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A simple plan? Hardly

11/17/2010 - MLB Chicago Cubs

CHICAGO -- Wrigley Field is a dump.

Ozzie Guillen said it, I've said it, anyone who has set foot in the park and taken their head out of the clouds and actually looked around, has said it.

Now Tom Ricketts is saying it. Not in those words, of course.

The field's nice and the neighborhood setting is fantastic, but it's not up for debate. It needs work. A lot of work. Joan Rivers kind of work.

The question is: Who should pay for Wrigley to be rehabbed and renovated?

Ricketts thinks it should be his family, with a lot of public help.

A year into his tenure as chairman of the Chicago Cubs, Ricketts, came out this week with a much-maligned, half-understood tax-increment financing plan that would allow the Cubs to utilize future tax money they pay to the state through an existing amusement tax to pay for improvements today.

Essentially the Cubs would use the tax money to pay back $200 million to $300 million in bonds they want to take out now.

The plan would be to freeze the amount of money the team currently pays via a 12 percent amusement tax on tickets -- $16.1 million in 2009 -- and when ticket prices go up (and, let's face it, they will) and the tax increases, the team uses the extra money generated after $16.1 million to pay down the bond debt.

This will go on for 35 years, which begs the question: Which will end first the tax freeze or the World Series freeze?

"To be clear, and to be very clear, what we have publicly proposed is a public-private partnership that allows us to reinvent future increases in the amusement taxes that are paid by Cub fans," Ricketts said in a news conference Tuesday with a host of labor and business leaders at Wrigley Field. "The resources would go to the ballpark for renovation and preservation so we can save the ballpark for the next generation of fans. There is no new tax, there is no tax increase, simply reinvesting of new taxes going forward."

As the proposal stands now, the bonds likely would be issued by the Illinois Sports Facilities Authority, which owns U.S. Cellular Field, but no one's sure who would be the guarantor on the loans if they aren't repaid as expected.

"Ultimately we have to work with the state to come to some kind of conclusion that works with that," Ricketts said. "The fact is the increase of amusement tax revenues should support the bonds pretty well. To go to the markets we might need a state agency to issue them for us.

"The dollars that go to support these bonds are paid for by Cubs ticket buyers," he said later. "The state needs to issue these bonds because we can't issue them on our own behalf."

I'm confused, you're confused, Mayor Daley is reliably confused, Michael Madigan is really confused. No one's really sure of anything.

Despite employing well-heeled political flacks, this plan has been met with confusion. According to news reports out of Springfield, Madigan, the powerful Illinois House Speaker, thought the plan was already withdrawn not long after the news conference ended as he told the Chicago Tribune.

"Tom spoke to [the] speaker after that blog entry," Ricketts' spokesman, Dennis Culloton, wrote in an e-mail. "[The] Speaker got some bad intel and misunderstood. We are moving forward."

As it stands now, the Ricketts family is looking for public help and the hundreds of millions in bonds will reportedly be matched by the Ricketts family, which makes this a "public-private partnership," as he repeated several times.

The public money will fix up the park while the private money will be supposedly used to create the Triangle Building, among other parts of the project that will benefit the neighborhood.

I'm going to pause with the haranguing for a second, because the Cubs aren't trying to borrow money for the hell of it. There is a point and it's to create a better, more vibrant Wrigley Field and a less scummy Wrigleyville.

The new "Wrigley 100" plans were unveiled at the news conference, and quite frankly, their renderings on how they plan to reshape the park look awesome.

We're not talking about adding a fresh coat of paint to the bathroom stalls or adding bison burgers to the concession stands.

This ambitious plan would ultimately turn Wrigley Field from a relic to a modern stadium complete with underground clubhouses and batting cages for the players, rooftop patios for the fans in the upper decks, improved concourses, concessions for everyone and a Disney World-like pedestrian mall ("Cubs Alley") between the park's exterior and the long-awaited Triangle Building, which will have a Cubs museum, restaurants, broadcast studios and shops.

And I'm sure the troths will be glorious. Throw in a World Series or two, and real Cubs fans might actually be happy.

This plan sounds great, but the hypocrisy surrounding the idea of how to finance it is more than a little amusing.

Joe Ricketts, the patriarch of the family and the one who put down $403 million in his company's stock to buy the team -- not counting the record $450 million that was financed -- is chairman of the "nonpartisan" group Taxpayers Against Earmarks. The mission of the group "is to end wasteful government spending and eliminate the corrupting practice of earmarks."

Joe is not nonpartisan, and neither is the rest of the family (Laura Ricketts once joked it was easier to come out as gay than Democrat.) Joe donates a ton of money to Republican causes and candidates.

Illinois political blog TheCapitolFaxBlog.com reported this the other day, and also noted that Joe is on the board of conservative think tank American Enterprise Institute, which decried funding stadiums through tax subsidies in its magazine in 2008.

Tom was asked about this incongruity between his father's work, which he said he supports, and how it conflicts with asking for tax money to rehab a privately owned stadium.

"An earmark is something that's appended onto a federal bill which is never debated, never discussed, just thrown in," Tom said. "The fact is, what it does is it jeopardizes the integrity of the federal budgeting process. You can tell by the people in the room today this isn't a private process we're going through. We're trying to be as open as possible. This is a decision that will be made by elected officials and the people in this room."

No this project isn't an earmark, per se, but it's close. If you bend the meaning a bit, you can see how some people would see that above statement as an exercise in semantics and this plan as hypocrisy.

After all, who would benefit the most by the Cubs getting a new park? The owners, of course. This isn't a nonprofit. While Ricketts has claimed he wants the team and the park to stay family-owned for a century, a new Wrigley Field would increase the team's value significantly. Astronomically, even.

According to TAE, the point of railing against earmarks isn't really the way they're put together, it's that they're tailored to benefit the people who are sponsoring them. Sound about right?

Here's what it says on the website: "Earmarks provide federal funding for projects benefiting only a state or local interest, or a private company, university or non-profit. In other words, most earmark-funded projects do not benefit the nation as a whole -- though the 'giving' of an earmark by a Member of Congress certainly benefits that Member."

Now, you can see the similarities.

There are differences. Important differences, the Cubs will tell you. The people providing the tax dollars are Cubs fans, the same ones who will enjoy the new stadium. Not a dime of non-Cubs money will go into this TIF-like deal.

But most real Cubs fans, actual Cubs fans, don't even care about museums or "Cubs Alley." The tourists are happy with being there and the diehards just want to see a World Series before they die.

I don't know if this hypocritical line of thinking matters to Cubs fans. I'm not sure it matters to me beyond a chuckle or two.

I want the Ricketts family to succeed. I like them, to be honest. I've spent some time talking to Tom and I find him to be a nice guy and he's extremely intelligent. In fact, he made his own money in the bond industry, so I trust his fiscal judgment.

But to say this isn't public money isn't true. He knew about the amusement tax.

It wasn't a surprise.

"The Cubs/Ricketts are, in fact, asking for public money because any funds devoted to Wrigley renovations are dollars that can't be allocated to, or used for, any other project(s)," University of Chicago professor and sports economics expert Allen Sanderson wrote in an e-mail. " 'Invest' is a word politicians and others who want to feed at the public trough use; it sounds so much nicer than 'blow' or 'spend' or 'divert.'"

In truth, it doesn't make financial sense for the Ricketts family to offer to pay for everything themselves, when they know all the other teams in town have gotten government help to build or rehab their stadiums, not to mention money devoted to Navy Pier, McCormick Place, et al.

While you can say the Boston Red Sox, whom Ricketts is trying to model the Cubs after, paid for their expensive stadium enhancements without getting taxpayer money, they also don't pay an amusement tax on tickets.

And trust me, ticket prices are going to go up if and when Wrigley is rehabbed.

Certainly, the haves will get their clubs and premium access, while the upper-deck folks will have to make do with public patios.

Fresh off getting a new spring training stadium with the passage of Proposition 420, which provides up to $99 million from the city of Mesa, Ariz., the Cubs are hoping government in Illinois helps them refurbish what they claim is the state's third-largest tourist destination.

According to a study done by consulting firm Conventions, Sports and Leisure International, the Cubs and Wrigley Field generate $618 million in economic impact to the local economy, $379 million in annual "new net direct spending" and pay $59 million in taxes, a third of which goes to the city.

The study says that 37 percent of Cubs fans come from outside the state and that Cubs fans overall spend $77 million in new money on hotels and $111 million on food. (Those numbers all come from 2009.)

But this is a game that people play all the time to get things built. Anyone can pay for a study that fits their narrow views. I'm sure it's right, or close, but it's also paid for by the team.

What the Cubs are trying to prove is that they bring money into Chicago, Cook County and Illinois. That's non-negotiable. We know that to be true.

But this is a touchy subject right now. The economy is reportedly growing again, but unemployment remains high, as do tensions.

Everyone besides Alfonso Soriano and Oprah Winfrey is scared about money.

The state of Illinois and the city of Chicago are constantly in the news because of precarious finances. We are besieged by cuts in school budgets, municipal budgets, you name it.

With tax dollars in such high regard, it's easy to see why editorial boards and government leaders are rejecting the Ricketts Plan without delving too deeply into it.

Frankly, no one wants to see tax money go to a private business owned by a family of millionaires purchased for them by a billionaire.

Fans don't like it, politicians don't like it. Labor leaders, who showed up en masse to support the project, are gung-ho. Because it means work for construction, painters, service employees. Ricketts said at least 1,000 union workers will be used on this project. That is a big deal. There's no denying that.

And he said the loss of future amusement tax receipts will be more than made up by increased sales tax from the projects, most notably the construction of the Triangle Building.

"If the plan is approved," he said. "There will be $4 million in sales taxes on equipment and material, far more than any loss, in the short term, in amusement taxes."

Ricketts also said the new building will add an "additional $66 million a year in economic activity."

Plenty of teams have asked for and received tax-increment financing, mostly through property taxes for planned developments and sales taxes. The city of Chicago is TIF-mad, if you read the work of Chicago Reader reporter Ben Joravsky.

But a ticket tax like this is pretty new territory, said writer and activist Neil deMause, who runs a website, and has co-written a book, "Field of Schemes," which "casts a critical eye on the roughly $2 billion a year in public subsidies that go toward building new pro sports facilities."

"I haven't heard of a ticket tax being used for this," he said. "I think it's a first. Usually they want kickbacks on sales tax or property tax."

Maybe it could work like they say, but he doubts it. He's seen this story before.

"It's splitting hairs, extraordinarily fine to say this isn't a tax increase, because this isn't existing tax money," he said in a phone conversation. "The tax money is not coming in yet. It's the same thing as me saying I'm only paying what I pay in income taxes now and I'm going to cut a deal with the government that any additional money I make I get to keep."

Ricketts said this turn of events wasn't ordained when he closed on the team after a long, arduous process with Tribune Company owner Sam Zell. The bond expert didn't know he'd be playing the bond market.

I noticed last year the team separated the 12 percent amusement tax from the price of the tickets, while alerting fans the tax would be added to their purchase. Most fans, I imagine, had no idea this tax was even in place.

I asked team president Crane Kenney on Wednesday if they did that in anticipation for a day like this.

The former Tribune lawyer looked at me, grimacing, twitching his face a bit, and then breaking into a smile.

"No comment," he said.

Jon Greenberg is a columnist for ESPNChicago.com.