Friday, November 12, 2010

The $200 million reaction.

So yesterday's news about the Ricketts family going to the state and asking for $200 million spread quickly and the reactions amongst the world was varied and heated.

I know seems like it is easy for me to sit back here in southern Wisconsin and say that this is a great idea and be happy about it. In the end, I've been helping pay for Comiskey Park and Soldier Field for years now, so I do indeeed have a stake in this. Technically the state tax payer shouldn't be effect by this loan to the Ricketts family, but stranger things have happened in Illinois.

  • Tim over at Aisle 424 discussed the social morality of giving the Cubs this $200 million loan. The title of that post is "If Illinois Gives the Cubs $200 Million, I'm Moving"...I don't suggest moving to Wisconsin where the income tax is considerably higher, the infrastructure of the state worse condition, and we are still paying off Miller Park for Bud Selig. (Oh, and we just elected a moron as Governor who just decided that some other state can have our $810 million for a high speed the federal government will just let us use that money for other pet projects...ha...stupid moron.) Sorry...I got side tracked there.
  • tried depriately to be balanced in their post, but in the end reverted to blaming Crane Kenney for all the ills of the world. I guess I can't complain about that. They did determine that the plural of Ricketts is Ricketti. I think I'll ask their permission to use that.  I like it.
  • On the profession media side, the Sun Times published an editorial condeming this idea and calling on the Cubs to finance the whole thing themselves. What is stupid and short sided about this view is the fact that the Ricketts family is willing to invest $200 million of their own money to help redevelopment of the Wrigleyville neighborhood. If the Cubs don't secure the financing, it is likely they will not to those infrastructure projects for the neighborhood deferring those funds back for the renovation of the park itself. That would leave it up to the city and county to deal with the other issues in the neighbhood including improved traffic control and parking.
  • Ed Sherman of Crain's thinks it is unlikely that Ricketts will be able to sell this deal to the state and says the Cubs have very little leverage here. He's right on both of these points. The White Sox has Tampa to use as leverage in the late 80's. No one is going to buy a threat from the Cubs to move to Schaumberg (which I'm cool with).

I don't know what the overall concensus is amoung the legislators in Illinois (or Governor Quinn), but it appears to me, even with the fact the this shouldn't increase state taxes at all, that the general opinion here is that the Cubs should not get the money from the state even though their fans have contributed a large proportion of the Amusement Tax since its inception.

I personally feel that it would be a shame to see Cubs fans get stiffed here after helping finance both Comiskey Park and the Soldier Field renovation. Cubs fans encompass the largest contributor to the Amusement Tax and they have asked for nothing from it in that time.

I also know that the state is in a dire situation right now with a $15 billion deficit. The PR move by the Ricketts family to do this right now is piss poor at best.

I, in the end, believe that this will be rejected by the state legislature which will result in something along the lines of a Personal Seat Licence program leveed on the season ticket holders to help pay for the renovations. My estimates tell me that the Cubs could generate between $54 to $100 million with PSLs depending on the price they set.

This would be unfortunate. I say that not because I would have to pay a ridiculous fee or give up my season tickets, but because Cubs fans would not only end up floating the entire bill for the Wrigley Field renovation, but still continue paying for Soldier Field and Comiskey Park.

Another reason this would be unfortunate? Because less money would be generated by PSLs and this would likely result in either the Ricketts family taking out more loans (at a higher interest rate) to get the job done or a reduction in scale of the overall renovation which would likely leave the park in a condition that will push it to be obsolete again much sooner that the hoped for 50 year life expansion.