Could the Cleveland Browns finally do something good for the State of Ohio? State Representative Mike Duffey thinks so.
Section 9.67 of the Ohio Revised Code became law in 1996 after former Browns owner Art Modell relocated the NFL franchise to Baltimore. The Columbus-based representative made an appeal to Ohio Attorney General Mike DeWine.
DeWine heard the case and is pursuing legal action against Precourt Sports Ventures and Major League Soccer. The lawmaker announced on March 5 that the State of Ohio is suing Precourt Sports Ventures.
#BREAKING: My office, and the city of Columbus, has filed a lawsuit against Precourt Sports Ventures, the operator/investor of @ColumbusCrewSC, & @MLS, to protect taxpayer interests & ensure they follow the law if they seek to move the team to TX. #CrewSC https://t.co/01Mo8QRYGv— Ohio AG Mike DeWine (@OhioAG) March 5, 2018
Representative Duffey sat down with Massive Report’s Ralph Schudel in December to discuss the Save The Crew movement and if the State of Ohio has a valid case against PSV and MLS.
Below is the interview with Representative Duffey, lightly edited for clarity.
Massive Report: What brought your attention to this issue regarding the Columbus Crew?
Representative Mike Duffey: My nephew actually, we were at a barbecue and he brought it up (in November). I had already contemplated the same thought. I think anyone that was watching this issue critically would have been thinking about, is there a state law that applies in this circumstance?
The thought had crossed my mind and I had kind of accepted out of hand that there was no public money in the facility because I had read it so much in newspaper reports and periodical reports and magazines. Everyone seemed to be drinking the same Kool-Aid that there was no public money and it was a privately financed facility.
What got me thinking about it was that I was doing a presentation, and we have a capital bill coming up here in the legislature which has things called community projects. Which are basically earmarks for projects for theaters, parks, economic development projects, the airport, the list goes on and on.
Last budget, I was producing a power point from this workshop and I was looking through the last capital budget and I saw an earmark for the Columbus Crew Obetz training facility and it was for $500,000. I thought “Oh my god smoking gun here. This is taxpayer support, this could trigger Ohio Revised Code 9.67.”
So I dug into it and I found out that I believe the funds had never been released because they didn’t proceed with that project. I was kind of forlorn and thought, “This is going to go nowhere, this is not helpful.” Then I thought to myself, “We’re not done yet. There has got to be other stuff where they took this public money, right?”
Rep. Duffey: I was surprised at the avalanche of public money that they’ve accepted since their inception. For example, there is a statutory tax exemption, and once I started really getting on to it, there was a night where I just stayed up looking at articles. One of them that I saw, the former general manager of the Crew Mark McCullers said in 2009 to the Columbus Dispatch, “We’ve requested $5 million dollars in state money to improve the parking lot and our fans have been telling us that our facility is not suitable, and it’s overdue that we improve our facility so we can give the fans what they need.”
What was interesting to me about that was ORC 9.67 says “tax supported facility.” So you have the general manager of the Crew describing the parking lot as “their facility.”
Not the state’s facility, not the expo commission’s facility, but their facility.
I talked to other attorneys around town who are part of the Save The Crew movement and they were like, “Did you know there is a lease on the parking lots and they (Crew SC) get 75 percent of the revenue?” So this was improved with state money and they are driving an annual revenue stream off of it, but they didn’t put anything into it? So that to me seems like tax support.
Section 3.2 of the lease agreement between Columbus Crew SC and the Ohio Exposition Commission contains parking revenue provisions. Generally the expo commission retains 25 percent of gross amount charged per car for all paid parking for sporting events and other events held by the Crew or it’s licensed use of the stadium.
However, once a certain break point is reached the OEC retains 12.5 percent of the gross amount charged.
For OEC events held on property, the OEC retains 50 percent of the gross amount charged per car for all paid parking. The Crew is entitled to establish the parking charges for all events.
There’s another piece of the revised code that specifically gives them a property tax exemption, and appears to have been written specifically because of the dates that are in it.
MR: What’s included in the property tax exemption?
Rep. Duffey: The revised code tax exemption for them is ORC 57.09.081
It’s a very long section, but you get a part where tangible personal property, and all buildings, structures, fixtures, and improvements of any kind to the land, that are constructed or, in the case of personal property, acquired after March 2, 1992, and are part of or used in a public recreational facility used by a major league professional athletic team or a class A to class AAA minor league affiliate of a major league baseball team for a significant portion of its home schedule and land acquired by a political subdivision in 1999 for such purposes or originally leased from a political subdivision, such political subdivision qualifying as such pursuant to division (H) of this section, in 1998 for such purposes, are declared to be public property used for a public purpose and are exempt from taxation, if all of the following apply.
ORC 9.67 asks, is it a tax supported facility? If yes, then they are limited in terms of being able to cease playing the majority of their home games at that facility.
MR: Through ORC 9.67 is there any type of invoking of a temporary restraining order to keep Precourt Sports Ventures from the possibility of communicating with Austin?
Rep. Duffey: It would be possible that if the actions of MLS/PSV conflicted with 9.67, that if there was a case in court. According to some attorneys, individuals who could be purchasing the team would have standing in this case because they have a benefit to them that is given by state law which says, “You’re the beneficiary of this if something happens.” So they have standing to make sure that state law is enforced.
Additionally, the state through the attorney general has the ability to also seek to enforce state law and arguably the City of Columbus has the ability once PSV/MLS violates 9.67 to take action as well.
All of them could be plaintiffs, and anyone of them could argue if they thought MLS/PSV was doing something that conflicted with ORC 9.67.