Hometown Pride Still Louisville's Best Asset

(To those of you who have continually checked for new posts or updates, I appreciate your diligence.  My three month absence has been a product of laziness as much as anything, but I'll divert some blame to a new job and an understandable winter lull in the news cycle in order to save at least a touch of face.)

The former "Bridge to Nowhere" finally has a purpose once again. 

The calendar page-turn indicating a new year has not slowed down the momentum that Louisville has created over the last 24 months.  In fact, a brief hiatus from anything out of the ordinary only helped drum up some excitement and anticipation for what should be considered a very successful first six weeks of 2013 in the Ville.  With the triumphant opening of the new Big Four Walking Bridge spanning the Ohio River (although the Hoosiers to the north are preventing a full circumvent of the waterway), the successful execution of the World's CycloCross Championships, and the buds of spring slowly making their way out of winter's dreary slumber, Louisvillian's are once again showing that hometown pride is still one of the city's best assets.

The Waiting Game

The Big Four Bridge Project had been in the works for nearly two decades, but had only really come to fruition since 2009.  The former "Bridge to Nowhere" (currently a fitting moniker considering the lack of an exit to the Indiana side) has been recommissioned as a pedestrian walking bridge, and really represents the forward thinking, progressive attitude that many in Louisville have taken on.  The unveiling of the bridge naturally fits in with the attitudes that led to the development of NuLu, the creation of the Yum! Center, and the renaissance of Main Street - the continual asking and answering of the the question "How can we take the city, as it currently stands, and make it better?".  The result?  A line of nearly 500 people, waiting on a brisk February day to enjoy the city's newest attraction.

A New Plan for Economic Success in Sports

With grass-roots groups such as Bring NBA2Lou and the newly formed Bring NHL2Lou, there is obvious interest in trying to lure a professional sports team to town.  However, since the departure of the Kentucky Colonels basketball franchise in 1976 and the Louisville Colonials baseball franchise in 1962 Louisville has been little more than a AAA sports town.  One thing the city has never lacked, though, is a thirst for competition, and a reason to show off our town in anyway possible.  With that knowledge the Louisville Sports Commission, an organization formed in 1999 to be the sports-themed arm of the Convention and Visitors Bureau, has effectively aggressively pursued many of the traveling championship events this country offers.  Without their leadership and guidance Louisville would not have hosted the Ironman, the recent CycloCross Championships, the Ryder Cup in 2008 at Valhalla, the National BMX Championships, and many of the other events that you've seen and heard about over the past several years.  What the city previously lacked in facilities it has made up for ten-fold, and our best asset is versatility.  With long stretches of both flat, and hilly spaces, along with both parkland and waterways in ample supply, we can handle nearly any event that doesn't require a domed stadium or a 70,000 seat attendance minimum .  These events draw local interest both far and wide, and also bring in tons of visitors through fan patronage and family involvement.  While they might not all have the panache or economic impact of the Derby or a Ryder Cup, they do all serve to enhance the intrinsic value of the city from an outsiders perspective, and thus, raise Louisville's brand value nationwide.  All positives for a city that is still trying to climb the ladder in terms of sporting prestige and professional athletic credibility.

Home is Where the Heart Is

Native Louisvillians, for the most part, are a very loyal bunch who want nothing more than to see their city thrive.  Even inside its borders, residents of the various neighborhoods are constantly hoping for growth and progress nearby their own homes, not just county wide.  That's why it is no surprise that long-time stalwarts  of our town continue to grow, change, and thrive, despite the continual sprawl, and redistribution of development around it.  The article in today's (Feb. 18) Courier about the overall growth of Middletown speaks to this very point.  Neighborhoods like Middletown, Northfields, Prospect, Shively, Okolona, Jeffersontown, and even Fern Creek have all experienced their own spurts of re-generation and creativity, as those folks who reside outside the Watterson find the desire to get in on the act that is 21st Century Louisville, and keep up with the Joneses in the way of providing something new and/or exciting.  The fact is that when someone in Mt. Washington sees a new restaurant downtown, they not only say "Wow that's a great dining room", they inevitably also reply "I wish it was a lot closer though", and thus progress begins - even if in only an infantile way.  Folks around town love all of the new creations that have come their way over the past few years, but will always continue to support the new fish place that opened on the corner, or the deli that changed owners and added a patio out back.  No one wants to see doors boarded up or "For Lease" signs out front, and most will do their very best to keep that from happening.

Community First

Louisville will always be the biggest small town this country has to offer.  It's just a different feel here.  Recently I spent a month living in Cincinnati, and I was struck at how disconnected the city was from itself.  People on the east side didn't want to go to the west, even for a new restaurant or attraction, and frankly didn't care about it.  People to the north didn't want to go downtown, even for a Super Bowl celebration, or a concert on the river.  That's not how it is here.  People care.  Those of us in the East End hate to hear about violence and disarray in the West End, and want to help do something about it.  People in Buechel get excited about the prospect of a new restaurant or jazz club opening in the Highlands, if it provides something different or exciting amongst the options currently present.  Just as the people of New Orleans go all out for events like Mardi Gras and Jazz Fest, Louisvillian's will always be unapologetically proud of the Kentucky Derby, the Ironman, a Ryder Cup, and the Bourbon Trail.  For us these events aren't just a reason to get out of the house, or another nuisance that adds to our ever expanding traffic patterns, these are reasons to get excited and to celebrate our city.  For good or bad, no matter your age, Louisville is our home, and we should all have pride in it.  When we all come together and support its upward improvement we will see growth that we never thought possible, and we will truly make Louisville Major League.

Why the NBA Should Be Important to Louisville

***Note***

This entry was composed before the release of the article discussing an independent economic analysis that was done to judge the potential impact an NBA team would have on the city.  This analysis stated that the city would see only a $2.4 million increase to the local economy.  Not only is that embarrassingly low, it stinks of being incorrect.  With a salary cap of $58 million plus salaries of executives and other workers, the local payroll tax revenue alone would equate to nearly $5 million annually.  And this doesn't even begin to include increases in revenue from merchandise sales, taxes on lease revenues to the Yum Center, and increases in spending in the Special Tax District which surrounds the arena downtown.

***************

I've written in the past that I thought the NBA in Louisville might be far-fetched, slightly off-based, and a stretch for the city to truly pursue.  But the day I wrote the post "Oklahoma City vs Louisville: A Basketball Case Study" I must have been drunk or high, or both.  I was being a moron.

When I met with the city's Director of Economic Growth and Innovation last winter he stressed to me that the city's main focus was trying to attract as much outside investment as possible that made sense for it to pursue.  Things where infrastructure might already be in place, but more development was needed.  Businesses that Louisville already participated in on some level, but might need a slight kick-start to improve upon.  When considering all of these facts, and the economic impact various industries might have, why an NBA franchise would ever be overlooked is beyond me.  We already have the infrastructure: a great NBA-ready arena (the Yum! Center), a plethora of 5-star hotels and restaurants for NBA opponents to stay at and chose from, and a concentrated amount of nightlife options within walking distance of both said hotels and the arena for players and coaches to frequent (because we know that Ballers gon' Ball).  And we have a huge fan base of basketball lovers within a 100-mile radius; one might even argue that it's the biggest basketball fan base in the country.  Sure the population of Louisville might not be big enough in-and-of itself to support a franchise, but when you consider the basketball lovers in Southern Indiana and the entire state of Kentucky you now have a population of followers that would be as big as any large market team in the League.  And we have capital.  With Papa Johns, Yum, Humana, Anthem, and UPS all headquartered within Jefferson County we have the start of a sponsorship base that would be as good as any around the country.  And what we lack in that area could easily be made up through partnerships with national firms that have a presence here such as Northwestern Mutual, United Healthcare, Kindred, and PNC Bank.  We aren't far off.

The arguments against a team are numbered and poignant: people who would support the NBA franchise aren't likely to also buy their season tickets to UL, UK, or IU games - hurting the already established college teams.  Attendance would be so low that the team would quickly be delegated to the annual conversation of contraction.  Local media outlets wouldn't have the capital to adequately support and market the team's games.  The Yum Center would need major renovations to house a team.  The University of Louisville, specifically, would be murdered by having to split dates with the team, and for having to share sponsorship dollars.  So on and so on.

Listen, these are all small items that, if people would really work together for the greater good of the city, would easily work themselves out in a positive way over time.  Starting with season tickets and attendance.  I am a UK fan.  I do not have UL or IU season tickets, and, while I'd love to have the opportunity to go to all of Kentucky's home games, I do not own those either.  But if an NBA team came to Louisville I would jump at the chance to support them because of the talent that would come through the arena, and the quality of basketball that would be played.  Fluff games like those that occur with the Long Beach States, Quinnipiacs, and Monmouths of the world would never take place.  Each of the 41 games played would be competitive, and would matter.  And even if the team were bad, how excited would people be to watch Kobe, Lebron, or Kevin Durant perform in our fair town?  Thousands of people would be interested in this spectacle!  And what if one of those guys were to say "Hey, Louisville is really cool!" wouldn't that just make our day?  On a pure numbers basis, the Yum! Center holds 22,090 folks (per their website).  Most nights there might only be 12,000-14,000 people in the stands depending on the opponent.  However, if the team is successful or the game is big this number could easily climb to 20,000+, allowing the team to average somewhere around 16,000 fans a game - and the average NBA game attendance last season was 17,273.  Not too far off.

Oklahoma City cited a statistic that attendance to nearby Oklahoma Sooner basketball games fell by 15% or so after the Thunder came to town, however this is in a state that is extremely football crazed and whose population isn't nearly as dense as ours in the immediate outlying areas of the city.  If UL were to see any drop in attendance after a franchise entered the picture I believe it would be minuscule as it is much more likely that the NBA team would suffer the loss of a patron if that person was given a choice between their longstanding favorite team or the new thing in town.  And while TV rights could be an issue, as there might not be many big dollar contracts available between a team and any of the local stations, I would guess that a regional institution like Fox Sports could be an option.  Or if the team wanted they could start their own station, keeping all the revenue from ads and television buys from Insight (Time Warner) that would ensue.

That leaves us with the issue of how they would fit with the University of Louisville.  And this really is the weakest argument in my opinion.  In my previous blog I did an analysis of the game schedules between UL's Men's and Women's programs and that of the Oklahoma City Thunder in order to see what the possibilities are for conflict.  And while there would be some, the reality is that only a few games a year (less than 10 total between all three teams) would really have to be moved around.  Something that is more than easily doable, to the point that that is really a non-argument.  And besides, with all that has come out on how little the University pays to rent the arena for a game, they should be more than willing to be flexible on dates when given the choice of that or paying a higher cost to put on their contests in the Yum Center.  Beyond that, imagine the synergies that could take place with a franchise and UL as students in their Sports Marketing, MBA, Sports Medicine, and Design programs might all have the opportunity of internships, temporary jobs, and other learning opportunities.  For students looking to gain a foot in the door to the ultra-competitive job market that exists within Professional Sports Franchises, this would be huge boon!  It would be a win for the University without a doubt.

At the end of the day, if the city wants to look for a way to increase payroll tax, increase its brand, and continue to push interest in a Downtown area that needs more consistent traffic, then an NBA franchise is the instant fix for all of this.  Millions of dollars would pour into city coffers through ticket sales, increases in tax revenues (from the added $58 million+ in salaries that the team would bring in), and increased foot traffic downtown.  This is something that would bring instant credibility to our city, and would go a long way towards re-establishing ourselves as the preeminent town in the South.  We'd have the best 2-minutes in sports, the best 2-week festival in America, the best college sports, and (potentially) the best NBA franchise in the country, to go along with all the other new and spectacular developments that have already begun coming to fruition throughout the past five years.  While it could take years and years to acquire, it's time for our city's leaders to stop being divided, to stop saying why we can't, and start realizing why we should.  In the 1960's and 1970's Louisville had two opportunities for Major League Sports teams, and has admittedly paid the price for ignoring them.  Please, for the sake of our town and the momentum we've developed, lets not do that again.

Louisville's Rotting Asset

Kentucky Kingdom has been closed since the summer of 2009, and  it is unclear if it will ever reopen.

There's an age-old question that many people ask when considering the assets they own: how do you really value it?  Some things, such as cars or other durable goods, are sure to depreciate and are at their peak value the day they are purchased.  Other items, such as homes, jewelry, and fine art, can appreciate and gain  enormous amounts of value through either time-based valuation or a large increase in demand caused by an incident in time.  But another category of goods is tougher to pin down, and those goods are things that are only really valuable if they are being used to generate some type of intrinsic worth; and when they aren't in use, these items are simply losing value and being a drain on resources.  Such is the case for the theme park formerly known as Kentucky Kingdom.  Like the ice cream machine you bought back in '93 when you thought you were going to hit it big in the gelato business, but is now dust-covered in the garage, unless the theme park is open and generating revenue then it is essentially a worthless use of some very prized real estate at the Kentucky Fair and Expo Center.  And it is absolutely dumbfounding that no government agencies have stepped up the plate to ensure it resumes business in the near future.

Consider this:  in the winter of 2010 when the Kingdom officially closed its gates it was reported that over 1,000 part-time summer jobs, 55 full-time positions, and an estimated 10,000 hotel stays would be lost annually.  Not to mention the millions of dollars of taxable revenue generated from cotton candy and stuffed animal sales.  On top of that, the fair board alone lost nearly $2 million in now unpaid rent and parking fees that the park brought into their coffers every summer.

The unfortunate part of the entire situation is that it was something that could have potentially been avoided.  Being mired in a large corporate bankruptcy, Kentucky Kingdom's operator and parent company, Six Flags, simply decided to pull the plug and cease operations at the park.  Leaving behind in its wake 58-acres of roller coasters and thrill rides that offer no benefit to the city if they aren't in use.  Twice now independent investors have attempted to purchase the park and restore it to some semblance of its previous glory, but these attempts have been futile at best.  Original owner Ed Hart tried to purchase the park with the help of some tax forgiveness and commercial loans from the State of Kentucky, the City of Louisville, and the Fair Board.  This deal ultimately fell through when tough economic conditions and shrinking municipal budgets caused those lending options to fall through.  And this past spring the owners of Indiana's Holiday World attempted to reclaim a portion of the park - saying the major roller coasters such as the Vampire, T2, and Thunder Run were too far in disrepair to make them feasible for re-opening.  This deal ultimately fell through when the Koch Family claimed the Fair Board was being too short-sighted in its lease agreement, and felt there would be nearly no way to make the project profitable.

So where does this leave us?  Mayor Greg Fischer has repeatedly said that it's his goal to continually be growing the economic base of our community, and has shown as much in his efforts to expand the presence of both Ford and GE here locally.  So why not reach out to try and lure an investor for this park locally?  Or approve a corporate-friendly tax package that would make a deal worth doing for Ed Hart or another local fan?  With 1,000 part-time jobs literally sitting dormant on the sidelines, what better way to jump start the local economy?  If you figure those jobs pay minimum wage at 20 hours a week for a seasonal six-month period that equates to over $300,000 annually in payroll tax alone that the city is losing out on, not to mention the other, probably, $200K lost without the park's full-time staff.  In total, there is an asset worth  near $500 million in annual economic impact (this is not an official statistic) that is simply being left to rot.  And each that passes by the memories of gleeful children frolicking, hundreds of teenagers celebrating a weekend at Day Five Alive, and throngs of adults soaking up rays in the lazy river simply fade into oblivion.  All while the thoughts of what could have been continue to mount as Louisville loses yet another piece of itself in the puzzle of what could make it great.

Job Growth in the Ville: Growing the Pot vs Enriching the Soil

Recently I had the pleasure of meeting and having a long discussion with one of our city's great assets, recently appointed Director of Economic Growth and Innovation for Metro Government - one of Mayor Fischer's right-hand men.  In our meeting I nervously meandered through a list of ideas, problems, and solutions that I had tried to thoroughly construct over the week I had to prepare, and, despite my best intentions, there were no groundbreaking solutions, no job offers, and little gained from our talk other than a better understanding of what Metro Government aims to do as a leader in growing the city's economic base.  Grow the Pot.  A phrase I heard at least 50 times during our discussion.  And while it is well-intentioned, and certainly is the ultimate aim of any economic developer, shouldn't we consider easier options within the confines of our great city first?  For sake of context, some of my ideas were as follows:

- A program that allows young JCPS teachers to get tuition assistance for the pursuit of advanced degrees in exchange for agreeing to teach at some of the county's most under-performing schools for an extended period of time.  (As it stands now young JCPS teachers can transfer out of the "doldrums" of poor schools as soon as they have tenure enough to do so within the confines of the union).

- A partnership with one of the national banking institutions present in the city that would bring young finance workers to the city where they could complete many of the analytical and back-office tasks that are currently performed directly on Wall Street at a much higher price to the company.

- Advanced entrepreneurial incubators where MBA students from surrounding universities could gather and bounce ideas off each other with ease.  A situation that the city, UL, or a donor, could fund in hopes of some of these ideas taking flight and becoming major corporations in the city.

- A revised TARC route that would lend the transport service to actually being used.  Could you imagine actually trusting that a certain bus would arrive at its pickup and drop-off locations on time?  And that the routes would be easy and clear to understand?

All of these ideas were brought up amongst friends before I even began thinking of presenting them to Mr. Smith, all of them were met with strong approval, and they all were quickly rebuffed as the meeting progressed.

I understand his point, for Louisville to grow we need to get more dollars injected into the economy by direct investment from currently foreign entities.  That's the easiest way for our city to grow its employment base the fastest - and that's true.  But it's also the most complicated and the path of most resistance in a lot of cases.  The truth of the matter is that Louisville, as an institution, have a lot of systems in place that are really good in purpose, but have been half-assed (sorry mom) in execution.  For example, when we discussed the teacher education idea Mr. Smith launched into a deep diatribe about how the problems with the school system really root in the downfall of the busing system and how the private school system has cannibalized the cities best students - both valid points.  But what if the cities best and brightest teachers chose to stay at the schools which needed them most?  The students there would be exposed to professionals who participate in their craft at its most rudimentary of levels: to mold and shape young minds, and to make a positive impact.  Believe me, it's the kids at these places who need it most.  Restoring hope at the lowest levels of schools would span greater confidence in ALL of our cities public schools and bring many students back into the fold whose parents would have otherwise had them home-schooled or sent to one of the many private institutions locally (many of whom employ these very same young teachers anyway).

The TARC idea was another one I was passionate about, and something I was prepared to personally take on if given the chance.  Unfortunately I was told that TARC was a private entity and that the city could not ask them to do anything - BS!  The city has every right to ask TARC to evaluate its operations in order to improve efficiency and its reputation around the city.  While I have no public records to back this up, I am certain that TARC receives SOME type of funding from City Hall.  And even if they don't, I doubt it would take much more than the offer of a grant or future funding to help get the ball rolling.  I surveyed countless young people who said that if they had reliable info on how the TARC routes operated, were confident in the promptness of their arrival, and felt like the service was affordable, that they would frequent TARC as much as possible for the purposes of transport for commutes and for leisure activities on the weekends.  And what better advertisement to a national organization looking to move 5,000 jobs than by saying "We don't have a subway or any sort of light rail, but our bus system is among the most efficient and effective in the country"?  Mr. Smith didn't seem to care.

The downfall of outsiders coming into Louisville and making big decisions, as Mr. Smith is, is that they often fail to see the usefulness that abounds in many of the city's most aged institutions.  Like trimming a plant in the spring, often times things must be consolidated in order for new growth to begin, and while growing the pot might be the goal it's extremely shortsighted to say that the only way to do it is through the attraction of new businesses.  Simply adding a new taxpayer to the community only creates one or two points of impact on the local economy, but expanding or improving a current asset to provide more growth provides exponential impact.  It might take a little longer to get new growth by enriching the soil, but in the long run it will create a much more fruitful plant.

The Start of Something Great

The idea for this blog has stemmed from years of living and observing Louisville - the city and its people.  Louisvillians are a great lot that often dream big, but usually find little in the way of coherent support or leadership to tackle big tasks and really get things done.  My goal for this small, intraweb space is to present ideas that are being floated throughout our city and explore them in both a macro and micro sense, and examine what is really needed to make our city spectacular.  Since the 1960's Louisville has really been treading just to keep its head above water, while peers such as Indianapolis, Nashville, Cincinnati, and Atlanta have zoomed by.  What is it that's kept us at bay?  Why do we still have the same problems 50 years later?  What can be done to really begin making waves in the region and once again establish ourselves as one of the premier locales in the Southeast?  I hope we can uncover the answers to these questions and more as we strive to make Louisville a Major League City.