An Easter Sermon on Being Disingenuous
By Jock O’Connell
Like any good former altar boy schooled (but not scarred) by the Jesuits, I’m spending part of Easter Sunday doing my homework for the PMSA newsletter. So a sermon seemed to flow naturally.
I see that the would-be proprietors of a glimmering new major league baseball stadium on Oakland’s waterfront have lately turned to billing themselves chiefly as saviors of the East Bay city’s housing crisis rather than as a famously low-budget sports entertainment franchise. Appearing on “CBS This Morning: Saturday” over the past weekend, Oakland A’s president Dave Kaval prominently touted the 6,000 new housing units his organization would be building in Oakland in conjunction with the new ballpark. Many of these, he promised, would be “affordable.” In the Bay Area, that term normally translates as anything but affordable. Last year, the average rent in Oakland topped $2,600 a month.
“Well, what it means for Oakland is jobs, economic development, over $3 billion in economic stimulus from this project alone, 5,000 new jobs, a huge investment,” Mr. Kaval insisted to the CBS program’s co-host, Michelle Miller.
Being somewhat skeptical by nature (and made even more so by experience), I’m not as willing as certain East Bay politicians to take Mr. Kaval at his word. Not that I think he’s lying, mind you. It’s just that, in sales as in lobbying, being a shade liberal with the numbers goes with the turf.
For example, how many of those “new” jobs will be construction jobs that will go away after the architects’ plans are brought to fruition? (Or just how many of those ballpark construction jobs would do little more than divert labor from other local construction projects?) Right now, the legions of parking lot attendants, ticket-takers, ushers, security personnel, and food vendors aren’t employees of the Oakland A’s but rather work for contractors like AEG (Anschutz Entertainment Group), Landmark Event Staffing Services, and Spectra, the coliseum’s food service provider. Since few of the jobs at sports arenas are full-time positions paying much more than minimum wage, it’s worth pondering how workers holding those “new” jobs Mr. Kaval is promising would be able to move into one of those “affordable” homes he’s promising to build.
One thing we know, there will likely be fewer jobs for parking lot attendants since there are no plans for a parking lot at the proposed Howard Terminal stadium. The A’s have been a fun team to watch over the years, especially in the David vs. Goliath ‘Money Ball’ era. Last year, despite having baseball’s third-lowest payroll, they won 97 games and went to the American League Wild Card game, only to lose to a club – the name of which Red Sox fans mention only with an expletive attached -- whose players were paid about $100 million more than the A’s shelled out to theirs. While that level of success is remarkable, what must worry team management is that the A’s drew an average crowd last year of only 19,427 at the Oakland/Alameda County Coliseum. That was the fourth-lowest attendance in major league baseball. Worse still is that the team’s average rating on NBC Sports California was just 0.56, 15% below the previous season and the lowest in baseball. Forbes magazine reports the A’s revenue in 2018 was $218 million or rather than less than half the $462 million the San Francisco Giants took in.
It’s easy to appreciate that the A’s would like a brand-new home. But building one in what’s clearly such an access-challenged location as Howard Terminal seems ill-advised for a team that struggles to draw a crowd to a facility with freeway access, acres of parking, and BART and Amtrak stops. What’s a fan to do once the A’s are playing on the wrong side of the eternally-congested Nimitz, a full mile from the nearest BART station? Mr. Kaval is going to need a bigger gondola.
On the other hand…In my commentary in last month’s PMSA newsletter (which the American Journal of Commerce kindly reprinted), I took issue with the scheme to build the A’s new ballpark at the Port of Oakland’s Howard Terminal. One point I neglected to mention then is that those elected officials and community activists who seem so cavalier about the threat a new ballpark and upscale housing project would pose to the Port should ponder how vital the Port would be if the Bay Area found itself struggling to recover from a devastating earthquake. Instead, I extrapolated from 2011 figures cited in the Port’s then-latest economic impact analysis to demonstrate the Port’s importance to the economy of not just Oakland but of the entire Northern California mega-region. Well, last week, the Port released its updated economic impact study by Martin Associates, the Lancaster, PA firm that all but monopolizes the business of seaport economic impact analyses.
According to the new report, maritime operations at the Port of Oakland directly support 11,393 jobs. That includes the over 1800 dock workers represented by the ILWU, the truckers serving the Port’s marine terminals, the rail crews, yardmen and dispatchers moving the containers by rail to and from marine terminals, the terminal operators, steamship agents, freight forwarders, chandlers, warehouse operators, container repair and leasing companies, pilots, tug operators, etc.
It’s safe to say that pretty much all of these jobs pay more than the A’s subcontractors reward the legions of ticket-takers, ushers, and hot dog vendors roaming the stands during the relatively few hours each year the A’s are at home. Yet the port’s well-compensated jobs would be jeopardized should fluid maritime operations be compromised by the arrival of a wholly incompatible new neighbor.
In addition to the jobs supported, the Martin Associates study puts the overall economic value of the maritime cargo and vessel activity at the Port at $60.3 billion. Of that amount, businesses providing direct services to the marine terminals received $2.2 billion of direct business revenue.
Were the seaport operations forced to shut down, that $2.2 billion of direct business revenue would be lost from the Bay Area economy. Broken down, $641 million of direct wages and salaries (excluding benefits) were paid to the direct job holders, for an average salary of $56,275; $546 million of local purchases were made, supporting the 5,831 indirect job holders, with an annual personal income of $333 million; and $281 million were paid in state and local taxes.
For those fans keeping score at home, please note that the maritime operations at the Port of Oakland yielded more in state and local taxes ($281 million) than the Oakland’s A’s total revenues last year ($218 million).
The commentary, views, and opinions expressed by Jock O’Connell are his own and do not reflect the views or positions of the Pacific Merchant Shipping Association. PMSA does not endorse, support, or make any representations regarding the content provided by any third party commentator.