Thursday, June 7, 2018

#atxcouncil: Latest Soccer Stadium Proposal Sucks As Badly as the Previous Ones....

"Dishonest scales are an abomination to the Lord,
But a just weight is His delight."
Proverbs 11:1

[Note on Format: We're going to offer commentary on quotes from the Chronicle article immediately following the relevant section, rather than holding them to the end.]

The Austin Chronicle details the latest on the ongoing soccer stadium debacle:
Last Friday, city staff released its report declaring McKalla Place "viable" for a soccer stadium, and later that day, Precourt Sports Ventures released their plan to build what they call a "legacy asset" for the city. Although many Council members have been unable to delve into the city's 34-page report, let alone Precourt's 189-page proposal (they're a bit busy with a project called CodeNEXT), those who did comment didn't do so in committed fashion.

Leslie Pool, who represents District 7 where McKalla is located, tempered enthusiasm for the city's report, noting that staff only acknowledged the site's viability for a stadium. "What is suitable for the site may not be what is most desirable for the site," she said, while anticipating plenty of hay to be made of Precourt's offer. Her colleague Alison Alter shared that same view of the city's report: More analysis would be needed to determine if Precourt's proposal is in the best interest of the city.

Some of the information included in that proposal had been established: a projected $354 million in community benefits to the city over 25 years; the $200 million, 20,000-seat stadium, fully financed by PSV; and a plan to devote more than half of McKalla's acreage to "open and accessible space." The city report supported PSV's claims of an economic boom for the city: Third-party analysis firm Brailsford & Dunlavey forecast a $384 million boost in economic activity and $332 million in wages over a 20-year period. Travis County could gain another $474 million and $461 million, respectively.
    • Anyone who believes "economic activity" forecasts 20 years out is a fool.
But PSV also provided insight into how they hope to structure a deal: The city would retain ownership of McKalla Place, infrastructure surrounding the stadium, and the stadium itself once construction is completed; and the city will be responsible for "all site preparation, remediation and off-site infrastructure," raising the eyebrows of those council members. The city report found that roughly $15.9 million in infrastructure costs would be required to improve water transmission systems and transit ($13 million for a new rail station). PSV President Dave Greeley said the language is "part of a broader conversation with the city," and that according to the reports they had reviewed, further remediation on-site would be unlikely.

With city ownership of the land and stadium, PSV would be exempt from paying property taxes – no small handout at a time when rising taxes are the central focus of some residents. But PSV wouldn't be getting the lot for free – rather, via a 20-year lease at $1 per year, the "most amusing" aspect of the proposal, said Pool. PSV would have the option to renew the lease for three more 20-year terms, at that cush fixed rate.
    • So the city takes all of the risk on the deal while the team pays no property it.
    • To say nothing of the fact that the city is so bad at maintenance that giving them ownership will make the asset depreciate faster.
One benefit that did receive more attention, however, was a partnership with Foundation Communities to provide affordable housing throughout the city. An initial $500,000 investment from PSV would go toward building the Waters Park Studio development near McKalla, and another $4.3 million would be invested into the nonprofit over 25 years.
    • Obviously, this website doesn't support that sort of expansion of subsidized housing in the first place, but even so $4.3 million over 25 years is just cheap. 
Two such options manifested Tuesday night, when representatives for Capella Capital Partners and Whitfield-Chen presented ideas to a Gracywoods Neighborhood Association meeting. Capella already owns three acres next to McKalla Place, which they plan to use for an 11-story office building and 22-story "downtown style" residential building with about 285 units sold at market rate. Four years ago, the group entered negotiations with the city to buy or lease the McKalla lot, which they'd transform into a mixed-use development with six acres of green space, four or five multifamily residential buildings (units affordable and market rate), retail, and a spot for a new rail station, paid for by the developer. Managing partner Neil Francois said in 2016 that the city had appraised the McKalla site at $29 million. By comparison, city staff's more recent report valued the property at $9.6 million. Pool, who attended the meeting, was shocked at the discrepancy, and said she would look into why the two appraisals were so different.
    • So, they're trying to muscle out a privately financed mixed use project in-favor of a heavily subsidized one?!?  Got it....
    • And, to do so, they're now lying about the value of the land. 
Read the whole thing here.

Bottom Line: You don't even need to look into the details on this one, what they're telling us is bad enough....

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