The fact that the Atlanta Braves got a ton of cash from taxpayers to build their new ballpark is largely forgotten in the wake of the team’s World Series victory.
It’s now expected that sports teams will soak the public in the form of colossal subsidies when building ever more grandiose stadiums.
Socialism thrives when it comes to supporting the local team.
But there was an understanding when the Braves got $300 million-plus from Cobb County to construct its park: It was that the team, on its own nickel, would build all the affiliated restaurants, apartments and office towers ― AKA The Battery.
Mike Plant, the team’s development chief, promised this back in 2015 when he said, “We do not ask, nor do we intend to ask, for any incentives for the mixed-use part.”
Well, that was then.
Last week, the Bravos were up at the plate again looking for a second helping of taxpayer love. The team and their friends at Truist, the mega-bank with a silly name, approached the Cobb Development Authority with the latest scheme: a 10-year property tax break to help build a $200 million, 250,000-square-foot office tower overlooking Truist Park. The new building would house 1,000 employees, most of whom probably would be coming from its Buckhead location.
One of the development authority board members, a spoilsport named Karen Hallacy, reminded Plant of his promise. She then asked, “How does that fit into this coming in and the Braves basically asking for tax abatements on the property?”
Credit: Alyssa Pointer
Credit: Alyssa Pointer
Now, Plant is no dummy. He’s part of the crew that convinced Cobb officials that writing a $300 million-plus check was a good idea.
“We’re not asking for (the tax breaks),” Plant responded. “Truist is.”
Actually, the Braves own the land and Truist would be renting offices built there. Plant said that offices these days must be “amenitized” or workers will just stay home in their pajamas.
So, even if by some legal contortion that Truist is actually the one asking for the tax abatements, the arrangement is to allow the Braves to luxuriate the building and make it more affordable to the bankers while the Braves earn a nice buck on the rent.
Bruce McCall, an attorney representing both Truist and the Braves Development Company, told authority members a request for tax abatement would be coming. The amount for such a tax break is still unknown. An office tower nearby, built by TK Elevator, got about $15 million worth in 2018.
McCall said Truist is “committed to this area,” but he hinted it might depend on the authority’s largesse.
“Truist Financial Corporation is a business,” he said. “They need to look at what they can do, where they can go, and they need to look at total costs. And this helps.”
It’s a Truism of business: if you get a healthy tax cut or if someone else pays (i.e., the rest of Cobb’s taxpayers), then you make more money.
Development Authority Chair Clark Hungerford chimed in with his own verbal gymnastics to explain why the Braves weren’t reneging on their promise. He insisted the new tower would not technically be inside The Battery.
“The commitment, if I’m not mistaken was for The Battery,” he ventured. “And this piece of property that we’re talking about, even though it’s close, it’s not the same piece of property.”
It was courageous stab at revisionism. Just this month, the Braves and Truist issued a press release announcing that the bank’s securities’ sector was moving to a building “inside The Battery Atlanta.”
The release repeatedly noted the new HQ would be “in” The Battery. Plant himself was quoted saying, “We are thrilled to welcome our partner Truist to The Battery Atlanta.”
He didn’t say “near” or “around the corner from” The Battery.
It reminds me of when Bill Clinton tried to wriggle out of the Lewinsky affair, saying, “It depends on what the meaning of the word ‘is’ is.”
I understand that businesses need all they can get to survive. The Braves and Truist are, no doubt, hanging on by a thread. So, I checked to see how dire it is.
Last year’s championship run brought in $568 million in revenue to the Braves, according to team owner Liberty Media. That’s up 19% from the previous high of $476 million in pre-pandemic 2019.
Braves Holdings’ 2021 operating profit before depreciation and amortization was $111 million, Liberty Media said.
Now, you can almost hear the Braves’ suits shouting, “Hey, we had an operating profit of only $31 million after depreciation and amortization!”
Credit: HYOSUB SHIN / AJC
Credit: HYOSUB SHIN / AJC
But while the accountants were busy depreciating and amortizing, the Braves organization was soaring in value, up $225 million last year to $2.1 billion, according to Forbes’ annual preseason analysis.
That’s not bad for an org that was worth about $450 million in 2007 when Liberty Media acquired the team in a byzantine tax saving transaction.
Also, Forbes’ estimate of the team’s value may be understated because its analysis didn’t include the Braves’ real estate investments, like The Battery.
How is Truist doing? you might ask.
Well, it reported $6 billion in net income for 2021. And in January, Truist CEO Bill Rogers said the costs of merging BB&T and SunTrust into the mega-bank with a silly name will be ebbing this year, doubtlessly allowing the company to greater profits.
So, please consider all that, Cobb Development Authority members, when the Truist and Braves return with hats in hand looking for a handout.
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