Is Fort Wayne’s baseball park a model for Columbia?

cleblanc@thestate.comJanuary 18, 2014 

The master plan for Columbia Common, being developed by Greenville's Bob Hughes, shows a location for a baseball park.

HUGHES DEVELOPMENT CORP.

  • If you go

    Columbia City Council is meeting Tuesday and holding a public hearing on the merits of a taxpayer-funded baseball stadium in the proposed Bull Street neighborhood. It’s unclear whether any votes will be cast.

    When: Noon

    Where: City Council chambers, third floor of City Hall, 1737 Main St.

  • Preliminary plans

    These are Hardball Capital owner Jason Freier’s projections for a Class A minor league baseball stadium and team in Columbia.

    Jobs

    36 full-time positions; 550 part-time and seasonal positions.

    Some of the full-time and all the part-time positions would be local hires.

    Annual payroll: $3.1 million.

    Stadium features

    The concourse would circle the field completely to allow viewing of the field and the restaurants, stores and other development outside the ballpark.

    Capacity for baseball games would be 8,500, of which 6,500 would be fixed seats.

    About 120 to 150 club seats.

    16 luxury suites would offer the best views.

    SOURCE: Hardball Capital chief executive officer Jason Freier

  • More information

    INSIDE

A publicly funded baseball stadium has been a success in Fort Wayne, Ind., because it triggered urban renewal in a once-decaying area, the Midwest city’s redevelopment director said.

“I’m not aware of a baseball stadium that pays for itself,” Fort Wayne Redevelopment Commission director Greg Leatherman said last week, “but we’re getting exactly what we wanted.”

He was referring to his city’s interest in using the ballpark as a catalyst to revitalize what was a blighted part of town almost five years ago when Parkview Field held its first minor league game.

Columbia officials are in talks with Jason Freier, who owns Fort Wayne’s Class A TinCaps team as well as the Savannah Sand Gnats. Freier has presented the Indiana facility as a template for Columbia during dozens of meetings here with residents and civic and business leaders.

Columbia City Council has yet to cast a vote on whether to build or how to pay for a ballpark, which is projected to be more expensive than Fort Wayne’s. A discussion is on Tuesday’s council agenda.

Supporters of a Columbia-owned stadium hope a year-round facility would attract hundreds of thousands of guests and spur construction in the enormous, proposed Bull Street neighborhood in the heart of the city.

Freier’s company, Hardball Capital, partnered with Fort Wayne to build a $31 million, multi-use ballpark for its team and for other activities year round. The city paid all but $5.5 million of the construction cost. Hardball Capital pays for all operating and short-term maintenance expenses, Leatherman and Freier said.

“When you talk about the entire project, it’s cash-flow positive,” Leatherman said of a four-part redevelopment plan anchored by the stadium. “There’s not a deficit if you include taxes we’re collecting from the hotel that wouldn’t be sitting here if we didn’t have the baseball park sitting here.”

The project, called Harrison Square, is composed of the stadium, a 250-room hotel, a four-story, mixed-use building and a parking garage. They all are part of a tax increment finance district, commonly called a TIF, that captures and reinvests taxes within the district to finance improvements.

Efforts by The State newspaper to get financial data such as property tax collections and changes in property values for Harrison Square were unsuccessful last week because the city comptroller was out of the office all week.

Though the redevelopment commission gathers detailed data about many aspects of Harrison Square, Leatherman said he’s unaware of a single financial report or any agency that would compile a complete analysis of the entire project.

In addition, the city has little information on how much Hardball Capital makes from the team.

“What I wouldn’t know is how much profit they make,” Leatherman said.

The commission could track the company’s sales tax reports to the state, he said. But it has not.

The city’s side of the deal

Fort Wayne’s only operating expense at the stadium is to pay the utility bills, a fund that’s running a deficit, Leatherman said. He said he did not have readily available the size of the deficit. Leatherman said parking fees designated for utilities do not cover the city’s cost.

Columbia Mayor Steve Benjamin, City Council’s strongest advocate for a publicly owned stadium on the Department of Mental Health property, said Columbia will not offer to pick up such a tab for a ballpark here.

“We will not be taking on the reasonability for utilities,” Benjamin said last week.

He said he wants a 60-40 split with Hardball Capital to build and operate a stadium. Freier prefers a 50-50 split.

But neither side has spelled out dollar amounts because formal negotiations require approval by City Council. It does not appear that Benjamin has the necessary four votes.

Frasier has said he could build the stadium for $35 million.

Council is scheduled on Tuesday to take up a resolution that would direct the city manager to start negotiations. Benjamin told the newspaper Friday that he’s unsure whether he’ll call for a vote on the resolution. The mayor pledged Thursday night to a hostile crowd at Woodlands Park that there would not be a vote Tuesday on “an ordinance.”

Benjamin has been accompanying Freier to dozens of meetings across the city as Freier makes his pitch to bring one of his teams here. Freier said rules that govern minor league baseball strictly prohibit him from naming which team would play in Columbia. The Savannah team is losing money every year because its stadium, built in 1926 and rebuilt in 1941, lacks amenities that could make it a year-round destination for families interested in more than professional baseball.

Leatherman said that despite the utilities fund being in the red, higher-than-expected attendance at Parkview Field has positioned the city and the company well.

For example, a fund created to pay for long-term upkeep and improvements is ahead of projections, Leatherman said. It has a more than $1 million balance now, he said.

“Our fund is filling faster than projected because our attendance is higher than expected,” he said.

The fund likely will stay ahead of the required $230,000 annual amount for the life of the 20-year lease that carries options for another 10 years. “We will have excess, unless something happens we don’t know about,” Leatherman said.

The $230,000 annual target – 1 percent of the hard construction cost – has been exceeded each year since the stadium opened in April 2009, Leatherman said.

The fund includes $150,000 yearly from the city’s half of the naming rights for the ballpark. The rest of the money comes from a $1-per-person fee that Hardball Capital pays Fort Wayne for every attendee at an event requiring a ticket after the 275,000th visitor, Leatherman said.

The city receives nothing from the first 275,000 visitors or from anyone who attends a free event.

Leatherman, who said he was not part of the original negotiations, said he does not know why Hardball Capital does not pay anything for the first 275,000 visitors.

“We’ve achieved our goal of not having to come up with additional revenue to keep the stadium operating,” Leatherman said. “I think it’s the best-run minor league ballpark in the country.”

Hardball’s side of the deal

Freier is quick to proclaim the ballpark’s success and the lack of public money used since construction: “We haven’t asked the city – and won’t be asking the city – for a dime,” he said.

During stadium construction negotiations, Freier said he offered Fort Wayne a choice similar to what he has put on the table in Columbia. The city either could receive about $400,000 annually over the 30-year life of the lease or $5.5 million up front, Freier said.

Fort Wayne opted for the $5.5 million. Hardball Capital makes no lease payments there.

That decision cost the city coffers $6.5 million because 30 years of $400,000 payments would have turned into $12 million, he said.

The attraction of an upfront payment is that it demonstrated the company’s commitment to the city, which Benjamin describes as the team “putting some skin in the game.”

The company’s out-of-pocket investment in the Fort Wayne stadium is $6.5 million, Leatherman said.

That sum is $1 million more than the company’s initial pledge of $5.5 million to build the ballpark and to help build the adjoining mixed-use building called The Harrison, Leatherman said. The Harrison opened about a year ago – two and a half years behind schedule.

Because of the delay – caused by a default from one of the developers then affiliated with Hardball, Freier said – Hardball agreed to spend more money to upgrade the ballpark, Leatherman said.

Freier called the extra expenditures a show of good faith. And he said the figure actually is $1.95 million because Hardball is contributing $50,000 yearly for 19 years to For Wayne to use as it sees fit.

The team owner said the range of ballpark improvements the company has paid for include a $900,000 enclosed, 155-seat area at center field; a $100,000 portable floor to accommodate concerts and other on-field events that protects the baseball turf; and six-figure upgrades to stadium electronics, including improvements for live television broadcasts of 70 home games.

Leatherman said it’s not uncommon for Hardball Capital to add to its investment in a ballpark and to pair with the city to sharing other improvement expenses.

“They’re spending a lot of money on the stadium,” the city redevelopment director said. “We just get together to figure out how to solve problems, and we do. We couldn’t have better partners.”

Columbia’s emerging deal

Many City Council members and Columbia residents are skeptical of a publicly built stadium.

Late last week, council members Leona Plaugh and Moe Baddourah held a forum at Woodlands Park, on the east side of the city. The meeting grew into a four and a half-hour hour marathon, with residents hostile to taxpayer money being risked on a ballpark.

Freier, who lives in Atlanta, was the last to speak at a point when the crowd of about 60 had shrunk to a handful.

“An owner from Atlanta has profits that do no good for the city of Columbia,” said John Ruoff, a longtime community activist.

Residents objected to more than public funding. Some said the stadium would not attract new revenue, only strip away money spent in other parts of town.

A consulting firm, Brailsford & Dunlavey, hired by the city to study the feasibility of a stadium has said such a facility could generate $411.5 million over 30 years from taxes, spending on hotels, restaurants and bars as well as personal earnings.

Consultant Jason Thompson agreed a stadium would result in substitute spending more than new spending. “But it may have been spending in the farthest reaches of Columbia,” he said. A ballpark would concentrate the spending in the city center, Thompson said.

He also told the crowd that the norm across the nation is that 80 percent of construction costs are covered by public money and 20 percent by private dollars.

Freier told The State newspaper his plans for Columbia differ in some ways from what is in the feasibility study.

For example, he envisions a slightly larger stadium than projected, one that could hold 8,500 people rather than the study’s calculation of 8,000. The ballpark would have 6,500 fixed seats and 120 to 150 club seats. The study projected 200 club seats.

Freier agreed that the study’s calculation of 16 luxury suites is about right.

The size of the workforce is likely to mirror the one in Fort Wayne, he said: 36 full-time jobs and 550 part-time and seasonal jobs. “We would expect to do at least that here,” Freier said, adding that all part-time and some of the full-time jobs would be filled through local hires.

TinCaps’ $3.1 million annual payroll is similar to what he plans for Columbia, Freier said.

He and Benjamin say a Class A ballpark can be built for $35 million, not the consultant’s estimate of almost $42 million, which includes a $4.4 million pot for cost overruns.

During the public relations blitz that will reach into a third week this week, Benjamin insisted the project is doable.

“To make a stadium a destination, I believe it needs to be a city facility,” Benjamin said. Though he has not disclosed his suggestion for paying for the ballpark, the mayor maintained, “The debt can be structured ... to the benefit of the citizens.”

If you go

Columbia City Council is meeting Tuesday and holding a public hearing on the merits of a taxpayer-funded baseball stadium in the proposed Bull Street neighborhood. It’s unclear whether any votes will be cast.

When: Noon

Where: City Council chambers, third floor of City Hall, 1737 Main St.

Preliminary plans

These are Hardball Capital owner Jason Freier’s projections for a Class A minor league baseball stadium and team in Columbia.

Jobs

36 full-time positions; 550 part-time and seasonal positions.

Some of the full-time and all the part-time positions would be local hires.

Annual payroll: $3.1 million.

Stadium features

The concourse would circle the field completely to allow viewing of the field and the restaurants, stores and other development outside the ballpark.

Capacity for baseball games would be 8,500, of which 6,500 would be fixed seats.

About 120 to 150 club seats.

16 luxury suites would offer the best views.

SOURCE: Hardball Capital chief executive officer Jason Freier

Reach LeBlanc at (803) 771-8664.

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