The original lease between Gateway and the Cleveland Indians, in 1991, gave the naming rights revenue to Gateway to help pay for the stadium and arena.  That seemed quite fair.  After all, little other revenue was headed to the entity that built the project.

However, when Progressive Insurance recently signed a deal to pay naming rights of $3.6 million a year, or $56 million over 16 years, not a penny will go to Gateway.  More important, not a penny will go to pay back Cuyahoga County the hundreds of millions of dollars owed county taxpayers.

The $56 million all goes into the pockets of the Dolan family.

This deal reveals how, no matter the circumstances, government now serves the wealthy at the expense of the ordinary citizen. And – to the detriment of our democracy – the ordinary citizen remains unaware or unconcerned.

So the $56 million goes into the pockets of Larry Dolan, baseball team owner.

What happened?

You can read all the Pee Dee coverage – as out of proportion as it was – but you are not told about the switch or why or how it happened.

Reality seems to escape the Pee Dee, which is not unusual under the editorship of Susan Goldberg.  She goes for dramatic, splashy graphic displays on her front pages, preferring skimpy information or, as she might call it, news.

The Pee Dee in a second-day story heralded the naming rights deal across its front page.  The coverage went 12 inches deep and six columns wide on Page One.  You would have thought the city made substantial economic gains for its citizens.

The 72-inch display was dominated by 49 square inches of valuable space dedicated to a silhouetted photo of the stadium upper deck bank of lights used to illuminate the field.  How thrilling.  Of course, the display came with a huge headline: “Goodbye ‘Jake.’”  Such a tug at the heart.

Good show, Goldberg. Give the People circuses must be her motto.

Goldberg’s front pages have been atrociously fluffy, though a recent front-page drama had a five-inch deep headline: “CAN THE CITY SURVIVE JACKSON’S ASSAULT ON GUNS?”  Survive?  It was accompanied by a nine-inch long photo of Mayor Jackson’s face.  PD “reader representative” Ted Diadiun, apologist of apologists, even found fault.  The headline didn’t even flow from the article, which was more reasoned.

Who are we scaring?  Why not a tabloid, Ms. Goldberg?

A more recent five-column, nearly 14 inches deep on Page One, was given to American Idol, a TV show. “Are networks pushing too big a dose of reality?” said the headline.  I ask:  Is the Pee Dee pushing a big dose of thin pap every day on the front page?

Now back to the reason Gateway didn’t get any of the $56 million, as originally negotiated.

A few years ago, Gateway was in such embarrassing financial straits because of the bad deals made on the leases that the Indians and the Cavaliers had to rescue Gateway, not out of charity but because a bankruptcy would have damaged both teams and their owners.  (The Gunds paid no rent ever and the Indians not very much since the two teams were deducting all kinds of expenses from their rent.)

So in order to save the embarrassment and predicament of bankruptcy of a successful and nearly new stadium and arena, the two teams decided that they would pay minimum operating expenses of Gateway.

In exchange, Gateway erased their rental obligations and allowed the two teams to take other revenues, including the naming rights revenue.

The Pee Dee, which never wanted to cover Gateway critically, ignored the gritty details.  Therefore, if reporters today wanted to go back to the paper’s files to learn about the past, well, it’s not there.  The Pee Dee coverage, particularly after Gateway began running the operation, has been pretty blank on economic issues. PD sportswriters are simply AWOL.

In this deal, the operating costs for Dolan for 2008 are set at $1.9 million, according to Gateway documents.  So Dolan pays $1.9 million but walks away with $3.6 in naming rights revenue that previously would have gone to Gateway.  Extra profit: $1.7 million.

So by “saving Gateway,” the owners enrich themselves.

The Cavaliers, of course, changed the name of Gund Arena to Quicken Loans Arena, free advertising for Quicken owner Dan Gilbert who bought the Cavs from the Gunds for $375 million.

The Cavs, for 2008, are assessed $1.2 million by Gateway for operating expenses.  This likely is much less also than the cost of the naming rights for the arena.

Back when Gateway was trying to originally sell the naming rights, Steve Strnisha, then city treasurer and a Gateway board member, said...

“The companies that are interested are ones that have a need to reach consumers and see this kind of visibility as helpful...  The quality of these facilities is going to be such that they’re going to get both regional and national attention.”

There was talk that Society Corp., a Cleveland bank, wanted the naming rights to the entire complex at $18 million.  At the same time, the bank was cutting 330 employees from its payroll; similarly Progressive has been cutting employment.

But Gateway ended up, not with Society or KeyBank as sponsor but with Gund and Jacobs.  Wonder where they got those names?

That gets us to the second part of this corrective update.  Not that anyone at the Pee Dee would care about the true facts.

Cuyahoga County earlier this month paid Gateway bond holders $3,533,992 for 2007.  The County had already paid $99 million on these extra bonds used to finance Gateway for the Jacobs and the Gunds and now Gilbert and Dolan families.  Some bonds go to 2023 so payments will continue.

The bond borrowings went to pay for the increased cost of the two facilities – costs that had skyrocketed during construction.  But Tim Hagan and Michael White spared no public subsidy to give the owners what they wanted.

The total bill for this year was some $10,259,088, including $75,399 in fees.  The bond pros always take their cut.

Most of the rest of the cash to reach the $10 million came from the City of Cleveland.

The down-and-out City of Cleveland contributed more than the County did this year.

First, $3,716,397 in admission taxes from the Q Arena didn’t go to the city, as the city’s admission taxes normally do, but was diverted by prior agreement to the bondholders to help pay the debt.

This is one of the cute tricks City Council and Mayor White used to finance these private con artists.

Then the city paid a one-time payment of $354,700 on September 4, 2007, as an annual payment the city had indebted itself for due to loans made for Gateway.

On December 24 – a Christmas Present to Gateway – the city sent the county another check for $2,984,700.  That amount is a one-time and full payment of future $354,000 annual payments that were scheduled over an 11-year period.  The city’s debt on loan is thus paid in full.  The funds came via excess “sin taxes” for Gateway that flowed to the city and not from any current city money.

If all this confuses anyone, there’s a simple guide to follow.

You, the taxpayer, have been screwed royally and the rich owners continue to be enriched very, very handsomely.

WKYC’s Donovan Shills for Browns

Chirpy, bouncy Jim Donovan of WKYC-TV loves the Browns.

Well, it’s his paycheck.  Or two.

Donovan is called the “voice of the Browns,” working games at WTAM-Radio.  He also does work for the Cleveland Indians.

NBC’s WKYC-TV, Channel 3, likes to portray itself as The Serious television news channel.  Straight up and factual.  And, in some important ways it does take a more serious approach.

However, allowing Donovan to do commercials for the Browns breaks the rules.  Reporters are supposed to report, not cheerlead and certainly not work for the people he or she is covering.

Would it be alright if Tom Beres, the political writer, did some political work on the side for a candidate?  Of course, it wouldn’t and WKYC wouldn’t allow it.

It would obviously damage his credibility and the news division’s credibility.

So why break the rules for the exuberant Donovan?

News director Rita Andolsen didn’t return a call to find out the station’s rationale for allowing a reporter to be a spokesperson for the people he supposedly covers.

Sports are now very big business.  However, they are treated as if the teams and players are competing as amateurs for charity by the “reporters” who cover them. 

Kucinich Tests the Fates Again

Dennis Kucinich screwed up so badly as Cleveland mayor that he gave us Mayor, Governor and Senator George Voinovich...  almost three decades of the Republican politician.

It’s unforgiveable now that Presidential candidate Dennis – apparently out of pride and ego – will give us Congressman Joe Cimperman.  Cimperman plays a politician of the people.  Yet he follows the agenda of the downtown greed gang.  He as happily feeds on their money as eagerly as athletes do on growth hormones.

Get out of the Presidential race, Dennis, or suffer the wrath of voters who have more sense than you apparently do.

Likely, only the overly-ambitious Cimperman himself, playing the eager fool, can save you.  You must know that the Pee Dee and Tee Vee will be as avidly in favor of Corporatist Cimperman as it is ardently against you.

Cimperman apparently feels voters appreciate a fool who goes to the home and office of his opponent with cameras hoping to score points by juvenile harassment.

However, I wouldn’t bet on foolishness to save you from yourself.

The voters this year are much more solemn and serious than the candidates.  They sense the impending tragedy for America of Republican and Democrat misrule.

County Deal Doesn’t Inspire

There should be no cheering the sale of the County’s ill-executed deal for Dick Jacobs’ East 9th Street complex... until the $35 million is transferred from the developers, the K & D Group, to Cuyahoga County’s treasury.

I’m not holding my breath.

Right now, I simply read the heralded deal as somebody has saved County Commissioner Tim Hagan and Jimmy Dimora from their embarrassing debacle of having purchasing something which they had not the resources to accomplish.

It should go down as another of the white elephant deals of this generation’s sold-out political leadership.

The Pee Dee display – accompanied a fanciful 81 square inch Page One drawing – offers much more than we can expect for years ahead, if then.

What needs to be watched is how many years these developers will hold onto these properties without any development.