Apr 12
2023
Holes in oversight of Bills stadium deal
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Erie County Executive Mark Poloncarz and his top aides like to say the community benefits agreement accompanying the deal for a new Buffalo Bills stadium is among the “best” and “strongest” CBAs ever committed to paper.
“This is the best CBA ever negotiated with any NFL team,” Erie County Attorney Jeremy Toth told Investigative Post this week.
But a close examination of the CBA, along with interviews with experts and the officials who negotiated the agreement, reveals at least two ways the deal could fall short of those lofty pronouncements.
For one, a yet-to-be-formed Community Benefits Oversight Committee made up of unpaid volunteers will be in charge of holding the Buffalo Bills accountable to the goals and commitments outlined in the agreement. Those include contracting and spending goals, plus monitoring how $3 million in annual contributions from the Bills is spent each year on various community-enhancing projects.
Yet the Oversight Committee will not have a dedicated budget or staff and will have to rely on existing county staff to perform various tasks and functions.
The Erie County Stadium Corporation, by comparison — the Empire State Development Corp. subsidiary that’s in charge of monitoring construction and operation of the stadium — will have a $2.6 million budget and a staff of four. The Stadium Corporation has already hired attorneys from Hodgson Russ and Sidley Austin and has hired the consulting firm LiRo Engineers, according to an Empire State Development spokesperson.
Second, the Bills may have greater control over the team’s financial contribution to the CBA than previously reported. The funds will not exist as a check the Bills send to the Oversight Committee each year to spend. Rather, the Bills, in conjunction with the Oversight Committee, will determine how best to spend a total of $3 million each year.
“This is not necessarily, you know, the Buffalo Bills writing a $3 million check. This is expenditures made by the organization and related entities that then gets reported to the Oversight Committee,” Toth explained.
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The Bills are committing to a CBA in exchange for substantial public support for a new stadium in Orchard Park, across the street from Highmark Field. The $1.5 billion stadium project — supported with $850 million in public funds — netted a CBA worth $100 million over 30 years. The CBA includes contracting and spending goals for maintaining and operating the stadium, as well as supplying concession stands. In each case, 30 percent of the contracts and spending must go to companies owned by women or people of color. The stadium design will also allow for expanded bus service.
That’s in addition to the annual $3 million contribution from the Bills for community projects, a figure which will be adjusted for inflation over the life of the deal.
County officials, from Toth to county legislators, have defended the CBA robustly, arguing that the county will provide whatever resources the Oversight Committee needs and that leaving spending decisions up to the Bills and Oversight Committee is a better set-up than prescribing specific projects and programs.
But some experts questioned whether or not the CBA could be appropriately monitored — and the money spent in the best possible way — under the current deal. John Goldstein, a national expert on CBAs who has served on oversight committees and advised dozens of CBA and other development campaigns, raised concerns that oversight may not be as transparent or accountable as officials hope.
“In this case, because of the tremendous amount of public investment, it just seems that this needs to be a very public and transparent process,” Goldstein said. “And there needs to be someone in charge who has a reputation for being honest and transparent and accountable.”
He also raised concerns that the Oversight Committee was operating in a “closed political ecosystem” without enough public accountability, a situation that could stymie its ability to influence how the Bills’ annual contribution is spent.
“Especially in this case, where the community has no input into how the money’s going to be spent, I don’t see how that money is going to turn into any kind of real benefit,” he said.
CBA oversight committee can’t have staff or budget
In mid-March, when the Erie County Stadium Corporation approved a framework of the deal for the new Bills stadium, it also approved $2.6 million in state funding to hire a director, staff and consultants to monitor the Bills’ compliance with the deal.
Steven Ranalli, previously of the Erie Canal Harbor Development Corporation, was hired to lead the Stadium Corporation. Two-thirds of the agency’s budget will go to consultants and lawyers.
That contrasts with the CBA Oversight Committee, which is prohibited from having a budget. Officials noted, however, that county staff will be available to assist the committee and perform administrative functions.
Legislator John Mills, the Orchard Park Republican who helped negotiate the CBA, said he didn’t “want to create another layer of bureaucracy” by giving the Oversight Committee its own staff and budget. Plus, he added, oversight of the CBA is a less intensive task than monitoring construction of a $1.5 billion stadium, so comparing the Stadium Corporation to the Oversight Committee is “not apples to apples.”
Any staffing needs the Oversight Committee has, he said, “we can handle that with staff in-house.”
“The Legislature is going to be watching this very closely, so any future administration is going to have to toe the line, because this is going to be something that’s reviewed every year by the County Legislature.”
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Toth noted that the county has already hired some additional staff to assist with stadium negotiations, including a new attorney. That attorney, he said, will be available to assist the Oversight Committee, though Toth couldn’t comment on whether or not the county would hire additional staff dedicated to CBA oversight.
“As of now, right now, I am not aware of any new resources being committed,” he said. “But that’s because we’ve already put the resources in place, some resources in place, over the last 12 months.”
County Legislature Chair April Baskin, the lead CBA negotiator, argued that the fewer prescriptions for the Oversight Committee the better, because such a structure would allow for greater community input. That applies to the Bills’ annual monetary contributions, too, she said in an interview last week.
“I’m more comfortable with giving that independent body made up of community members that power, than trying to structure it in a document,” she said.
Neither Baskin nor her staff responded to additional questions from Investigative Post about the Oversight Committee and the resources it will have at its disposal.
An Empire State Development spokesperson, in an email, indicated that it was possible that the Stadium Corporation and the Oversight Committee could share resources after the stadium is constructed, but that such decisions have not yet been made.
“ECSC will have a [post-construction] role, but how the Oversight Committee will be managed and or staffed has yet to be determined,” the spokesperson said.
How the money flows
In part because the Oversight Committee has yet to be established, and its bylaws yet to be written, it’s not clear how the Bills’ annual $3 million commitment will flow.
Baskin suggested that the Oversight Committee will exercise significant control over the money. The Oversight Committee, she said, may be able to accept applications from individuals and community groups who want to seek funding from the Bills for various projects or programs.
“And I intend to be a strong advocate and county government to make sure that they have the resources that they need,” she said.
Toth, however, suggested that the Bills will have significant control over its annual contribution and may only report to the Oversight Committee what it has already decided to fund. That structure was intentional, he said.
“There [were] some legal concerns about putting money into a bank account, controlled by an entity, that didn’t exist at the time,” he said of the Oversight Committee. “And so it was sort of the lawyers stepping in and structuring it in a way that the money doesn’t actually flow through the CBA oversight committee.”
The Bills, Toth said, “ultimately have the control.”
“But what they’ve agreed to do, which no NFL team has ever agreed to do … is essentially report to an independent entity what it is they’re doing in the community,” he added.
A spokesperson for the Bills did not respond to a question about how the team’s financial commitment will function.
Goldstein, the CBA expert, said the Bills’ CBA ultimately gives the team a lot of wiggle room and lacks hard-and-fast accountability measures. He pointed out that the contracting elements were goals, not requirements, meaning they may not be legally enforceable. He also questioned how effectively the annual financial contribution could be spent.
“It’s hard for me to see a scenario where the fund would actually fund something that [has] a dramatic impact on equity,” he said.
“If they really wanted to figure out good ways to use that money, they of course could.”
