Downtown Diamonds?: Ballpark no magic pill, five cities show

When a group of Oakland officials and ballpark
boosters embarked in April on two whirlwind
tours of cities and their new downtown stadiums,
they were armed with a list of questions.

By Robert Gammon and Cecily Burt – Oakland Tribune STAFF
WRITERS

How were the ballparks financed? What mistakes
were made? Did they revitalize downtowns? And,
most importantly, how were they sold to
taxpayers?

While the five cities each have distinct stories to
tell, the tours revealed that a ballpark alone is not a magic pill for awakening a downtown
area. Stadiums by themselves create few high-paying jobs and typically attract restaurants,
sports bars and game-day vendors.

But the tours and subsequent interviews by Oakland Tribune reporters who accompanied the
city delegations also found that if a ballpark is part of a larger economic revival effort, it can
spur or quicken the pace of other commercial development and housing. But not always.

The tours took place at a time when Oakland is arguing over what is the best way to revitalize
its once-thriving upper downtown, now home to vacant historic buildings and empty
storefronts.

It’s an argument that has raged around the country, as cities have attempted in the past
decade to inject new life into their downtowns by spending public funds on popular retro
ballparks that serve as visual reminders of when American life revolved around Main Street,
USA.

In Oakland, City Manager Robert Bobb and City Council member Dick Spees, who led the
tours, believe a new downtown A’s ballpark, coupled with theaters, restaurants, nightclubs and
housing, could be the key to restoring the city’s vibrant past.

But Mayor Jerry Brown and City Council President Ignacio De La Fuente — who refused to go
on the tours — have pinned their downtown dreams on housing, embracing a large apartment
complex plan for the same uptown site as the proposed ballpark between 18th and 20th
streets. They also point out that the A’s have yet to commit funds for a new stadium.

On Brown’s side are numerous studies by sports economists showing ballparks provide little
economic benefit and are not worth the public funds showered on them. A downtown Oakland
ballpark likely would require a public subsidy of at least $175 million to $200 million, a recent
study indicates.

"Stadiums produce crowds that spend money on hot dogs and perhaps dinner at a nearby
restaurant — if you’re lucky," said John Quigley, professor of economics and public policy at
University of California, Berkeley, and contributor to the book "Sports, Jobs and Taxes."

"If the team wants to pay for its ballpark that’s one thing, but to subsidize it on the basis that it
might spur development is bogus," Quigley said.

But proponents say the downtown-ballpark boom is still relatively new and that some cities
with recently built stadiums are showing signs of revival.

David Fike, an economist and dean of faculty at Holy Names College in Oakland who went on
the ballpark tour, said in a short study produced in May that a "new ballpark in Oakland has
the potential to contribute significant economic benefit to the city, but only if it’s part of larger
plan" to revitalize the immediate downtown area.

"From my perspective (a ballpark) makes sense for the uptown site, but not anywhere else,"
he said in an interview.

Even Mark Rosentraub, a sports economist and nationally recognized critic of publicly
subsidized ballparks, said that if government insists on spending taxpayer dollars on a
stadium, it shouldn’t be built in an outlying area.

"If you’re going to spend money on a stadium, there’s no point in putting it anywhere else
than a downtown," said Rosentraub, a professor and dean at Cleveland State University. "It’s
the only place where you’re going to have a synergistic effect."

Denver

Bobb and his staff view the new Coors Field and its impact on Denver’s lower downtown area
as a model for how to harness that synergistic effect for Oakland. Local ballpark boosters are
so enthralled with Denver they made sure both tours stopped there.

There’s no denying the area next to Coors Field, known as the LoDo District, has experienced
a rapid growth spurt in the past seven years. Ballpark proponents say developments that
would have taken 20 years happened in fewer than 10.

"When Coors Field came on line, it really solidified the area’s development … and it
accelerated it," said Craig Umbaugh, a Denver attorney who worked on the Coors Field development team, to tour
members.

According to Fike’s report and the Downtown Denver Partnership, a business organization that tracks downtown
development, about 3,000 housing units have been built in the downtown area since Coors Field opened in 1995.

An additional 5,700 residential units are in the planning stages, and area property values have skyrocketed. In
addition, the 0.1 percent sales tax used to pay off the 20-year bonds on the mostly publicly financed stadium brought
in so much money that the bonds were paid in a little more than nine years.

But in many ways, Denver’s baseball experience is entirely different from Oakland’s. First, unlike Oakland, Denver
didn’t have a baseball team and wasn’t going to get one unless it built a ballpark. Also, Coors Field was never part of
an overall city plan to revitalize downtown.

And unlike the preferred uptown Oakland site, the LoDo District — a historic section of red-brick warehouses adjacent
to downtown — was undergoing a renaissance even before the ballpark opened.

"A lot of people will tell you the ballpark turned around the area, but it didn’t. The neighborhood was already on the
upswing," Tom Noel, a professor at the University of Colorado, Denver, who specializes in the city’s history, said in a
phone interview after the tours. Noel voted against the sales tax measure, which lost in the city of Denver but gained
enough votes in the suburbs to win.

Even Coors Field backers acknowledge that the downtown growth coincided with the overall economic boom of the
late 1990s. In addition, critics point out that other than brew pubs and restaurants, the area immediately around
Coors Field has yet to attract significant retail development.

Seattle

The first stop on tour No. 1 served up a cautionary tale for Oakland officials trying to figure out what to do and what
not to do when building support for a new ballpark.

From circumventing the electorate — which had previously spurned a tax measure to build a new stadium — to
fast-tracking construction that eventually led to huge cost overruns, Seattle made mistakes at every turn.

At $517 million (in 1999 dollars), the Mariners ended up with the most expensive ballpark in Major League Baseball.

Furthermore, the tour learned, Safeco Field is in an industrial area south of downtown, a good 25-minute walk from
the commercial heart of Seattle. The eye-popping transformation of this port city’s downtown had little to do with the
new ballpark, say local developers.

Still, King County baseball fans who voted against taxing themselves to pay for the new stadium are now among the
sell-out crowds streaming through the turnstiles for every home game.

"I voted against it, I didn’t think it was a good way to spend public money," said Gary Knell while enjoying a beer at
an early-season game. "But now that it’s here, I’m glad."

Washington state Sen. Tim Sheldon was one of the dissenters of the financing scheme set up by the legislature, and
his skepticism has not waned. The financing plan includes new countywide taxes on food and drinks, rental cars and
ticket sales, plus proceeds from stadium license plates and two lottery games.

"The lottery didn’t generate the money that the state thought it would," Sheldon said. "It’s several million dollars
short each year, and if the money isn’t there, it still comes out of the general fund."

But team owners, who had threatened to leave if the Mariners didn’t get a new ballpark, feel the public owed them a
classy new baseball-only stadium.

"From the team’s perspective, the city/public has the responsibility for creating a facility that allows the team to
make enough revenue to be competitive and succeed," said Bob Aylward, executive vice president for Mariners’
business operations.

Cleveland

Cleveland is one of the few stops on Oakland’s tour that actually included a new ballpark as part of its downtown
revitalization efforts, albeit the historic south side of town now known as the Gateway district.

The run-down, 26-acre Central Market zone had already been selected as the best spot for a new downtown sports
complex. From 1986 to 1987 the city spent $19.3 million to buy up the property, mostly parking lots.

Ballpark boosters point out that 40 new businesses — primarily bars, restaurants and sports-themed retail shops —
have sprung up around the complex. There were six before Jacobs Field opened in 1994.

The neighborhood also has added 200 residential units, 464 hotel rooms and 118,000 square feet of retail space
since the ballpark opened in 1994. From 1995 to 2000, 151 storefronts worth $13.8 million were renovated.

According to statistics compiled by the city’s planning department, $250 million in new development has either been
completed or is under way in the Gateway district, and an additional $289 million is planned.

"Dispose of the naysayers because it will change a quadrant (of the city) by economic spinoff — if you don’t surround
it with surface parking," said Thomas Chema, president of the nonprofit Gateway Group. The entity owns the
Gateway sports complex of Jacobs Field and the Gund Arena, home of the Cleveland Cavaliers basketball team.

But critics contend the ballpark siphons revenues from businesses in other areas of the city. Prospect Avenue may
be seeing a resurgence, but retail has fled Euclid Avenue, once Cleveland’s main street, they say.

The Council for Economic Opportunities in Greater Cleveland also notes that boosters of the new Gateway sports
complex promised 28,000 new jobs, but a study the group conducted found that only about 2,000 jobs have
materialized in the entire downtown area.

"It turns out that whatever job gains took place in the immediate neighborhood of the ballpark were swamped by job
losses in the same area resulting from massive levels of retail business closures, such as the closing of the May
Company department store in downtown Cleveland," said George Zeller, a senior researcher with the economic
council.

The public paid the lion’s share of the ballpark costs. Adjusting for inflation, taxpayers paid $186 million compared to
$24 million by the Indians, according to a 2001 study by Raymond Keating, published in the Entrepreneurial
Economy. Most of the public funds come from a "sin" tax on tobacco and alcohol.

Baltimore

For downtown ballpark lovers, the first stop on the second tour was like taking a trip to baseball’s version of Mecca.

When Oriole Park at Camden Yards opened in 1992, Baltimore launched the new, old-style stadium craze. Ever
since, delegations from nearly every city that has contemplated building a downtown stadium have journeyed to see
it.

With its distinctive redbrick warehouse beyond center field and views of Baltimore’s downtown skyline, Camden
Yards recalls memories of when baseball really was the true American pastime.

"When the (New York) Yankees come to town, you can’t get a hotel room in this town," said Kim McCalla, explaining
the continuing popularity of Camden Yards 10 years after it opened. McCalla is a project director of the Maryland
Stadium Authority, which built and runs Camden Yards and the next-door Baltimore Ravens football stadium.

But critics say Baltimore owes taxpayers around the country a big apology for setting off the flurry of publicly
subsidized downtown stadiums.

"Baltimore set a terrible precedent," Howard Denis, a former Maryland state state senator, said in a phone interview.
"These ballparks have soaked up a lot of taxpayer money around the nation, … funds that should have been used to
deliver essential services, such as education and transportation."

Like Coors Field in Denver, Camden Yards was never part of a grand scheme to renovate Baltimore’s downtown
area. It was really about keeping the Orioles from leaving town as the Baltimore Colts had done in 1984.

Although it’s a short walk from Baltimore’s bustling Inner Harbor, a downtown development group told the Oakland
delegation that Camden Yards was an afterthought, an add-on to a waterfront plan that began decades before.

Camden Yards has attracted mostly restaurants and bars, but also has helped the city’s hotel occupancy rate and
raised Baltimore’s national profile. But it has yet to entice large-scale housing developments.

Ballpark proponents, however, say Camden Yards is beginning to spur other nearby projects, including a proposed
medical facility a few blocks from the stadium.

There was no vote on the stadium, because polls showed a ballpark financed almost entirely with public funds would
lose. Instead, the state set up special legislation for Camden Yards and created four new statewide lotteries to
generate enough money to pay for it.

However, the lotteries have fallen short of expectations. As a result, lottery funds that were to be used for other
services had to be redirected to repay the bonds on the ballpark.

Detroit

For ballpark proponents, the experience of Detroit has been something of a disappointment so far. For stadium
critics, it offers proof that downtown ballparks don’t always spur development in a city’s urban core.

Comerica Park, which opened a little more than two years ago in a blighted section on the edge of Detroit’s
downtown, has had one of the shortest honeymoons in the majors. And it could be a sign that downtown retro
ballparks are losing their luster.

Despite its $300 million new ballpark — the last stop on the Oakland delegation’s second tour — the Detroit Tigers as
of early June were attracting fewer fans than the Oakland A’s, who play in one of the oldest facilities in the major
leagues.

The reason? It depends on who’s talking. Some fans said it’s because the Tigers have been one of the worst teams in
baseball, and a new ballpark won’t keep attracting people if the ball club is losing. Others said their suburban
counterparts don’t like coming to downtown Detroit. Still others said it has to do with a lack of public transportation in
the Motor City.

And many fans blamed the gaudy design of the stadium, which includes huge snarling Tiger gargoyles that greet fans
as they walk through the ballpark gates. Whatever the reason, critics say Comerica Park has been a waste of public
funds.

"The new stadium here has been a terrible failure," said Frank Rashid, a leader of a Tigers fan club that fought to
keep the team playing at historic Tigers Stadium. "I was a devoted fan. Now I just don’t follow the game."

Although Comerica Park has yet to generate significant housing development in the immediate area, it’s one of the
few ballparks that was built with more private funds than public.

The city of Detroit, Wayne County and the state of Michigan accounted for $140 million (in 2000 dollars), or about 47
percent of the total cost, according to C. Beth DunCombe, former president and CEO of Detroit’s Downtown
Development Authority. The rest was private money.

Ballpark proponents say Comerica Park helped convince the owners of the Detroit Lions to build a mostly privately
financed $500 million football stadium, marketplace and hotel next door. Proponents believe the dual sports
complexes and the marketplace eventually will spur revitalization of the area.

"Downtown Detroit may look somewhat dead, but it was truly dead before — there wasn’t a (construction) crane
anywhere," DunCombe said. "And it all started with Comerica Park and the announcement in 1995 that it was going
to be built."

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