guess it'll remain that way until Jan 23rd. But I started wondering again about the 1 billion dollar joint proposal from the Convention Center to work with the City to redevelop Seattle Center that never got any traction. It was off the charts with the expenditures but I'd be curious what the details were. Was there a Nitze-Stagen inspired plan to rebuild the center house into a trade conservatory with addtional convention space that would be attached with a new arena built in the Memorial Stadium footprint? Such a plan would be incredible, ambitious, visonary, and expensive. Which of course would never work. Oh well, I guess the folks at the Gates Foundation will have to get used to looking at the butt end of an ampatheater.

Mr Baker said...

On Dec 15th there was a story in the Seattle PI called "Gregoire's pledge will not be the last word on taxes", in that Ross Hunter had a few quotes, how knowing the gov's budget will help set some core priorities, how there are some unknown things from the federal stimulus package, that it could be more than just infrastructure spending, it could include help to states on other things that might effect the budget process.

Within that context I would expect that some proposals will not get announce until it is known, in some way, how much cutting will really take place.
Google news "Ross Hunter" to find it, also see a story about Hunter being named part of a national group that looks at commerce, that is a big deal, under reported.

Mr Baker said...

There is 3.8 billion in capital construction, with a note stating that the state is seeking federal funds in January, my guess is that part of this that goes toward school and higher ed building construction is something they are trying to get funds for.
Page 30 in the highlights.
This is the area where something can happen, if anything.
This may take a few weeks.

Anonymous said...

Possibly some fore-shadowing on potential fierce opposition to any tax revenue for Key Arena and Husky Stadium. Once the unions have had their say with the Gregoire they'll go after the legislature to see what taxes are available and where they're going.

Mr Baker said...

I posted a new story at Sonicscentral, in it I posted a message about the Obama stimulus, and in bold the words health care.

The hacks the claim to represent the people in those unions need to do their homework.
WTF do they think the Feds mean by stimulus and healthcare?
WTF do they think the Feds mean by stimulus and schools infrastructure?
Those are both general fund line items in the governor's budget she was required to propose before it will be known what the feds will really provide. It is going to be more then her projected 1 billion.
This is the low point in the budget negotiation with the Feds and the state legislature.
She does not make the budget, she proposes a balanced budget by law, then she signs a budget provided, not by her, but by the legislature.
I think the union should have waited two weeks. That's poor timing.

Anonymous said...

Hey Mr. B., I caught your banter with "moron extrodinaire" Coperinicus. Wow, contrarians like him leave me speechless. That arena in Kent is great investment for the T-birds and the city. I'm actually a little shocked that the Storm had not considered playing there.

Mr Baker said...

I was thinking the same thing about the Storm. I am sure it is leverage in some way. Anne Levinson being a former deputy mayor I am sure knows every way to get a favorable lease with the city.
The storm never had their own contract, they never got a cut of their game parking or concessions, that all went to the Sonics.
I am partly hoping and mostly expecting that they have something in their new lease that deals with the potential expansion.
I am hoping they take a public position, even a minor one, on the remodel.

There isn't a logical argument against the remodel now that the debt has been paid off.

Mr Baker said...

BTW, in today's Seattle Times they have an editorial on the lack of scientific data used in the Puget Sound Partnership's action agenda.

If some other group wants money I guess the Times just identified a giant target.

A Ron Sims boondoggle, perfect budget cover.

Anonymous said...

Our friends at SEIU has sued the Gov. It sounds like CVD's patron's are ready to duke it out with the legislature and anything to do with "economic stimulus" plans that would create jobs. I think it's going to get bloody.

Mr Baker said...

I saw that last night. Brian mentioned that the hoteliers have "lawyered up", I was expecting them to step in at some point. They were very upset that the fund was raided last year. That is how and why the law was changed last year. If there wasn't push back from the hoteliers there would have been no motivation to change the law, and as was alluded to by Brian, the legislature could just raid it again.
The problem for the legislature in the short run is that there was a law passed that was narrowly written to describe where the fund money comes from, how it is a seperate fund, and what it is used for.
To un-do that is not just rewriting the law, but may violate the state constitution (according to somebody named Ben, I will look this up myself). The hoteliers are carrying an unfair tax burdon not shared by like businesses all over the state, the restiction of size of hotels of 60 or more rooms is clearly intended to provide a filter to prevent smaller towns with bed and breakfasts from having to be taxed for the purpose of building convention centers, cultural and arts facilities, and stadiums. If that is not going to be the purpose of the funds then the filter of 60 rooms is an unfaiirly applied filter if the revenue benefits cities and counties with smaller populations and smaller hotels. Everybody that has a hotel should pay the same added 7% extra sales tax (a massive tax increase), or the fund should be left to its intended purpose.
I am a guy sitting on his sofa, drinking coffee, and I can make that argumant. This is not a criminal case but equity, what is fair. Proving what is, or is not, fair in this case is pretty easy.
I imagine other groups that are in a similar boat of raided special funds and accounts will be chearing on the hoteliers.
The long term problem for the legislature is twofold: 1, they will stop getting any cooperation from any industry for any special tax, for any reason, for a very long time. Killing a golden goose. 2, there is a tax credit that cities and towns use for trade and tourism to build stuff, the Lynnwood Convention Center for example. The state forgives a small percentage of the sales tax from a given community to build stuff. I would not be too tough for the City of Seattle to request this fund for KeyArena and point to the Dali Lama as a non-sport convention style event that the building can support in this community. Ross Hunter at some point in the past few months has said as much, I think be said that he would prefer to solve this with the intended special fund or these communities would be right back here asking for tourism tax dollars. The sale's tax credit is a percentage that may amount to a lot more money from the general fund in the future than satisfying those requests with the special fund.
The sale's tax credit could still be applied with the special fund, and in better times that is exactly what happens. The legislative argument here is that King County has a right to ask for the tax credit to put with their special fund to make a larger pool of money for all these proposals. I think they claim that they gave the back (the governor took it, Hunter already said it would go back to the general fund on the linked audio on the above story). Giving back something you were not going to keep is a cheap negotiation tactic, but it plays ok in the media (you reading this Jack or Jim?).
This will get ugly, uninformed people, and a fair measure of informed, will hate this if Seattle get's to keep even a dime of the special account. That's too bad.
Again, if adding 7% more sales tax to a hotel room is a good way to balance the budget, or pay SEIU, then the tax should be state law everywhere.
All or leave the fund alone should be the debate, not kill the tax or leave the fund alone. The hotels are getting something out of this infrastructure.
But you knew all this.
Have a great day!

Anonymous said...

Thanks for the info. All that being said though if the city of Seattle and Convention Center worked together on a proposal they would have been formidable. And since the city has taken its position, and the CC has plans for expansion but nothing solid and that leaves a big "Matzo ball" of revenue out there for the legislature and the unions to bicker over in the new year. But I don't see the city's plan for SC as a "money grab". The emphasis has to be on creating jobs and stimulating the economy. The decision will ultimately be made wether giving state workers raises or creating new jobs in a stagnant economy is more beneficial. There is also a rumor regarding Husky Stadium that the entire funding will be taken care of privately which muddies the water even more. So things should definately get interesting soon.

Mr Baker said...

Well, husky stadium as the fall guy was going to happen one way or another, where do you suppose the added private funds are coming from?
When I walk past the Halls of Allen, Gates, Gates, Balmer, next week going to class I can only be left to wonder.

I think the convention center was an unwilling partner, no question, but as the nature of the economy became more clear they jumped in with both feet. If the legislature thinks it has the right to raid the fund then the convention center and hoteliers would end up fighting for the money in "good times" a few years from now.

The first task force meeting was July, the convention center started making noise in September.
My opinion is that they are partners in protecting the fund more than they are worried that the city will slice off 1%. That 1% was likely a huge motivator to pay attention, but as the October meeting of the task force got closer they shifted from just saying they were not sure that there is enough money (possibly stopping the city right there) but to a rushed plan to use all of the rest of the 6% for years to come. Had they arrived with a proposal to use all of the 7% in conflict with the city the meta message is that there is a conflict to be resolved between two parties for the same revenue source.
That source is conflict free between both parties as far as the legislature goes.

I analyse these situations for the meta message.
What does the conflict tell the legislature?
It says there is a conflict and while they get their priorities straight we can take the money now.

What would it say to have Brian Robinson, co-founder of save Our sonics, as the face of moving the convention center and Seattle Center package portion. It looks like a trojan horse to Seattle sonics haters like CVD. That may be the end result, but it is clearly not the intention going into this last July.

In the end I am depending on the kindness of strangers, and the lawyers of multinational corporations that own hotels in Seattle to fight the battle.

The 2.5 million jobs from the feds has grown to 3.2 million jobs by 2011.
I still think the federal money shell game with the infrastructure and health components will eventually throw a big bucket of cold water on this situation.

GOP wants a say in stimulus plan

Congressional Republicans on Monday said they would work with Democrats to craft a plan to stimulate the economy but only if GOP ideas are considered for a bill that could cost as much as $1 trillion.

Mr Baker said...

I meant cold water on the unions freaking out and suing the governor over a proposal.

She dug holes where she thinks the feds will fill in. She met with Obama, not SEIU troll CVD. If they had a relationship with the gov, or an ounce of patience they wouldn't look like jackasses right now.

Anonymous said...

So do you think the conflict between the city and the convention center will be resolved soon?

Mr Baker said...

It is resolved one way or another when the convention center releases its budget for its project in 10 days.

Magic 8-ball says yes.