I think this is gonna end up with the Jackets leaving.  It’s very difficult right now for NHL teams to make money.  The Jackets get a subsidy from the NHL which helps offset their losses.  But even if the arena had its rent paid for, the Jackets would struggle to be profitable in the Columbus market. 

They should probably move to Cleveland.  Since Cleveland has a public arena and another major league team in the arena, the Jackets have more potential to make money.  Or at the very least, they should threaten to move to Cleveland so that Nationwide would reduce their rent.

But I still don’t think that even with the rent reduction that the team can survive in Columbus.  If the NHL subsidy changed or dried up, the team would be in even more dire straits.  And basing the economy of a team on this kind of income is likely to be disastrous.

http://bluejackets.nhl.com/club/page.htm?id=62139&navid=DL

he seems like a nice guy.

This is just a bait and switch where they make their money on the AD development then stick the county with the Arena.

The finances the faced the Blue Jackets are not new. All the expenses and incomes where foreseeable. Nationwide and the Dispatch should work out their own deal with the Blue Jackets and stop asking for handouts. They already have received millions form their property tax abatement.

One (semi-) defense I will definitely offer up to the Blue Jackets is to that arena, though. The one thing arenas/stadia can offer that could be identified as a public good is geographically targeted spending/development. The entertainment spending on the whole is just substitute spending, but an arena/stadium can make sure that the money is focused in one specific neighborhood. The arena was instrumental in building the Arena District.

That said, a) I think the A.D. is now beyond needing the Blue Jackets to stay alive/develop, and b) focusing entertainment $ in one neighborhood has the side effect of other areas losing out. Remember when people used to go to the Brewery District? Likewise, if the Jackets leave and R Bar or O’Shaughnessy’s go out of business, it might be a shame, but those entertainment dollars and jobs aren’t lost—they’ll just be redistributed to other local venues.

First, the business choices that these two organizations made at their respective inceptions were quite different.  Those behind the Blue Jackets decided that they absolutely had to have their team play in an expensive arena right in the middle of downtown, and they were under pressure, from NHL and others, to get it done fast.  Like many other examples from that time in the late 90s and early 00s (examples which are now cautionary tales that, unfortunately, I think many in business and finance are desperately trying to ignore) the exuberance to “have it now” and not think long-term of sustainability and consequence has led to an untenable situation for the NHL in Columbus, and possible collateral business casualties in the Arena District.

The Crew investors and operators were much more deliberate, and as such they were immeasurably more accommodating to the city. Furthermore, they had a realistic understanding of the near and long-term financial and real estate circumstances.  They built a privately funded, simple yet first-rate stadium on public land in a place that was certainly not their first choice.  They recognized that if they couldn’t get what they wanted now, they could settle in a less than optimal location, put down roots, and grow into the community.  Then, maybe someday, they could afford to move downtown to the place they wanted in the beginning.  While the Blue Jackets spent beyond their means, demanded considerations then and demand more considerations now from the public, the Crew spent within their means and gave consideration to the community.  In this regard, between the Blue Jackets and the Crew, it’s night and day.

Another important fact to keep in mind is that the ownership structure of the Crew is quite different from that of the Blue Jackets.  The Crew, like all of the teams in its league, are part of the single-entity structure of Major League Soccer.  The Hunt family is the largest private investor in the Crew, they manage the operations of the Crew, but they are not the “owners” of the Crew; the owner is MLS.  This creates a great deal more stability for a still relatively new league and team.  The Crew certainly are a private enterprise, but it’s a unique and effective private enterprise in that it incorporates certain, dare I say, socialist principles and safety nets that seek to ensure that it spends within its means, grows at a steady clip, and doesn’t melt-down like we, sadly, are seeing the Jackets do.

None of this is to suggest that the Crew are impervious to financial hardship; but I think it is important to not identify what Lamar Hunt created – and what has been sustained by practical use of resources – with the mess that Nationwide, the NHL, and the Blue Jackets have created and now expect the public to help to solve.

“Sports franchises belong to the communities they play in” is, flatly, a lie. If it were the case, every team would be the Green Bay Packers. The Crew belong to Mr. Hunt. We see none of the profits, nor the losses. As it should be—it’s a private business. The public should not bail it out because it’s a bad business model. If another city wants to do so, that’s fine. Our money is better spent on something that brings real economic development.

The Buckeyes are precisely reversed. The athletics department not only is fully self-sufficient, but donates money back to the University, which receives taxpayer support. In that sense, it lightens the taxpayers’ burden. They’re our Packers. Not many college programs can claim that!

Bottom line: if you want a company to stay in business, get folks to purchase their goods. Don’t seek help from the government. If not enough folks buy the goods, the company goes out of business. Not every company should stay in business on the government’s dime. It’s capitalism, and it’s what do best—even better than sports.

Crew GM Mark McCullers 11/2009
“We’ve seen what’s happened with the Blue Jackets and their situation with a privately financed, privately held facility. This community has struggled in getting public-private partnerships put in place in order to build professional sports infrastructure, and it’s something that we’ve got to figure out. I’ll be meeting, and I have been meeting with local politicians and community leaders. But we need to fix this problem for the professional sports industry, not just the Blue Jackets, so in five to 10 years, when we’re either needing to address our situation here or if we’re talking about a new stadium, we’ve got a mechanism in place that’s a public-private partnership that’s going to be able to get the job done and in five to 10 years we’re not looking at the same situation with the Crew that we’re looking at with the BlueJackets right now.”

Question to Clark Hunt, owner of the Crew 3/2010

Are you at the point where you are simply waiting on some help from local business and political leaders to help with some of the facility improvements you would like to see?
“I wouldn’t say we’re waiting on it. That’s something that’s very important for us to cultivate. Ultimately, sports franchises belong to the communities they play in. From a fan standpoint, a corporate standpoint, a political standpoint, we need people to understand our value to the city. We haven’t yet gone throughout the difficult process of building a publicly-supported facility. That’s probably something the franchise is going to need to stay in Columbus. That’s our home, but at some point in the future we’ll have to cross that bridge.”

I definitely see the other side of the issue. Its pretty sickening that taxpayers money supports private businesses instead of being spent on goods and services for the citizens. But on the other hand darn it, I love my Columbus pro teams! It’s clearly a character flaw, I blame it on the y chromosome. I’m sick of pulling for Cleveland and Cincinnati teams. Anyway, unfortunately I don’t see how we keep the Jackets or the Crew without some type of deal with the devil like this.

Man, if the Jackets and Crew leave, we’ll be left with only one taxpayer subsidized professional sports team in town… the Buckeyes! ;)

So being against public financing of pro stadiums is basically deciding to be against having pro sports in town. Fair enough, we can disagree about this.

Just food for thought, I think that whatever the city does with the Bluejackets will ultimately be the fate for the Crew. And probably for any another pro team the city tries to get in the future.

here are some quotes from the Crew’s ownership and GM:

[URL="http://www.crewxtra.com/live/content/features/stories/2009/11/19/ca_u_crew_gm.html?sid=108"]Crew GM Mark McCullers 11/2009[/URL] “We’ve seen what’s happened with the Blue Jackets and their situation with a privately financed, privately held facility. This community has struggled in getting public-private partnerships put in place in order to build professional sports infrastructure, and it’s something that we’ve got to figure out. I’ll be meeting, and I have been meeting with local politicians and community leaders. But we need to fix this problem for the professional sports industry, not just the Blue Jackets, so in five to 10 years, when we’re either needing to address our situation here or if we’re talking about a new stadium, we’ve got a mechanism in place that’s a public-private partnership that’s going to be able to get the job done and in five to 10 years we’re not looking at the same situation with the Crew that we’re looking at with the BlueJackets right now.” [URL="http://blog.dispatch.com/crew/2010/03/more_from_clark_hunt.shtml"]Crew Owner Clark Hunt 3/2010[/URL] [B]Are you at the point where you are simply waiting on some help from local business and political leaders to help with some of the facility improvements you would like to see?[/B] “I wouldn’t say we’re waiting on it. That’s something that’s very important for us to cultivate. Ultimately, sports franchises belong to the communities they play in. From a fan standpoint, a corporate standpoint, a political standpoint, we need people to understand our value to the city. We haven’t yet gone throughout the difficult process of building a publicly-supported facility. That’s probably something the franchise is going to need to stay in Columbus. That’s our home, but at some point in the future we’ll have to cross that bridge.”

If the Jackets leave, I think the Crew eventually will too. And then we’ll be left with only one taxpayer supported Professional sports team in town, the Buckeyes ;)

I think we are learning that when a city of our demographic and economic capacity expends resources, space, and energy on providing an arena for the explicit purpose of supporting a corporation’s vanity professional sports enterprise, then that city to a degree, whether it likes it or not, is at the mercy of that corporation and that enterprise.  When the corporation claims it requires considerations from the city or it will take its toys and go home, there are two choices, and both, like this year’s Blue Jackets, stink on ice: either yes, the city will make considerations and subsidize your untenable business practices; or no, we are prepared to have an empty, all but useless, $175,000,000+ building sitting in the center of our city for the foreseeable future.  It’s clear to me that Forward Together has terrific intentions, and I’m sure they are honest in their efforts.  I wish them luck in coming up with a creative solution.  But the private/public partnership isn’t a true third-way.  Such a partnership will inevitably be out of balance in favor of the private at the expense of the public, precisely because this was a vanity endeavor for the private “partner” from the beginning, and it has become an economic well-being issue for the public.  I don’t think it rises to the level of “extortion,” as I’ve heard and read it described in other places, but the city will pay a price no matter the outcome.

BTW, how much are they paying that player who called Columbus a; “Goat town”?