Jax Finance Committee OKs amphitheater deal
Sam Mousa and Mike Weinstein talk to Jaguars Superlobbyist Paul Harden


A packed Jacksonville City Council Finance Committee meeting Monday included what Chairman Bill Gulliford described as a “dog and pony show” related to Jaguars stadium upgrades and an update on the Police and Fire Pension Fund imbroglio, among other issues.

If this were pro wrestling, it would be a supercard. Paul Harden, the Jacksonville Jaguars’ superlobbyist, was on hand, as well as Jags’ President Mark Lamping in both the agenda and regular meeting. As well, Chief Administrative Officer Sam Mousa and Chief Financial Officer Mike Weinstein were on hand from the Lenny Curry Administration.

The Committee approved the deal Monday afternoon, and three more Council committees will review it Tuesday, clearing the path to full Council approval next week.

— The amphitheater deal, in its current form, was supposed to be run through by Mousa “very quickly.” If so, the slow version would be a sight.

Mousa noted that the amendment to the original lease between the city and the Jacksonville Jaguars included a 30 year lease to run the indoor practice facility “flex field” and a 30 year lease with a Jaguars’ “subsidiary” to run the amphitheatre.

“The city of Jacksonville will fund $45 million toward the cost of the improvements,” said Mousa, describing the agreement as a “partnership” and “pretty equal.”

Mousa will be “involved” prominently in the implementation of said improvements.

If the cost is below $90 million, the city will share in the savings.

Three-thousand permanent seats will be removed from the stadium due to Club improvement.

“The next point I want to make is one lost in the discussion of the project,” said Mousa.

The city, he said, also has the “ability and authority” to make money off the facility via ticket and parking surcharges, and these new facilities will be “city assets.”

“The city has the authority to use the amphitheater just like the Jaguars do,” Mousa added.

Meanwhile, revenues will be folded into a capital improvement “dedicated enterprise fund” for the facility.

Mousa notes that ticket surcharges have not been adjusted since 1994; expect a new ordinance boosting surcharges for extant and new facilities next year. Currently, they are at a dollar per ticket for the arena and the T-U Performing Arts Center.

Mousa also suggests that in the early stages of the project, the surcharge fund may run a surplus, which could go into stadium improvements. He also notes that $7 million is “sitting in a fund” for capital improvements to current facilities.

Improvements are slated to begin after the TaxSlayer Bowl and will be wrapped in time for the NFL preseason.

Mousa notes that the deal was arrived at after weeks of painstaking negotiation with the Jaguars.

“We think it’s a good deal for the taxpayers,” with a “private entity building” facilities “for 50 cents on the dollar.”

Mousa took questions.

Crescimbeni wanted to know about naming rights; those “opportunities,” said Mousa, belong to the Jaguars, though Council gets to confer “blessing on the actual name for the naming rights.”

As well, after the renovations, 8,000 club seats are slated to remain from the original 11,000, though Mousa cautions that “hard design” has not happened yet.

The old club seats could be sold; the Jaguars would handle the disposal of those assets, and other “salvageable material,” said Mousa, which would go “toward the cost of the improvements.”

Mousa also promises that a “significant number of subcontractors” will get work from this job.

“A 90 million dollar project is bound to create a significant number of trade forces for the area,” Mousa added.

Meanwhile, Mousa stressed, “there are revenue generating opportunities for the city. We’re not just giving away $45 million and getting nothing for it.”

And the Jaguars, meanwhile, would be on the hook for any cost overrun past $90 million on construction.

Councilman Aaron Bowman wanted to know if Jacksonville could raise bed tax; Mike Weinstein noted that Jacksonville “can’t go up in our current structure.”

Bowman asked another inconvenient question, regarding whether a market analysis has been done.

Mousa assured him that the Jaguars did one, and it indicated that there would be economic benefit to the amphitheater.

As well, said Mousa, “amphitheater acts and arena acts are quite different,” and the covered field and amphitheater present new opportunities.

Bowman didn’t sound sold.

Danny Becton questioned the disposition of the $7 million Enterprise Fund, specifically regarding $3.4 million earmarked for the scoreboard improvements.

Mousa noted that the financing of scoreboards is still in “commercial paper” rather than “fixed debt.” Weinstein chimed in that “no part of the $7 million is obligated to anything but maintenance” and that the money is financed at around 1 percent, a practice that will be maintained “as long as the rates are so low.”

Becton and Weinstein debated about the merits of such financing.

“Eventually, the payment for the scoreboards will come out of this fund,” said Becton. “This payment eventually will come out of this fund,” the Councilman added.

Becton is much more bearish on the “commercial paper” strategy than the administration.

“We barely have the dollars to pay for both of these payments… at the rate current revenue is coming in,” he said.

Weinstein noted that money previously earmarked for the Convention Center would help with the financing; Becton, however, didn’t buy that math.

Weinstein then put the Times-Union article on this subject on blast, saying it was predicated on “worst-case scenarios” and a boost in bed tax revenue would offset obligations.

“The previous revenue that we were using this fund [for] is maintenance,” said Becton, who noted maintenance obligations on extant facilities, such as the T-U Center and Convention Center

“What happened to these projects that I thought we’d approved in this year’s budget?”

Mousa bristled, saying that the fund in question only applies to sports center facilities.

“I don’t want to confuse those two facilities with the three down at the Sports Complex,” the CAO said, noting that “we don’t see a desperate need for capital improvements” and that financing allows for the administration to manage capital improvements on an as-needed basis.

After some discussion, Finance Chair Bill Gulliford put Becton on hold, with his own questions.

“Wouldn’t it be interesting if we could give the media a number” generated by Bed Tax revenue since the Jaguars came to Jacksonville, “revenue that we would not have had if the Jaguars had not come here.”

It would be; that number is not available, sadly.

Then, Gulliford, in a tone much like an infomercial, broke down the costs to “make a pretty strong argument that all we’re paying for is the amphitheater” which would “draw more attraction to the community.”

Mousa: “that’s a very fair assumption” and he noted that the original conception of the deal between the city and the Jaguars was akin to a split.

As well, the amphitheater construction would end the litany of “noise complaints” from the extant Metropolitan Park amphitheater, Gulliford posited.

There are five guaranteed events for the amphitheater, said Mousa, with others than can be added with 60 days notice from the city provided the Jaguars haven’t locked the date.

Mike Weinstein reiterated that the deal is “truly designed to be a partnership,” with surcharges to the city even from Jaguars’ events.

Weinstein also noted that Bed Tax is up 4 to 5 percent the last couple of years, and that projected increase would facilitate friendly fixed-rate financing.

However, he added, “$45 million will have an impact.”

That said, “this is the best package we can provide for you if you want to do something like this.”

The question: does Council want to do it?

Lori Boyer had questions regarding the future financing of a new Convention Center; Weinstein noted that the “excess money that falls beyond the debt service” could go toward the Convention Center, which was a hot item this summer.

“Generally, the concern has been… a historical pattern over many years now of trying to provide additional revenue for the team to make this a financially viable enterprise,” said Boyer, noting that scoreboards and naming rights are examples, and “I’m concerned about where this ends” and “that we have nothing left.”

“What does the next year and the next year hold,” Boyer asked.

Weinstein noted that the budgets are a “priority system,” subject to change, and “if you want to do something this bold, this is the best way to do it” with the “least negative and the most positive.”

Becton spoke again, questioning that this indeed is a “partnership,” before going in on surcharges.

“You can double” those surcharges on various facilities “and it still won’t be very much,” and there will be a negative demand impact as “the price of entertainment goes up.”

Meanwhile, Becton said, surcharges for various facilities are all “part of the potpourri of budget” with General Fund outlay filling the gaps.

Becton then asked about the Metropolitan Park amphitheater, which Mousa responded is undergoing a “structural evaluation.” Gulliford noted that in 2009, a determination was made that it’s “problematic” as a facility and “needs to be replaced.”

Despite these compelling arguments, Becton contends there need to be “further negotiations,” given that the city commits half the cost but doesn’t get half the rights.

Mousa urged him to look at this as an opportunity for the city to generate revenues. If 25 events a year happened in the amphitheater, the ticket and parking surcharge could raise $800,000.

“We make money off the Jaguars’ events,” Mousa said. “Putting on events is a risky business. The city is not in a risk business,” Mousa said, citing guarantees and other risks assumed by event promoters.

Meanwhile, Mousa added, all ticket and parking surcharges go to the new facilities.

Weinstein, meanwhile, said that this was a use of “taxpayers’ dollars” to benefit a larger group of people, and that the city is about more than profit and loss.

Gulliford chimed in, saying that there could be salutary benefits to downtown development from an amphitheater, and that there may be regional benefit to the amphitheater.

Mousa: “these are quality of life elements needed for the downtown area. And the city is all about quality of life.”

A representative from SMG, the management company, noted that the success of events comes down to “what the market will support” and that the “energy from this collaboration” would boost the success of the enterprise.

Crescimbeni wanted to know how well the St. Augustine amphitheater is doing; an obsession of a few Council members who seem to think that facility is siphoning Jacksonville business.

SMG had no idea. SMG also posited, somehow that some “big names” might be playing a 5,000 seat facility such as the amphitheater, as if he (or, more likely, Council) had no clue about the margins of national touring acts, including guarantees and other nonnegotiable overhead.

Mark Lamping of the Jaguars spoke next, explaining “why” Shad Khan would want to invest $45 million into public owned facilities.

The purpose: to “stabilize” the franchise’s economics, quashing persistent relocation rumors.

“This project will go a long way toward maintaining the momentum of downtown Jacksonville,” and “these enhancements” would help attract other big events, including to EverBank Field.

Lamping noted that Athletic Directors for University of Florida and Georgia were enthusiastic about the proposal, as it relates to the Florida/Georgia game.

As well, this would be “very positive” to the future of the TaxSlayer Bowl.

“We’ve been working very hard to make sure that football weekends in Jacksonville are a big deal… what you will see is that Jaguars’ home weekends… will begin Saturday night with a big concert before each Jaguars’ home game,” Lamping promised, adding that there is still risk and the event business is “not for the faint of heart.”

Lamping noted that this facility holds about half of what the arena does, and that this “midsized amphitheater business” is a growth sector in the entertainment business.

“In addition to us filling a different niche,” Lamping said, this would provide “leverage” as the partners pursue 25 events in a given year, in a drive toward financial viability.

Lamping also promised a fund surplus, echoing Mousa’s comments, which would go toward maintenance of EverBank Field, which would prolong its useful life.

— Before that happened, Finance Chair Bill Gulliford provided an update on the PFPF issue, introducing Council Auditor Kirk Sherman, who discussed the mechanics of the subpoena of the PFPF, including the controversial commission recapture details, management fees and so on. Information was provided at what attorney Hank Coxe (representing Robert Klausner, the PFPF counsel) called a “unilateral request” of the Finance Committee to have information available at the Monday meeting.

Information received was incomplete, with some of it not going back to 1987, which nettled John Crescimbeni, who noted that the fund’s failure to retain documents, such as commission requests, market value yields and accounting system printouts, as well as independent auditor reports, may have violated records retention requirements. Finance Chair Bill Gulliford noted that the subpoena required the custodian of the documents to appear.

Long story short: the custodian of the documents will be invited to appear next January at the first Finance meeting of the new year. If uncooperative, there will be a subpoena. Finance Vice Chair Anna Brosche, an accountant, will review the documents for lapses and such that need to be remedied.

  • In accordance with the taxicab companies’ conflict with Uber/Lyft, a moratorium on medallion renewal was approved without dissent.

A.G. Gancarski

A.G. Gancarski has been a correspondent for FloridaPolitics.com since 2014. In 2018, he was a finalist for an Association of Alternative Newsweeklies "best political column." He can be reached at [email protected]


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