By Roldo Bartimole
The growing inequities of America keep showing up most conspicuously in American sports where tax-subsidized venues tilt more and more to the pleasure of the wealthy.
The publicly subsidized basketball arena – now called the Q, formerly the Gund – has several new loges available. Don’t rush to buy.
Cost: $900,000 each, a five-year deal.
The price does not include required event tickets.
The $180,000 a year loges also require purchase of eight to 12 floor seat tickets per game.
It will cost you, depending on the seats, another $500,000 or $1.5 million, according to an article in Crain’s Cleveland Business.
So let’s round off to a million bucks.
You do get some credit for food and drink, a little enticement for a big-ticket item. Crain’s reported the Cavs offer a $30,000 credit toward food and beverage consumption, along with a $15,000 credit for concert tickets.
That should go quickly with Abramoff-type business entertainment of elites. Should someone be checking the pols that attend these loge soirées? Who is that familiar face hiding in the corner?
The pampered loge guests get an exclusive menu unavailable to others.
This information is gleaned from a special editorial section in Crain’s, Oct. 2-8.
It symbolizes the enormous growing gap between ordinary people and the pampered wealthy. It also exposes the high-living, tax-deductible style of inequality of corporate America. It reminds one of the Abramoff free tax-write off entertainment that makes much of sports today not sports but a business, often corrupting.
These new loges contrast to the traditional suites that now go for a measly $150,000 to $230,000, up from $85,000 to $150,000 when the Gund was opened.
I guess that’s why owner Dan Gilbert of Quicken Loans calls the new suites Platinum loges. There are five. Maybe you had better rush.
The $5-million picked up by Gilbert won’t have to be shared with the owners – essentially us. Originally, 27 percent would have been paid to the people who built the arena – us. Circumstances, you might say, have changed. The 27 percent share has been eliminated.
The fact is that the Cavs have never paid a cent in rent. You can’t believe that? Well, when it appeared that the Gateway Economic Development Corp., the non-profit entrusted with temporary ownership, was ready go bankrupt the two teams at Gateway were forced to do something drastic. The circumstances forced the Cavs and Indians owners to agree to pay for Gateway’s operation costs and capital improvements. But Gateway lost other income streams.
Bankruptcy would have been too costly and embarrassing
So you see the Northeast Ohio economy can’t be that bad. Not when some corporations can shell out about $1 million over five years (not counting food, drink and whatever else they lay on their “guests”). What the hell, it’s a business expense so we, the taxpayers, essentially end up paying again.
The Crain’s article by John Booth notes that the Platinum suites “offer a swanky alternative for the Cavs’ experiences.”
“Experiences” are very important to VIPs.
We’re offering you the opportunity to separate yourself from the rabble.
The million bucks include one parking spot in the area where the players park (also free on us). The million bucks also buy you a “private, meet-the-players event.” Thrilling.
The Cavs ownership in the last couple of years has paid $20 million to spruce up the arena, expecting, of course, some payoff via its super star LeBron James.
Another $4.2 million was spent to spruce up the front offices used by the staff and executives (photos show the revamp is quite stylish, in a basketball way). The original arena, a little more than 10 years old, had 50 furnished offices at a cost of $1.4 million. (See below my 1993 article with more details.)
Gilbert and the Cavs also are constructing a practice facility in Independence, diverting income tax revenue from Cleveland. It’s called Cleveland Clinic Courts. Isn’t that cute.
“This is a fun entertainment business, and as far as I’m concerned when people walk into the front offices, it shouldn’t be a law firm” Gilbert is quoted saying. (Guess they have never been in the (former) offices of Climaco, Leftkowitz, Peca, Wilcox & Garofoli, Gateway’s lawyers. The lobby overhead sky lighting gave one the feeling he or she might be lifted to heaven at any moment.)
Not only all this but you can walk in where the players enter the arena. My heart, slow your beating.
Meanwhile, over at the poor relatives of Cleveland sports, the Indians owners are creating a Heritage Park. Wouldn’t it be better if they won a pennant?
Owner Larry Dolan gives you an opportunity to be part of Indian history. “Secure your place in Indians History,” says a half-page ad in the Plain Dealer.
You can buy an 8 by 8 paver at the park with a logo for only $375. A plain one goes for $300 and for you cheap fans, a 4 by 8 paver goes for $150. What bargains.
If you are not platinum, hell, you have to be satisfied with a brick. No special food enticements included.
The following is a Sept. 4, 1993 article from Point of View that gives some historic background and information of the generosity of Cuyahoga County taxpayers to the multi-millionaire team owners, with some added remarks in italics.
What a comfortable little club we have making decisions for us here in Cleveland – the Cleveland Corporates and their attendants – an array of city and county politicians.
Gateway paid Tony Garofoli hundreds of thousands of dollars in part to “negotiate” a lease with both the Cleveland baseball and Cleveland basketball teams.
He must have twisted the hell out of the arms of Dick Jacobs and the Gund brothers. Arm sling sales are up.
In addition to getting all the goodies – stadium, arena, concessions, parking, free loges, no taxes, free garages and whatever – Gateway has lavished huge administration facilities with fancy furnishings for Cleveland’s two wealthiest welfare families.
The Gunds – Gordon and George – will have personal office suites in the $118- million, (final cost $154-million), 21,000 seat Arena and as tenants and operators of the new arena to open next year will have provided to them 50 other offices including offices for guest teams, in a space of some 30,000 square feet.
Dick Jacobs and his operation will have 57,500 square feet of brand new office space in a separate building on site, provide by Gateway, though the lease says specifically that Jacob, as lessee, will be housed “within the baseball facility, as designated in the final plans.”
The Jacobs building cost Gateway $7 million including an expected $900,000 in furnishings (more later).
Gateway executive director Tom Chema used the absurd excuse for the building as a means of blocking a poor view of a ramp at the complex for the construction of the $7-million building.
If you took what Jacobs asks tenants for space in his Society (now Key) Center, a few blocks from Gateway downtown, $38 a square foot, you’d understand what a gift the office space afforded Jacobs and the Gund really is.
For Jacobs, at 57,000 square feet at $38 a square foot annual rent would be $2,185,000. For its 25 year lease that would mean a $54-million gift.
For the supposedly charitable Gunds the gifts from Cuyahoga County taxpayers would be for 30,000 square feet at $38 a square foot, an annual gift of $1,140,000 and for the 30-year lease, $34,200,000.
For both, Gateway has allowed the taxpayers to subsidize the two-team owners some $88 million (on office space alone).
And you’ll remember that Mike White and Tim Hagan went to the state legislature to get property tax relief for the Gunds and Jacobs (and now the Dolans and Gilbert) so that the two wealthiest families in Cleveland will not even have to pay property taxes for the free office space.
Thanks, school kids of Cleveland. Thanks Mayor White and Commissioners Hagan, Mary Boyle and Jim Petro.
And the Gunds and Jacobs (Dolans & Gilbert in each case cited below also) will surely enjoy the space they’ve been given because Gateway will fill it with some of the best furnishings money – tax money – can buy.
Gateway will spend $1,443,800 to outfit the offices for the Gunds and their team with proper furnishings.
In addition to their personal office suites each, the Gunds will be provided with a boardroom for the corporation, six conference rooms, and an executive kitchen.
Nothing too good for the elite ruling families.
The main conference center will cost $20,000 addition and another $15,000 has been provided for miscellaneous owner equipment.
Specifications for the future to be provided by Debra Brys Interiors aren’t available yet but the specifications for the Jacobs’s administration building at Gateway indicate how lavish Gateway has been with the taxpayers’ money.
While the Gunds and the Jacobs (Dolans & Gilbert) get free loges and their free office suites, they will also be able to enjoy their favorite meals since Gateway has provided them each with executive dining rooms. (Gund spent $600,000 to make one free loge an apartment and paid for it only after it was revealed in Point of View).
How sweet it is. Being multi-millionaires and then being able to live like millionaire on Cleveland taxpayers. Oh, yes, how Sweeeet it is.
And this happened, let me remind you all, under the watchful eyes of some of our best progressive politicians – Mike “Mayor Businessman” White, Council President Jay “Citizen Action” Westbrook,’ Tim “I’m Just Here to Help the Poor” Hagan, and Mary “Hardnosed for the Taxpayer” Boyle.
Of course, we don’t need a campaign for the election of Mayor in Cleveland this year because everyone is quite satisfied. Mayor White has a free ride.
The Gunds were also given three free loges – one double loge. With loges running annually from $85,000 to $150,000 (see increase above) that would mean as much as $450,000 a year or over the length of the lease another gift of $13-million (for free loges) if prices don’t increase for 30 years (which we know they have and will).
Gateway will receive rent from the Gunds at a rate of 27.5 percent of the 92 suites and 48 percent of the club seats (this has been dropped in the new agreement with the teams paying only operating funds for Gateway) yet to be determined by number, but not until operating expenses, arena improvement and a reserve area covered. After an attendance of 1.85 million, a rent of 75 cents a ticket will be paid, and then $1 after 2.5 million (also eliminated under new agreement) attendance.
Gateway must provide 1,700 parking spaces, a commitment that has been insured by the city’s $40-million bond issue to construct two garages for Gateway. (The garages are losing money and the city pays the costs).
As a hint as to what the Gunds can expect in their arena one can look to the specifications requested by Jacobs for his free administration building.
It includes a custom-made 18-foot long, five-foot wide, boat shaped, ash veneer, conference table that would cost, according to a custom wood product maker, as much as $10,000. The Gunds would have six conference tables.
Jacobs ordered the conference table with inlaid strips of wood that would appear as baseball stitching and an inlaid metal logo of the team, the buffoonish Chief Wahoo.
Jacobs also ordered via Gateway, 13 Arpeggio Lounge chairs that list, according to a sales consultant, for $1,456 each but might, in this weak economy, actually sell for about half.
Another 400 or so chairs, partly upholstered, will be given to Jacobs.
In addition to business offices, the building will provide a Heavy Hitters Club Room, including an executive dining room for marketing season tickets to corporate prospects.
Also provided are 11 credenza cabinets, five cocktail tables, seven dining room tables, nine bar stools, 28 dining room tables, for sofas, and other tables and chairs, plus a lectern with another custom-made Chief Wahoo logo on the f ace.
I asked Chema if he had reported all these gifts to Jacobs to the Internal Revenue Service (IRS) but he thought that rather ridiculous and answered, “Absolutely not.”
The Gunds likely will have as generous equal treatment as Jacobs. It’s said that the Gund negotiator, Richard Watson, of Spieth, Bell, McCurdy & Newell, was the toughest of negotiators. (Watson should rate as one of the worst civic Clevelanders if Cleveland Magazine ever does that list).
Specifications are rather detailed and specific. Even the requirements known are rather specific, down to the contract agreement to, before presenting the offices to the Gunds, “clean light figures, polish metal surfaces, and faces of glass and mirrors.” One Gund suite will be painted with Honey White Sherwin-Williams semi-gloss and the other with a Sherman-Williams to be selected by the architect.” (Watson didn’t miss much).
Oh, by the way, “vacuum carpet and similar soft surface products.”
I mean, the Roman Emperors had nothing on the Cleveland Corporates.
Remember, the crowd will roar in ’94. (And in 2006-07).
The taxpayers and voters, they’ve been anesthetized. (Ditto for 2006-07).
From Cool Cleveland contributor Roldo Bartimole roldoATadelphia.net (:divend:)