elpasospeak

The El Paso Times recently reported that the city of El Paso’s sales tax revenue has increased 2.3 percent for the year through October.

What they did not report was what Brutus mentioned the other day in Bad Bets.

While the increase in the sales tax collections is good news, the bad news is that the city is counting on (they have already budgeted) a 4.3 percent increase.

Hotel Occupancy Tax revenues are down one percent while the city told us to expect a three percent increase.

Remember that the city is now telling us that they will have to use general fund revenue to supplement bond payments for the ball park.

Unless things turn around we are looking at a revenue shortfall.  What services will have to be cut or what fees will have to be increased?

There was a time when the reporters at the Times researched their articles instead of just printing what some government agency asked them to print.

Muckraker

According to this article in the Times opening day for our new ball park will be April 11, 2014.  The Pacific Coast League arranged the schedule so that our team will play the first few games of the season out of town to allow the ball park to be completed.

The October 15, 2013 city council agenda has the latest “Guaranteed Maximum Price Amendment” with the construction company they hired to build the ball park.

Surprise, Surprise!

My initial reading of the amendment yielded these jewels:

• The ball park will enjoy substantial completion by April 28, 2014.  That’s a little late for an April 11 opening.
• “Substantial Completion is defined as the Ballpark being ready for a full capacity Triple-A baseball event.  However, this may require code “work arounds” such as fire watch, extra stadium staff for security, etc. which costs will be borne by others.”  I may be wrong but I think that code work arounds are the same as code violations.
• Final completion of the park is scheduled for August 31, 2014.  The regular season ends September 1, 2014.
• The document excludes certain things from the price, like:
  • railroad platforms and bridge
  • railroad platform foundations
  • Missouri and Durango street improvements
  • offsite improvements/work (this probably includes the water and sewer work the city is not talking about as well as the pedestrian and road work around the park)
  • special construction provisions required at railroad
  • porcelain/art signage
  • 4 TOPP or 2 TOPP tables and loose chairs
  • aluminum and fabric sun shades

Reasons for increase

The presentation for city council includes a page that offers these reasons:

“Construction commenced before delivery of complete design.  Only recently has the design advanced to the point to allow the CMAR [Construction Manager at Risk] to set GMP [Guaranteed Maximum Price]”

“Project Schedule — Drives costs up due to overtime, expedited materials, etc.”

“Bids have not been as favorable as projected:  Bids have been as competitive as possible; however, many contractors lack the resources necessary to meet the schedule.”

In other words we could have built the ball park for less money if the team played in Tucson or at Cohen Stadium during 2014 and moved to the new ball park in 2015.

We deserve better

Brutus

What is the job title of the fellow who writes for the editorial page of the Times?  To me “reporter” would be inappropriate, his articles seem to be arguments, often devoid of facts. Last Sunday he wrote about those of us that have a problem with how the ball park deal was done, that by the way includes our mayor.  Scattered among the insults he made were several misstatements.

He wrote “the fact still remains that no property taxes will go toward ballpark construction”.  As the lawyers say, that is a distinction looking for a difference.  Money taken from sales tax revenue and service/permit fees is money that will have to be raised through other sources, property tax included.  His argument is like saying that your spouse’s paycheck does not help pay the mortgage.

Then he wrote this:  “They paid $20 million to purchase the Triple-A franchise of the San Diego Padres. They are not going to recoup $20 million anytime soon — probably never.”  The fact is that the teams are bought and sold regularly  for more money than our sports group paid.  This quote from a Forbes article sets the record straight:

The most instructive transaction was the recent sale of the Las Vegas 51s (Pacific Coast League/AAA), the New York Mets‘ farm team that recently set a new baseline for Class AAA teams. The 51s ranked No. 48 in attendance last year, and only three AAA teams drew fewer fans. The Wall Street Journal profiled the team’s many troubles in June, noting that no MLB franchise wants to be affiliated with the team. And yet in May the Vegas team sold for $20 million, which has become the generally accepted minimum price for a AAA team.

Next he wrote “Nobody in their right mind would pay $20 million for a minor-league baseball team unless they were already so rich that $20 million isn’t the milk money”.  Once again he is wrong.  The article How billionaires like Warren Buffett profit from minor-league baseball ownership explains that owning a team is often a good investment.  This quote from the article expains:

Someone that paid $22 million for a team earning $4 million is roughly getting an 18 percent pretax return on capital. Another example of the great return on investment is the owners’ ability to sell teams for much more than the original purchase price.

Then came  “And, no, they’re not going to turn around and sell the franchise for $21 million to some family in another city that would be honored to have Triple-A baseball” another statement that has no foundation.  Yes the contract with the Downtown Development Corporation requires the team to stay in our eventually to be built stadium for 20 years.  That does not mean that the team cannot be sold.  The value of the team will depend in large part upon attendance.  The ownership group has not fared well publicity-wise.  It is possible that they might want to get out of the deal eventually because of local public opinion.

“Perhaps the most ridiculous statements by math-challenged Livids is that the Foster-De La Vega built a new parking garage next to their renovated historic Mills Building so they could get back their part of the $20 million by soaking El Pasoans at the garage” was his next argument.  I have no way of knowing the real number but I would not be surprised to learn that 74% of the voters don’t find the statement ridiculous at all, even with the grammatical error that our professional newspaperman had in his piece (statements … is).

Our writer then ventured into arithmetic, another subject that he sees differently from many of us.  He wrote  “And ridiculous statement No. 2 is that the Hunts and Foster-De la Vegas couldn’t even get us a winning team. Doiiink! Our franchise finished this past Pacific Coast League season 10 games over .500.”   I am happy for the team, they did have a winning season this year.  The facts, however, are:

The Tucson Padres played three years.  Their record was 198/234, or 198 games won and 234 games lost over that three year period.  The team unfortunately has a losing record.

I don’t know why this writer feels the need to insult us.  He might argue that he was trying to be humorous.  I don’t buy that.  I think that he is writing what his bosses want him to write.

Ultimately the newspaper must make money.  Subscriptions are a smaller part of its revenue stream.  Advertising generates the majority of the income.  However, advertising income is based on how many newspapers they sell.  Personally, I am coming to close to voting with my wallet.

Then again, they never get the coyote.

We deserve better

Brutus