Lance Lopes says Oak View Group is seeking $70 million in federal tax credits should KeyArena be declared a national historical landmark, as expected. But Lopes added the money isn’t a “subsidy” — only funds given any company preserving historical buildings.
Just how historical of a landmark KeyArena winds up being could prove lucrative for one of two companies seeking to renovate it for NBA and NHL use.
Director of projects Lance Lopes says Oak View Group is seeking $70 million in federal tax credits should KeyArena be declared a national historical landmark, as expected. But Lopes added the money isn’t a “subsidy” — only funds given any company preserving historical buildings.
“In no way is that a public subsidy,” Lopes said. “We’re just asking for credits that anybody spending this type of money on a historical building would be entitled to.”
At least one sports economist agrees. Victor Matheson of the College of the Holy Cross said Friday: “I would not consider that a subsidy for the arena. Because I think that’s a subsidy that you would grant to anything you designate as an historical thing.
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“In which case, it’s not the fact that it’s an arena that gets (the federal tax credits), it’s the fact that it’s historical that gets it.’’
But Brad Humphreys, a sports economist from West Virginia University, disagrees.
“Absolutely, it’s a public subsidy,” Humphreys said. “It’s tax dollars. Forgone federal taxes collected is an implicit subsidy. The only difference between this sort of subsidy and something from the state or county is whose pocket is this coming out of? It’s coming out of the pockets of everybody in the country.”
Matheson questions if KeyArena should be considered a “historical” venue.
“I think it’s probably a crock that it should be a historical monument,” he said. “I mean, for God’s sake, this isn’t Soldier Field, or Ebbets Field or something. It’s KeyArena. I mean, come on.’’
The arena is under consideration for historical landmark status because it is one of the buildings constructed for the 1962 Seattle World’s Fair.
A group headed by entrepreneur Chris Hansen that is pitching a rival arena project in the Sodo District issued a release Thursday stating the KeyArena renovation groups would seek more than $200 million in subsidies apiece.
In a comparison between its project and KeyArena proposals by Oak View Group (OVG) and Seattle Partners (SP), the Hansen group alleged historical-landmark benefits are part of OVG’s subsidies. It did not state an amount.
The Hansen group also says its arena project would cost more than $600 million and that it is putting $200 million to $300 million of private equity into that. No mention was made regarding who pays the balance, though Hansen’s group said it could secure a bank loan for the balance.