ARLENE VIOLET - Numbers just don’t add up

ARLENE VIOLET - Numbers just don’t add up

Are you as fed up as I am with the steady diet of fabrications coming out of the Statehouse? Bloviating has become second nature. Here are just a couple of examples.

The PawSox Stadium – The owners (and, sadly, some reporters) and legislators at the hearings keep telling the public that the PawSox owners are putting in $45 million into the deal. Wrong! The billionaires are only putting in $1 million each. The remaining $33 million that they claim is their contribution is debt, not equity. Revenue from attendance and so-called “naming rights,” which were supposed to be their lease payments, instead are supposed to pay off this third issuance of bonds. In total, taxpayers are at risk of having to pay $71 million of bonds plus interest and costs.

If there was a prayer that AAA baseball would be so popular that it would grow as opposed to losing attendees at present, that naming rights would bring in revenue year after year for 30 years, then the owners would be giving personal guarantees. They aren’t putting their personal money at risk – only yours. Any legislator who votes for this deal without at least demanding personal guarantees from owners should be run out of town.

It is also a fig leaf argument to state that the overall AAA league association would come to the rescue. Putting aside the fact that they have many legal ways to escape responsibility, nothing says that the association will still be in existence since its fortune is predicated on all AAA teams being successful and participatory. A dozen sports teams that were major league have gone bust, including the Los Angeles Dodgers.

Nobody in the state is qualified to vet this transaction, including the legislators, the governor or the people at the Commerce Corporation. As you will see below, the Commerce Corporation and Gov. Gina Raimondo overstated job growth with the $40 million subsidized Wexford project.

Wexford – Grinning from ear to ear, our state politicians and the head of the Commerce Corporation shoveled more than dirt at the groundbreaking ceremony in Providence on Sept. 25. A GoLocalProv investigation found that the job creation numbers for permanent jobs that led to the $40 million in tax breaks for the project were inflated by the Raimondo administration. The governor had repeatedly stated that 1,000 new jobs would be permanently created in Rhode Island. After fact-checking her and the Commerce Corp. claims, they say the actual new jobs are less than 10 percent of projections. Counting tricks – like saying 100 new jobs will be created by Brown University’s tenancy – will actually create only 15 jobs since 85 current employees will just move to the site.

If something as simple as job creation numbers are off by 90 percent, how much more difficult is it to vet the PawSox transaction when the financial analysis would be trying for the most sophisticated CPA firm?

No lender on earth would loan money to this PawSox project. Yet, your leaders are poised to commit you to subsidizing $71 million and counting. While moaning about whether to continue your car tax break next year, or where the money is going to come from for the $2 billion projected to fix crumbling schools, they lack the guts to ask for personal guarantees. They’re scared of billionaires, not you.

Violet is an attorney and former state attorney general.

Comments

You are wrong. It is why you were one and done & beaten badly by James O'Neil.
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