Richard Conlin: Why I voted No on the Arena

The deal is better than most, but that doesn't mean it benefits the city's taxpayers.
Council member Richard Conlin. (City of Seattle)

Council member Richard Conlin. (City of Seattle) None

Last week, the Seattle City Council voted 6 to 2 in favor of an agreement that would ultimately result in public financing to support constructing a new arena south of Safeco Field. Councilmember Nick Licata and I voted against the legislation (Councilmember Rasmussen was absent). I'd like to explain the background and the reason for my vote.

We have often been told that this was one of the best deals any city has ever been offered, and that now it is even better. Both of those statements are probably true. But neither of them demonstrates that it is a deal that is truly in the interests of the people of Seattle. This revised agreement may prevent the most problematic outcomes. That does not mean that we will wind up benefiting from it, or that it is a good use of the City’s time, resources, or financial capacity.

As I noted in August when I first wrote about this proposal, the question before the Council is not whether we think having an NBA team is a good thing, but whether it is necessary and appropriate to invest public money (in the form of municipal bonds) for a new arena. We have seen no evidence that constructing a new arena to bring an NBA basketball team to Seattle requires City participation. The land is zoned to permit its construction, and the developer has purchased that land and lined up several very wealthy investors who have the capacity to pay for an arena and for the teams to fill it.

The core issues remain. The City has negotiated an agreement that we would never do with any other for-profit business — giving up future City taxes that the business would generate and investing them in the business instead. This is a very odd financial  model for a public entity, with a very complex and convoluted agreement wrapped around it.

This agreement takes an expense away from the business owner — paying his taxes. Now this expense becomes money from the City invested in his business, and he makes a profit on it.

It takes a benefit away from the City. Normally a new business pays taxes into the general fund. Then all our residents and businesses enjoy better services or lower taxes. But now those taxes go back to the business to become an ‘investment’ that does not, in my opinion, generate returns for the City.

I respect the efforts of my colleagues to improve the proposed agreement. Getting some funds generated by the arena dedicated to transportation improvements, securing a personal guarantee from Chris Hansen that the City debt will be repaid, obtaining more City control over funds generated by the Key Arena during the time an NBA basketball team would be located there, and adding a provision limiting the possibility that we will be stuck with a money-losing arena by giving the City the right to require Hansen to buy it back after 30 years are all positive steps. Because the entire agreement is with a single entity and lead individual, there is still some exposure, but it is greatly reduced, and there is a pretty good chance that additional City resources are not significantly at risk.

But these do not change the core issue. And there are additional uncertainties. We will have to figure out the future of Key Arena, which in 2011 made $310,000 on $6.6 million in revenues, and now will face a City-funded competitor for major shows and possibly lose its primary sports tenant, the Seattle Storm. While the transportation fund will help with industrial business and Port issues, this project adds to the challenges and uncertainties about their future and the future of the thousands of jobs they support. And there is still possible litigation and the investment of City resources in managing very complex financial and logistical arrangements.


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Comments:

Posted Mon, Oct 1, 8:44 a.m. Inappropriate

Thank you Council Member Conlin and Nick Licata. The rest of the current crop of council members clearly do not give a whit what their constituents think -- they're supporting a new sports arena that the majority in Seattle do not want. Especially Sodo and West Seattle are ill-served by these so-called "public servants" who would rather bow and scrape to multimillionaires and billionaires, and give in to the minority but loud, shrill and "anyone who disagrees with us hates sports" voices of those think the arena is a good deal when in fact it is not -- at least not for the city and its taxpayers.

It's certainly time to hold to the fire the feet of those council members and the mayor, who so blithely ignore real needs for public funds in favor of an entertainment complex that many people won't ever attend because they can't afford the price of entry -- Seattle elitism at its finest.

Posted Mon, Oct 1, 7:12 p.m. Inappropriate

arthurking, you make a wide assumption when you say 'the majority in Seattle do not want the new arena'. I have not talked to anyone who doesn't want it, both inside Seattle and outside.

Perhaps your world and mine never meet up.

Posted Mon, Oct 1, 8:31 p.m. Inappropriate

At least three public opinion polls in Seattle and King County have shown a 60 percent anti-arena mindset. You can disregard those if you like, but I'm certain the last thing pro-arena folks want is a public vote. They'll give you all kinds if phony baloney reasons -- like the vote on I-91, which was far more general and, by the way, which the current proposal DOES NOT satisfy -- but the bottom line is they know if it went to a vote they would lose.

Posted Thu, Oct 4, 9:51 p.m. Inappropriate

Polls are not votes. Locally, and regionally, the polls you cite do not match how people I know feel.

Something is askew in the City of Seattle, and that is PRIORITIES.

Most everyone I know LOVES Chris Hansen and the fact that he's one of the very, very few who will put his private money where his values and civic sense of duty are.

Posted Mon, Oct 1, 9:22 a.m. Inappropriate

I appreciate you re-posting Conlin's essay here -- I've still got misgivings about the structure of the deal, and the long-term effects this project will have on the overall economy of Seattle.

sandik

Posted Mon, Oct 1, 4:27 p.m. Inappropriate

I think Mr Conlin made the right call. First, most of the people attending the games and events at the arena are going to be from in the area and would be attending other events at other facilities instead of the new Arena. The taxes from those facilities would go to the general fund. So this may actually end up costing the general fund revenue. This is hard to tell for sure, but it if does happen, there won't be anything anyone can do about it. Second, the traffic for commuters is going to be rougher without the viaduct, and when there are multiple events going on in the arena, the congestion is going to be a lot worse.

sjenner

Posted Mon, Oct 1, 7:44 p.m. Inappropriate

I'll admit to being surprised by Conlin's "no" vote, given that he's normally one of the City Council's biggest suckups the developers have. I wonder what his reasons actually were.

NotFan

Posted Mon, Oct 1, 8:40 p.m. Inappropriate

I do not fully understand why Key Arena worked well for basketball in the past and will not supposedly do so again.

I do not endorse one cent of taxpayer money to pay for this. If the City must be a bank then let private industry pay bank rate.

Let the players donate out of their salary.
Let the big money people fund it.

IF it is such a good deal and so profitable why do they need City money??

What amazes me is it seems the only people who can build anything in this town without a bunch of wrangling and paper is the entertainment industry

leitmotif

Posted Tue, Oct 2, 6:20 a.m. Inappropriate

Council Member Conlin is correct. He has been correct about this proposal throughout the process. I appreciate that Council Member Conlin knows that he represents the Seattle citizenry, and voted against the Hansen proposal.

jhande

Posted Tue, Oct 2, 1:59 p.m. Inappropriate

I think I figured out Conlin's game. He wants to be mayor, and figures he might tap into resentment of the arena deal. He also opposed a developer deal in Laurelhurst, which will help him with campaign contributions.

The reality, of course, is that he knew there was no downside to opposing the arena because it was a done deal. The reality is also that Conlin is no less of a water boy for the so called "progressive" "new urbanists" than McGinn is. And he never met a developer he wouldn't suck up to.

So next year, we'll have McGinn and Conlin and Burgess running for mayor. Three sides of exactly the same coin.

NotFan

Posted Fri, Oct 5, 11:43 a.m. Inappropriate

Although I can live with this arena deal IF the taxpayer's end of it is paid for by renters and event attendees, as a matter of principle I just don't like public financing of what will be a privately-held facility...and I'm a huge sports fan. In that regard, I agree with Councilor Conlin. Should Boeing feel empowered to ask Seattle and King County to help pay for replacing their own antiquated facilities in Seattle and Renton? Parallels can be drawn and Boeing inarguably has far more influence over the local economy than two sports franchises ever could. Or would the NBA and NHL hire 85,000 employees at union wages?

I don't have a vested interest in this since I live over 100 miles away and don't need the NBA or NHL to enjoy basketball or hockey. What I DO have a vested interest in is having taxpayer dollars spent wisely. I question why Hansen and his group of investors are relying on the public to help build this arena. If it's such a slam dunk financially (sorry for the metaphor), why not build the arena entirely with private money and take 100% ownership of it? Can't they find other investors to cover the $200 million expected from taxpayers so this isn't even an issue?

If the return of the public's portion via a user tax of tickets and parking (I'd add concessions and merchandise) is a sure thing, then go for it. I grew up watching the Sonics and Totems (and the Smashers and Cascades, for that matter) at the Coliseum so that building holds a lot of great memories. But that building is also 50 years old and has its limitations. It's time to replace it.

Posted Sat, Oct 20, 10:03 p.m. Inappropriate

Glad to see there is at least one Democrat left in local government.

Given that Mayor McGinn & Co. Board Exec Dow Constantine are more interested in bending over for multimilionaires than in doing the people's business, it makes you wonder what "progressive" really means in Seattle -- I guess it means they "progressively" try to make the city too expensive for anyone but the uber-rich, their good friends.

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