We take a break from the “wheat/chaff” analysis to talk about two clear buckets of chaff: John Fisher and Dave Kaval, and the financial gap still standing in the way of moving forward with the $12B Howard Terminal project the city has yet to commit to in a binding vote.
If there is one thing I’ve learned in the process it’s that “IFDs are a BFD”. IFD stands for Infrastructure Financing District, and produces tax revenue from the businesses that lease property in the district.
Much of the needed money for Howard Terminal has been committed through the Fisher investment group, city funding, grants, and possibly lemonade stands set up by the children of A’s players — though this project keeps getting stalled because their daddies keep getting traded.
The remaining money could come from the creation of 1 or 2 IFDs, whose revenue relies on enough businesses leasing enough property to generate the projected tax revenue. Because it seems you can’t spell IFD without a big IF.
There are 3 entities that could pay for any shortfalls. They are the Fisher/A’s group, the city of Oakland, and Oakland’s taxpayers.
One way to account for any potential shortfall is the Raiders’ way: “If our projections turn out to be inaccurate, the city can just go broke paying for it and we’ll go ahead and leave anyway.” As much as I want the project to go forward and for the A’s to remain “rooted in Oakland” with a splashy new ballpark, I applaud the city for refusing to consider that model.
Another solution is to saddle Oakland’s taxpayers, many of whom are too busy living in extreme poverty to worry much about a ballpark, with any shortfalls. Robin Hood would not approve of this “steal from the poor and give to the rich” concept.
The final option is for Fisher and A’s to bet on themselves. They insist that there is nothing to worry about, because this project is going to be a resounding success, businesses will be lining up to lease property, and the IFDs will surely generate enough tax revenue to meet projections that would bridge the remaining money gap.
Great, I hope you are right. And assuming you are, there is no risk whatsoever in you agreeing that if somehow — I know, it won’t happen, we’re just spitting out hypotheticals here — the IFD revenues fall short of projections, Fisher and the A’s will reach into their pockets, not into the city coffers or the pockets of Oakland’s families, to pay for the difference.
It’s not even a lot to gamble for Fisher and the A’s, considering that not only are they apparently so sure that the difference will be “$0.00” but also that the projected IFD figures account for only something like 0.3% of the $12B.
And Fisher/A’s aren’t willing to bet on themselves enough to guarantee that if some portion of that 0.3%, a shortfall that would be more in the “$100M” range than in the “hundreds of millions” range?
Without question, in the past the city of Oakland has been guilty of some terrible dealings, and at times bad faith, in trying to keep its professional teams here. But here we are talking about money that is based on hypothetical projections, which brings inherent risk. And no way should it be the city, or its tax payers, who assume that risk. It absolutely should be Fisher/A’s and it’s a zero risk if their rhetoric is true — the IFDs will create sufficient tax revenue to produce the money from businesses and not from them.
But this risk should belong strictly to Fisher/A’s, for whom the potential shortfall amount is relatively petty cash, not to a city trying to tackle housing, gun violence, and widespread poverty, and not to tax payers who struggle to find two dimes to rub together.
It sounds like the “IFD issue” is the last big hurdle still stopping the city from embracing the binding vote that can allow the project to move from “theoretical” to “actual”. And if the Fisher group and the Oakland A’s aren’t willing to bet on themselves, I don’t know why anyone else should.
Note: The author is generally ignorant around stadium projects and business dealings and could have all his facts wrong. If this proves to be the case, please be advised that this entire article is, in fact, extreme and clever satire.