The Close-To-Dallas Stars

It's hard for me to sit here and read through the Dallas Stars' proposed plan for a new arena and not be angered by what they're doing. I will, in no way, be affected by the decisions that the Stars and the poltiicians in and around Dallas make, but it seems that their official colour of Victory Green should be renamed to Greedy Green based on their new arena idea. After all the bad press they took over Kenny Jacoby's USA Today article that exposed the Stars' efforts to create an arena monopoly around Dallas, threatening to leave Dallas while demanding another city to pay for their new arena seems to be the Dallas Stars' way of alienating fans and supporters.

In a move that defies logic at first glance, the Dallas Stars are aiming to move to Plano, Texas, a suburb of Dallas, where a new arena will be built in a a mixed-use district at a site called The Shops at Willow Bend. The Stars will leave American Airlines Center in 2031 for this new proposed arena despite American Airlines Center only being used for the last 25 years, and it seems like this move goes opposite to conventional thinking. After all, the Ottawa Senators are moving to downtown Ottawa after years of complaints about their location in Kanata, and the Arizona Coyotes struggled mightily in Glendale.

However, the move begins to make sense once you start mapping out the arenas they own and operate in Dallas, specifically in north Dallas. Sean Shapiro makes this clear in D Magazine, writing,

"The Stars own and operate eight StarCenters within North Texas; none of those rinks are in Dallas, and six of the eight are north of 635. If you draw a map connecting those northern StarCenters—Valley Ranch, Farmers Branch, Richardson, Frisco, McKinney, and Plano — the proposed arena project falls right in the middle."

The Stars are moving into the middle of their arena kingdom where, as Shapiro writes, "so much of its fanbase resided outside the city. According to multiple sources, the Stars' season-ticketholder base has already largely shifted to the northern suburbs. While there will be some churn leaving Dallas, the Stars are confident internally that they'll pick up more season-ticket holders from the move."

Business real estate thrives on the idea of "location, location, location", so the Stars' move to north Dallas would make some sense if they're moving closer to their season-ticket base. As stated in Shapiro's piece above, the Stars feel they can gain more season-ticket holders with this move even if they lose a few ticket holders from other parts of Dallas. Clearly, business has never been better, right?

On Tuesday, Stars owner Tom Gaglardi signed non-binding letter of intent for a proposed sports and entertainment district at The Shops at Willow Bend. The problem with this agreement is that it literally means nothing as it is non-binding. The Stars are obligated to do nothing to develop the area if they determine the site's location to be, in any way, unacceptable. Think "Phoenix" and "remediation".

Unlike Phoenix, however, the Dallas Stars are looking to avoid getting their hands dirty when it comes to shovels in the ground for a new arena. Field of Schemes writer Neil de Mause makes a great point about who will build this arena and who will be paying for it based on CBS News' reporting. S.E. Jenkins wrote in the linked article above,

"According to the letter of intent, the city is expected to contribute up to $700 million in funding toward the project from TIRZ revenue and other available funds. Development costs for the arena are expected to be around $1 billion."

de Mause points out that this is taxpayer money in another acronym.

"A TIRZ is Texas’ version of tax increment financing, where any rise in property taxes on a site is kicked back to pay off the bonds that built the project getting taxed, a kind of fiscal perpetual motion machine that it takes either advanced economics or the wisdom of Oscar Madison to see through as still being public money."

In short, Plano taxpayers will be forced to cover the bill for this new arena through another convoluted tax scheme proposed by politicians to pay for a billionaire's shiny, new toy. And in this agreement that the Stars are proposing, they're going to reap all of the benefits that come with owning the arena without paying a dime for the construction of this new money-making entertainment venture.

"It's going to be a business dream, honestly,” another NHL team president told Shapiro for his article in D Magazine. "You get to control the venue, you get to control the surrounding area, and you get to make money 365 days a year on that space. Between that and some of the corporate entities based in that area, the Stars could easily be a top-10 revenue team."

Yes, that's all correct. The Stars will own and operate the new arena, allowing them to sap every penny from parking, concessions, ticket sales, merchandise, private suites, and anything else in the arena for any and all events held there. The Stars will be able to develop the surrounding area with businesses - Shapiro points out that Tom Gaglardi is a hotelier by trade - which will enable them to collect fees and lease monies for any businesses that want to move into the sports and entertainment centre. And the Stars paid for none of it.

Again, I point back to Jacoby's USA Today article where the Stars have strong-armed their way into rinks across Texas where they raise ice-time costs, reduce total ice-time for teams, and hold a monopoly on ice time for "every level of amateur hockey in North Texas from preschoolers to adults". This money-printing venture is protected from all oversight thanks to the Stars stacking the regional USA Hockey governing body with their own people. They own everything.

Now you might be thinking, "The Stars had to sink some money into this idea," but this is where the problem began. Jacoby reports,

"The cities each put up around $10 million or more up front to build the rinks. Once built, they leased the rinks exclusively to the Stars, who agreed to repay the cities in rent payments over 20 to 30 years. In theory, the cities would eventually get their up-front costs back, while the Stars would keep the profits."

Strangley, this sounds almost identical to what the Stars are proposing in Plano, Texas: build us an arena and entertainment complex, we'll manage it, and we'll make sure you get your tax monies back in a couple of decades. Win-win for everyone, right?

With the city owning the arena, though, any repairs, maintenance, and upgrades will be their responsibility to fund, yet they're taking none of the revenue that comes from arena ownership - parking, concessions, and ticket sales - needed to maintain the arena. If the city can't come up with the required funds to maintain or upgrade the rink, the Stars can use the "not viable for an NHL team" excuse to move again. They'll keep the mamangement portion of their arena contract intact, but the team can now explore other arena options.

What's worse is that no one has even discussed any options for American Airlines Center which could sit vacant after both the Stars and the NBA's Dallas Mavericks have started walking the paths of each team building its own arena. Dallas could have a completely viable, 25 year-old arena sitting downtown that doesn't have a permanent tenant. In an era where more teams want to own the buildings they play in, the Stars seem to be the one team that wants to control everything in and around their arena without holding the mortgage.

The Dallas Stars might be perfecting the art of being the most transient team on the planet. They are exactly what Agent Smith, played by Hugo Weaving, described in The Matrix to Morpheus, played by Lawrence Fishburne when it came to the human species.


This seems to be the Dallas Stars' business plan: move to an area, bleed as much money out of that area as possible, and then relocate. Or as one former NHL team president texted to Sean Shapiro for his article, "Do you need to be in Dallas to be the Dallas Stars?"

If the vote by Plano goes through for the Stars, we'll soon find out.

Until next time, keep your sticks on the ice!