Arthur Blank Taps DeKalb for $12M, Because He Can

So much for a raise.

August 3, 2015 9:10 am

by George Chidi

 

The public’s natural reaction to government plans for sports stadium “investments” is inchoate incandescent rage. Taxpayers could have been convinced, once upon a time, before Russia’s winter Olympics, before the FIFA scandals, before John Oliver’s weekly rants went viral. Not anymore.

Stadiums as bad government policy are cliché sports bar conversation fodder today, especially as we contemplate traffic on Braves game days in 2017. The idea should be dead on contact.
And yet, here we are. Again.

DeKalb County’s commission will vote Tuesday to turn over 40 acres of public land for the use of a private sports team for 30 years, tax free, spending (they think) $5 million to prepare the property and paying a billionaire $7 million for the privilege.

Arthur Blank wants to build Atlanta United’s $30 million soccer training complex behind the DeKalb County jail, near MARTA’s Kensington Station. It would be the perfect place to stage a re-enactment of “Mean Machine” or “Victory.” Which commissioners should play which prisoners’ roles is something I’ll leave to your imagination.  

I’ll tune my rage back into the visible spectrum long enough to consider the rationale for putting public money on the line here. The station at the intersection of Memorial Drive and I-285 is a New Urbanist nightmare, a giant parking lot surrounded by blight, underused office space, low density neighborhoods and a jail.

Arguably, the county needs to see healthy commercial districts develop in areas that cities can’t annex or incorporate. Building around MARTA stops makes long-term sense, and Kensington may be the best candidate.

Consider how well downtown Decatur works, with MARTA in the middle of a vibrant commercial district. Lee May, the county’s interim CEO, wants to duplicate that at other MARTA stations.
The irony. The county budget anticipates about $24 million more, net, this year. Disproportionately, that money will come from city property owners. Property values rose much faster in cities than in unincorporated DeKalb this year, and the county changed how it duns cities for county services, raising their taxes.

May floated a plan earlier this year to move some county offices to the facility across from the county jail — and a five-minute walk from Kensington — as a catalyst to redevelopment. The stadium deal looks like a piece of that plan, by moving the Parks Department to the facility.
On top of that, DeKalb County’s shifting demography, driven in part by immigration, makes soccer an attractive sport for public support.

That doesn’t make spending money on a sports complex less stupid in this case. But it’s the argument we’re going to hear and I want to give it an honest airing. None of that gets past the obvious: the financial profile induces vomiting.

The county plans to spend $7 million for the privilege of moving its Parks Department to a 6,000 square foot facility at the new complex. That much Class A office space around here sells for about $600,000; most is under a million. The extra $6 million? Gravy.

I can understand lending land for development, and spending money to prep it for development. Tax breaks can be debated. But an extra $6 million to Blank — and to whichever politically-connected developer gets the construction contract — on top of all of that? Insane.

Six million dollars. That’s what we spend on the county’s summer recreation programs. For thirty years.

The memorandum of understanding calls on Blank to cover his end of operation and maintenance costs. But the document doesn’t say what those costs might be. The county will be generously allowed to host a limited number of special events at the facility during the season. It doesn’t say how many. Will DeKalb’s school soccer teams be allowed to regularly use the facility for games? It doesn’t say. What would that cost? It doesn’t say.

Blank pays DeKalb 15 percent of naming rights revenue, which I suspect will be minimal. All of the other revenue (except for the county’s generous allotment of special events) goes to Blank. The county gets no share of ticket revenue.

The agreement calls for at least 10 percent of the jobs related to building maintenance and operations be reserved for DeKalb County residents. My reading of the documents shows that the first 83 jobs have an average salary of about $200,000. The second tranche of 40 jobs has an average salary of about $55,000. I suspect most of the construction, maintenance and facility operations job fall in that latter slice. The agreement doesn’t say.

The agreement requires Blank to keep Atlanta United’s practice facility there. It does not require Blank to keep operating Atlanta United. If the league goes the way of the USFL, DeKalb’s only bankruptcy protection is it taking possession of the facility at the end of the term … along with all of the upkeep costs of a single-purpose structure.

Six million dollars. I contemplate the long list of extremely pressing needs in DeKalb County that could be met with $6 million. The county festers with blight that it can’t afford to condemn and tear down. Emergency shelter space remains extraordinarily tight, especially for women with children. Road repair and infrastructure maintenance has a backlog of years if not decades. Even funding for an animal shelter — and I note that the current facility must be torn down, according to this agreement — appears unstable. Animal activists in DeKalb are complaining about a broken deal over that funding.

That touches on the second problem. Trust.

DeKalb County government has had a bad couple of weeks, even by the degraded standards by which we’re left to measure such things.

Last week, commissioners passed a mid-year budget that cut spending requests for corruption investigations. The DeKalb district attorney’s office asked for $200,000 to hire investigators and an assistant DA in its public integrity unit. Denied. The CEO wanted to continue $500,000 in funding the Bowers internal investigation — a preliminary report is due sometime in August, by the way. Denied. (The CEO says he’ll find the money somewhere else.)

A few days later, we were left to boil tap water for days because the water department apparently doesn’t know how to find the right valve to turn anymore.

And now, Blank decided that the nine-figure concession he managed to squeeze out of Atlanta wasn’t enough. He’s chasing DeKalb for a few million more.

The design and construction of the sports facility will be done in partnership with Decide DeKalb. That’s the newly-rebranded DeKalb Development Authority, headed by Vaughn Irons.
Over the last couple of months, I’ve come to respect Irons’ acumen as a businessman and an agent for economic development. I’m as shocked as anyone. But as I discovered listening to him at the debates to fill the commission seat, there’s a reason he’s been asked to take responsibility by civic leaders; he’s smart and experienced and understands the nuances and limitations of the government’s role in economic development. I respect the quality of his mind.

But he’s still under a cloud of ethics questions which limit his power to make the case to the public.
A skeptical public needs to know what it’s getting for its money. Barring that, it needs to know that if it doesn’t have all the data, it can trust the people who do. But now? Given all of this? The well of trust is too dry for this game.

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