BY Art Thiel 05:44PM 06/26/2012

Thiel: Conlin says arena won’t get OK, but . . .

As the longtime chairman of the Seattle City Council’s land use committee, Richard Conlin knows a few things about dirt and what goes on top of it.

At the moment, however he finds himself under a fair amount of real estate after basketball fans heard about  a letter he sent constituents that said of the new basketball/hockey arena: “It is unlikely that this proposal will be approved.”

He becomes the first member of either the city or King County councils to offer a forecast, and apparently his voting intention, on the fate of the $490 million project backed by Seattle native Chris Hansen, Microsoft chairman Steve Ballmer and members of the Nordstrom family.

The local Twitterverse immediately came alive with contempt from basketball fans for Conlin’s position. At the least, the timing was surprising since council staffers are still researching the proposal and further public hearings are scheduled before the panels vote in August.

Conlin Hansen did not return phone calls and voice mails. His letter did not say how he knew the rest of the council members position on the proposal.

In the letter, wherein Conlin misspelled throughout Hansen’s name (“Hanson”), Conlin listed “a four-part test” that the council is supposed to be using to reach a decision. The first part was easy: yes, having the NBA back in Seattle would be a good thing.

The second test was arena location. He viewed with “skepticism” the SoDo location because of impacts on traffic and KeyArena, but wrote, “We need to continue to review.”

The third test was appropriateness for public investment, to which he wrote, “I have seen no evidence that justifies making a public investment, nor any serious reason why a public investment is necessary for the project to proceed.”

Of the fourth test, protection of the public investment,  he wrote: “It is not clear that the proposed relocation guarantee, for example, is any stronger than the lease which the Sonics broke when they moved to Oklahoma City. It is not clear whose assets are on the line if the arena becomes insolvent –  the arena in Portland (with a team owned by Paul Allen, who certainly has deep pockets) declared bankruptcy, leading to a difficult and challenging financial problem.”

He concluded the letter by saying arena advocates ought to lobby Hansen to make the project a 100 percent private enterprise.

He began the letter by saying “we do not invest public money in businesses,” which was odd because the proposal does not call for an investment in an NBA or NHL teams, which are  private businesses. Hansen proposes a project whose building and land would become publicly owned property that houses private businesses, in the way that King County taxpayers partially subsidize the Port of Seattle, which allows use by for-profit companies of the seaport and airport.

Additionally, Conlin’s statement about not investing in businesses contradicts the policies outlined here by the Seattle Office of Economic Development.

Also, the city and county have a long history of investing in public sports facilities that house private teams. Resentment of that practice among many taxpayers is what led Hansen to propose a $290 million private investment, and what amounts to a maximum $200 million loan from the public. The public money is largely a tax abatement over 30 years that does not include new taxes.

There is a theoretical risk to the public from bankruptcy, but Hansen’s documents and testimony were explicit that, in the unlikely event of bankruptcy, the municipalities would end up owning the team assets as well as the building in the event of default.  That is nearly unprecedented in modern public-private partnerships.

Regarding the sale of the Sonics to Oklahoma City interests, the franchise did not “break” the lease, but instead left with the blessing of the city council when the parties settled a landlord-tenant lawsuit brought by the city that released the Sonics two years early in exchange for $45 million. Conlin was a signatory to the deal, despite the fact that many observers believed a federal judge would rule in favor of the city’s position.

In an email Monday on another arena topic, the validity of former councilman Peter Steinbrueck’s claim made to the county council last week that the location of the proposed arena violates land-use ordinances,  a claim rejected by Mayor Mike McGinn, Conlin said both were partly right.

Conlin and Steinbrueck were co-chairs of the land-use committee in 2000 when ordinances were adopted that defined the baseball and football stadiums as part of a stadium transition zone that allowed for some sports/recreational use around the stadiums but were intended to limit impacts on the area’s industrial uses.

“Having reviewed the staff report on the stadium transition zone,” Conlin wrote in an email, “it reinforces my memory that Peter is right that there was no thought of a third stadium-like facility at the time.  The Mayor’s staff is also right that there is no legal barrier to an arena on that site.

“Intentionality is another question, and the staff report does indicate that the intention of adding those blocks to the south of Safeco Field (which the staff had recommended against) was to support uses that relate to the stadia and to provide a buffer to the industrial area, not to contemplate another stadium use in this area.  So my interpretation would be that building the arena would be legal within the current framework of laws, but that Peter is correct that it represents a reinterpretation of the purpose of including this area in the stadium transition zone.

“So, it remains fundamentally a policy question, not a legal question, and Peter’s points provide some additional weight to the argument that this is a poor fit with the industrial zoning around it — i.e., that the City in 2000 would have been unhappy with such a proposal, and quite likely would have prohibited it if it had been presented.  The extent to which that is still true in 2012 is, to my mind, an empirical question that ought to be able to be settled with data.”

So in Conlin’s view, Steinbrueck’s point was misstated as a legal argument, but may have merit with council members who agree with the priority of preservation of the industrial area.

Regarding the “four tests,” the views of Conlin, as a former council president and a member for 14 years, may be influential. But his flawed representation of Hansen’s proposal, the dismissal of the project’s chances before all the research is complete and his absence of an accounting for his conclusion, is a bewilderment.

And spelling the man’s name correctly is always helpful for credibility.


YourThoughts

  • Vern

    He did not spell Hansen correctly. Dick must be really digging in with lots of attention to detail. No wonder the answers on financing seemed so complex to Dick.

    • art thiel

       Amazing how an error like that will stick, when nothing else will. Get staff help, Dick!

  • Vern

    He did not spell Hansen correctly. Dick must be really digging in with lots of attention to detail. No wonder the answers on financing seemed so complex to Dick.

    • art thiel

       Amazing how an error like that will stick, when nothing else will. Get staff help, Dick!

  • http://twitter.com/d00fybatz Ryan H.

    I can’t help but be more than a little disturbed by Connlan’s (see what I did there?) behavior. It seems unlikely to me that he would arbitrarily decide to speak for the entire council like that.

    Secondly, how the hell does this guy occupy our city council? It’s one thing to be against the arena because you don’t like sports or whatever, but this guy’s objections have been shot down time and time again. He apparently told Chris Daniels that Hansen didn’t answer his questions and still hasn’t told the council how much public investment the project needs. This is complete BS. The questions have been answered ad nauseum, and if he thinks they haven’t then he clearly doesn’t have the cognitive abilities to do his job.

     I don’t think this can be made any clearer than it has been, and it’s frankly terrifying that our elected leaders are too dense to comprehend a single word that’s been said to them on this. It would be extremely unfortunate to see a deal of this magnitude shot down because the investment group used too many big words.

    • RadioGuy

      Ryan, the sad truth is that Conlon (oopsy!) occupies a seat on the City Council because voters did not toss him (and other Councilors who took the money and let the Sonics go) out of office.  Nickels is out as mayor more because of Snowmageddon and other dumb moves more than the Sonics fiasco, but nearly all the Councilors remain.

      And, Art, while the municipalities might end up possessing the arena and team assets in the event of a bankruptcy (not sure how they’d get team assets since any team would likely be a separate entitity), is it really worth owning a white elephant AND its debts?  The City of Seattle already owns two similar white elephants…they’re called Key Arena and Mercer Arena (and the latter has been unused for public events since the 2001 earthquake).

      I don’t think the arena deal Hansen is proposing is bad, and it’s likely the best one Seattle is going to get, but there ARE risks.  I may not agree with Conlon (there I go AGAIN) but the City and County Councils are within their right to ask tough questions…it’s called due diligence, or simply doing their jobs.

      • art thiel

        Fully agree, Radio. I think tough questions and due diligence are mandatory. I’ve never said otherwise, and have asked patience among fans, because this is moving faster than any previous project.

        Regarding bankruptcy, the reference is about bankruptcies by owners (Tom Hicks Bruce McNall, etc.), not a team bankruptcy that would create the white elephant you suggest.

        And you’re correct that most of the council remains intact after the 2008 deal to let the Sonics go. Sports fans tend to occupy an echo chamber that is magnified by the sports-radio enablers, believing their numbers are much larger than they are. They forget that I-91 won 72 percent of the vote within Seattle. That’s a huge amount of disdain for sports, and a big part of why the council felt the risk to let the Sonics go was worth it. 

    • Jamo57

      As a resident of Everett, and as such a person who feels a bit helpless at times watching the drama unfold in SeaTown and KingCo, I hope Conland’s (my turn) foot in mouth maneuver serves to galvinize the public who seems to favor the arena deal by a wide margin.   

      I think us proponents may tend to feel the arena approval is inevitable (full-time yayhoo posters at the Times’ boards notwithstanding) but hopefully this will serve as the impetus for showing Conland the will of the people.    I haven’t seen a legitimate poll (one asking a straightforward, non-leading question) that hasn’t favored the arena by less than a 70-30 margin.

      Perhaps it is time to forgo the ‘nice, polite, respectful’ manner of addressing the council and simply advise the body to get it done or update their respective resumes for getting a real job.

      • http://twitter.com/d00fybatz Ryan H.

        Being from Everett, you have the argument that that if the arena doesn’t happen, there’s no hockey team. No hockey team, no Canucks road games. Thus X number of nights you have no reason to come to Seattle, buy tickets, stop at a restaurant before the game, buy a couple beers, etc.

         This is exactly the type of revenue every reasonable city government tries to attract to their city. But for some reason, ours doesn’t seem to get that. No wonder McGinn sounds so deeply perplexed when he has to defend this proposal by saying “wait, don’t we all agree that people coming into our city is a GOOD thing?!” Sadly, Mike, they don’t agree apparently.

        • Jamo57

          Absolutely Ryan.    We also do Husky football games (season ticket holder) and the occasional Ms game.   In the past we have gone out of our way to support establishments around the stadium or near the park and ride where we take the bus to the stadium (for Husky games that is Northgate Transit Center).  

          I am coming to the conclusion (and it wouldn’t really be that difficult to do) that we might as well support establishments in Snohomish County prior to or at the end of our journey into Seattle.    Right now our continued support of the Ms is very tenuous, given their hypocritical stance on the arena,  but the support of the Huskies will continue.   Seeing as how King Couny and the City of Seattle don’t seem to be too interested in the commerce we bring to the city, I think we would be happiier supporting our own communities.

          And having made a weekend road trip to VBC to see the Canucks, and feeling that we were welcome and appreciated, I have no problem in saving my ducats and taking them north too.   Besides, the bills I get back are much more colorful and interesting.   There’s a hockey player on the $5 bill!!!!    

          At least I can pass this ;message along to the respective councils and I think I will take the message to all the boards I post on to suggest to fellow residents of ‘outer’ Puget Sound they consider doing the same.

          • art thiel

             It is too bad that non-Seattle residents are left out of the equation. That’s why the last, best stadium deal was still the 1997 football stadium, because it was state-wide vote. Even if Paul Allen paid for it, people were allowed to vote no, and 49 percent did.

        • art thiel

          Lots of scar tissue in this town over sports and stadiums, Ryan. The bad deal on the Key is still fresh in many minds. The initial skepticism is warranted. But it seems the deal has the kind of public-private benefit that works better than most.

      • art thiel

         All the polls taken I’ve seen are non-scientific, meaning that activists can cause action via social media that skews results. So I wouldn’t be sure about any wide margin, particularly as it applies to Seattle proper (see I-91).

    • art thiel

       I wrote recently that Hansen should have said during his council presentation that the cheaper interest rates any city can get vs. a private investor makes costs cheaper for both parties. And the privates are taking the risk on team purchase, which is the private portion of this endeavor. Conlin appears to have found objections have already been answered, except for the points stated here.  

  • http://twitter.com/kurayami27 Ryan H.

    I can’t help but be more than a little disturbed by Connlan’s (see what I did there?) behavior. It seems unlikely to me that he would arbitrarily decide to speak for the entire council like that.

    Secondly, how the hell does this guy occupy our city council? It’s one thing to be against the arena because you don’t like sports or whatever, but this guy’s objections have been shot down time and time again. He apparently told Chris Daniels that Hansen didn’t answer his questions and still hasn’t told the council how much public investment the project needs. This is complete BS. The questions have been answered ad nauseum, and if he thinks they haven’t then he clearly doesn’t have the cognitive abilities to do his job.

     I don’t think this can be made any clearer than it has been, and it’s frankly terrifying that our elected leaders are too dense to comprehend a single word that’s been said to them on this. It would be extremely unfortunate to see a deal of this magnitude shot down because the investment group used too many big words.

    • RadioGuy

      Ryan, the sad truth is that Conlon (oopsy!) occupies a seat on the City Council because voters did not toss him (and other Councilors who took the money and let the Sonics go) out of office.  Nickels is out as mayor more because of Snowmageddon and other dumb moves more than the Sonics fiasco, but nearly all the Councilors remain.

      And, Art, while the municipalities might end up possessing the arena and team assets in the event of a bankruptcy (not sure how they’d get team assets since any team would likely be a separate entity), is it really worth owning a white elephant AND its debts?  The City of Seattle already owns two similar white elephants…they’re called Key Arena and Mercer Arena (and the latter has been unused for public events since the 2001 earthquake, although it’d be perfect for Seattle U basketball, like it was in the 70′s).

      I don’t think the arena deal Hansen is proposing is bad, and it’s likely the best one Seattle is going to get, but there ARE risks.  I may not agree with Conlon (there I go AGAIN) but the City and County Councils are within their right to ask tough questions…it’s called due diligence, or simply doing their jobs.

      • art thiel

        Fully agree, Radio. I think tough questions and due diligence are mandatory. I’ve never said otherwise, and have asked patience among fans, because this is moving faster than any previous project.

        Regarding bankruptcy, the reference is about bankruptcies by owners (Tom Hicks Bruce McNall, etc.), not a team bankruptcy that would create the white elephant you suggest.

        And you’re correct that most of the council remains intact after the 2008 deal to let the Sonics go. Sports fans tend to occupy an echo chamber that is magnified by the sports-radio enablers, believing their numbers are much larger than they are. They forget that I-91 won 72 percent of the vote within Seattle. That’s a huge amount of disdain for sports, and a big part of why the council felt the risk to let the Sonics go was worth it. 

    • Jamo57

      As a resident of Everett, and as such a person who feels a bit helpless at times watching the drama unfold in SeaTown and KingCo, I hope Conland’s (my turn) foot in mouth maneuver serves to galvinize the public who seems to favor the arena deal by a wide margin.   

      I think us proponents may tend to feel the arena approval is inevitable (full-time yayhoo posters at the Times’ boards notwithstanding) but hopefully this will serve as the impetus for showing Conland the will of the people.    I haven’t seen a legitimate poll (one asking a straightforward, non-leading question) that hasn’t favored the arena by less than a 70-30 margin.

      Perhaps it is time to forgo the ‘nice, polite, respectful’ manner of addressing the council and simply advise the body to get it done or update their respective resumes for getting a real job.

      • http://twitter.com/kurayami27 Ryan H.

        Being from Everett, you have the argument that that if the arena doesn’t happen, there’s no hockey team. No hockey team, no Canucks road games. Thus X number of nights you have no reason to come to Seattle, buy tickets, stop at a restaurant before the game, buy a couple beers, etc.

         This is exactly the type of revenue every reasonable city government tries to attract to their city. But for some reason, ours doesn’t seem to get that. No wonder McGinn sounds so deeply perplexed when he has to defend this proposal by saying “wait, don’t we all agree that people coming into our city is a GOOD thing?!” Sadly, Mike, they don’t agree apparently.

        • Jamo57

          Absolutely Ryan.    We also do Husky football games (season ticket holder) and the occasional Ms game.   In the past we have gone out of our way to support establishments around the stadium or near the park and ride where we take the bus to the stadium (for Husky games that is Northgate Transit Center).  

          I am coming to the conclusion (and it wouldn’t really be that difficult to do) that we might as well support establishments in Snohomish County prior to or at the end of our journey into Seattle.    Right now our continued support of the Ms is very tenuous, given their hypocritical stance on the arena,  but the support of the Huskies will continue.   Seeing as how King Couny and the City of Seattle don’t seem to be too interested in the commerce we bring to the city, I think we would be happiier supporting our own communities.

          And having made a weekend road trip to VBC to see the Canucks, and feeling that we were welcome and appreciated, I have no problem in saving my ducats and taking them north too.   Besides, the bills I get back in change are much more colorful and interesting.   There’s a hockey player on the $5 bill!!!!    

          At least I can pass this ;message along to the respective councils and I think I will take the message to all the boards I post on to suggest to fellow residents of ‘outer’ Puget Sound they consider doing the same.

          • art thiel

             It is too bad that non-Seattle residents are left out of the equation. That’s why the last, best stadium deal was still the 1997 football stadium, because it was state-wide vote. Even if Paul Allen paid for it, people were allowed to vote no, and 49 percent did.

        • art thiel

          Lots of scar tissue in this town over sports and stadiums, Ryan. The bad deal on the Key is still fresh in many minds. The initial skepticism is warranted. But it seems the deal has the kind of public-private benefit that works better than most.

      • art thiel

         All the polls taken I’ve seen are non-scientific, meaning that activists can cause action via social media that skews results. So I wouldn’t be sure about any wide margin, particularly as it applies to Seattle proper (see I-91).

    • art thiel

       I wrote recently that Hansen should have said during his council presentation that the cheaper interest rates any city can get vs. a private investor makes costs cheaper for both parties. And the privates are taking the risk on team purchase, which is the private portion of this endeavor. Conlin appears to have found objections have already been answered, except for the points stated here.  

  • Myk

    I sent an email to Conlin with similar points about the lease…if this is a policy/economics question then using the old Sonics situation is entirely disingenuous since it didn’t have any economic impact on the city.

    • http://twitter.com/d00fybatz Ryan H.

      Plus, he voted to terminate the lease. So, even if it had been a fiasco he would have been partly responsible. A doubly stupid argument, on his part.

    • art thiel

       Hansen and city lawyers have built some security into this plan that came from the mistakes with the Key. Conlin is reaching on this point. Far as I can tell, Hansen is not attempting to booby trap this plan.

  • Myk

    I sent an email to Conlin with similar points about the lease…if this is a policy/economics question then using the old Sonics situation is entirely disingenuous since it didn’t have any economic impact on the city.

    • http://twitter.com/kurayami27 Ryan H.

      Plus, he voted to terminate the lease. So, even if it had been a fiasco he would have been partly responsible. A doubly stupid argument, on his part.

    • art thiel

       Hansen and city lawyers have built some security into this plan that came from the mistakes with the Key. Conlin is reaching on this point. Far as I can tell, Hansen is not attempting to booby trap this plan.

  • Joe98115

    I’m not sure how I’d feel about Allen’s buying the Rose Garden back when he was offering 50 cents on the dollar (which was refused, resulting in receivership operation) and then be bought it back with undisclosed terms.  I mean, wouldn’t that be like ArenaCo saying “ok, we’ll only pay you 80M of your 120M back” ?

    • art thiel

       Good point, Joe. The analogy between the Rose Garden and Hansen’s proposal is tenuous. Lots of things going on there that would be different the the proposal here.

  • Joe98115

    I’m not sure how I’d feel about Allen’s buying the Rose Garden back when he was offering 50 cents on the dollar (which was refused, resulting in receivership operation) and then be bought it back with undisclosed terms.  I mean, wouldn’t that be like ArenaCo saying “ok, we’ll only pay you 80M of your 120M back” ?

    • art thiel

       Good point, Joe. The analogy between the Rose Garden and Hansen’s proposal is tenuous. Lots of things going on there that would be different the the proposal here.