Safeco Field cost

DMZ · September 20, 2004 at 7:58 am · Filed Under Mariners 

To clarify something: we often refer to Safeco as being a $330-350m stadium financed by tax dollars. This is a little unfair to the team, but entirely fair in another sense.

The cost of the stadium was supposed to be in that range, with the M’s contribution slated to be about $40m, which they immediately recouped by selling the naming rights to Safeco Insurance.

However, the cost overruns, which the team was respoinsible for in the rush to build it, and which they had promised to pay for, were not paid for by the public. Though not for lack of trying, as the M’s attempted to get the public to pay for it (because the tax was collecting more revenue than anticipated, which is like going to lunch with someone and refusing to split the bill because they have more money then you). The final cost of the stadium was about $520m, and I’ve read the team ended up covering about $130m of the overruns (meaning the public paid $390m for the stadium). The team then went and tried to pursue legal action against everyone they’d hired to build the stadium. I don’t know if they recovered any of that money or not — I can’t remember reading anything about any settlements, but that’s the kind of detailed, no-story-here event that I imagine was probably on page 8 of the business section, if it ran at all.

If that’s the case, the Mariners ended up paying about a quarter of the cost of the new stadium out of pocket, which would make them one of the more generous contributors in the last stadium boom. But some points to consider:
– the overruns were entirely the fault of the team’s desire to open mid-season 1999, a move that made them about $75m in additional revenues (I could do a detailed breakdown of my guess there, but that’s probably in the ballpark — ha!) for that year
– they did try and go back on their promise to pay and made all kinds of dire predictions about what would happen if they were forced to pay their lunch tab

In that sense, I’m reluctant to credit them for this.

However, assume for moment that the team’s crack legal team went out into the wild to go hunt for settlement money and they came back with nothing. There would be a massive debt on the books the team would have to pay down as a result of their own actions. When they pay that off, it makes their profits look much smaller, even as their revenues may be spectacularly high. Even for a highly profitable team like the M’s, this means they can retire that debt quickly over the last couple of successful years, making it easy to make the profits of those boom years go away.

This is important to you because while the team’s lease with the PFD is laughably bad (I’d love to rent a place to live under the terms of this deal) it does contain limited profit-sharing. The team is supposed to share a portion of the money they make once they’ve paid off debt they supposedly (but did not actually) accumulated during the 1989-1999 years. The Mariners, if they never recovered any of the cost of the overruns, have $126m in postponement of the start of revenue sharing, of putting money back in the public coffers. As a result of thier own incompetence in project planning.

That’s a lot of money. That’s a lot of postponement.

Not that has anything to do with present events. It just occurred to me.


24 Responses to “Safeco Field cost”

  1. Itea on September 20th, 2004 9:24 am

    DMZ – Nice to see you mention this. I was telling someone the other day that you complain about the temporary bleachers because they bother you, but you don’t complain about the whole sordid deal by which the stadium was built in the first place because you like Safeco in general, even though it was a crappy endrun pulled on a public that had voted the project down. So I owe you an apology.

    [I have been there, but not in three years now (or four maybe). Eventually, the thought of subsidizing really rich people and really large corporations bugged me so much that I stopped going.]

    – Itea

  2. hans on September 20th, 2004 9:39 am

    Hmm… seems wierd. The Mariners were originally going to owe $40m for the stadium, but they made that back immediately by selling the naming rights. In the meantime, the public was paying $330-$350m for the stadium. Why is it that the Mariners get to sell the naming rights and not the public? How is this fair? It is like letting the godfather of my first born name him.

    “I was thinking of naming him Edgar… You think he ought to be called Rolf? Well, okay I guess…”

    I have always thought that Safeco Field was a crappy name. Couldn’t we have called it something classic and respectable like Mariners Stadium? Heck, after this year, why don’t we start calling it Edgar?

  3. big chef terry on September 20th, 2004 9:51 am

    My recollection is that the M’s financed the over-run through some issuance of debt, but I need to be checked on that. That allowed them to pay back the overrun over a longer period of time.

    Most modern stadium deals are totally skewed towards the franchise owner in terms of revenue sharing, or hogging, post deal. Same thing for Seahawks stadium. The Sonics are already trying to get some too.

  4. JP Wood on September 20th, 2004 9:51 am

    Art Thiel devoted some space in his book to this but did not go into detail. If you could get an interview with him of one of the researchers he used, you might get more, but in light of the drill-job he gave the internet community (“Melvin’s biggest public shortcoming is the 30-second audio and video bites after games… a whole lot of Mariners fans equipped with an Internet service provider seem to think it’s the be-all and end-all of managing”.) in an otherwise more than fair column this morning in which he really stomped on the FO, that might be tough:

  5. Jon Wells on September 20th, 2004 10:24 am

    I usually like Thiel, but I thought that column was one of his worst ever. I am so tired of reading about how Melvin’s done nothing wrong and he’s just a victim of a bad season. The most laughable part was the final paragraph:

    “Perhaps in a few years, when Madritsch leaves in free agency to join a contender that Melvin is managing, they will share a laugh and a shake of their heads about a half-season from hell in Seattle in which conviction, belief and intensity didn’t make the roster.”

    BOB MELVIN will never manage in the majors again, let alone manage a contender!

  6. Bill Tollett on September 20th, 2004 10:41 am

    He may yet manage. Coming into the job he was highly regarded as being one of the up and coming managers in baseball. Besides, looking superficially at only the records, he led a team to 93 victories in his first year and has had a dismal season this year, in which veterans have underperformed to the point that half the team is now made up of rookies with potential and career minors players.

    Don’t get me wrong, I think Melvin needs to go. But I certainly wouldn’t call this whole thing his fault. He’s a bad manager, but even a good manager has trouble winning when the front office gives him crappy players.

  7. Kevin on September 20th, 2004 10:52 am

    Wow, it’s hard to know where to start with the Thiel column. I disagree with much of what he writes, but it’s nice to see him avoid the tortured prose that takes 12 words to get to a unfanny analogy that marks much of his writing. I’m too busy busy for a full-length reaming right now, so I’ll limit my criticism to his remark about internet users; the overwheliming majority of criticism for Melvin (at USSM and other places) has been directed at his in-game managing abilities, not his after-game personna. Pinella was never much for the post-game interview either. Typical interview question: what did you think of Edgar’s 12-pitch at bat that culminated in the walk-off home run? Pinella: That was a good hit (silence).

  8. Evan on September 20th, 2004 11:10 am

    That’s a great idea. I’m going to be calling it Edgar Field from now on.

  9. Pete Livengood on September 20th, 2004 11:11 am

    Derek — I’ve seen one passing reference to a settlement, in a May Art Thiel column (the one, I think, that he recently revisited saying the Mariners’ FO took him to task on the figures he used):

    “Mariners CEO Howard Lincoln’s commitment to running a profitable operation has worked splendidly — the club’s reported net income to the PFD through four full seasons at Safeco is a cumulative $68.6 million, plus a $14.325 million one-time payment in 2002 that is believed to be the settlement from the architect and contractors for the disputed cost overruns in building the ballpark. Citing confidentiality agreements, the Mariners declined to confirm the source of the money.”


  10. AK1984 on September 20th, 2004 12:11 pm

    “Not that has anything to do with present events. It just occurred to me.” [DMZ] Okay, in regards with that, I’ve got some opinionary viewpoints on a contemporary issue involving the Seattle Mariners, with that being the following: Could management re-assign/demote Bob Melvin to the title of Bench Coach next year, while in turn hiring a new mananger. I think it would be hilarious to have this proposed to Melvin, and see what his reaction would be; IMO, he would most likely accept it, given he ostensibly seems to be an emotionaless drone who resides in a realm of stoicism. BTW, it would be cool to see Rene Lachemann manage the team as he did during the mid-80s—HAH! (Besides, that way, we could pay Melvin next year to do something productive, instead of letting him go for nothing.)

  11. Jon Wells on September 20th, 2004 12:53 pm

    How could Melvin have been regarded as one of the “up and coming managers” in baseball when he hadn’t even managed a minor league game at the time of his hiring? In any event, I don’t think he gets another major league managing job until he first spends a few years as a coach or has some success managing in the minors…

  12. eponymous coward on September 20th, 2004 1:01 pm

    Ah, so they got 14 million back on $126 million in stadium overruns.

    Hmm, still a lot of postponement possible. Now, if they only start executing on the plan to become a revenue-sharing titan they’ll be set- they’ve got the losing down, now they just need to slash salaries to $30 million…

    And given that Melvin’s in-game “strategery” isn’t his strong suit as a manager, and wasn’t on display in the 2001 World Series when Melvin was bench coaching for Bob Brenly (which was bascially Randy and Kurt outpitching very questionable managerial decisions), why the heck do you think he’d add anything to the team as bench coach other than pathos as an ex-manager?

    While we’re at it, what does Lachemann add to the team, other than reminding us that we suck once again, just like the 1980’s?

    At this point, I think whoever’s managing is basically irrelevant on the larger scale of things in the Mariner organization. It’s like firing the captain of the Titanic after it’s been hulled by the iceberg and telling the new guy “OK, now get us to New York”. Without substantive changes in the organization’s ability to evaluate baseball statistics and willingness to step outside of groupthink, John McGraw or Casey Stengel wouldn’t win (and they didn’t, when they had crap teams). The fact that we haven’t had a rookie hit 10 home runs in a season since 1997 has FAR more to do with Melvin getting fired than his own performance.

  13. Paul Weaver on September 20th, 2004 1:29 pm

    I don’t want a rookie hitting 10 HR when a veteran can hit 20, but I still get what you’re saying, epo. Ideally we’d like to have every M’s farm team winning a championship in a dominant conga line of talent up to the top – where our system-groomed, superiorly scouted talent crushes both the inferrior teams of mediocrity and payroll-Titans alike. Our system will be so crowded with talent, that the rest of the league will look like amateurs. Starters on any MLB team will be trying to get promoted to AA for the Mariners. Bob Melvin will coach the Mariners to a 159-3 record with a team that any other manager could get to 162-0. A tiring, old Ichiro, hitting just .325, will be batting ninth – speaking fluent English by this point.
    All this if only the guys at the top would know to stay away from Garciaparra’s brother, or know not to trade future stars for mediocre veterans.

  14. Steve Alliston on September 20th, 2004 1:39 pm

    On the stadium vote: though it’s no doubt true that a lot of voters thought they were voting against ever building a stadium for the M’s with public money, such a measure never came to the ballot. Seattle voters voted down a particular financing package for a stadium. The package that was actually passed by the legislature was far better and, given the closeness of the vote, would clearly have passed…at least in Seattle. What the vote told lawmakers was that there was support for building a stadium, but not with that particular kind of plan (which I believe involved raising the city’s portion of sales tax). The current plan which increases taxes on rental cars, hotel rooms and restaurants, along with taking money from user fees paid on tickets to Safeco, is much more fair.

    I think the community has an interest in having a baseball stadium. Even if you don’t go, it gives everyone in the city a topic of conversation. I can’t think of a lot of things to say to a lot of people in town but “Boy do the M’s stink this year” always gets a nod.

  15. Dave on September 20th, 2004 2:06 pm

    Raising taxes on hotels and rental cars by 10 % is more fair than raising a city wide tax one tenth of one perecent? One of the most annoying things about spring training is paying $30 to rent a car, then paying $15 in taxes, because Arizona has followed this model. I don’t see how it’s at all “fair” to tax people from out of state so that we can build our own toys. I realize why it’s more popular (screw the tourists! Yay!), but fair? Seriously?

  16. JP Wood on September 20th, 2004 2:16 pm

    Jon in the #5 slot:
    When I said Thiel was more than fair, I was referring to his taking the FO to task, including Gillick’s lame duck decisions, rather than sticking the major blame for this pathetic season on Melvin. Melvin is under the lights every day, while Bavasi and Lincoln love to fly under the radar. I was glad to see Thiel turn the tables, despite his cheap shots signaled above.
    Of course Melvin shares in this catastrophe. I think Thiel was saying was that it’s unfortunate that no one really has a handle on anyone else who merits more distain.

  17. PaulP on September 20th, 2004 2:21 pm

    I’m confused by this pararaph:
    This is important to you because while the team’s lease with the PFD is laughably bad (I’d love to rent a place to live under the terms of this deal) it does contain limited profit-sharing. The team is supposed to share a portion of the money they make once they’ve paid off debt they supposedly (but did not actually) accumulated during the 1989-1999 years. The Mariners, if they never recovered any of the cost of the overruns, have $126m in postponement of the start of revenue sharing, of putting money back in the public coffers. As a result of thier own incompetence in project planning.

    I thought once the M’s payed off their Stadium debt, that they would start revenue sharing. I didn’t think it applied toward the debt associated with running the team pre-1999. So is it the $130 of overruns, or 126mil of previouse debt, or both? Also, do you have a source for the previous debt thing?

  18. eponymous coward on September 20th, 2004 3:11 pm

    Whoops, thread hijacking in progress. Nothing to see here.

    I don’t want a rookie hitting 10 HR when a veteran can hit 20

    Are you sure you’re not Pat Gillick or Bill Bavasi?

    Seriously, our inability to produce ANYTHING resembling a superior major-league hitter to make a significant contribution to our team since A-Rod is by and FAR the reason this team is awful right now. The hitter’s who’ve come out of our system since 1997 (the Cruz and Varitek trades) are:

    Raul Ibanez
    Scott Podsednik
    Ramon Vazquez

    That’s pretty much it, outside of the Bloomquists, Monahans and Gipsons of the world filling out the 25 man rosters. That’s a crappy amount of productivity from a farm system for position talent, and it’s why we have an old and overpaid team.

    I think Bob Fontaine will help that (the Angels and the White Sox have had better productivity than we have)…and so will not losing a first round draft pick, but cripes, this system is awful for producing hitters.

  19. DMZ on September 20th, 2004 3:24 pm

    On this: “I think it would be hilarious to have this proposed to Melvin, and see what his reaction would be; IMO, he would most likely accept it, given he ostensibly seems to be an emotionaless drone who resides in a realm of stoicism.”

    Stoicism has a bad rap. It’s not about being emotionless, it’s about following where reasoning leads you, and that good lies in your own soul and not in (say) some universal imperative.

    If Melvin was truly a stoic, he’d have gotten past his own attachment to by-the-book tactics and been smarter about talent evaluation.

    Derek, way too into philosophy

  20. PaulEnumclaw on September 20th, 2004 4:11 pm

    A couple of things…

    First, the Mariners DID quietly drop their demand to the “extra” money that the tax dollars were raising.

    They got a lot of heat over it in the press and for once the PFD got some backbone (perhaps they borrowed someone else’s) and basically told the team “you’re gonna have to sue us to get the extra dough; otherwise, we’re using it to retire the debt earlier and save the taxpayers some money.”

    The club’s ownership did some mental figuring and realized that there was NO chance they could get this case out of King County. Since any jury they’d be in front of would promptly laugh them out of court with their “those tax dollars are raising more money than expected, so we should get it” argument, they (rightly) decided to drop the case.

    The end result still isn’t that bad for the team- it does indeed mean that they have been able to apply any/all profits for the past few years to the cost overruns, which means it winds up a wash for the club’s ownership.

    Of course, we’re ignoring the fact that those cost overruns were part of a stadium that vastly increased the club’s value (and hence the owners’ profits if/when they decide to sell).

    In short, the whole thing is typical of the club’s owners. They were very smart in what they tried to do, but when people actually thought about how the average taxpayer would get the shaft they were shot down.


  21. PaulEnumclaw on September 20th, 2004 4:24 pm

    Found a link to an article that talks about when the M’s finally gave up their claims against the PFD and the contractor.

    (When the claim on the “extra” tax dollars flopped like Ted Danson doing a blackface routine at an NAACP dinner, the M’s shifted the thrust of their legal maneuvers towards the PFD. They basically tried to blame the PFD and contractor jointly for having the unmitigated gall to CHARGE the Mariners the cost overruns for all the demands, leading to the overruns, that were being made by… the Mariners.)

    Anyway, at

    you can see that they came to settlement with the PFD.


  22. Snuffy on September 20th, 2004 4:26 pm

    Buntin’ Bob Melvin must go… but only AFTER hapless Bavasi. That would be fair.

    The real issue here is player salaries, frankly, in all sports… The players deserve what the owners are stupid enough to pay. The OWNERS… NOT the TAXPAYERS! I love baseball. I’m a Mariner fan. In lean economic times… when so many issues need attention and so few dollars are available, how can anyone with a straight face suggest giving taxpayers money to support pro-sports??? Any politician who supports this should be voted out… or worse. As Casey said, “You can look it up.” And when you do you will find that there is NO basis for taxpayer bail-out for pro-sports. Zero. Theiroughtabealaw!

  23. Itea on September 20th, 2004 4:38 pm

    Steve Alliston – You are correct, and my wording was wrong. The _specific proposal_ that came into being was never voted on.

    That said, it’s also clear that the de facto process in King County was to bring stadium projects to a public vote. This process was skirted.

    I’m not sure that this “far better” package would clearly have passed another vote. I think only a small percentage of the voters look at the particulars of a deal like that. I follow baseball closer than 99.99% of the country, and enjoy playing the game, but I would have voted against the stadium. I think it’s wrong to take that much public money and put it towards something that relatively few people enjoy. I’d have much rather seen the Commons come into being.

    On the related note, I try not to even say the S-word [though I do in my comment above]. Naming a public stadium after some private corporation is graffiti, and not the cool artsy kind. People who call naming rights “creative financing” don’t know what the word creative means – there is nothing creative about naming public works after businesses. I ask everyone here to join me in refusing to bleat along. Just call it the baseball stadium.

    – Itea

  24. tede on September 20th, 2004 5:36 pm

    The ownership got a lousy deal on the Safeco naming rights. Not even market value for the time. But they have made out like bandits on the in stadium signage. I don’t like the Safeco company, but at least they supported the M’s from way back when (Where’s Wade Cook these days?). Reminds me of Smulyan trying to convince Microsoft to at least advertise in the Kingdome since they did so in Toronto. Microsoft said they advertised in the Skydome and not the Kingdome because they care about baseball in Toronto.

    The time John Ellis teared up and the M’s tried to get an even better deal with everybody ironically did not work with the City of Seattle where the M’s had no leaverage compared to the County. I remember the M’s complaining at the cost of the cops for security, traffic control etc. Every time I see that old over tan Seattle cop working the 1st base dugout since the Kingdome days, I wonder how many boats has this guy purchased from his time and a half gig watching baseball games. The one time an idiot ran onto the field this year, he barely moved.