Today's loser: The arena proposal
The Seattle City Council (much like the King County Council earlier this week) has no intention of rubber-stamping the mayor's half-billion-dollar "self-financed" arena proposal.
At the first meeting of the council's arena oversight committee this morning, council members had tough questions for city staffers and arena consultant Carl Hirsh, who is receiving nearly $20,000 a month to advise the city on the arena proposal.
After listening to a presentation about all the arena's purported benefits — among them, promoting civic engagement, spurring economic development, and, in deputy budget director Hall Walker's words, "promoting cultural vitality" — council members had some pointed questions.
First: When will San Francisco hedge fund manager Chris Hansen, who has proposed building the stadium with a combination of his own cash and public money, reveal the members of the mysterious "investment group" that will fund his portion of the stadium? Hansen has so far refused to tell the media or city officials who the potential investors are, although they're reportedly all familiar Seattle names.
"Before the council will act, we will have to have disclosure of who all these principal players are and who is investing," council member Tim Burgess said. Council member Tom Rasmussen added that he wouldn't feel comfortable signing off on the arena until the city had looked into the investors' credit histories, court records, and financial information.
Walker said it was up to Hansen, who was not at today's meeting, "to communicate the list of investors to you all" when he decides to do so. That will reportedly happen sometime in the next two weeks.
Second: Why is the city on the hook for as much as $120 million, while the county's contribution is capped at $5 million if Hansen fails to secure an NHL team? (That number jumps to $80 million if Hansen manages to secure both an NHL and an NBA team.) Put another way, why does the cost-sharing split change so dramatically if Hansen fails to lure the NHL — from a 60-40 city-county split, to a scenario where the city's contribution is more like 90 percent?
Council members and city staff went around and around on this one, with staffers explaining — less than helpfully — that the city has a larger tax base (and thus a greater ability to issue debt) than the county, and council members asking — several times, in fact — why the city's ability to pay more translated to an agreement to pay more.
Ultimately, the staffers didn't really answer the question, except that the city has already committed to buy the land back from Hansen for the arena at a cost of up to $100 million, so "the extent of the county involvement really becomes quite a bit less" than the city's, especially without an NHL team, Walker said.
"The county is looking at themselves as sort of the extra piece of financing over and above what the city can finance on its own," Hirsh said. "It's a question of risk to the county."
Walker subsequently denied, however, that an NBA-only arena is inherently riskier than one that's home to both the NBA and the NHL.
Third: About that $100 million payment to Hansen: Isn't that a pretty sweet deal, given that the land, most of which Hansen has already bought up, is certain to increase in value if the arena gets approved?
Council member Sally Bagshaw summed the deal up this way: "So he got a great deal and now we pay for whatever it's appraised for" after the arena is approved.
Walker said that although the potential arena "does add value," the $100 million cap should serve as a check on the city's payout to Hansen. Hansen spent an estimated $40 million on the land.
One thing that was clear: Revenues to pay back the city's investment will not come from a new local sports TV network, as council members were initially told. Although the city and county can make money by selling naming rights to the arena, any TV profits would go to the team itself, not the arena's public investors.
The arena committee's next meeting is at 11 a.m. on June 6, in council chambers.
Today's Winner: Inconclusive
New polling from local political consultant Strategies 360 shows Republican Rob McKenna slightly ahead of Democrat Jay Inslee, 43 to 39. The poll could actually be good news for Inslee though: Compared to Strategies 360's previous poll from late last year, McKenna has dropped three points. He was ahead in September, 46 to 39.
Or bad news: Inslee hasn't budged. He was at 39 percent in September as well.
But perhaps there's another way to score the Inslee-McKenna standoff. The poll also took the voters' pulse on big policy issues on which the gubernatorial candidates diverge. Inslee has made a big deal of his support for gay marriage and McKenna's opposition. Score one for Inslee. Voters support gay marriage 54 to 33. And in fact, opposition to gay marriage has dropped. It was 35 percent against last year.
But wait. Score one for McKenna. Voters support charter schools, 51 to 25. McKenna has come out strong for charters. Inslee has come out against.
Tie breaker? Inslee's team has condemned McKenna for signing onto the anti-Obamacare lawsuit. But Washington voters are in favor of full repeal, 35 to 32. Point for McKenna.
But wait! How about this tie breaker? McKenna is sinking in King County. Once showing good numbers in the Puget Sound, he's down to 37 percent in King County. McKenna's okay numbers in King County (for a Republican) have been a potent stat for him. However, he needs to creep above 40 percent to win in November. He appears to be heading in the wrong direction.
The poll of 500 likely voters conducted between May 22 and 24 had a 4.4 percent margin of error, which leaves everything up in the air. McKenna's 43 to 39 edge falls within the margin of error.