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Jul-03-2010 19:53
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Matthew Knight Arena?
Ersun Warnke Salem-News.com Business/Economy ReporterOregon basketball fans pay more than double the old price for tickets at the new arena, and concessions and other costs will likely rise at a similar level.
 Fairness isn't exactly an attribute in this story, but it could be. |
(EUGENE, Ore.) - At Phil Knight University, as some people are fond of calling the University of Oregon, you can hardly walk a block on campus without finding a building named after a member of the Knight family.
Perhaps we will soon have murals being put up that depict Phil Knight communing with gods and angels, as the Medici were fond of in ancient Florence.
This extreme form of aristocratic privilege is justified by the claim of aristocratic patronage. It is heralded in the press that Phil Knight deserves these honors because of his great generosity to the University and the people of Oregon.
For the sake of accuracy, let us examine those claims in some detail.
Matthew Knight Arena is being paid for by a $200 million dollar debt issue, taken out by the State of Oregon. This is $200 million dollars being borrowed in the name of the tax payer, to be paid back at interest, resulting in a total bill that will probably be around $400 million.
This massive bill is to be paid for with a massive increase in ticket prices.
Ultimately, the parents of University students will foot most of the bill, and the increase in ticket prices will serve to make attending your student’s games an even greater financial hardship.
On the other hand, the whole purpose of building the most expensive arena in college basketball is to build a team that can compete aggressively on the national level, and get the national TV coverage that will make this arena very profitable for Phil Knight and his Nike empire.
Building a nationally competitive basketball team means cherry picking students from around the country, so chances are that Oregon parents won’t have to worry about having to pay higher prices to see their children on the court. Their children won’t be on the court.
So, what does Phil Knight pay for all of this free advertising? Just how generous is he?
He pays nothing. That’s right. Nothing.
He has “pledged” $100 million dollars as collateral on the State’s loans, which will only be paid if increased revenues fail to cover the debt payments.
Here is the deal:
The State of Oregon borrows $200 million to build an arena.
The University of Oregon, using more taxpayer money, pays for recruiting, coaching, tutoring, and pampering all of the top notch basketball players they bring in from around the country.
The City of Eugene pays for the surrounding infrastructure necessary to support the arena.
Oregon basketball fans pay more than double the old price for tickets at the new arena, and concessions and other costs will likely rise at a similar level.
The arena gets named after Phil Knight’s son.
Nike gets millions upon millions of dollars in free advertising in perpetuity.
Phil Knight pays nothing.
The “investors” who buy the State bonds issued for the project get $200 million in tax free income.
Wow, that really is a good deal!
Every time I review one of these boondoggles I become ever more convinced that I should learn to deal Three Card Monte and setup a table on the Capital steps. I could make a fortune. As long as the passing legislators were allowed to gamble on the credit of the taxpayers that is.
What I would suggest tor Phil Knight is that if he would like to show some generosity to the people of Oregon, and put his family’s name on grandiose buildings, perhaps he should consider building some factories in our State.
If you are selling pairs of shoes for hundreds of dollars surely you can afford to pay your employees fair wages. Surely the economic impact on the State of shifting a significant portion of Nike’s production to local factories would far exceed that of a basketball stadium.
Meanwhile, I would suggest that Matthew Knight Arena be renamed Oregon Veterans Arena.
Since $400 million dollars of taxpayer money has already been committed to this project, surely a bit more could be dedicated to erecting a memorial outside the stadium to the Oregonians who have served, been wounded, and passed away in the last decade of foreign wars.
Surely these thousands of veterans deserve more honor than a single man.
If the taxpayers of this State are to pay $400 million dollars to build a grand arena for staging sporting events, then it should be the taxpayers who decide who this arena should be named in honor of.
When thousands of people come to this arena to watch games, and millions more see it on television, a memorial to our veterans would serve as powerful reminder of the sacrifices that have been made in the name of our State, Country, and way of life, to make it possible to build grand buildings and stage great spectacles of sport.
In fact, the choice of a name for this arena reflects very clearly on culture and values of the people of this State.
Do the people of this State reserve their greatest honors for aristocrats who suck on the public teat and aim only to aggrandize themselves and increase their personal profits through every sham display of generosity that they stage?
Or do the people of this State reserve their greatest honors for those who toil in anonymity, working with dedication and making great personal sacrifices for the greater good, even while others increase their wealth and status at their expense?
The choices made, and there reflection on our culture and values, will be on display for the entire nation to see every time the Oregon basketball team takes the court at our new arena.
The taxpayers of Oregon are the ones paying for this arena, and they are paying dearly. It is their arena, and it is for them to decide what name should be given to it.
Naming the arena to honor Oregon Veterans is one possibility that makes sense. If you simply wanted to name the arena after the people who paid for it, Oregon Taxpayers’ Arena would be fitting as well.
Salem-News.com Business/Economy Reporter Ersun Warncke is a native Oregonian. He has a degree in Economics from Portland State University and studied Law at University of Oregon. At a young age, his career spans a wide variety of fields, from fast food, to union labor, to computer programming. He has published works concerning economics, business, government, and media on blogs for several years. He currently works as an independent software designer specializing in web based applications, open source software, and peer-to-peer (P2P) applications.
Ersun describes his writing as being "in the language of the boardroom from the perspective of the shop floor." He adds that "he has no education in journalism other than reading Hunter S. Thompson." But along with life comes the real experience that indeed creates quality writers. Right now, every detail that can help the general public get ahead in life financially, is of paramount importance.
You can write to Ersun at: warncke@comcast.net
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Paul January 14, 2011 1:53 pm (Pacific time)
"This is $200 million dollars being borrowed in the name of the tax payer, to be paid back at interest, resulting in a total bill that will probably be around $400 million." What your saying is the Univesity will borrow $200 millionf rom tax payers, then pay it back with interest totalling $400 million right? So the state would make $200 million on this deal acting as lender to the UofO. This is what you have a problem with?
Dick Corliss January 13, 2011 8:31 pm (Pacific time)
I guess there too many people today that don't realize who Phil really is. How he got here. No-one gave it to him. His track coach was his mentor, partner & friend that was a dedicated individual to after many years became NIKE. Read some history. Talk to some with grey hair. It would and has filled books. REad some of them. Ask Kenny Moore.
Jeffrey Stockton November 7, 2010 1:54 pm (Pacific time)
Phil Knight has been extremely generous to the university. Even if he didn't put any money down for this project, he's the one who made it happen. Competitive athletics is good for UO as a whole, good for Eugene, and good for Oregon. The success of the football team has energized alumni who in turn donate, many times to the University, and not directly to athletics, and raises the overall profile of the university as a whole. You should be ashamed of yourself for presenting such a biased one sided view of what Phil Knight has done.
Editor: Did you even read the article? You worship who you want but don't lecture my writers for being bluntly honest about a company that among other things, funds the Israeli occupation and genocide in Palestine.
Oregon Reader July 30, 2010 9:56 am (Pacific time)
I think a better angle for this story is in the following, which is from a Willamette Week editorial: http://wweek.com/editorial/3629/14083/ COURT AWARENESS: (Counter-clockwise) a design of the Matthew Knight arena (image courtesy uoregon.edu), an aerial view of the Ducks’ new hoops home (image courtesy mactomatt.net), and the home being built for Phil Knight’s aide, Howard Slusher (image courtesy Darryl James). Democratic and Republican legislators shredded the University of Oregon this week like the Ducks’ men’s basketball opponents did on the court last season. It’s rare to see a powerful institution so badly battered in a routine interim legislative hearing like the one on Monday before the Senate Business and Transportation Committee. The topic was the school’s $227 million basketball arena project, $200 million of which came from a 2008 state bond issuance. But the real issue going forward is far larger than the arena, now that new school President Richard Lariviere is asking the Legislature to support an $800 million operations bond (see “Hotseat: Richard Lariviere,” WW, May 19, 2010). “The university does not inspire confidence,” says committee chairman Sen. Rick Metsger (D-Welches). “What you get from this project is either they don’t know what they’re doing or they don’t want the public to know. Neither is good.” Committee members reacted angrily to a case made by John Williams, a researcher for Plumbers and Steamfitters Local 290. Drawing on university documents he began collecting last July, Williams sketched out the evolution of the arena project. The 12,500-seat arena to replace 84-year-old McArthur Court began in 2003 as a private project to be funded by Nike founder Phil Knight and orchestrated by his right-hand man, Howard Slusher. Records Williams presented to the committee show that three firms expressed interest in building the arena. Two were the Turner and Hunt construction companies. Both are experienced arena builders, and each said it could build the arena for $125 million with a management fee of 2.25 percent. Hoffman Construction said it would build the arena for $150 million and charge 3.25 percent. Despite the higher charges, the Slusher team began working with Hoffman, a Portland firm that has completed major construction at Oregon Health & Science University, Portland International Airport, the Portland Art Museum, South Waterfront and Nike’s campus. But between 2003 and 2007, the arena deal morphed from a privately financed project to one the Legislature agreed to fund. Normally, such large public projects require competitive bidding to ensure the best deal for taxpayers. But in 2008, the Oregon University System voted to exempt the arena project from that requirement because Hoffman had been working on the deal since 2003, finding there was “no reasonably available alternative.” So the state sold bonds. And construction began last year. Frances Dyke, a UO finance vice president, says Hoffman has required competitive bidding for its largest subcontracts. But Williams illustrated instances in which subcontractors pledged mysterious “in-kind” donations to the project to win bids, only to subsequently submit change orders to recoup the cost of these donations. A larger question that emerged from the micro details is whether the university is equipped to handle large publicly financed projects in a transparent fashion. “I’m having a hard time understanding why a public entity would be satisfied by not using the lowest bidder,” says Sen. Bruce Starr (R-Hillsboro). Starr compared Williams’ description of university officials stonewalling on public records requests with what he called the relative openness of the Oregon Department of Transportation on its capital projects. Dyke told the panel that Lariviere is revamping UO’s approach to public records. She added the arena project is “on time and on budget” to open for the 2010-2011 season. Dyke presented few answers to the specific criticisms that Williams raised, however. She pledged that the university looks forward to cooperating with a planned secretary of state audit of the arena. “We are aware of concerns expressed by the construction industry,” Dyke told lawmakers. “We take these concerns seriously and are fully supportive of the audit.” Williams and trade union representatives at the hearing seemed skeptical of Dyke’s pledge of transparency. A tangible source of their skepticism is a nearly 12,000-square-foot home on the shores of Lake Oswego that Hoffman is building for Slusher, who led the selection of Hoffman to build the arena. Hoffman is one of Oregon’s largest and most successful contractors. But the firm rarely builds single-family homes. “It’s not something we’re well known for,” says Bart Eberwein, a Hoffman spokesman. Eberwein says in an average year the firm might build three or four single-family homes for high-end customers. Eberwein acknowledges that Slusher oversaw the arena project early on but says that role ended in 2004. Several years later, he says, Hoffman agreed to build a home for Slusher in Lake Oswego. Eberwein says there is no link between Slusher’s role in the arena project and the Lake Oswego home. “There’s absolutely no connection,” Eberwein says. “It’s a clean deal.” (Slusher declined to comment.) “I have no evidence [of a quid pro quo], but the appearance is just awful,” says Williams of Hoffman building Slusher’s house. “If Hoffman won the arena job in a competitive situation by being the low bidder there’d be no cloud. But this contract was awarded by a single individual [Slusher] and rubber-stamped by the university.”
Hank Ruark July 5, 2010 8:35 pm (Pacific time)
O/Rdr:
You should recognize rapidly that to be a commentator one must first,foremost,fancy-free and famously become deep-view professional reporter...
That's in simple demanded self-defense from those who neither recognize nor can apparently appreciate what is required to do useful work at the latter level.
You questioned E's words:
"Nike gets millions upon millions of dollars in free advertising in perpetuity.
Phil Knight pays nothing."
Yet content-and-surround make completely clear he is referring to continuing value of Nike-view --quite literally by millions--in all the public exposure and impacts given the name and inescapably also the product by the very facts he states so clearly.
For your other points we are sure to see explication as he sees demanded for further full detail, obviously impossible to supply in less than full book-length coverage, surely not applicable nor possible with reasonable space here.
Your participation valued, but give the writer a clear shot when questions arise, and even encourage efforts here... you pays your nickel for first read, and if you seek more do so in appreciative tone, given effort, time, space, attention and cost-to-you.
Of course you can always do your own report seeking the same professional levels we work towards, too... !! Then we can seek question-response from you, in turn.
Fair enough ?
Oregon Reader July 5, 2010 5:10 pm (Pacific time)
Ersun, Should you decide if you are going to be a news reporter or a commentator? 1. Could you please share from where you calculate the assertion that "Nike gets millions upon millions of dollars in free advertising in perpetuity."? 2. Could you please further define what you mean when you write, "The “investors” who buy the State bonds issued for the project get $200 million in tax free income."? Are you saying that the interest that is paid is tax-free to them? Is the income tax-free for all classes of investors? From what agency are the bonds sold, or through which program? 3. When you talk about fair wages, are you comparing American workers' wages to those in far-away countries with the differing costs of living? Or are you saying that Nike's employees in Oregon are not being fairly compensated? Could you please expound? 4. You indicated that $400 million dollars of taxpayer money has already been committed to this project. Could you please indicate who and how these taxpayer funds will be allocated? You have brought up more questions with you commentary/op-ed than you have answered...
Hank Ruark July 4, 2010 8:33 pm (Pacific time)
Mike: My ref. was to historic fact of widespread world-level concern some years ago, re level of pay then by Nike to children in contracted facilities. Most persons see a real moral problem involved; you do not. You consign him to hell if he doth not meet your standard. I'm willing to accept what the public makes of his status now and later, with due regard for current events and costs. Values vary in cultures but moral treatment of workers, especially underage,powerless and exploited for dollar-gain, surely qualifies as moral concern as worldwide response then demonstrated and still does.
Mike Fitzpatrick July 4, 2010 6:15 pm (Pacific time)
In these foreign locations how does NIKE remuneration compare to the prevailing wages in these locations. As far as children working, what is the cultural norm? I recall I worked as a child and did not suffer from the experience, but there are different norms/mores in all countries, so what business is it of ours to challenge them. Many Vietnam veterans still do not buy NIKE products because when they set up production facilities in Vietnam we were still trying to ascertain more info on our MIA's. We still are. Seems if someone has a major problem with Knight at UO, then take it to the governor or legislature. Years ago Jesse Jackson attempted a boycott of NIKE in Portland, failed, though crtain finacial considerations were made on Knight's terms. If not for his ignoring the Vietnam veterans, I'd say he has been a significant benefit to Oregon, otherwise I pray he burns in hell.
Anonymous July 4, 2010 8:37 am (Pacific time)
You stated several times that taxpayers will be funding the payments. Could you share the exact source of funds for your assertion?
Ersun Warncke July 3, 2010 10:26 pm (Pacific time)
Well, the Oregonian has been reporting on the problems with record keeping from the construction, so I wouldn't hold my breath on the documentation. Apparently the construction company that got a no-bid contract to build the stadium is in the process of building a 12,000 square foot home on Lake Oswego for Phil Knight's right-hand-man who gave them the contract, so that is always a good sign.
Hank Ruark July 3, 2010 8:21 pm (Pacific time)
Never forget it was Nike use of child workers getting only pennies per hour for producing Nike products that drew world wide protests not so many years ago. IF any such gifts to our universities have actually been paid by the ostensible donor, let the recipient authorities produce the checks or other records of actual payment-received --and make them illustrations for an answering response to this S-N report. But do not "hold breath" awaiting such event either by them OR the Oregon mainstream media, either...!!
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