Point Blank Video: The Art of a Finely Feathered Nest?

Originally posted March 7, 2013

Point Blank on agraynation.com is an irreverent point of view at events in and around the state of Georgia, including Augusta, Atlanta and the public policy meaning of it all to a perhaps-slightly-addled refugee of the late, great American middle class.

Today, in Point Blank, the topic for consideration is the haste with which the Georgia World Congress Center Authority and the City of Atlanta look to be pursuing a bad deal for the taxpayer.

 

Teeing Off for the Last Time

Originally posted March 8, 2013 at 12:14 PM

Harrison view of Tee

 

by Al Gray

A journey for this writer that began about a year ago concluded on Monday, February 11, 2013 with a presentation before the Finance Committee of the Augusta City Commission. Commissioners Wayne Guilfoyle and Bill Lockett had requested a final act of assistance with respect to the tumultuous Tee Center operating agreements in the form of an analysis of the proposed Tee Center plan and budget that had been submitted by Augusta Convention Center operator Augusta Convention Center Management LLC (ACCMLLC), a subsidiary of Augusta Riverfront LLC and a related entity to Morris Communications, publisher of the Augusta Chronicle.

The Chronicle local government writer who reported on the meeting made no mention of my report, which was very kindly received by all of the commissioners.

The analysis provided was compiled in a very rapid fashion, as is customary with Augusta events, but questioned about $323,000 of costs (the revised schedule accompanying this article is somewhat higher from factors mentioned in the discussion) within the budgeted loss of $804,000. The discussion, key issues, and related amounts are as follows:

The inclusion of $10,048 for vacation and holidays had been questioned because budgeting 2080 hours indicated that the costs were included elsewhere in salaries. This was not seriously contested and it was agreed that using the figures for imprecise budgeting would not be determinant of the actual costs paid.

Since access to the management company’s records was not afforded Augusta, one had to assume that nothing else was in the “Payroll tax” line item besides payroll taxes, hence $24,626 in unidentifiable costs were questioned. ACCMLLC responded that there were insurance costs and 401k costs in the figure. The response was unsurprising and those other costs are defensible.

Credit card fees at $3,702 were questioned, because catering that would have generated heavy credit card usage has been stripped from the final agreement, leaving only event organizers as the only likely payers. ACCMLLC contested that assumption, but not totally convincingly, in this observer’s estimation.

Various maintenance items were questioned at $7,800, because the facility would be under warranty for a year, but this analyst had missed the fact that ACCMLLC showed those expenses starting in later months of operation. ACCMLLC convincingly answered that question.

Property Insurance at $48,000 was listed, despite the fact that property insurance was specifically to be bought separately by Augusta, not by the manager. The response was that the description was incomplete, with other insurance being included.

Electrical power was budgeted at 10 to 11 cents per kilowatt hour, whereas Georgia Power has special rates of as little as 3.5 cents per kilowatt hour. The amount questioned of about $115,000 was the difference in the average industrial rate in Georgia of 5.5 cents and the 11 cents budgeted. The response was that after some 6 months or so of experience, rates would be negotiated with Georgia Power. This writer is of the opinion that this was a cost that the manager should have negotiated in advance.

ACCMLLC had provided no figures for the labor costs of Tee Center employees when they work for the Marriott Hotel or existing conference center project, for which Augusta bears no costs. 50% of designated management employees and 20% of other employees produced an estimated $113,760 in question. This issue was not specifically addressed in the meeting other than that the audit of actual costs would catch any credit or refunds due to Augusta. Discussion ensued that the city must show extreme diligence in administering the Convention Center contracts, because there are 4 entities with separate accounting and contract treatment, despite the “Augusta Convention Center” moniker being used to refer to the overall facility, even extending to the titles on the plan and budget.

A suggestion was made to have the Tee Center accountant transferred over to Augusta, but that recommendation was not met with any approval.

A commissioner asked what the recommendation would be for approving the budget. The response here was that a budget should not be the basis for rejecting the plan, that it was probably wise to provide a cushion because no one wants to revisit it later in the year, and that respect for property rights attendant with approving the operating contract meant that the plan should be approved.

So many assurances beyond those in the contracts are on video at this point that it will be hard for the parties on either side to renege without generating a firestorm.

Everyone involved is Tee-totally exhausted.

Your correspondent would like to thank the City of Augusta for this opportunity. Doing the Augusta Project for a year and 3 months including the Tee Center before adding the Falcons’ Stadium project last month, provided simply stunning chances to expand knowledge into new areas of expertise especially Convention Centers. The Augusta Project is over, all objectives were attained with stunning success, and now the next phase will begin.

Thriving on the unconventional for the last 30 years has turned ‘boring’ accounting into a lot of fun.Now it will be fun to be able to market convention center expertise learned from the pros down on Reynolds Street.

To the citizens of Augusta, thank you for your kind support. Together all can strive to fix Augusta, as best we can. If Augusta can be fixed – do not underestimate the strides that have been made – anything is possible.

-AG

The Falcons Rookery Project

Falcon’s Rookery Project

Originally posted March 7, 2012 at 12:05AM

by Al Gray

Over the last 2 years the Georgia World Congress Center Authority and the Atlanta Falcons Management have negotiated a Term Sheet for the construction and operations of a new stadium whereby the WWC relinquishes its 39.3% hotel motel tax funding stream, management of the stadium, and the Georgia Dome, which is to be demolished.

Agraynation.com saw this $1.2 billion transaction as an opportunity to kill 3 birds with one stone:

The first objective was Public Service for the City of Atlanta, who was handed this project after it grew too hot for the State Legislature to handle, in evaluating the Terms.

A second goal was demonstration of the Aurelius Principle employing a multidisciplinary approach which uses the other party to a transaction’s own documents to present a counterargument.

Evaluation of the Falcon’s Claim that the team was spending $700 million to the public’s $200 million.

This site compiled a restatement of the sources and uses of funds for the project after securing a key document that was missing from the GWCCA’s stadium development web page.

The detailed report, which features link to the source GWCCA documents and consultant reports was posted on the Agraynation.com site for inspection.

The Conclusion? The Falcons might spend nothing for the $1.2 billion stadium because the H/M tax stream, would exceed $1.2 billion over 35 years and could be borrowed against for as much as $650 million. (Key omission is out-year revenue stream, as alluded to by Atlanta Business Writer Maria Saporta and AJC columnist Tim Tucker.) Seats rights that GWCCA is giving up pitch in another $150 million to $200 million, and other revenues ceded by Atlanta and Georgia make up the rest.

Coming up –

In POINT BLANK, we take an irreverent look at the benefits to Falcon owner Arthur Blank’s net worth, followed by

A Well-Orchestrated Trick Play? – a look at how the GWCCA seems covered against an otherwise suicidal Term Sheet that they agreed to.

Legal Twigs in a Falcon Nest – a look at Term Sheet Trick Plays and ways to shift costs to the public

Finally – White Flag Negotiators Serve Whom?

Agraynation.com – A public service site brought to you by Cost Recovery Works.com, where the Aurelius Principle now serves clients, after 30 years in development and implementation at ever-higher levels of business and government.

Falcons’ Rookery Nearly Perfected?

Birds’ offense scores a $1.17 Billion Stadium for Free, GWCCA gets a Safety, Deal Hangs on a Thin Reed

By Al Gray

February 25, 2013

 

Dear Arthur Blank:

Contracts, commonly dismissed as mere tools, can become art forms. Under your Picasso-like direction, the Falcons’ negotiators of terms to build a new stadium with the Georgia World Congress Center (GWCCA) had delivered the workings of a masterpiece. The deal exhibited the key elements of the art form in carefully extracting more profits than the other parties would ever recognize without help. The agreement approached genius in getting the GWCCA to make it so lucrative. Now that plan has been punted over to Atlanta’s Mayor Kasim Reed by Georgia Governor Nathan Deal. Can you still pull this off? Absolutely!

The situation is perfect, too. The World Congress Center owns the existing Georgia Dome, where your Atlanta Falcons have contracted to play through 2017. With that lease expiring, the Congress Center and city are anxious about the future of their complex. Insuring that the Falcons stay downtown is of paramount importance to the politicians.

A key Citi presentation obtained by agraynation.com completes a trail of cost estimates and studies posted by GWCCA that show that the Falcons may have to pay $43 million or less for the $1.17 billion stadium.

Please forgive the brashness in barging into your team of artisans. This author was initially seeking to provide pro bono services to the Atlanta City Council and the State of Georgia, but multidisciplinary techniques grounded in documents can assess either side of a major transaction like this one. The evidence has been gathered and in this instance has shown how masterful the Falcons’ team has been in negotiations! Here is the scorecard on their effectiveness.

Hyperlinks appear in blue to the supporting documents.

Sources of Funds

Description

Amount

Debt Funded by GWCCA Contribution of Hotel/Motel Tax & Seats Rights

 

State/local Bond Proceeds from Hotel/Motel tax in Initial Years*

$359,985,041.00

State/local Debt backed by GWCCA Seats Rights Contribution, primarily Private Seat Licenses.

$150,000,000.00

State/local Funding from Leveraging Excess Hotel/Motel tax into Subordinated Debt (If not used for financing, as much as a nominal estimated $246 million is designated by the Term Sheet for stadium maintenance and future improvements)

$178,271,016.90

Total GWCCA Contribution

$688,256,057.90

 

 

State and City Funds

 

Sales Tax Rebate on Construction Materials

$30,000,000.00

Land**

$24,500,000.00

Atlanta Infrastructure Costs

$53,000,000.00

Total State of Georgia and City of Atlanta Contributions

$107,500,000.00

 

 

Enterprise Debt/Equity supported by Revenues Ceded by GWCCA

 

New Debt backed by Stadium Naming Rights surrendered by GWCCA to Falcons, over the first 20 years reduced to present value

                    $73,324,149.00

New Equity backed by Food and Beverage Rights donated by GWCCA to Falcons, over the first 20 years reduced to present value

                      $55,579,705.00

Total Funds from GWCCA Contract Rights Ceded to Falcons

$128,903,854.00

Public-sourced Funds Total

$924,659,911.90

 

 

NFL G-4 Funds Program

 

Advance from NFL

$100,000,000.00

Grant from NFL

$50,000,000.00

NFL Loan

$50,000,000.00

Total Funds from NFL G-4 Program

$200,000,000.00

 

 

Funds to be provided by Falcons out of current finances and operations

 

Falcon’s Funding to meet Estimated Project and Financial Costs

$43,017,265.10

Total Funds from Existing Falcons’ Operations

$43,017,265.10

Private-sourced Funds Total

$243,017,265.10

 

 

Total Sources of Funds

$1,167,677,177.00

 

Uses of Funds

Description

Amount

Total Construction, Site and Land Costs*

$1,032,000,000.00

Retirement of Georgia Dome Debt*

$60,000,000.00

Atlanta Infrastructure Costs

$53,000,000.00

Debt Service Retirement Account, Cost of Issuance, Underwriters’ Fees*

$22,677,177.00

 

 

Total Uses of Funds

$1,167,677,177.00

 

*The total funds shown on the Citi presentation, $359,985,041.00, less Dome debt retirement of $60,000,000.00 and Debt costs of $22,677,177.00 ties to the $277,307,864.00 shown on the BSG Sept. 2012 report (cites the Citi report) containing the $1,032,000,000.00 total funding and cost figure.

** Land is not shown as a Use of Funds item, as it is included in the $1,032,000,000 project cost total.

Of course this is just one opinion, although one has to believe the negotiating team will find the documents most familiar. It can be imagined here that they would find some holes to shoot in this analysis, but there are more supporting arguments for it than can be recited here.  It would be a boat-load of fun to participate in a city council meeting for a debate over the basic concepts.

On Wednesday February 20, the Falcons and GWCCA artisans of this transaction were heard before the Atlanta City Council saying that the football club was funding “$500 million to $700 million” of the new stadium project and that the public would be pitching in $200 million. That PR seemed to be working pretty well for enough of the Council to be willing to pass the new arrangements, whatever those may be. The Council seemed resigned that this is a “done deal.” Atlanta should get a better deal – to the tune of $250 to $400 million – but will it?

From this vantage point in the pine woods of east central Georgia, it looks like the Falcons are well on their way to getting $1.12 billion from the public and the NFL. All that is left is for your football club to come up with the other $43 million. Thanks to the lawyers and certain “options” in the Term Sheet, last minute funding “waterfall” diversions, and looseness of the scope between what the Falcons are providing and the public is furnishing, massaging at least another $43 million should be a cakewalk. Getting a $1.17 billion stadium for free should top anyone’s business career!

Getting this agreement, or a similar one, signed, sealed and delivered is job one. Once that is done, the Falcons Special Teams in Program Management can take to the field and shift another $100 million or more in costs over to Atlanta. Hire a savvy program director who knows how to play this game with the same gutsy aplomb which the Term Sheet negotiators used playing theirs. Winning coaches have winning strategies from start to finish. Winning projects do much the same.

After the stadium is built, more $hundreds of millions can flow from operations and costs shifts. Those opportunities are another article for another day.

Vigilance builds victory. The Falcons have been vigilant. Any owner would be proud.

 

-AG

Originally posted February 25, 2012 at 10:40 PM

 

The author is President of Cost Recovery Works, Inc. a firm focused on delivering superior returns for clients undertaking major projects including local governments searching for cost recovery in large construction, maintenance, entertainment venue, and other large contracted efforts. Clients and employers have included 9 Fortune 500 Companies, with 5 more served under subcontracts. Mr. Gray has been working on a pro bono basis for the Augusta, Georgia Commission since January 2012 in a comeback effort from early retirement, finding that stresses on local governments foster growing prospects for multidisciplinary cost recovery approaches. A foray into public policy is an opportunity to further multiple objectives, including public service.

Video: Augusta Commission Committee Discusses Heery/Dukes Contract

Tuesday, June 11, 2013
Augusta, GA
From CityStink.net Reports
Contributions were made to this article by Al M. Gray, President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns.
An Augusta commission committee gave no recommendation to proceed with the multi-million dollar contract with Heery International yesterday, deadlocking at 2 to 1. Marion Williams and Wayne Guilfoyle voted not to proceed with extending the contract as-is. Grady Smith and Corey Johnson voted in favor of extending the contract “as-is”. CityStink.net was there yesterday and got exclusive video of the meeting including where Cost Recovery Specialist Al Gray challenged Heery officials. You can watch that video below.
You can also see our most current investigative piece concerning the Heery saga:

Even an Overseer Needs Oversight

Heeryly Absent

Originally posted on CityStink
June 9, 2013
Augusta, GA
by Lori Tabb Davis
Contributions were made to this article by Al M. Gray, President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns.
The entire hullabaloo over extension of Augusta’s Project Management contract with Heery International involving community liason Butch Gallop, campaign contributions, gifts to county commissioners, and other hysteria, brings one repetitive thought. Where is the oversight over the Heery overseers?
Can I say totally absent? For certain it is stunningly absent.  For now, I brand it Heeryly absent.
When our Augusta Today and Citystink.net team of contributors submitted Georgia Open Records Act requests regarding the Heery contract itself and various contract documents from projects that Heery is and was being paid to manage, control, and supervise for the City of Augusta, we found absurd contradictions with Heery’s role as overseer.
When we looked in the contract and elsewhere for the project procedures manual governing Heery’s performance of the work, we learned that Augusta had none. Our sources told us that an early effort to adopt one was squelched.
  1. Because there was no project procedure manual, perhaps that was the reason that there was no job progress photography protocol to provide us with date-stamped color photos, accompanied by delivery and storage details, of the infamous Tee Center Kitchen Equipment, only black and white pictures of boxes in an unidentified, undisclosed location.
  2. Because there was a lack of coordination of design documents for the Tee Center and already-operating Conference Center, perhaps that is why my open records request for the design of the HVAC for the Tee Center and Conference Center dating back to the days when the Marriott was a Radisson was met with a data disk with blank directories from the city. I fault Augusta for that, but if Heery is Augusta’s Program Manager, shouldn’t they make sure old and new documents are better coordinated?
  3. Because it looks like general contract limits on change orders do not appear to carry through to subcontracts, eye-popping amounts of Augusta’s funds could be in jeopardy.
  4. Heery, if I understand correctly, was paid rates up to and exceeding $200 per hour to provide such services!
  5. The new estimated costs Heery wants to extract from Augusta has been presented at an increase of $1.6 million, including a $149,000 increase/ overrun for the Tee Center, a project that was a total disaster from A to Z.
If Heery is kept, at least $350,000 needs to be cut from that 1.6 million dollar number! I think if all aspects of it were examined, the number that could be cut would be triple that.
How about oversight allowed to Augusta to oversee the overseer Heery by their contract? That was Heeryly absent, too.
  1. The contract cost was put on auto-pilot with 4% annual rate escalation built into the original 2004 Contract. This continued until 2011, when Heery billed slightly lower rates and continued to do so into 2013. The 4% escalation remains, with a consumer Price Index adjustment. With inflation likely to pick up, who knows what the rates will be with compounding like Augusta has seen.
  2. The 2004 contract allows confirmation of the direct cost classification of Heery’s employees without providing what the billing classifications are in terms of employee education, qualifications, certifications, and experience. It sure looks like the program manager Heery has wide latitude to assign people to this contract without Augusta really having the criteria set for their billing rates! (Does Butch Gallop ring a bell? What is a community liason anyhow?)
  3.    The contract does not provide for proof of the direct costs of Dukes, Edward, Dukes or Gallop and Associates, who are not Heery employees, but Heery “sub consultants”.  What are they?
  4.  Access is restricted to “accounting records”, when it is probably the Heery personnel files that would best be used to verify billing classifications.
  5.  There is a statement –  “Owner may only audit accounting records applicable to a cost reimbursable compensation” This sure sounds like the negotiated rates are sacred and cannot be analyzed by Augusta. Such limitations must go. When paying millions of dollars for professional services, shouldn’t Augusta be able to audit anything that touches on what the city is getting?
Our team’s investigative efforts have born amazing results for Augusta and it is a shame to see them stymied by restrictions on audit rights. We saw that the Messerly waste water contract with ESG mandates that Georgia Open Records access be extended to every significant subcontractor. Subcontracts and major supply orders under Heery-managed general contracts need to be brought in line with that standard too. We cannot help if we are stonewalled by contractors and the administration.
After the numerous controversies and fiasco’s involving Augusta projects, Butch Gallop and Associates, the Tee Center, and Tee Center parking decks, it is clear – the overseer needs oversight and the Augusta administrator, starting with George Kolb and continuing under Fred Russell,  has not provided it, he has avoided it. Heery, understandably aiming to please the client, looks like it became a rubber stamp.
If the Augusta Commission extends this contract, citizens should expect better controls, refunds of any miscalculated rate overcharges (if any exist), and lowering of rates to reflect known factors favorable to Augusta. Augusta needs to ditch Butch Gallop now, too.
Our Augusta reformers love old movies and I used to get all into being Lois Lane. Here is a segment that came to mind as I pondered all of this.

“You…you’ve got me, who’s got you?”

Harrisburg in Augusta is in free fall. Deke Copenhaver might be an Ironman, but he is no man of steel. Heery has him, but who has Heery?  Looks to me nothing but hot, stagnant city air.
Somehow I think both would just as soon see me, go splat. Augusta too, if there is a dime involved for them to get.

–    LD

Downtown Augusta Brawl Video Goes Viral

Monday, May 6, 2013
Augusta, GA
From CityStink.net Reports

A video of a violent brawl in downtown Augusta, GA on the night of April 27th has been making the rounds of social media. Police say they are just now finding out about the violence more than a week after it occurred even though gun shots were fired. On The night of May 3rd, a couple was violently attacked with baseball bats on Riverwalk. Is violence in downtown getting out of control? Will these incidents reverse efforts to revitalize downtown? Where were the police? At Operation Rolling Thunder Checkpoints perhaps?
We here at CityStink.net decided to enlarge the video of the brawl in an effort to help the police identify suspects. Oh we also added some background music and production values too. Maybe the DDA can use it as a promotional video for downtown. Come downtown ya’ll, where everything’s waiting for you!

Teeing Off for the Last Time

Originally posted on CityStink
March 8, 2013
Augusta, GA
By Al Gray

 

The author, Al M. Gray is President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns.
A journey for this writer that began about a year ago concluded on Monday, February 11, 2013 with a presentation before the Finance Committee of the Augusta City Commission. Commissioners Wayne Guilfoyle and Bill Lockett had requested a final act of assistance with respect to the tumultuous Tee Center operating agreements in the form of an analysis of the proposed Tee Center plan and budget that had been submitted by Augusta Convention Center operator Augusta Convention Center Management LLC, a subsidiary of Augusta Riverfront LLC and a related entity to Morris Communications, publisher of the Augusta Chronicle.
The Chronicle local government writer who covered the meeting made no mention of my report, which was very kindly received by all of the commissioners.
The analysis provided was compiled in a very rapid fashion, as is customary with Augusta events, but questioned about $323,000 of costs (the revised schedule accompanying this article is somewhat higher from factors mentioned in the discussion) within the budgeted loss of $804,000. The discussion, key issues, and related amounts are as follows:
  • The inclusion of $10,048 for vacation and holidays had been questioned because budgeting 2080 hours indicated that the costs were included elsewhere in salaries. This was not seriously contested and it was agreed that using the figures for imprecise budgeting would not be determinant of the actual costs paid.Since access to the management company’s records was not afforded Augusta, one had to assume that nothing else was in the “Payroll tax” line item besides payroll taxes, hence $24,626 in unidentifiable costs were questioned. ACCMLLC responded that there were insurance costs and 401k costs in the figure. The response was unsurprising and those other costs are defensible.Credit card fees at $3,702 were questioned, because catering that would have generated heavy credit card usage has been stripped from the final agreement, leaving only event organizers as the only likely payers. ACCMLLC contested that assumption, but not totally convincingly, in this observer’s estimation.
  • Various maintenance items were questioned at $7,800, because the facility would be under warranty for a year, but this analyst had missed the fact that ACCMLLC showed those expenses starting in later months of operation. ACCMLLC convincingly answered that question.
  • Property Insurance at $48,000 was listed, despite the fact that property insurance was specifically to be bought separately by Augusta, not by the manager. The response was that the description was incomplete, with other insurance being included.
  • Electrical power was budgeted at 10 to 11 cents per kilowatt hour, whereas Georgia Power has special rates of as little as 3.5 cents per kilowatt hour. The amount questioned of about $115,000 was the difference in the average industrial rate in Georgia of 5.5 cents and the 11 cents budgeted. The response was that after some 6 months or so of experience, rates would be negotiated with Georgia Power. This writer is of the opinion that this was a cost that the manager should have negotiated in advance.
  • ACCMLLC had provided no figures for the labor costs of Tee Center employees when they work for the Marriott Hotel or existing conference center project, for which Augusta bears no costs. 50% of designated management employees and 20% of other employees produced an estimated $113,760 in question. This issue was not specifically addressed in the meeting other than that the audit of actual costs would catch any credit or refunds due to Augusta.
Discussion ensued that the city must show extreme diligence in administering the Convention Center contracts, because there are 4 entities with separate accounting and contract treatment, despite the “Augusta Convention Center” moniker being used to refer to the overall facility, even extending to the titles on the plan and budget.
A suggestion was made to have the accountant transferred over to Augusta, but that recommendation was not met with any approval.
A commissioner asked what the recommendation would be for approving the budget. The response here was that a budget should not be the basis for rejecting the plan, that it was probably wise to provide a cushion because no one wants to revisit it later in the year, and that respect for property rights attendant with approving the operating contract meant that the plan should be approved.
So many assurances beyond those in the contracts are on video at this point that it will be hard for the parties on either side to renege without generating a firestorm.
Everyone involved is tee-totally exhausted.
Your correspondent would like to thank the City of Augusta for this opportunity. Doing the Augusta Project for a year and 3 months including the Tee Center before adding the Falcons’ Stadium project last month, provided simply stunning chances to expand knowledge into new areas of expertise, especially Convention Centers. The Augusta Project is over and now the next phase will begin.
Thriving on the unconventional for the last 30 years has turned ‘boring’ accounting into a lot of fun.
To the citizens of Augusta, I offer thanks for their kind support and a promise to strive to fix Augusta, as best we can.

Short Sheeted via Term Sheet


Public Thrown for Loss in (nearly)Free Falcons Stadium?
By Al Gray
The author, Al M. Gray is President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns.
Georgia Dome to be Torn Down for new Falcons Stadium
About two months ago, a “term sheet” was signed by the Georgia World Congress Center and the Atlanta Falcons to build a new retractable-roofed stadium for their pro football team. After the travails that followed the notorious Augusta Tee Center Term Sheet, the mere mention of that phrase was enough to raise eyebrows.
The thought came to mind “What if……?” What if it was a one-sided deal against the public? What if the consultants’ reports were not analyzed? What if the cost to the taxpayer was a whole lot greater than advertised? What if the legalese meant huge opportunities for cost-shifts to the public? What if media was silent because of the team owner’s position on the board of the Atlanta newspaper’s parent company?
The deal was too huge and the possibilities too big to ignore, so this author performed a month long investigation on the reported stadium costs versus what the documents showed. The report that came from this effort is the inaugural article in agraynation.com, the multimedia blog born out of the Augusta Project, that work being a year-long series of investigations and articles that appeared in City Stink and the Augusta reform Facebook pages.
The Falcons say they are paying $700 million of the $1.2 billion cost.
Are they really? Or is this another prank of being short sheeted via term sheet? Will the weary public think it is turning in to a warm comfy bed, only to find all openings denied?
Most of the cost is all ours.
There is a big rush to get this deal approved ASAP.
Stay tuned.

AG

Enslaved Forever on the TEE Plantation


Monday, November 12, 2012
Augusta, GA
By The Outsider
Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article
Now all Augustans lie prostrate to Massa Billy and Massa Paul, thanks to the 6-3 vote of the Augusta Commission to pass the TEE Center deal last Thursday, November 8, 2012. White, black, Mexican, Korean, Chinese or Indian, the entire City of Augusta is now enslaved to Billy Morris and Paul Simon or, if you believe Augusta radio talker Austin Rhodes at WGAC, the Morris children.
No one can really tell who the owners of the new TEE Center management company are because it didn’t even exist until last month and it was registered by an intermediary to keep the ownership hidden, something Augusta’s procurement policies seem to prohibit. It will just have to suffice that the person’s listed on various documents for the original Morris/Simon LLC suggest that the Morris family are the principal owners. Even the Augusta Chronicle, who has acted throughout the TEE escapades as a front for these shadowy LLC’s, has been forced to weakly acknowledge that there are ties with Morris Communications.
The place where they put the permanent shackles on the people was originally supposed to be Augusta’s wonderful new TEE Center, but the massas had confiscated the building before the last concrete set up. They weren’t content to just stick spurs in horses over there in their Hippodrome in Aiken County, now the children all across Richmond County find themselves bound to a plantation and they didn’t have to move to Morris’ Creek Plantation, Wade Plantation, Butterfield Plantation or Millhaven Plantation to do it.
When you are in Augusta, you don’t move to the plantation, the plantation comes to you. Worse of all, the legalese says you and your descendants are slaves to the Morris massa’s TEE House FOREVER!!!
Yes. You read that right.
Mayor Deke Copenhaver and Administrator Fred Russell cheered as Commissioner Corey Johnson, Commissioner Matt Aitken and four other commissioners voted for this:
“Term of this Agreement” shall mean the period of time commencing on the date of this Agreement and continuing in perpetuity for so long as the TEE Center is in existence and shall include the period of time following any casualty with respect to the TEE Center for so long as City has the right to rebuild the TEE Center.
Now reader, you are just about to read the last part of that and tell me it is a way out of the Tee Center for Augusta because it ends when the TEE no longer exists.  Well, it is like the old tale of Dem Bones – “Toe bone connected to the foot bone: Foot bone connected to the leg bone: Leg bone connected to the knee bone…..” You just have to make the connections to get the whole body of facts.
Reading on:
During the Term of this Agreement (perpetuity), City shall, at its sole cost and expense, maintain the TEE Center to the Standard for so long as the TEE Center shall exist.
Getting a better picture now, reader? The “Standard” is whatever Billy and Paul’s interpretation of what their Marriott Hotel says it is and Augusta has to pay whatever it takes to meet their ‘Standard.’ That sounds expensive already, doesn’t it?
Now you Doubting Thomases who are left thinking that this pay-out to Morris and Simon isn’t FOREVER, get with the program. “The knee bone is connected to the thigh bone, and the thigh bone is connected to the hip bone.” And so it goes with the Tee Center. You follow the boneyard and find out it is the TEE Center. Now a Doubting Thomas would say “Well, if Augusta decides to contract with someone else or close down the Tee Center, we can stop paying them or stop paying costs on their behalf, right?”
This isn’t exactly true, according to the contract:
The parties acknowledge that Developer has an important interest in insuring that the TEE Center is maintained in accordance with the Standard, whether or not Developer serves as the Manager or Caterer. Accordingly, this Agreement, and particularly this section of this Agreement, may be enforced by Developer. (Developer is the Morris/Simon)
 
In other words the Morris/Simon massa still has the power over the taxpayer, even if their contract is lifted.
Are you getting a queasy feeling in your stomach, Hephzibah? So you on Warren Road think that the TEE plantation you are on will meet an emancipation proclamation that sets you and all your descendants free from PERPETUAL bondage? Dear readers might still not be convinced that the TEE Center is their massa FOREVER. It’s time to read some more:
During the Term of this Agreement (PERPETUITY, remember?), City shall, at its sole cost and expense, procure and keep in effect fire and extended coverage for the TEE Center and all personal property located thereon, including rent loss or business interruption …, in amounts at no time less than the total replacement cost therefor. Such policy referred to above shall name City and Developer as loss payee and additional insureds, as their interest may appear.
 
So, there you have it. Augusta has to pay for the TEE Plantation in PERPETUITY and pay to insure that it is replaced in PERPETUITY. If it is destroyed, the Morris/Simon hotels are almost certain to be destroyed too, so replacement would be driven more by the Morris/Simon decision on what to do with their hotel complex than anything Augusta decides.
How great is the claim on Augusta’s tax system to pay for the TEE Plantation? On the financing side, the project was built using general obligation sales tax bonds, as certifications by the Construction Manager, R.W. Allen attest. General obligation bonds are backed by the fullest ability of Augusta to tax people out of their homes and businesses out into the street. On the operations side of the TEE Plantation, hoteliers get looted for the first $250,000 (another $100,000 goes into capital spending), but then the rest of the TEE Center losses come out of the General Fund, which also is fed by the power to tax folks into poverty. When a contract like the TEE contract gets executed, that obligation comes before paying for essential city services, like fire and police protection.
Now that the whole skeleton of bones has been assembled, the full picture of the TEE Center deal is this – All of the people of Augusta-Richmond County, their children, and descendants are now under double general obligations to the extent of the value of all of their property to the Morris children and descendants in PERPETUITY.
Get used to the shackles and chains that Mayor Deke put you into.  Only death or getting out of Augusta will give relief.
Can you say that you’ve been TEE-totally subjugated?
It sure looks this way to an Outsider.***
OS