By Stephen Young
By Stephen Young
By Stephen Young
By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
Palladium is the City Hall suck-up giveaway by which this same city council was tricked earlier in the year into shoveling out $43 million in tax money for a French lingerie and sports memorabilia shopping mall next to the new not-quite-downtown arena.
Not that it was particularly strange for Mayor Laura Miller to go after Palladium. That was long overdue. The strangeness was that most of the city council supported her, all except Mary "Yes, Ross" Poss and her Southern Sector Posse.
At Miller's urging, the council voted 10 to 5 to suspend its rule against voting twice on the same deal in one year. That means they can go back in and redo or even undo the Palladium deal at any time in the near future.
This is exactly the kind of spine-stiffening resolve the voters were looking for in February when they voted by 17 percentage points to make Miller the mayor. The city is broke. Things have been badly run. The coffers appear to have been looted by unprincipled insiders. People want a stop to it.
The principals behind Palladium are Ross Perot Jr. and Tom Hicks. Perot always drives a hard bargain, but at least he stays quiet about it. Hicks drives a tough bargain, too, but he can't stop himself from being a rude jerk in the process.
Hicks is the one who complained of "injustices" when Dallas police nabbed his kid at a Deep Ellum kegger for rich Park Cities brats in early 1999. In March when he wasn't getting his way fast enough on the Palladium deal, he fired off insults against the city from a vacation home in Hawaii, saying Dallas was a "can't-do" city and that he was fed up with all the politics.
He's like all these guys: They love the politics as long as it provides them with a positive cash flow. It's called "I love Little League if I win."
And look at the pattern here. Hicks and Perot got their deal, mainly by promising direct infusions of cash into the four African-American council districts and by pocketing the blow-hard support of North Dallas council member Mary "Yes, Yes, Ross, Yes" Poss. Poss' lawyer husband has been a faithful Perot family retainer on and off for many years.
Then as soon as they got the money, Hicks, who had been browbeating everybody about how committed he was to helping the city center, announced he was selling his share of the deal. Then his people started telling the city they were going to welsh on a five-year commitment to manage Reunion, the old city-owned arena, a little stab in the back that could shaft the city to the tune of about $2 million a year.
While all of this was coming apart, Miller, on vacation with her family in Southern California, figures out that Hicks is just a few miles down the beach from her at his summer office. She calls to ask for a personal out-of-town informal meeting to iron out the differences. Here comes the mayor in her beach thongs, sun visor in hand, asking pretty-please can we talk.
He's too busy.
This is a key point in the saga, because it goes straight to Hicks' personality. And it's his personality that will screw the Palladium deal. It's his personality that will screw his partners and his investors in the bargain.
Palladium was Hicks/Perot's second bite of the tax subsidy apple on the same deal. Long before the Palladium subsidy was ever proposed, Hicks and Perot won a hairbreadth referendum in 1998 that gave them a $125 million tax subsidy for their new not-quite-downtown arena. That measure passed almost entirely on the backs of professionally vote-brokered absentee ballots in poor minority precincts.
Reunion still looked new to most people and wasn't even paid for yet. But the plan was to shutter it or maybe even knock it down as soon as the new arena opened. North Dallas voters were ticked. Vote brokers notwithstanding, the irritation over tossing Reunion out like a half-eaten bonbon might have been enough to defeat the subsidy for the new arena.
The Perot/Hicks political handlers managed to offset that negative voter energy by making a handshake promise that Perot and Hicks themselves would keep Reunion open and running for five years. But a year ago, Hicks and Perot started signaling that they wanted a third subsidy, almost a million a year more to run Reunion. The city manager said no. He told them they had made an important moral promise to the voters to run it on their own for five years, and he wasn't going to negotiate any change in that deal.
Then a few months ago Perot and Hicks sent word that they were flat ditching out of the handshake agreement on Reunion.
They had managed it into the hole. No surprise. How did we think they were going to manage it? They have total control over which acts and events appear in which arena. Imagine the divvy: "Here's a bad money-losing act for Reunion. Here's a good money-making act for the new arena. Bad one for Reunion. Good one for new arena."
To make things even worse, Hicks and Perot have refused to open up their own books on Reunion, in spite of information the council has seen indicating that expenses from the new arena have been improperly charged against the old one. (I tried to reach the Hicks/Perot people but was shunted to Lisa LeMaster, their PR agency. They faxed me some statements, but they never produced anybody with the balls to actually talk to me.)
All of this taken together puts most of the city council in a terrible position politically. Coming off 10 years of unparalleled growth in the tax base, the city is financially hammered, forced to slash basic services and fire employees, losing its bond rating, in a bad mess. The public impression is that a lot of this is happening because they've been giving away the store down there. In the middle of all that, the council gets Reunion back in its face like a big custard pie.
They look like fools.
Several weeks ago a number of committees of the council began trying to get the Perot/Hicks people to come talk to them about it. They never showed up. Even last week when the full council met to talk about it, nobody from the Perot/Hicks outfit even bothered to attend the meeting. It was like: "Aha, suckers, we got ours: Now eat Reunion and die!" The speeches made by individual council members at the full council meeting were devastating, and I'm not talking about the members who remotely could be considered critics of Hicks/Perot. The astonishing thing was the level of bitterness and tone of personal betrayal from people who have been among Hicks/Perot's most staunch defenders and advocates on the council. James Fantroy, one of the African-American members whose district is slated for a sluice of cash, said he would not have voted for the Palladium subsidy had he known then what he knows now.
Alan Walne, a Lake Highlands/North Dallas representative, himself a businessman with a long history of defending business interests at City Hall and specifically of voting for Hicks and Perot, said: "I can't even begin to explain to you how deeply this hit me." Walne said he had sought assurances from former Mayor Ron Kirk before Kirk left office that Hicks and Perot would not try to sleaze out of their five-year commitment. "I was told, as Mayor Kirk could do, in no uncertain terms that that wasn't going to happen.
"I know we heard from the attorneys from the standpoint of legally what's there," Walne said, "and Miss Poss has gone on about what's the legal obligation. But I don't do business strictly on legal obligation. When I give somebody my word in addition to that, that's more binding to me than what the attorneys can prove.
"I am very disappointed that Mayor Kirk couldn't have brought clarity to it and couldn't have made a phone call on behalf of the city to remind everybody what the deal was. And it's going to cost the city 2 million dollars."
Finally Walne said of Hicks and Perot: "I don't want to do business with these people."
The reality is that the council's threat to reopen the Palladium deal could go away. Mayor Miller and East Dallas council member Veletta Lill, a strong supporter of the mayor on this issue, both told me at the end of last week that Hicks and Perot could recapture the votes they need on the council. They could protect Palladium by backing off from their attempt to weasel out of the Reunion Arena management contract.
But think about that one for a minute. It means that Tom Hicks, in a strictly pragmatic and businesslike attempt to save his deal and cover his investors, takes his own sun visor in hand, shuffles back down the beach in his own thongs and says to the mayor, "I apologize. We shouldn't have tried to ditch out of Reunion. It won't happen again."
He does that, he's got his deal back. Guess what. He won't do it. This train wreck is going to keep right on happening, because this Little Leaguer can't make himself apologize to the first baseman the way the umpire told him to. Cannot do it. Not grown-up enough yet.
My next prediction? I'm going with projectile vomiting again, this time when all the people who put money into Palladium realize what is about to happen. Ladies and gentlemen, open your umbrellas!