Monday, April 29, 2013

Will the Jazz stay in Utah? In Salt Lake?

Disclaimer:  I work part time on the event staff for EnergySolutions Arena.  None of the information contained in this post is confidential information obtained during my employment there.  Likewise, all of the opinions contained herein are purely my own, and do not reflect the opinion of EnergySolutions Arena, Larry H Miller Sports, the Miller Family, or their sponsors.

This afternoon, it was announced that the NBA's relocation committee unanimously approved a plan to keep the Sacramento Kings in Sacramento instead of moving them to Seattle.

Some of you are probably saying "Bob, this is a political blog.  Why are you talking sports?"  Well, I can write what I want, and there is a political aspect to this post, I promise.

For those of you who need to be caught up on the issues at hand, let me summarize a few things.  For several years, the family that owns the Sacramento Kings has been trying to get a new arena built in Sacramento.  As they have had trouble funding the arena, they have threatened to move the team to Las Vegas (where they own the Palms casino) or to Anaheim.  Recently, they have put the team up for sale.  A few months ago, a group from Seattle (which lost it's NBA team to Oklahoma City because the city wouldn't fund an Arena) put in a bid to buy the Kings with plans to move them to Seattle.  The Seattle group already has approval for a new NBA/NHL arena.  The City of Sacramento put together a group of investors to buy the team and keep them in that city.  That plan seems to have been successful.  I believe part of that plan includes building a new arena.

All of this has lead some people on twitter to say "could the Utah Jazz move from Utah?  If they stay in Utah, would they stay in Downtown Salt Lake?"  I say no way to the first question, and probably to the second.

First, on whether the team would ever move from Utah.  When he was alive, Larry H Miller maintained that his purchase of the Jazz was a gift to Salt Lake City and the state of Utah.  His family recognize that this gift is the lasting legacy of their husband and father, and is a gift that came a great personal financial risk to them (Miller mortgaged everything he owned twice in the mid-80s to purchase the team, and then again in the late 80s to build EnergySolutions Arena).  Selling the team would be selling Larry's legacy.  Furthermore, they recognize that selling the team would have a negative influence on the rest of their businesses.

Also, even if the family sells the team, it doesn't mean they would sell to an out of state interest.  The Huntsman, Eccles, and Garff families are big Jazz fans and could have an interest in buying the team.

Now, for the question of staying downtown.  The 22-year-old EnergySolutions Arena is the 7th-oldest arena in the NBA.  One of the arenas that is older, Madison Square Garden, has undergone a multi-year renovation where they essentially gutted the entire arena a built a new one inside.  Two more of the older arenas, in Oakland and Sacramento, will be replaced in the next three years.

When it was announced that EnergySolutions had bought naming rights to the Arena, Larry H Miller said that the arena had about 10 years of life left.  That was in 2006.  When there were upgrades to the enterances and some food areas a few years ago, Larry's son Greg, who is now CEO, said that the arena had about 10 years of life.  So, in reality, the team will probably be replacing the building sometime within the decade.

So, will they stay downtown?  Well, they almost didn't.  Larry H Miller purchased a large chunk of land near 11400 SOuth just off I-15 to build his arena.  However, he was having trouble getting the infrastructure improvements needed from Sandy City. The LDS Church stepped in and sold him the lot the arena stands on now for next to nothing.  The Church recognizes that keeping the Jazz downtown would help the viability of downtown.  They also recognize that nearly every broadcast of the game to markets outside of Salt Lake includes at least one shot of the Salt Lake Temple.  For this reason, the Temple is one of the most recognizable buildings in Utah, and thus a destination for tourists.  While you'll get some of that if the team moves to the suburbs, it wouldn't happen otherwise.  The Church owns to parking lot blocks in downtown that would be perfect locations for a new arena:  Block 85, home of the Medals Plaza for the 2002 Olympics and kitty-corner from the current arena.  The other option is the block on the west side of the Courthouse TRAX station.  The Church bought that land a few years ago and have no plans for development.  I would imagine that a simple land exchange would be benifitio=al to both the CHurch and the Millers.

Likewise, I think that the Millers would have an easier time getting some taxpayer funding for a new arena.  The millers have very quietly built relationships with those in GOP leadership in the legislature.  Likewise, being the legislator who killed the Jazz wouldn't be the best way to get reelected.

Some are pointing out the hoops that Real Salt Lake had to jump through to build a stadium. However, this situation is different.  RSL said that they would turn a profit, and gave statistics to show that they would be able to.  However, some of their figures were questionable, and some of those questionable figures have fallen far short.  The Jazz do not currently turn a profit, and the family is comfortable losing some money, as having the team helps the other businesses.  Also, some of the troubles RSL had in getting a stadium built in Downtown Salt Lake were caused by three factors: 1) The preferred locations for the downtown stadium were not for sale.  Salt Lake City's plan included using eminent domain to take the land, which would have been expensive.  2) The stadium issue was at the height of Rocky Anderson's antagonism of the Legislature.  This is the same Legislature that sided with Big Tobacco when it came to smoking in bars after the tobacco lobbyists pointed out that Rocky was in favor of the ban.  3) Legislative leadership represented Sandy and rigged the game to favor their city.  Pork, anyone?

RSL is not the Jazz.  I think that the Millers could get most of what they want from the City, the County, and the State.

Keep in mind that I am not advocating for or against the use of taxpayer funds for a new arena.  That is a different topic for a different day.


1 comment:

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