We're not exactly hurting for space in OKC. I know some want the room count higher because it will mean a taller building, but we do need to realize there's plenty of space near the CC that can build hotel stock as both infill and usefulness to the CC.
Exactly. A number of people posting here continue to operate under the mistaken assumption that everyone attending a convention stays in the convention hotel and everyone in the convention hotel is a convention attendee. In a properly-functioning convention environment both assumptions are far, FAR from the truth. Especially if the CC is built walkable to existing hotel stock.

Putting this here:

Phoenix aiming to sell money-losing Sheraton hotel | News OK (http://newsok.com/phoenix-aiming-to-sell-money-losing-sheraton-hotel/article/feed/824953)

We're not exactly hurting for space in OKC. I know some want the room count higher because it will mean a taller building, but we do need to realize there's plenty of space near the CC that can build hotel stock as both infill and usefulness to the CC.

Height could also come from building the parking for the entire convention complex into the hotel structure as a pedestal. I don't know what they plan to do, but A) I seriously hope they aren't planning on further encircling our parks with parking garages (highest and best use, right?), and B) Underground parking is twice as expensive as structured parking (40K vs. 20K per space).

So Ed Shadid is tweeting about a town hall meeting to address a plan to "divert $100+ million from OKC schools to subsidize a convention hotel, etc"... Anyone know what he's on about? Is this about creating a TIF district to fund the hotel and CC or something?

So Ed Shadid is tweeting about a town hall meeting to address a plan to "divert $100+ million from OKC schools to subsidize a convention hotel, etc"... Anyone know what he's on about? Is this about creating a TIF district to fund the hotel and CC or something?

TIF Districts - OKCTalk (http://www.okctalk.com/showwiki.php?title=TIF%20Districts&page=2#post883678)

This is intellectually dishonest by Ed.

This is intellectually dishonest by Ed.

Exactly how so?

The more open and public dialogue the better. I think that too often we only hear one side about TIF projects and their funding. I'm glad Ed is willing to discuss the other side and invite the public. You don't have to love Ed Shadid to appreciate the fact that he does offer an alternative viewpoint, and not just as a vote on the horseshoe, but by involving the public.

He also pays for these town hall meetings straight out of his own pocket.

Among other things, the City needs to rethink how they setup this TIF stuff.

Exactly how so?

It is an absurd and gross oversimplification to say that this TIF is "taking money from the schools." It is far more nuanced than that, but Ed is preying on people's fears with this statement.

He also pays for these town hall meetings straight out of his own pocket.

Which does not absolve him from making intellectually dishonest statements. There are far bigger villains to public schools in our state than temporary tax abatement. Why not use your public platform to raise these issues as opposed to needlessly inflaming a weary public about something that is not really causing the problem?

Which does not absolve him from making intellectually dishonest statements. There are far bigger villains to public schools in our state than temporary tax abatement. Why not use your public platform to raise these issues as opposed to needlessly inflaming a weary public about something that is not really causing the problem?

You still haven't said what is intellectually dishonest.

And what bigger villains are you talking about? And what specifically would you have the City do about them?

When a councilperson says they don't know what a TIF is and OKCPS is in the dark about TIF proceedings that significantly impact their schools, there is a problem. Ed addresses these problems by shining light on them and inviting the public to be informed and engaged in the civic discourse. This differs from the current MO of City Hall where big time decisions are made behind closed doors with little public input or awareness.

Like him or hate him or be indifferent about him, but if his point is when a TIF gets created that will result in less available funding for the public schools to the tune of X or for Y months/years/etc., that's a fair point for folks to consider. Maybe a TIF isn't the one best option for funding a convention hotel and a conversation should be had.

FWIW, I suspect there will be a TIF all the same, irrespective of whether a conversation is had or not.

This differs from the current MO of City Hall where big time decisions are made behind closed doors with little public input or awareness.

...and are increasingly blowing up in spectacular style in full view of the pubic.

But the truth is, its not that Schools receive less funding. Under a TIF, schools would not receive any ADDITIONAL funding for a period of time. To me, this is the intellectual dishonesty that the above commenter was likely alluding to.

It's one thing to say "please be informed that under TIFs any increase in property value (hence tax) by a development would not go to schools/libraries but instead to developers to assist the city in creating/adding development. Here we have a TIF being considered that could divert $100m in incremental tax revenue to help aide the development of the new convention hotel but please be aware that the TIF would mean schools would not receive this increase in property value of the hotel for 25 years"

instead of

"OKC plans to divert $100+ million away from schools " which sounds more scorched earth scare tactic (and intellectually dishonest) to me.

I agree with those who commented that it is great to have Ed on the council in that at least he opens dialog to the otherwise behind close doors decisions OKC is far too guilty of; but don't be political in your message - instead be constructive! Inform the public! Allow THEM to decide whether TIFs are taking away from schools.

I could agree, if the citizens of OKC - well informed by these town halls, created a referendum stating that 'any new TIFs would last only 10-years in length because the OKC Public School district is NOT receiving many of the benefit these TIFs have created in rising property values throughout downtown Oklahoma City'. This to me, would be MUCH more constructive, perfectly honest, and would accomplish something that likely is NEEDED in OKC and SHOULD BE ED's goal/approach rather than the scorched earth approach which leaves people upset but nothing is done about it. This is the ED I would like to see and he totally could become this LEADER rather than creating dialog against the mayor and/or chamber for political points. ....

But the truth is, its not that Schools receive less funding. Under a TIF, schools would not receive any ADDITIONAL funding for a period of time. To me, this is the intellectual dishonesty that the above commenter was likely alluding to.

TIF's run 25 years and capture ALL increases in property values during that time.

Virtually all property values increase over time. At a modest 4% appreciation rate, property values would almost triple over 25 years, which means property tax would triple as well. At 6%, property values and taxes would more than quadruple.

So, when you implement a TIF, you are cutting off all those increases in tax that would go to the schools (72% of property tax goes to education), while at the same time their costs are rising dramatically in period spanning two and a half decades.

We are now talking about adding 4 or 5 more TIF's and that would have a massive impact on the funding received by schools and other entities that rely on property tax.

BTW, $100 million is very low.

TIF 2 alone (main downtown TIF) is currently projected to divert $126 million, where it was originally budgeted at $47 million. Before it's done, it may well capture closer to $200 million.

That's one TIF. We are now talking about several new ones (NE Corridor, Convention Hotel/Garage, Core to Shore, First National and Wheeler, with likely more to come) and each will be quite significant.

Do we know if any of these TIF's are going to finance our crumbling bridges? It seems if we are going to build more buildings that will add more people to our population, we should have bridges that can hold them. I admit I don't really understand a TIF, so I really appreciate that Ed will have a town hall.

Do we know if any of these TIF's are going to finance our crumbling bridges? It seems if we are going to build more buildings that will add more people to our population, we should have bridges that can hold them. I admit I don't really understand a TIF, so I really appreciate that Ed will have a town hall.

All the TIF's are being used for urban development.

When a councilperson says they don't know what a TIF is and OKCPS is in the dark about TIF proceedings that significantly impact their schools, there is a problem. Ed addresses these problems by shining light on them and inviting the public to be informed and engaged in the civic discourse. This differs from the current MO of City Hall where big time decisions are made behind closed doors with little public input or awareness.

Geez, do you pray to Ed at night?

Though I generally dislike your posts and think Ed is oversimplifying this as he does many things, a conversation is never a bad thing. What I don't like is Ed trying to drum up support to outright defund projects that were voted on 6 years ago by the majority in OKC. Seeing as how this is about the convention hotel and not about the cancellation maps project... discuss away.

Geez, do you pray to Ed at night?

Though I generally dislike your posts and think Ed is oversimplifying this as he does many things, a conversation is never a bad thing. What I don't like is Ed trying to drum up support to outright defund projects that were voted on 6 years ago by the majority in OKC. Seeing as how this is about the convention hotel and not about the cancellation maps project... discuss away.

ED is not a knight in shining armor. Discuss all you want, but his past shenanigans will haunt him.

I am far from an Ed mouth-piece, but those who can't see the value of what he is trying to accomplish right now are missing the forest for the trees.

A serious discussion needs to be had about this NOW. Pete's factoid ought to be sobering to all of us. $47M estimate, $127M reality and climbing every year. The $80M difference there is equivalent to >50 $50k/year teacher salaries over a 25 year period.

Ed hasn't even said "We need to stop TIF now." He's simply asking that we educate ourselves so that we can make better-informed decisions.

Furthermore, we need to talk about the administration of TIF funds, and that process needs to be opened-up to public scrutiny big time, especially if we're falling into $100M of cash we were completely unprepared to have.

Dr. Ed Shadid's goal is to derail any future MAPS projects; his platform has been about the discontinuance of extending the future 1 cent city MAPS sales tax.

The recent action he took concerning the old union bus station should tell you what he's all about:


Hines development firm plans to build a 27-story tower and parking garage.

Their renderings include preserving the bus station sign, but that’s not enough for some.


Councilman appeals demolition of historic downtown bus station | KFOR.com (http://kfor.com/2015/03/17/councilman-appeals-demolition-of-historic-downtown-bus-station/)

Goodbye MAPS IV - 2017; especially expansion of the street car, possible future rail and the Thunder will need to plan for a new home following 2025 which would be about the time MAPS V would be proposed.

Dr. Ed Shadid's goal is to derail any future MAPS projects; his platform has been about the discontinuance of extending the future 1 cent city MAPS sales tax.

The recent action he took concerning the old union bus station should tell you what he's all about:



Councilman appeals demolition of historic downtown bus station | KFOR.com (http://kfor.com/2015/03/17/councilman-appeals-demolition-of-historic-downtown-bus-station/)

Goodbye MAPS IV - 2017; especially expansion of the street car, possible future rail and the Thunder will need to plan for a new home following 2025 which would be about the time MAPS V would be proposed.

Laramie, I love your stuff, but let's hope we've decided that by 2025 our cities have higher priorities than funding new arenas for (in our case) a very profitable NBA basketball team. This socialism for the rich while "free market" rhetoric is rammed down the throats of everyone else has got to stop.

Dr. Ed Shadid's goal is to derail any future MAPS projects; his platform has been about the discontinuance of extending the future 1 cent city MAPS sales tax.

The recent action he took concerning the old union bus station should tell you what he's all about:



Councilman appeals demolition of historic downtown bus station | KFOR.com (http://kfor.com/2015/03/17/councilman-appeals-demolition-of-historic-downtown-bus-station/)

Goodbye MAPS IV - 2017; especially expansion of the street car, possible future rail and the Thunder will need to plan for a new home following 2025 which would be about the time MAPS V would be proposed.

Ed Shadid has been saying for a couple of years in writing and speech that the 1-cent MAPS tax should be extended for a "MAPS 4 Neighborhoods" and transit improvements.

What does the Devon Energy 499 Sheridan expansion have to do with MAPS? It is horrible urban design with its skybridges, corporate plaza, and two structured parking garages and could almost certainly be accomplished while saving historic structures. The judge will now hear both sides and have to make that call.

The City is LONG past overdue a basic discussion about TIFs as it is clear there are no written parameters as to who qualifies and what kind of development we are seeking to accomplish, the city council and school board do not fully understand them or best practices in other cities, and the process is being hijacked to create a funding mechanism for a $70-120 million gap in funding for the convention center hotel and parking garage (which was not discussed during the MAPS campaign).

Why not make TIFS better rather than see them go away because certain interests are going to the well too many times too far from their stated purpose.

...and are increasingly blowing up in spectacular style in full view of the pubic.

This is a funny typo.

TIF's have their place when being applied in a responsible way. My problem with the "town hall" is that again, it will probably not be a meaningful debate format.

You basically have the status quo meeting regularly and Ed's status quo political "town hall" meeting without any of the people involved who actually make decisions about TIF's.

For me as a citizen, the fundamental question is whether a TIF is needed on a individual project? Is it warranted? Will it force a commitment to redevelop? Will it enable public infrastructure such as the expansion of a streetcar line for the greater good?

There is a logical argument as to why TIF's are an important develoment tool. However, some would argue that some of it's use are unwarranted and that the development would happen anyway. There is room for debate. It just never seems to happen when there is an actual proposal on the table.

why not make tifs better rather than see them go away because certain interests are going to the well too many times too far from their stated purpose.

this

TIF is the only way OKC can utilize property tax that would otherwise go to the county. Come on, Pete. Do you really think Ed characterizing TIF as diverting money from schools is fair? The use of the word diverting itself is dishonest. The money is not going to the schools now. There is no money. Only the additional revenue not currently going to the county would be abated. I'm spelling this out because I've heard many people confused by Ed saying TIF is taking money from schools. Not true.

And Pete, do you really need me to explain who is underfunding our schools? It's not happening because of a few development projects downtown. It's happening because of our nitwit governor and Neanderthal legislature.

TIF is the only way OKC can utilize property tax that would otherwise go to the county. Come on, Pete. Do you really think Ed characterizing TIF as diverting money from schools is fair? The use of the word diverting itself is dishonest. The money is not going to the schools now. There is no money. Only the additional revenue not currently going to the county would be abated. I'm spelling this out because I've heard many people confused by Ed saying TIF is taking money from schools. Not true.

And Pete, do you really need me to explain who is underfunding our schools? It's not happening because of a few development projects downtown. It's happening because of our nitwit governor and Neanderthal legislature.

TIF is taking future money away from schools (and other agencies). It really is that simple.

Whether or not that is in the best interest of OKC is debatable, but there is no debate to be had regarding that fact.

The TIF that started in 2000 is a lot different animal than anything that is started today.

At least 3 more TIFs are in the process of being started (which would all terminate in 2040 if they were started today) and they are estimating (WWAAAYYY under I might add) ~$370M of future tax revenue. That's $219M+ for schools.

The C2S TIF they have estimated bringing only $140M by 2040…That's an absolute joke as there is nearly NOTHING in C2S right now. C2S could be completely filled in by 2030 for all we know. I'd be willing to bet that about $200M would be collected in the last 10 years of the TIF alone.

But by all means, let's stop a discussion about what we're doing with nearly $1B of money because it's being started by Ed Shadid…

Laramie, I love your stuff, but let's hope we've decided that by 2025 our cities have higher priorities than funding new arenas for (in our case) a very profitable NBA basketball team. This socialism for the rich while "free market" rhetoric is rammed down the throats of everyone else has got to stop.

The more quality hotels we have, the more events we can attract. The fact that we didn't have any quality hotels downtown killed the convention center industry potential in the 1970s & early 80s. Hotels like the Old downtown Hoilday Inn (520 W. Main), Tivoli Inn, Skirvin, Skirvin Twin, Hotel Oklahoma (old Sheraton) had closed or weren't reputable to attract events about the time we opened the Myriad Convention Center in 1973.

We need to keep the Chesapeake Energy Arena; build the new convention center & conference hotel in its proximity.

Does any NBA team own their own arena? It's not profitable...

The Thunder rental agreement:


Rent

The Thunder pay $1,640,000 in annual Arena Rent ($40,000 per game) for forty-one (41) regular season NBA home games. Additional Rent of $40,000 is to be paid for each preseason and postseason home game. Rent is subject to periodic CPI adjustments, capped at 3% annually. The Thunder also pay an annual Practice Facility Rent of $100,000. – Sect. 2(a)(i) & (iii), pg. 2]

The Thunder pay game expenses to the amount of $28,000 per home game no later than fifteen (15) days after the end of the calendar month. The Thunder also remit naming rights revenues to SMG in the amount of $409,000 in quarterly installments. – Sect. 4.1, pg. 29–30


Sources: Lease: http://law.marquette.edu/assets/sports-law/pdf/lease-summary-oklahoma-city-thunder.pdf
$30 million relocation fee: NBA approves Sonics' move to Oklahoma | Sports | Seattle News, Weather, Sports, Breaking News | KOMO News (http://www.komonews.com/sports/17916284.html)
$45 million debt settlement of KeyArena: Sonics settlement to pay off KeyArena debt - Arena Digest (http://arenadigest.com/200809232477/basketball/nba-basketball/sonics-settlement-to-pay-off-keyarena-debt)

That's the problem, we don't plan for the future.

Sure, we have a very profitable NBA basketball team; however the ownership lost nearly $60 million in the 3 years the team was in Seattle. Add the $1 million relocation fee paid to every team in the league (29) plus $1 million to the NBA = $30 million; plus $45 million to break their lease agreement and leave early which paid off the debt to Key Arena. The Oklahoma City ownership group were $135 million in the red (bleeding money) before they made $1 dollar in OKC.

A new arena will require an anchor tenant like the Thunder; also an ungraded arena puts OKC in the mix for concerts, large gathering & future events.

Cities like Louisville, Seattle, Kansas City & Pittsburgh would love to lure an NBA franchise to their city: Top Cities in Need of an NBA Team | Bleacher Report (http://bleacherreport.com/articles/1025252-power-ranking-top-cities-in-need-of-an-nba-team)

Forbes estimates the Thunders' worth at $930 million. The owners are not hurting for money.

Forbes estimates the Thunders' worth at $930 million. The owners are not hurting for money.

And they paid what for it…like <$400M?

That's >100% return on an obscenely massive investment in less than a decade (and honestly, I think it's pretty close to a 200% return). That's better than any of them could have ever hoped for.

The real reason why we don't need to build a new arena is because ours works just fine. Older arenas didn't work because higher player salaries resulted in higher operating expenses, and the only way they could cover those was with expensive luxury boxes. Most of the old arenas (like the Key Arena in Seattle) couldn't be retrofitted with those suites. The Chesapeake however, was built with that knowledge in mind. Until some new money making thing comes along that requires major structural changes to an arena, we won't have to build new.

TIF is taking future money away from schools (and other agencies). It really is that simple.

Whether or not that is in the best interest of OKC is debatable, but there is no debate to be had regarding that fact.

The TIF that started in 2000 is a lot different animal than anything that is started today.

At least 3 more TIFs are in the process of being started (which would all terminate in 2040 if they were started today) and they are estimating (WWAAAYYY under I might add) ~$370M of future tax revenue. That's $219M+ for schools.

The C2S TIF they have estimated bringing only $140M by 2040…That's an absolute joke as there is nearly NOTHING in C2S right now. C2S could be completely filled in by 2030 for all we know. I'd be willing to bet that about $200M would be collected in the last 10 years of the TIF alone.

But by all means, let's stop a discussion about what we're doing with nearly $1B of money because it's being started by Ed Shadid…

TIF makes possible deals that otherwise would not be possible. You can't divert money that otherwise wouldn't exist. In urban contexts, the TIF is even less of a factor because there is already some "increment" and you can only "divert" the added increment.

The more quality hotels we have, the more events we can attract. The fact that we didn't have any quality hotels downtown killed the convention center industry potential in the 1970s & early 80s. Hotels like the Old downtown Hoilday Inn (520 W. Main), Tivoli Inn, Skirvin, Skirvin Twin, Hotel Oklahoma (old Sheraton) had closed or weren't reputable to attract events about the time we opened the Myriad Convention Center in 1973.

We need to keep the Chesapeake Energy Arena; build the new convention center & conference hotel in its proximity.

Does any NBA team own their own arena? It's not profitable...

The Thunder rental agreement:



Sources: Lease: http://law.marquette.edu/assets/sports-law/pdf/lease-summary-oklahoma-city-thunder.pdf
$30 million relocation fee: NBA approves Sonics' move to Oklahoma | Sports | Seattle News, Weather, Sports, Breaking News | KOMO News (http://www.komonews.com/sports/17916284.html)
$45 million debt settlement of KeyArena: Sonics settlement to pay off KeyArena debt - Arena Digest (http://arenadigest.com/200809232477/basketball/nba-basketball/sonics-settlement-to-pay-off-keyarena-debt)

That's the problem, we don't plan for the future.

Sure, we have a very profitable NBA basketball team; however the ownership lost nearly $60 million in the 3 years the team was in Seattle. Add the $1 million relocation fee paid to every team in the league (29) plus $1 million to the NBA = $30 million; plus $45 million to break their lease agreement and leave early which paid off the debt to Key Arena. The Oklahoma City ownership group were $135 million in the red (bleeding money) before they made $1 dollar in OKC.

A new arena will require an anchor tenant like the Thunder; also an ungraded arena puts OKC in the mix for concerts, large gathering & future events.

Cities like Louisville, Seattle, Kansas City & Pittsburgh would love to lure an NBA franchise to their city: Top Cities in Need of an NBA Team | Bleacher Report (http://bleacherreport.com/articles/1025252-power-ranking-top-cities-in-need-of-an-nba-team)

It isn't exactly OKC's fault that Seattle turned into a horrific NBA market

TIF makes possible deals that otherwise would not be possible. You can't divert money that otherwise wouldn't exist.

We unequivocally cannot know this. I agree that it is a great tool to use to entice development, and I do believe it helps bring in development that may otherwise not come in, or may come in on a lesser scale/degree than what is ultimately delivered because of TIF. But this is a belief, not a fact, and more than anything, it is a reality that is subject to manipulation and getting taken advantage of. If Clayco builds their full project for half the TIF they asked for, that doesn't make TIF look good.


In urban contexts, the TIF is even less of a factor because there is already some "increment" and you can only "divert" the added increment.

There is literally a 5x6 block of streets in OKC that qualify at the level of "urban" context that you're speaking of. Everywhere else there are notable to significant holes in the urban fabric.

And let me remind you that they're about to do a TIF for C2S. if that encompasses much area at all, we're talking about a bunch of land that has NOTHING built on it, and a bunch of land that is going to get developed regardless of the existence of TIF.

Again, I don't think anybody here is opposed to TIF, but it's a far less transparent way for the government to steer money to whatever end they choose.

Furthermore, there are potential ways to make TIF work even better for the City:

For instance, we use TIF money as a basis for loans made to developers: We can loan out 2.5 to 5 dollars for every TIF dollar we collect and set interest rates competitively in order to attract more development.

The real reason why we don't need to build a new arena is because ours works just fine. Older arenas didn't work because higher player salaries resulted in higher operating expenses, and the only way they could cover those was with expensive luxury boxes. Most of the old arenas (like the Key Arena in Seattle) couldn't be retrofitted with those suites. The Chesapeake however, was built with that knowledge in mind. Until some new money making thing comes along that requires major structural changes to an arena, we won't have to build new.

...That's why the NBA is no longer in Seattle.

We've got to plan in stages of 5 -10 years ahead.

We're talking about future planning, 2025. Our convention center & conference hotel will be vital for the success to maximize our city's potential instead of maintaining the status quo.

Well aware of the situation with KeyArena; Seattle underestimated OKC. We planned for the future (NHL or NBA). We built a basic structure in which we had to raise $110 million through an extension of MAPS (MAPS for HOOPS - Big League City campaign) for NBA arena upgrades & a team practice facility. Had this not passed, the Thunder would be in Kansas City who offered free rent to lure an NHL or NBA team to occupy the Kansas City Sprint Center.

Mayor declares victory for Ford Center upgrades | News OK (http://newsok.com/mayor-declares-victory-for-ford-center-upgrades/article/3212041)


If future owners want to relocate the team, that's their decision, Sonics Vice President Terry McLaughlin said. The current ownership doesn't have a preference for Kansas City versus Oklahoma City, he added.

Kansas City tried to steal the Supersonics before they had a chance to relocate to OKC.

Source: Plenty of cities waiting in line for NBA team - seattlepi.com (http://www.seattlepi.com/news/article/Plenty-of-cities-waiting-in-line-for-NBA-team-1208410.php)


Forbes estimates the Thunders' worth at $930 million. The owners are not hurting for money.

The ownership group paid $350 million for the Thunder. The value of the team could be in excess of $930 million today; until you sell the team for that amount, that value is just a number--good collateral credit to borrow against if necessary.

Oklahoma Group Buys SuperSonics - latimes (http://articles.latimes.com/2006/jul/19/sports/sp-nbarep19)

The idea that the NBA market turned bad in Seattle isn't really very accurate. The POLITICAL CLIMATE is what turned against the league and the team (including pre-OKC-based ownership).

A new arena is important if a team needs an improved revenue source to keep up with and be competitive with other teams in the league. That's what happened in Seattle - bad arena lease and fewer revenue sources for the team. If new arenas are being built that have new concepts for revenue generation that ours doesn't have, then we will need a new arena. As a smaller market, our team needs good sources of revenue or we'll be one of the perennial bottom feeders in the NBA. So far, I haven't seen any evidence that there is some exciting new concept in arenas that we need to emulate. Until then, upgrades are good enough - while being aware that we need to be watching what other cities do.

betts is straight on but as urbanized stated it was also political.

just to Preface - this is a long post (apologies in advance - but I think it is good for everyone to really understand the situation that took place up here in Seattle - in context with OKC possibly needing a new arena and/or when)

the reality is, the citizens up here got tired of teams coming asking for public subsidy to build or refurbish arenas/stadiums. We had just 'finished' building two new stadiums for the NFL and MLB after tearing down the Kingdome (also a disaster in itself). Also, folks felt that we'd just finished renovating the Seattle Center Colusium into KeyArena - and at that time it was deemed NBA standard.

The problem is things (the NBA standard) changed. As Betts points out, tertiary game and non-game amenities became a key revenue source and all teams wanted that (understandably so). Seattle has a largely wealthy market with some of the richest people in America residing in the metro area, however, KeyArena (despite being upgraded from the general seating pov) lacked similar amenities that would command the prices ownership felt this market should be capable of handling. By the way, I'm not talking about the Bennett ownership here yet, I'm talking about Schultz. IMO, he was right - so he went to the city and then the state to see if a deal could be done to re-renovate KeyArena to build in luxury suites, club suites, and restaurant/shoppes like nearly all other markets were doing. (as an aside, this is exactly what OKC shelled into the Ford Center during the Maps for Hoops extension, so essentially Schultz wanted Seattle to catch up with the NEW NBA model just as OKC eventually did in creating the Peake).

Turns out that our (WA) state legislature is quite conservative that people might otherwise think - and they denied Schultz. Our most powerful legislator - House Speaker Frank Chop - literally ran his platform AGAINST the NBA. Schultz solicited NBA to assist and Stern and folks did come to make a pitch; that fell on def ears. By the way, this was accompanied with protesters and a largely apathetic voting populous who did not desire a new tax. Of course, this upset David Stern and so Schultz was left to try to deal with Seattle. The city was MORE supportive than the state but again the residents of Seattle (and likely the metro) voiced opposition to a city sponsored tax to renovate KeyArena. The story was the same, didn't we already do this? From a fan prospective, it doesn't get any better. So on. Also, there was a council member who I believe was the president of Seattle City Council who like Speaker Chop basically killed any prospect of SEATTLE providing public assistance beyond tax abatement.

So now, Schultz got the ax from Chop and the state legislature; Schultz got the boot from Seattle council; the NBA got the middle finger from the city voters with their smashing re-election of Chop, the Seattle Council president (I forget his name), and the mayor at the time (also was opposed to the NBA); and the Seattle wealthy elite were too busy or had their heads in the sand to do anything to help -

SO! Stern encouraged Schultz to place the team up for sale, that maybe a new owner could get traction with the state/city since they were all probably tired of Schultz. In all honesty, I believe Stern wanted Ballmer or the like to buy the team back then and use their power/$$ to get the state/city to come to a deal. After all, staying in Seattle WAS the best option since OKC was flirting with and almost permanently kept the Hornets and there wasn't yet an NBA quality arena (although KC and others were building them). Schultz put the team up for sale, appealing to the business community here to at least come in for larger minority stakes and join him in the battle. NOBODY budged. Schultz gave a last ultimatum, it was in the Seattle Times - I remember reading it - that if nobody here stepped up that he'd offer the team to outside investors. Again, nobody budged and I think Seattle felt pretty confident that they'd 'won' and the NBA would probably pay for the upgrades itself.

Think again! Stern must have then reached out to Bennett - after he lost his bid to buy the Hornets and keep them in OKC (which actually WAS the right thing to do despite the political sour grapes New Orleans might have felt if that commenced). Stern didn't want to take the political hit at the time when the NBA was essentially reinventing itself. But he also wanted OKC - despite being a small market, it was a huge success and could be used as a MODEL for other markets to follow (or else). Stern also had a staunch ally in Bennett and Mayor Cornett - the more friends you have the better. So, Stern offered the Sonics to Bennett in exchange for him releasing the Hornets back to New Orleans. Apparently there was agreement because Schultz went with Bennett despite offers from California and other places. Note, there was nobody local who made a bid if I recall correct. But given the competing bids, Bennett had to step up and buy the team for likely more than it was worth at the time; $360m and (im speculating) there must have been a plan in place by Stern-Bennett and the OKC investors; if they could turn Seattle around (get retrofit KeyArena or new arena within 2-years perhaps), then they could sell the team later for more than $360m and Stern would expand the NBA by two teams; one in OKC and one in KC or perhaps Vancouver. Handshakes were made and enter Bennett to the Seattle scene.

I recall when it was announced that Schultz had sold the team to Bennett, most people around here felt great that Schultz had moved on and they'd 'won'. They never conceived that Clay Bennett would do anything other than sit on the Sonics and 'make money' by being in a top 15 market. They had blinders on to the fact that Bennett's sole goal was to get a franchise of some sort to OKC. I recall being on chat forums during that time with arrogant Seattle Sonic fans where I made this point over an over and was called all sorts of OK centric but demeaning names. Turns out, I was right!

Bennett did give it his best shot and why not, if he could get something going then he could have a huge ROI for his investment team AND still get a team in OKC either way. First, I recall Bennett meeting with Seattle officials. They gave him the Big City tour to educate him on what it means to be a Big League owner, blah blah, but Bennett got down to business concerning the arena. He used Schultz's reports to show how Seattle was underperforming compared to the NBA model and it's top-15 market size SHOULD be. Seattle showed Bennett the boot - that they'd allow OKC to invest in a retrofit but there wouldn't be appetite for a public subsidy. Next, Bennett along with Stern and CO went to the state legislature to make the pitch. The idea was a retrofit or new arena somewhere else. The legislature iirc didn't like the idea of a retrofit but DID allow for alternative options to be pitched; so Bennett and Co went on a tour and found land they thought might work in Renton (Boeing was offloading a massive amount of property and developers were building the now completed town center), Bellevue (which is the center of the wealth in seattle metro - was offloading a bunch of car dealerships along I-405), and a few other sites but these were the top two. Bennett returned to the state, only to eventually again - get the ax primarily due to land ownership issues iirc. So Bennett returned to Seattle one more time and this is when things got heated.

Here's something many Seattle people don't like to discuss/remember, but there were also referendums that came about at that time which placed severe restrictions on public subsidies at the same time all of this was going on. Seattle passed I-91 which limited public subsidy to some ridiculous formula that basically meant it had to be built privately. You'd think in a city like Seattle that private investors could build a new arena or at least retrofit KeyArena. Nope - nothing happened. With that, Bennett set forth an ultimatum - agree to a new site since retrofit in Seattle is off the table OR move to OKC. Everybody here thought he was bluffing; but look at what took place in 2007 and you see the groundwork toward the move to OKC really did happen. I recall they were literally giving away discount tickets just before the team moved, nobody cared and I think the concensus here was that they'd 'won' again, showed this Okie, and that he'd tuck his tail between his legs and Ballmer would buy him out. That didn't happen and you know all the rest.

My point in all of this is to educate or at least provide prospective as unbiased as possible on what MY recollections were during this time. I recall an apathetic and increasingly hostile populous that was against the NBA, regardless of what Sonicsgate or fans say after the sale - nobody stepped up at that time, I don't recall any rallies in support of the team until they were definitely going to leave (this was the SOS - save our sonics movement that started in 2008), and the state and city govts made it very clear there would be no public support and lastly the business and wealthy elite let it slip away. I recall Bennett made a last ditch effort (at the beckoning of SoS) to buy the team in 2008 right before the vote to relocate - of course Bennett laughed all the way to NYC because he knew the vote would be successful regardless of the show and tell they had to 'pitch' about OKC needing to upgrade Ford Center. That was the plan all along anyway, but to appease the political climate - they added in Tulsa in the initial 'market', got OK state support and also tax abatement for the players, championed the Ford Center Maps extension, and recalled the smashing success of the Hornets.

As I said, the vote was going to be to relocate anyway since Ford Center even without upgrades was more profitable in OKC than KeyArena was in Seattle (along with the bad blood). But everything else was icing on the cake and ensured a unanimous vote to relocate (outside of Seattle native Paul Allen who understandably HAD to vote No and Mark Cuban who considered OKC the largest tertiary market for his team). And OKC is where it is now, a smashing success but now ready to write its Second Chapter. I think we need to focus on this long before we need to worry about a new arena since the Peake is still a top arena in the current (and near future) NBA model.

I'd agree, however, that we could retrofit in all of the elements that were eliminated from the 2008 expansion. ... That would place the Peake in the top 5 of arenas IMO and push out our new arena bid by at least another 20-years.

We veered way off topic - and maybe this part of the discussion should be moved to a different thread - but Hot Rod you are the only person I have ever heard describe those events exactly the way I myself think it happened. That is almost exactly my understanding of the events, and I'll just say that during all of it I was reading Seattle papers as intently as OKC's coverage.

I also read every page of the Key Arena lease the very day of the sale (it was 99 pages if I recall), faxed from a Seattle reporter to an OKC friend of mine. I will add to your story that the lease that was written in the mid-nineties at the time of the Key renovations (even before Shultz' ownership) was HORRIBLE for the team. It was fine early in its life, but the team had to take on more and more of the debt service expense each year, AND still pay rent. By the mid 2000s they were essentially paying a mortgage AND rent for the same building, simultaneously. They also didn't get a penny of the concessions, but instead the city did. Contrast that with the 'Peake, where the Thunder essentially gets all of the profit (now the league standard). The lease lease was simply absurd by modern standards, and Seattle wouldn't budge.

"Sonicsgate" actually got most of the story right - including largely blaming politicians for sitting on their hands - but it tells an incomplete story by ignoring the solid BUSINESS reasons behind the move. Sure, the OKC owners ultimately mostly just wanted a team in OKC, but I think they (especially Clay) were willing to play by the rules, stabilize the Seattle situation, make some money while they owned it and parlay a "sweet flip" into owning a different team in OKC at a later date (be it expansion or a failed and league-owned Hornets organization). They also came to OKC as the only game in town, and though Seattle is larger and wealthier, OKC offered a much less-diluted market. We also could offer a modern, DEBT-FREE building, essentially for free. THAT story was never acknowledged nationally or in Seattle. The move became a no-brainer, from a business standpoint.

The main problem is that Seattle wouldn't play ball politically. Like you said, they had sports facility fatigue, an apathetic legislature, and a general population who were less-inclined to sell out for sports. If the Sonics hadn't been the last hog to the trough, we'd probably instead be dissecting the Seahawks' or Mariners' move to another city. The NBA drew the short hand, the lease sucked worse than the building did, and OKC had much more to offer than anyone thought.

But Seattle didn't have bad fans; in fact they had great fans. Sure, attendance dwindled when the team was gutted to start the rebuild (understandable) and during the lame-duck season, but to say they had bad fan support is as simplistic and wrongheaded as when Seattle fans characterized all of us as trailer-park-living rednecks who could never afford to pay NBA prices, and when they (and everyone else) claimed that free agents would never sign here.

In a nutshell, the biggest problem Seattle had was arrogance, followed closely by ignorance (of the situation that awaited a team in OKC). To this day people there believe there could be no other reasons than lies, crookery and hillbilly hometown boosterism that a team owner would relocate from beautiful, cosmopolitan Seattle to Hicktown, U.S.A. Meanwhile a team that lost tens of millions per year, bought from Shultz for $350 million, now MAKES tens of millions and was just valued by Forbes at $930 million.

The legislature iirc didn't like the idea of a retrofit but DID allow for alternative options to be pitched; so Bennett and Co went on a tour and found land they thought might work in Renton (Boeing was offloading a massive amount of property and developers were building the now completed town center), Bellevue (which is the center of the wealth in seattle metro - was offloading a bunch of car dealerships along I-405), and a few other sites but these were the top two.

Well if that's not irony, I'm not sure what is!

totally agree Urbanized. But I do have to say that the fanbase up here really dried up long before Clay bought the team. Sure, there were and always will be die-hard Sonics fans. But in my opinion they didn't do anything to try to save the team until it was too late. And even then, they sent threats and cheap shots instead of real solutions that COULD have been enacted on by Bennett, the politicians, the business community, and Stern. Nope, in my HONEST opinion fans here gave the middle finger to it all and had a pu-pu elitist attitude that the NBA owed Seattle for being a top market in it's league (so the NBA needed Seattle in order to be successful). They had many chances but blew it and then blamed everyone but themselves.

Sure, the politicians are most to blame but I think local citizens up here (even fans) have as much blame/responsibility for what happened as anybody in the state and city government because the citizens didn't change the situation or create an environment where the Sonics could at least negotiate for success. the Gun barrel approach failed and many people up here are too smug/proud to admit it.

Anyway - I'm glad OKC got the NBA (Thunder), personally, because I too thought Seattle was over-saturated. Just because you have a large metro area and rich folks doesn't mean you are a major league sports haven capable of supporting the big 3. In fact, nobody would ever admit it but there was always a dark-horse among the three Seattle teams; we support two teams very well (along with our Vancouver Canadian brotheren - mostly Mariner fans) so during most of the period it was the Seahawks that was the dark horse. In the 2000s, that changed and the Sonics became the back stage team. Just how it really was/IS up here.

I know were massively off-topic but I'll end it here by saying - "I hope and pray everyone in Oklahoma City metro area is safe from the horrible weather you all had Wednesday. OMG."

TIF makes possible deals that otherwise would not be possible. You can't divert money that otherwise wouldn't exist. In urban contexts, the TIF is even less of a factor because there is already some "increment" and you can only "divert" the added increment.

Ed's point is that TIF incentives should be used sparingly and only for developments that would otherwise not exist. What if a developer decided to invest and let the schools and county benefit naturally from the increased assessment without demanding taxpayer subsidies? The business community says they want to improve urban education in this city while at the same time not allowing potential increases in tax revenues to be used for public education.

I think we can all agree that a TIF shouldn't be used for free money to developers. Off the top of my head, I'd say it should be used:

1) To get development in a place where it normally wouldn't go (i.e., a poor area or one with significant barriers to development),
2) To get something that is much better quality than would be built otherwise (like turning a 10 story midrise into a 25 story highrise), or
3) To get something that is of significant public benefit (like a certain percentage of affordable housing in said 25 story highrise)

TIF funds should also be used carefully, to turn an "almost there" into a "got it". They shouldn't be used to fund a project that is otherwise completely unworkable.

Would be interesting to see if TIF rules could be rewritten so that an annual adjustment could be made to capture for schools and county the share that they would have gotten on the unimproved property. This could perhaps be based on the consumer price index, which essentially paces inflation. That way those entities would not miss out on increases in taxes that would have happened anyway, which is one of the objections that Pete and one or two others have brought up.

Would be interesting to see if TIF rules could be rewritten so that an annual adjustment could be made to capture for schools and county the share that they would have gotten on the unimproved property. This could perhaps be based on the consumer price index, which essentially paces inflation. That way those entities would not miss out on increases in taxes that would have happened anyway, which is one of the objections that Pete and one or two others have brought up.

Just to be clear, in TIF #2 (the big downtown district), properties that don't receive economic development assistance only have 50% of the property tax increase go to the TIF district; the other half goes to the regular taxing jurisdictions.

If they do receive TIF or other economic assistance from the City, then 100% of that increase is captured by the TIF.

Even on that basis and where the huge majority of properties in TIF #2 only get the 50% capture, they have far exceeded the amount originally budgeted ($47 million) vs. the current projection of $126 million.


TIF #2 is the only district in OKC that uses this 50/100 split.

Here is the problem with TIF's as being used by OKC. When developers build this stuff more people and companies move here - and that puts a burden on the services provided by the city and state, but none of the tax revenue generated by the growth goes to help fund the tax burden created by the growth, so their tax burden falls to the rest of us. I already don't like the growth model but hell, this is worse than the growth model because we don't even get the revenue for 25 years. Personally, I am getting a little tired of that. If we keep losing money on every transaction we can't make it up in volume.

To be sure, the only money that goes to developers is the money we give them. I don't know the law, but there's no reaspn we couldn't find a way to make the moneu accesible to the entities that would normally recieve it anyway.

So how would we fund the Convention Hotel ? BONDS?

no incentive=no hotel

So how would we fund the Convention Hotel ? BONDS?

no incentive=no hotel

We also don't have any way to pay for the necessary convention center parking.

The decision the City makes on land acquisition needs to be based on future expansion of the convention AND the hotel. We may not be able to afford our desires now but the City will have the ability to adjust to the economic demand later. NO Debt.

No debt is the envy of many Cities and their mayors.

No debt is the envy of many Cities and their mayors.

And it seems that large state of the art convention centers and hotels around the country built with bonds is the envy of our city leaders.

... by saying - "I hope and pray everyone in Oklahoma City metro area is safe from the horrible weather you all had Wednesday. OMG."

Wednesday had its moments, but if that storm had been in junior high, the av clubbers would have made fun of it and tossed empty film reels at it.
Gotta admit though, you know you're in Oklahoma when a single day's forecast includes wind, rain, hail, a tornado or three, and an earthquake.
Oh, yeah, and tigers. Must not forget the tigers.

I used to love that line in Twister about We got cows! But Tigers, yeah, that's a whole new kind of special.

We also don't have any way to pay for the necessary convention center parking.

That is an absolute statement..? I think it is safer to say that there is not yet a publicly-identified way to pay for it, or to say that there is not an immediately obvious way to pay for it. That holds true for a lot of things.

And I am NOT trying to be cryptic. I'm just saying that I have seen a lot of rabbits pulled out of hats over the years.

That is an absolute statement..? I think it is safer to say that there is not yet a publicly-identified way to pay for it, or to say that there is not an immediately obvious way to pay for it. That holds true for a lot of things.

And I am NOT trying to be cryptic. I'm just saying that I have seen a lot of rabbits pulled out of hats over the years.

No, that's completely fair.

I was just raising the point because the City has already identified the garage as one of the projects needing funds from the proposed south CBD TIF, and in their initial estimates seem to be counting on TIF dollars to pay for all if not most of it.

We unequivocally cannot know this. I agree that it is a great tool to use to entice development, and I do believe it helps bring in development that may otherwise not come in, or may come in on a lesser scale/degree than what is ultimately delivered because of TIF. But this is a belief, not a fact, and more than anything, it is a reality that is subject to manipulation and getting taken advantage of. If Clayco builds their full project for half the TIF they asked for, that doesn't make TIF look good.



There is literally a 5x6 block of streets in OKC that qualify at the level of "urban" context that you're speaking of. Everywhere else there are notable to significant holes in the urban fabric.

And let me remind you that they're about to do a TIF for C2S. if that encompasses much area at all, we're talking about a bunch of land that has NOTHING built on it, and a bunch of land that is going to get developed regardless of the existence of TIF.

Again, I don't think anybody here is opposed to TIF, but it's a far less transparent way for the government to steer money to whatever end they choose.

Furthermore, there are potential ways to make TIF work even better for the City:

For instance, we use TIF money as a basis for loans made to developers: We can loan out 2.5 to 5 dollars for every TIF dollar we collect and set interest rates competitively in order to attract more development.

You're not hearing me on a lot of things, but you obviously understand TIF well enough to be dangerous so don't take that as an insult. The first thing is that TIF usually requires some negotiation, and the reason for that is because you can structure it so that a "fair share" still goes to schools and other holy cows (so we can pretend the affected housing is feeding school enrollment). Because TIF is negotiated, it's been my experience on projects that I've worked on, that the process will allow for a review of project finances and then they will try to get you the TIF you need, and not the TIF you don't. Project finances don't ever plan for profit for this reason; it's called "developer's fee." It's a totally legitimate expense for the developer's time and effort, since he/she usually has a team of employees that also gotta eat.

As for urban context, the funny/sad thing about downtowns as command post is that the land speculation usually prevents, rather than enables, real estate development. The land underneath most downtown buildings, usually, is worth more than the building on top of it, unless it's Devon Tower. Just think about the former Downtown Ford's recent market appraisal. For one, I still can't get my head around the fact that they operated a car lot for decades on land that is worth $100 MILLION. Wow. Only in OKC.

I also thought that OKC did occasionally use the TIF fund to make bridge loans? That's actually a pretty innovative/conservative use of TIF. Most projects just get it. Regarding the Clayco 4-towers, especially with the 2 residential towers that they say will be delivered (and surely the TIF will be structured to ensure), do you really think that entire development is feasible in OKC without subsidy? I hate to say it, but I don't. High-rise residential NEW construction says a LOT about a real estate market.