Marcus Smith says MLS bid to continue

The on again-off again Major League Soccer bid is a go. Speedway Motorsports executive Marcus Smith told CBJ on Monday afternoon his investment group was in the process of completing its application and would submit it to league headquarters by the end of the day.

Smith’s decision follows a long weekend of uncertainty set off by city government opting against a scheduled vote on Jan. 27 to spend $43.75 million of tourism tax revenue to help fund a 20,000-seat soccer stadium. A day earlier — last Thursday — county commissioners approved a proposal to invest $43.75 million of property tax money and provide a 16-acre site assessed at $13 million at no charge to Smith.

Bids are due Jan. 31. MLS plans to select two expansion cities later this year and both new teams will start playing in 2020. Entry fees are $150 million per team.

Smith told CBJ on Monday that MLS granted an extension allowing for additional time for City Council to consider taking a longer look at a possible stadium investment.

“We’re going to go ahead and finish the application and submit that (today) and we’ll follow up with the city,” he said. “And we’ll follow up with the city and answer any questions they might have.”

Last week, Mayor Jennifer Roberts and several members of City Council cited a rushed process, a lack of details on additional costs such as sidewalks and infrastructure near the stadium and higher-ranking community priorities as the basis for their decision to cancel the MLS vote.

On Monday, the lone vocal proponent of the previous MLS pitch on council, James Mitchell, told CBJ he needs to be convinced a second look is warranted.

“I would be very skeptical,” Mitchell, a Democrat, said. “If I didn’t feel at least half of council was open to it (I wouldn’t push for a vote). But if it’s the way it is now, I think my time could be spent working on other things.”

He added, “Hey, I can count (votes).”

Mitchell said beyond timing and concerns over how a stadium would be accepted by the adjacent Elizabeth neighborhood, council colleagues balked over spending $43.75 million and expressed distaste for Marcus Smith’s father, 89-year-old Speedway Motorsports founder and chairman Bruton Smith. The elder Smith spent seven years fighting with Cabarrus County over terms of unpaid incentives and whether county government owed him $80 million.

The case ended in December 2014 when the state Supreme Court opted against hearing an appeal challenging a lower court’s decision dismissing the speedway’s claim.

Marcus Smith is leading the MLS bid, but opponents of the stadium-funding plan have pointed to Bruton Smith’s past feuds with local government and his inclusion on billionaires lists as ample cause for not spending taxpayer money on a soccer stadium.

“One thing I can’t change is the ownership group,” Mitchell told me Monday. “Bruton could be a non-starter (for some on council). I didn’t realize (their animosity towards him).”

Two more expansion clubs will be added at an undetermined future date and at an undetermined cost. Smith and his investors have pledged to pay the entry fee and half of the $175 million stadium construction cost.

MLS deferred all questions about the Charlotte bid to Smith. Charlotte is among 11 cities, including just-added Phoenix, the league invited to submit applications for a team.

There are 22 MLS teams now, including 2017 expansion clubs Atlanta and Minnesota. A second Los Angeles team and Miami are expected to join in 2018. That puts Charlotte in competition for either the 25th or 26th franchise. League executives said last month they will cap the team count at 28.

MLS “really wanted us to stay in the game and they didn’t want the deadline to be the reason Charlotte wasn’t in contention,” Smith said.

There isn’t a set deadline for a city decision on the stadium, he added.

Last week, several days before the mayor and council canceled the MLS vote, Ron Kimble, the recently retired deputy city manager who is working part-time for the city on economic development projects, outlined terms negotiated by city and county government with Smith.

After his presentation, Roberts, citing a shortage of time, declined to allow council members to debate the proposal. Instead, she encouraged council to email questions to Kimble and Marcus Jones, the new city manager. By Thursday, opposition on council and public sentiment combined to kill a planned public hearing and vote scheduled for Friday.

Marcus Smith, during his CBJ interview Monday, mentioned what he believes is a crucial distinction for city government: The ability to tap dedicated tourism tax money limited to projects such as stadiums, arenas, cultural venues and the convention center.

That money “is earmarked to go toward things that benefit travel and tourism,” he said. “You have this money that can’t go to teacher pay or building schools. It’s really about supporting travel and tourism — that’s why (the industry) supported the taxes from the beginning.”

Dena Diorio, Mecklenburg County manager, told me earlier Monday that there is little left for the county to do other than wait and see whether Smith’s bid goes through and the city reconsiders its stance on stadium funding.

Smith also addressed complaints by the owner of the Charlotte Independence, a minor league soccer team that, until Marcus Smith began his MLS talks, had negotiated with the city and county for a smaller $25 million stadium project that would have renovated 81-year-old Memorial Stadium. Eventually, the stadium could have been expanded to 23,000 to 25,000 seats for an MLS club in six to eight years, Independence managing partner Jim McPhilliamy said.

Last week, McPhilliamy warned that a failed MLS bid by Smith could leave Charlotte without any pro soccer. He also said $230,000 worth of architectural renderings paid for by the Independence were used as part of a lead-in to Smith formulating a bid.

“I’ll tell you this: I never saw any renderings from the Independence,” Smith said Monday. “We would never pass off someone else’s work as our own and I don’t think the MLS would want to be in business with somebody who would. I understand frustration and it’s an unfortunate thing.”

City government has spent hundreds of millions of dollars on sports projects over the past 15 years. Commitments include $265 million for the NBA arena opened in 2005; $200 million for the NASCAR Hall of Fame opened in 2010; $87.5 million for renovations at the privately owned NFL stadium; $34 million for improvements at the NBA arena and $8 million (matched by the county) toward a $54 million minor league ballpark opened in 2014.

Author: Erik Spanberg, Charlotte Business Journal