Off the Kuff Rotating Header Image

J. Kent Friedman

The Sports Authority at 20

Sep 24th, 2017
by Charles Kuffner.
Comments are off for this post

A few stadia, a little mission creep. Where has the time gone?

As the Harris County Houston Sports Authority celebrated its 20th anniversary Monday night with a reception for current and former directors and board members, it moves into its third decade as a considerably different agency than the one that came into being in 1997.

While the city-county agency continues collecting and distributing the hotel-motel and rental car taxes that funded the billion-dollar construction cost of Minute Maid Park, NRG Stadium and Toyota Center, its more visible function these days is as a sports marketing arm that hopes to bring another NCAA Final Four, an MLB All-Star Game, the Pan American Games and other events to the city.

J. Kent Friedman, the board’s current chairman for more than a decade, jokes while that his predecessors – former Texas Secretary of State Jack Rains and Houston developer Billy Burge – presided over an eventful construction boom from the late 1990s into the early 2000s, his role is considerably less glamorous.

“We’re like the folks with the broom walking behind the elephant,” Friedman said.

It’s a pithy quip for a time frame that involves less flying dirt but still confronts Friedman and executive director Janis Burke with significant decisions and negotiations as the authority hopes to squeeze more years out of three buildings that are, in terms of their initial lease agreements, middle-aged.

Basically, at this point the mission of this committee that was originally formed to get NRG Stadium (née Reliant Sstadium), Toyota Center, and Minute Maid (née Enron) Park built encompasses three things: Handling the bond finances for said stadia, negotiating lease extensions for the occupants of same, and trying to bring big sporting events to Houston. They’ve done a pretty good job with the latter, and I suppose if they didn’t exist some other organization would have to be formed to do that work. I hope they do at least as good a job with item #2, because I don’t want to think about what might happen in the event one of those venues is deemed uninhabitable by its tenant. So good luck with that.

(The story mentions in passing the litigation with HCHSA’s bond insurer, saying they are “three years removed” from it. The last story I saw was that an appeals court had reinstated the lawsuit, which had been previously dismissed. Doesn’t sound like a resolution to me, but I’m too lazy to google around and see if there are further updates.)

Lee’s campaign finances

Jan 7th, 2016
by Charles Kuffner.
4 comments

Among other things, Commissioner El Franco Lee leaves behind a lot of money in his campaign finance account.

El Franco Lee

When Harris County Commissioner El Franco Lee died unexpectedly Sunday, he left friends and allies in mourning, political hopefuls jockeying for his job and an uncommonly large campaign war chest of nearly $4 million.

What happens to that sum – which far outstrips the campaign cash held by all of his fellow commissioners combined – remains an open question.

All elected officials are required to disburse their political reserves after leaving office, but campaign finance experts said the present situation is unusual given the extent of Lee’s holdings, which his campaign treasurer now is tasked with distributing.

“This much money I’ve not seen before,” Austin campaign finance lawyer Buck Wood said.

Andrew Wheat, research director for the watchdog group Texans for Public Justice, agreed.

“I can’t remember this question coming up,” Wheat said. “That’s an extraordinary amount of money for a county commissioner to be sitting on.”

[…]

State law dictates that Lee’s longtime friend and campaign treasurer, J. Kent Friedman, now must disseminate those leftover political funds to one or more of the following entities within the next six years: the Democratic Party, a candidate or political committee, a charity, a scholarship program at an institution of higher education, or the state treasury. He also may return money to Lee’s donors.

Friedman said he has not considered what to do with the late commissioner’s campaign account.

“I hadn’t even thought about it until you asked the question,” he said. “I haven’t given it three seconds’ worth of thought.”

I do have some thoughts on this, but in the spirit of decorum, I’ll demur for now. I do hope that when the time comes for decisions to be made that they are made with transparency. We should know what ultimately happens with these funds.

And now we have a lawsuit over HERO repeal ballot language

Aug 8th, 2015
by Charles Kuffner.
19 comments

Oh, for crying out loud.

RedEquality

Last month the Texas Supreme Court suspended the Houston Equal Rights Ordinance, more commonly known as HERO, and ordered City Council to either repeal the non-discrimination measure or put it up for a public vote.

On Wednesday council voted 12-5 for the latter, and in November Houston voters will be asked this question at the polls:

“Shall the City of Houston repeal the Houston Equal Rights Ordinance, Ord. No. 2014-530 which prohibits discrimination in city employment and city services, city contracts, public accommodations, private employment, and housing based on an individual’s sex, race, color, ethnicity, national origin, age, familial status, marital status, military status, religion, disability, sexual orientation, genetic information gender identity or pregnancy?”

That question, according to the coalition of pastors and conservative activists that have been fighting HERO tooth-and-nail since it went before council last spring (even though religious groups are exempt from having to follow the law), is deliberately confusing and not the same as a public vote on HERO. On Friday, Andy Taylor, one of the attorneys who first sued the city over HERO alongside Steve “Men Who Lose Their Testicles Can’t Read Maps” Hotze (who later dropped out of the suit), filed yet another legal challenge against the city in hopes of changing the wording of the ballot measure.

In a motion filed with the state supreme court Friday, Taylor points to the city charter language related to ballot referendums: “…such ordinance or resolution shall not take effect unless a majority of the qualified voters voting thereon at such election shall vote in favor thereof.”

That’s the legal basis for Taylor’s petition to change the ballot language – that voters should vote “yes” or “no” on HERO, not “yes” or “no” on whether to keep it.

[…]

Ultimately, it appears the anti-HERO coalition fears the ballot language could harm their chances of success at the polls. “This is a legal recipe for an electoral disaster,” Taylor writes. “Voters will be confused, because someone who is against the proposition cannot vote against, and vice-versa.”

It’s unclear why Taylor and his coalition still feel they haven’t won the HERO-ballot battle and keep heading to the courts. The public now has the opportunity to cast a vote on other people’s rights, which is what Taylor and other opponents have wanted all along. Is the current ballot language (do you or do you not think HERO should stand?) really so confusing as to spoil the anti-LGBT contingent’s chances at the polls?

Mayor Parker’s statement is here. I’m convinced that the only language that would be acceptable to Taylor and his band of idiots is “Do you or do you not want to protect your children from a bunch of filthy perverts?” But hey, maybe they’ll get the Supreme Court to save their sorry asses again.

In the meantime, while we wait for that foolishness to be adjudicated, there’s this:

Boosters of big sporting events in Houston are nervous about the fight over the equal rights ordinance.

Opponents of the ordinance have succeeded in putting the issue on the November ballot. Now, some HERO supporters are calling upon the NFL to move the 2017 Super Bowl out of Houston if the ordinance is repealed. The online petition was launched by a blogger and it has dozens of signatures.

“Well, I think if Houston is ever perceived as an intolerant, bigoted place, it will greatly diminish our opportunities to bring sporting events to town,” admitted Sports Authority Chairman J. Kent Friedman.

Houston’s Super Bowl Committee had no comment.

The NFL reportedly considered moving a Super Bowl out of Arizona over legislation that would’ve offered legal protections to businesses that discriminated against gays. That never happened, because the governor vetoed the bill.

HERO opponents say it’ll never happen here either.

“That’s simply a red herring. That’s simply what they tried to do in Indiana and Arkansas and the Religious Freedom Restoration Act,” said ordinance opponent Jared Woodfill. “It basically shows that they are going to do anything and everything they can to skew the issue.”

“I think it’s a real threat,” said KHOU 11 Political Analyst Bob Stein. “Now, how it plays with the voters is very interesting. It could conceivably become one in which voters have a backlash against it, see it as a — how can I say this? — a threat.”

Via PDiddie, the blogger in question. The petition is here, and it surely can’t hurt to sign it. How likely it is that the NFL might actually move a Super Bowl that would be 14 months out at the time of the vote if it goes badly I couldn’t say, but it would certainly make it a lot harder, if not downright impossible, for Houston to win bids on other big events, and I would predict with absolute certainty that some events that are currently on the calendar would be canceled, just as they were in Indiana after they passed that ill-advised “religious freedom” law. There’s a good reason why the Greater Houston Partnership supports HERO – this is the norm in the business world, and it’s a base condition for companies that want to recruit top talent. Anyone who thinks repealing HERO would not have negative repercussions is not living in the real world. You can like HERO or not, you can like the way Mayor Parker got it passed or not, and you can be like Dave Wilson and obsess all you want about the genitalia of every person who enters a women’s bathroom if you want, but the prevailing reaction to the loss of HERO will not be good for Houston. Texas Leftist has more.

Appeals court revives MBIA lawsuit against Sports Authority

Apr 28th, 2014
by Charles Kuffner.
Comments are off for this post

Here we go again.

A lawsuit against the agency that pays the debt on Houston’s sports stadiums is back on following an appeals court ruling.

Last April, a state district court judge ruled that a bond insurer could not sue the Harris County-Houston Sports Authority or the Harris County Sports & Convention Corp., saying they were immune from such legal action as government agencies.

MBIA Insurance Corp., with the National Public Finance Guarantee Corp., sued the Sports Authority in January 2013, asking that the cash-strapped agency be forced to collect more money to cover its obligations, including additional parking and admissions taxes at Reliant – now NRG – Stadium, and seeking damages for other alleged breaches of contract. The sports corporation, the county agency that manages NRG Park, also was listed as a party in the suit.

In an opinion issued last week, a three-judge panel from the First Court of Appeals ruled that the Sports Authority had waived its immunity when it entered into an agreement with MBIA – now National – that provided that the company, which insures $1 billion in bonds, would guarantee regularly scheduled principal and interest payments on them.

Upholding part of state District Court Judge Elaine Palmer’s decision, it also ruled that the sports corporation was not liable because the company had not accused it of breach of contract.

Sports Authority Chairman J. Kent Friedman said it has not yet decided whether to ask the First Court for a re-hearing, to appeal to the Texas Supreme Court or to “go ahead and try the case.” Deadlines to request a re-hearing or appeal are next month.

“I continue to be very confident in our position in the litigation,” he said. “All it really did is allow them the right to proceed with their lawsuit.”

See here, here, and here for the background. The Court’s opinion is here, and if like me your eyes glazed over after about five seconds, you can skip to the end and confirm that the bottom line is that the Harris County-Houston Sports Authority does not have immunity and thus can be sued, but the Harris County Sports & Convention Corporation does have immunity as Judge Palmer ruled and thus cannot be sued. The matter is now back in the 215th Court, pending a decision by either party to appeal the part of the ruling they didn’t like. Also, I’m glad to see that we seem to be done with that “Kenny Friedman” business, and J. Kent Friedman is once again being called “J. Kent Friedman” as well he should be. So there you have it.

Someone attempted to do something about MBIA and the Sports Authority

May 24th, 2013
by Charles Kuffner.
1 comment

And others expressed their disapproval about it. What the “it” is, and who it was that was trying to do “it” remain unclear.

Who dunnit?

Who dunnit?

A surprise legislative maneuver has local government lobbyists scrambling to defend the agency that pays the debt on Houston’s sports stadiums against an alleged takeover attempt by the company that insures its bonds.

The insurer, MBIA, has hired lobbyists to circulate language that would prevent the Harris County-Houston Sports Authority from spending money on anything other than debt service and legally required payments without its creditors’ approval.

Sports Authority chairman J. Kent Friedman said the draft, which names neither the Sports Authority nor MBIA, appears innocuous at first glance.

“It’s extremely well done. You have to be an insider to know what this really does,” he said. “In effect, they would take over running the Sports Authority. I’m convinced they’ll try to stick it on some other piece of legislation at the end of the session, on the floor so it’ll get as little notoriety as possible, and try to slip it through.”

A Houston-area lawmaker had considered attaching the language to a pending financial transparency bill, Friedman and others said, but quickly dropped it when a lawyer whose feedback he had sought realized its implications. The legislator could not be reached Friday.

[…]

Harris County lobbyist Cathy Sisk called the legislative maneuver “bizarre,” saying the insurer appears to be trying to get lawmakers to do what a judge did not.

“We’ve pretty much alerted everybody in the delegation to watch for it,” Sisk said. “I’d like to think that means it doesn’t have much of a chance of being attached to anything, but you never know. Anything can happen in the Texas Legislature.”

City of Houston lobbyist Kippy Caraway said her team also is on alert.

Kevin Brown, a spokesman for MBIA affiliate National Public Finance Guarantee Corp., said what the firm seeks in its lawsuit against the Sports Authority and the goals of the draft amendment are different.

“The legislation that we have been promoting seeks to achieve greater transparency and accountability from certain governmental entities that are in financial distress,” he said. “The Sports Authority’s opposition to that legislation should raise serious questions for Houstonians and other stakeholders about the authority’s financial condition and the reasons for its objections.”

The draft amendment runs two pages and would apply to a “political subdivision in condition of financial stress,” as defined by five points that describe the Sports Authority.

The amendment says such an entity “may not, unless authorized by (its) creditors” spend money on anything other than debt service, payments required by law or a contract, or to maintain its assets. The draft also would, among other things, require the entity to submit to its creditors a plan stating how it will address its financial woes.

See here, here, and here for the background on MBIA and the Sports Authority. Frankly, the most important piece of information in this article is that the Chair of the Sports Authority is now being referred to as “J. Kent Friedman” again, after a brief run of being called “Kenny Friedman”. Whether this represents a return to copy-editing standards on the part of the Chron or the documenting of a brief midlife crisis on Friedman’s part also remains a mystery.

Things that the story left a mystery:

1. The identity of the legislator. Why wouldn’t you just say who the legislator was? So what if he couldn’t be reached for a comment by the time the story went to print? The fact that this amendment was drafted and this legislator was shopping it around before pulling it back isn’t in dispute, so no one’s reputation is on the line. What purpose is being served by holding back this information?

2. The full text of the amendment. Reporter Mike Morris has clearly seen it, since he quotes from it, but it runs two pages and all we get is a couple of sentence fragments. The amendment was apparently not filed, since I can’t find it via an amendment search using the phrase “political subdivision in condition of financial stress” or a combination of the words. But clearly it exists, so a document could be made of it and uploaded somewhere for the rest of us to see.

3. The bill that the unnamed legislator was going to try to attach it to. At this point in the session, it could only be attached to a Senate bill, and if adopted it would thus require a conference committee to get the different versions straightened out for final votes. If we knew the Senate bill in question, we could then ask the Senate author what he or she thinks of this maneuver. Given all of the sturm und drang we’ve seen recently, that might have made for a more interesting story than the one we got.

As it happens, from prior communication I’ve had with MBIA representatives, I was able to get answers to these questions. The bill in question was SB14, specifically the committee substitute CSSB14, authored by Sen. Tommy Williams. The House legislator was Rep. Jim Pitts, who was the House sponsor for the bill. I don’t know how you can call Rep. Pitts, who is based in Waxahachie, a “Houston-area lawmaker”, but I suppose that’s a minor quibble at this point Rep. Jim Murphy. The amendment, which was drafted but not officially filed, is here. Again, I’m not sure why this information wasn’t in the story. Be that as it may, MBIA disputed Friedman’s contention that this was an attempt to “take over” the agency, saying that the main purpose of the legislation was to enhance transparency and accountability. At last report, a point of order had been sustained against CSSB14 in the House, so this is all likely moot at this point. But we still should have known more about what was happening at the time.

UPDATE: I have since been informed by Judge Emmett’s office that the legislator was Rep. Jim Murphy, not Rep. Jim Pitts. I suspect this was a matter of confusing one Jim for another.

Sports Authority gets sued

Feb 2nd, 2013
by Charles Kuffner.
1 comment

MBIA, the company that insures the Harris County-Houston Sports Authority’s bonds, has filed a lawsuit to force the Sports Authority to collect more money to pay its obligations.

If MBIA must cover payment shortfalls and cannot reimburse itself from the authority’s reserves, the amount owed to the insurer will accumulate with interest. In such a scenario, MBIA officials have said, hotel and car rental taxes would be tied up for years paying off MBIA when those dollars could have been put toward local projects had the bonds been paid off on time.

Authority Chairman Kenny Friedman said MBIA’s urgency is driven by a desire to skirt its obligation to pay the bonds, an accusation the insurer denies. The authority bought bond insurance for a reason, Friedman said, and added that neither the stadium homes of the Texans, Rockets and Astros – which the authority was created to finance – nor the land under them are at risk.

“It’s a frivolous lawsuit. I think it’s designed to get them some perceived PR advantage,” the agency’s chairman said. “We’re the third-largest county in the country and we’re not going to be bullied by a second-rate insurance company. What MBIA is looking for is a bailout, and it’s just not something we’re going to do.”

It was MBIA’s 2009 downgrade that strained the authority’s reserves in the first place, Friedman said.

After MBIA’s downgrade, $125 million in variable-rate bonds the authority sold to help build Reliant Stadium were converted into a loan due in 2014 rather than the original 2030. The authority since has struggled to make much larger payments under this “term-out,” and MBIA has had to cover shortfalls seven times, including last November, reimbursing itself each time from the authority’s reserves. Three term-out payments remain.

Again with the “Kenny Friedman” stuff. Did I miss a memo or something? Is there a new style guide out that says the name “J. Kent Friedman” is, like, so 2012? First this and then David Ward – where will it end?

Ahem. See here for the background. I don’t know who’s right and who’s wrong, but I do know that if MBIA prevails, the price of tickets and parking at Reliant will go up, because the current tax levied on tickets and parking, which is where the revenue to pay off these obligations comes from, are lower than the law allows them to be. You Texans and Rodeo season ticket holders might want to keep an eye on this.

The Sports Authority’s finances are back in the news

Jan 14th, 2013
by Charles Kuffner.
2 comments

I still have no idea whether this is something we need to worry about or not.

The firm that insures the Harris County-Houston Sports Authority’s $1 billion in bonds – sold to finance the homes of the Texans, Rockets and Astros – is calling on the cash-strapped authority to bolster its depleted reserves and warning of potential consequences if it does not.

MBIA Insurance Corp. Assistant Vice President Kenneth Epstein said this week the authority’s reserves are half what they should be and that the bulk of the agency’s debt, issued in 2001, has fallen short of revenue projections every year but one since then.

“We’ve been a willing participant over the last four years in trying to come up with a solution to the authority’s problems. The authority has not come back with any solution to what’s been happening,” Epstein said. “We want the authority to recognize that a problem exists, to bring people to the table, and to try to come up with a solution.”

The depleted reserve should be $55 million but is $25.4 million, Epstein said, putting the authority “in a very precarious position” and limiting its ability to handle dips in hotel and car rental taxes, its main revenues.

Sports Authority Chairman Kenny Friedman said the group is looking for a deal that could let it replenish its reserves and lower its payments in the long term, but said his board does not share MBIA’s urgency. The deal is structured to protect the city’s and county’s credit ratings and the stadiums, he noted.

“They are focused on what they should be focused on, which is protecting MBIA’s insurance obligations, and we’re focused on what we should be focused on, which is what’s right for this community and for these venues,” Friedman said. “We’re not going to do a deal just because it’s good for MBIA. It’s going to have to be good for the community. If we find one of those, we’ll do it.”

Friedman called MBIA’s concerns “strange” given that the insurer’s 2009 downgrade amid the financial crisis contributed to the strain on the reserves.

Important question: Are “Kenny Friedman” and J. Kent Friedman the same person? Because if they are, it’s the first time I’ve ever heard the name “Kenny Friedman”.

Be that as it may, see here, here, and here for some background. Not being a finance guy, I struggle to understand this stuff every time it comes up. County Judge Ed Emmett is quoted in the story telling MBIA to calm down, which reassures me somewhat but doesn’t really clarify things. I don’t know what else to add to this, so just consider this latest chapter in the saga noted for the record.

Sports Authority will not impede Astros move to AL

Nov 25th, 2011
by Charles Kuffner.
2 comments

One of the odd side stories that came out after MLB officially approved the sale of the Astros to Jim Crane was this contention by attorney Kevin W. Yankowsky of Fulbright & Jaworski that the Astros’ lease at Minute Maid Park required them to be in the National League. At the time, Sports Authority Chair J. Kent Friedman said it was an “interesting analysis” and that he’d have their legal beagles look it over. It didn’t take them long to kick it out.

On Tuesday, McLane and Crane completed the transfer of the Astros.

[…]

Crane said he will attend the winter meetings. One thing he won’t have to deal with is any challenge from the Harris County Houston Sports Authority over the Astros’ move to the AL. A partner from Fulbright & Jaworski L.L.P. last week said a move to the AL would violate the terms of the lease at Minute Maid, but the HCHSA said in a release that its legal team has a differing opinion. Withholding consent for the Astros playing as an AL team, the HCHSA determined, would be “unreasonable.”

Here’s the Sports Authority’s full response:

The Lease provides in Section 5.1(a) that the Astros have the right to use the Stadium for “the operation of a Major League Baseball franchise.” There is no reference in this Section to league affiliation. Further, as defined in the Lease, the term “Major League Baseball” expressly includes the National League, the American League and all Member Teams. In addition, Section 5.1(a) of the Lease expressly uses the uncapitalized word “franchise” instead of the capitalized, defined term “Franchise.” Only the capitalized, defined term “Franchise” is limited to a National League franchise. The uncapitalized term “franchise” is not so limited. Finally, the reference to “Baseball Home Games” (basically defined as Astros baseball games as a member of the National League) in Section 5.1(a) of the Lease is not a limiting phrase. Rather, it is used as an example of a use incidental to the use of the Stadium for the “operation of a Major League Baseball franchise,” not as an exclusive use. This interpretation is confirmed by the use of the phrase “including, but not limited to,” which precedes the phrase “Baseball Home Games.”

Accordingly, the Astros are permitted under the Lease to operate a Major League Baseball franchise in either the National League or the American League and to play their games in the Stadium attendant to such operation. Therefore, the Sports Authority is not in a position to prevent Major League Baseball from potentially moving the Astros to the American League.

The Astros transfer to the American League does require a minor change to the Non-Relocation Agreement to confirm that the Astros cannot play any home games outside the Stadium in violation of the Non-Relocation Agreement. The Astros have agreed to this minor change.

Even though the Astros cannot assign their interest in the Lease or mortgage their leasehold estate in most instances without the consent of the Sports Authority, the Sports Authority may not unreasonably withhold its consent. The Sports Authority’s withholding of its consent based solely on a potential Astros move to the American League could be considered unreasonable and therefore a violation of the Sports Authority’s covenant not to act in an unreasonable manner in this regard.

I don’t know, I have a hard time believing this will be the end of it. I just have a feeling that there’s a lawsuit out there to force the issue. I certainly could be wrong, I have nothing more than my gut to go on, but this is what I think. What do you think?

MLB approves Astros sale

Nov 19th, 2011
by Charles Kuffner.
3 comments

It’s official.

Jim Crane’s $610 million purchase of the Astros from Drayton McLane was unanimously approved by Major League Baseball’s owners this morning.

All that remains is a formal closing of the transaction, which likely will take place early next week. At that point, McLane’s 19-year ownership of the club will end.

As we know, this not only means that the Astros will be changing leagues, but that the MLB playoff format will change as well.

Two wild card teams will be added to Major League Baseball’s playoffs no later than 2013, the same year the Houston Astros will begin play in the American League.

Commissioner Bud Selig announced Thursday that baseball’s owners unanimously approved Jim Crane as the Houston Astros’ owner. As part of his agreement to buy the club, Crane will shift the Astros to the AL after 2012, creating two 15-team leagues.

“It’s a historical day,” said Selig, whose new format ensures that an interleague game will be contested “from opening day on.”

Selig did not offer specifics on the schedule or playoff format, but said his committee for on-field matters favors the one-game playoff among wild-card teams in each league, saying it would be “dramatic.” The additional wild cards could be added for the 2012 season, but will be in place by 2013 for sure.

I’m not a hidebound traditionalist by any means, but count me among those who thought the current system, which as noted before produced two of the most compelling playoff races we’ve seen in a long time, was working just fine and didn’t need any further tweaking. But never let it be said that MLB and Beelzebub Selig are letting moss grow on them.

A potentially troublesome, or at least potentially hilarious, side item here has to do with the Astros’ lease at Minute Maid Park.

An Astros move to the American League could violate the team’s lease agreement with the Harris County Houston Sports Authority, according to a local attorney.

Kevin W. Yankowsky, a partner at Fulbright & Jaworski L.L.P., outlined his findings from a review of the lease in a Tuesday letter to J. Kent Friedman, the Sports Authority’s chairman of the board.

Yankowsky, an Astros fan since the 1970s, will make a presentation at the Dec. 1 Sports Authority Board of Directors meeting urging a strict enforcement of the Astros’ lease to play their home games at Minute Maid Park. The wording of the lease agreement, Yankowsky said, spells out that the Astros cannot play at Minute Maid as anything but a National League team without receiving prior consent from the Sports Authority.

[…]

“My position would be: (The Sports Authority) simply ought to refuse to renegotiate their lease,” Yankowsky said. “All they have to do is stand on their rights and let Major League Baseball know that come 2013 they intend to stand on their right. Then it’s up to baseball.

“Baseball can either sue the Sports Authority or give in. The Sports Authority doesn’t have to sue anybody. They can sit back and say, ‘We’ve got a valid lease, and this is what it says, and we’re going to enforce it.’ ”

Citing provisions from a 2000 agreement that expires at the end of 2029, Yankowsky said the terms spell out that the home team — the Astros — be a National League franchise.

[…]

“In the simplest form, what this means, in my judgment, is come opening day of 2013, the Sports Authority can refuse to let them play because it’s not a permitted use of the stadium,” Yankowsky said. “They can quite simply lock the doors and say, ‘No, it’s not a permitted use.’ The play of Major League Baseball games, by definition, are limited to games in which a National League team is the home team.”

Friedman called it “an interesting analysis” and said he has asked the Sports Authority attorneys to review the matter.

“We’ll take a hard look at it,” Friedman said. “If there is a legitimate legal position to be taken by the Sports Authority that benefits the community, we ought to take it. If it’s a stretch or if it’s something that ultimately doesn’t benefit the community, then that’s not what we should be doing. But that’s easy to say. How to sort through all that remains to be seen.”

While I applaud the outside-the-box thinking here, I have a hard time seeing this as anything more than a minor annoyance for MLB and the ‘Stros. Let’s be honest, this is the sort of problem (if it really is one) that is solved by whacking it with a checkbook until it dies. There’s a negotiated settlement in someone’s future, if it comes to that. I hope I’m misunderestimating Attorney Yankowsky’s interpretive skills, because I love me some misdirected chaos, but I’m not holding out much hope. Greg has more.

More Sports Authority woes

Apr 24th, 2011
by Charles Kuffner.
1 comment

The Harris County-Houston Sports Authority is dealing with more financial issues that may require it to dip way into its cash reserves.

Lawyers for the authority and MBIA now are disputing whether Swiss bank UBS gave proper notice of its intent to terminate the interest-rate swap agreement that would require the $27 million payment. The deal was intended to control interest-rate spikes on the $125 million in variable-rate bonds the authority issued to help build Reliant Stadium. The authority’s other $875 million in debt is on a fixed rate.

The authority’s main reserve account today holds about $51 million, Executive Director Janis Schmees said; the payment to UBS would come from that account.

Schmees said neither the payment nor a default by the authority would affect the average citizen or sports fan. The authority, a quasi-governmental entity whose unpaid board members are appointed by the city and county, was created to finance the stadiums, in part, so the city and county’s credit ratings would not be at risk in the event of financial trouble.

[…]

Barton Smith, professor of economics emeritus at the University of Houston, said the situation presents, at worst, an “indirect risk” that would have an “almost not detectable” effect on taxpayers.

“If they default, who’s it going to hurt? Well, it’s going to hurt the bondholders if they’re stupid enough to let them default,” he said. “The risk to us Houstonians … is that they couldn’t continue to carry out their functions without some type of Harris County bailout.”

A potential default would have no spillover effects on other governments, Smith said, because the factors that would lead the city or county to default have nothing to do with the authority’s situation.

In case you’re wondering what the HCHSA’s functions are these days, their Chair J. Kent Friedman was kind enough to tell us all about them in this op-ed from a few months ago. Frankly, other than being the Dynamo’s landlord I don’t think there’s much that would need to be replaced. As long as they can’t do any damage to the city or the county in the event they do go down, I’m not terribly worried.

The Sports Authority wants you to know it’s working hard for you

Dec 14th, 2010
by Charles Kuffner.
1 comment

I feel like the Chron should send a bill for its standard advertising rates to the Harris County-Houston Sports Authority for running this op-ed by its chair, J. Kent Friedman. It’s one part victory lap for negotiating the Dynamo Stadium lease and one part “Hey! Look at all this stuff we’re doing!” rah-rah. I like the Dynamo Stadium deal as much as the next guy, but the basic outline for it was in place long before the HCHSA got involved at El Franco Lee’s insistence earlier this year. As for the rest, nice work and all, but next time just send out a press release, OK?

On a side note, since the recent Port Commission kerfuffle, I thought it might be useful to examine the membership of the boards and commissions I happen to blog about. The Sports Authority board is thirteen members, six each chosen by Houston and Harris County, plus one – Chair Friedman – chosen jointly. Of the six board members selected by Harris County, five are white and one is African-American. Of the six chosen by the city of Houston, two are white, two are Hispanic, one is African-American, and one is Asian. Of the five non-white members on the board of 13, four were city of Houston appointments. Oh, and both of the women on the board – one white, one Hispanic – were City of Houston appointees. Just thought you’d like to know.

Here comes the Sports Authority

Mar 5th, 2010
by Charles Kuffner.
Comments are off for this post

Ready or not, here they are to ride to the rescue.

The Harris County-Houston Sports Authority agreed Monday to talk to city and county officials about its possible involvement in a soccer stadium for the Houston Dynamo.

The authority will establish a task force to determine its response to an invitation from the city and county to take “a limited administrative role” in a stadium for the Dynamo. Board Chairman J. Kent Friedman said the task force will be charged with finding out what that its role would be and recommending to the board whether to accept it. It will not involve any tax money from the authority. There is no deadline for the task force to finish.

I still don’t think the Sports Authority is really needed, but if it’s the only way to get El Franco Lee to take action, then I guess that’s how it is. We’ll see if it actually leads to something.

Sports Authority to the rescue?

Feb 28th, 2010
by Charles Kuffner.
2 comments

After many months in limbo, there may finally be a way forward for Dynamo Stadium, though it’s a somewhat convoluted path.

The Harris County-Houston Sports Authority board is scheduled on Monday to discuss becoming the landlord for a professional soccer stadium in Houston’s East End.

[…]

[Harris County Commissioner El Franco] Lee repeatedly has said that putting the soccer stadium on the Commissioner Court agenda is not his responsibility. Most of the proposed stadium site is in Lee’s Precinct 1, and the five-member Court consistently adheres to a protocol that puts each commissioner in charge of public works projects on his or her turf.

On Friday, just more than a week after [Mayor Annise] Parker and Lee met, a joint Houston-Harris County statement announced, “Both the City and County have asked the Harris County-Houston Sports Authority to take a limited administrative role in construction of a stadium.”

Harris County Community Services Department Director David Turkel, who has been the county’s lead negotiator on a stadium deal with the city, acknowledged it was Lee who asked that the Sports Authority get involved.

Should the Sports Authority’s board decide Monday to become a player in the deal, it would bring to the table an agency whose board is chaired by Lee’s campaign treasurer, J. Kent Friedman.

Sheesh. Swamplot quotes from a Houston Business Journal article that adds more:

Lee has steadfastly refused to comment on the issue, and did not respond to interview requests. Speaking in Lee’s place during several recent interviews, Turkel has become more guarded, citing the delicate situation and his desire to avoid hampering a possible agreement. In a nutshell, though, Lee wants concessions from the city and the team that he has not yet received.

“Lee is not comfortable putting it on the agenda as is, because it will get voted down,” Turkel says.

For one, the county is looking at who will own the stadium after the lease runs out in about 30 years, and how that would affect a deal in which the city would buy out the county’s share. Precinct 2 Commissioner Sylvia Garcia wants Dynamo family ticket packs priced comparably to movie tickets, which has been more or less agreed upon.

That quote from Turkel just doesn’t square with the way Commissioners Court runs its business. Wanting to get the Sports Authority involved, that makes more sense. It may be a logical move and a good fit to do this, but I think Judge Emmett is right to be concerned that it won’t make the politics of this deal any more popular. It’s also not clear what exactly the Sports Authority would be doing if it gets involved or why their involvement is needed. If they were an obvious piece of the puzzle, you’d think they’d have been mentioned before now. But if the bottleneck is El Franco Lee, and El Franco Lee says he wants the Sports Authority involved to get this moving, well, you do the math. We’ll see what comes out of Monday’s meeting.