Sixers will pay for Philadelphia’s impact studies of the team’s plan for a downtown arena

The Sixers will pay for the Kenney administration’s studies on the impact of the team’s proposed $1.3 billion downtown arena, an arrangement that critics say casts doubt on the outcome of what were promised to be independent city analyses.

The plan, principals confirmed to The Inquirer, is for the basketball team’s project developers to put money into a pot that Philadelphia Industrial Development Corp. (PIDC), the city’s public-private economic development agency, would then use to hire consultants to evaluate key aspects of the planned 18,500-seat arena.

City officials said the Sixers would fund the $655,000 cost of two parts of the study, with the cost of a third part still to be determined.

» READ MORE: The Sixers want to leave South Philly behind. The prospect of a Center City arena presents more questions than answers.

Mohan Seshadri, executive director of the Asian Pacific Islander Political Alliance, a group that has fought the team’s plan to build on the edge of Chinatown, said having the Sixers fund the key research taints that entire process, given the team’s crucial interest in the findings.

“How do we go to our community and say, ‘You can trust the results of this’?” Seshadri said. “The people doing the studies know who is paying. And they have a profit motive to pay attention to who is paying. They’re going to want contracts in the future. They’ll orient the studies around the needs and wants of the developer.”

Joy Huertas, a spokesperson for Mayor Jim Kenney, issued a joint statement on behalf of the city and PIDC that cited the expense of hiring consultants and said, “The taxpayers should not foot this bill.”

The city requested that the Sixers create the pool of funds, but except for providing the financing, the team would have no involvement in the evaluation process, the statement said. PIDC would control the selection and management of the consultants “with no input from the Sixers,” the statement said.

The city and PIDC said having the developer pay for a study is similar to applying for a building permit, where the fee reimburses the city for the cost of examining the building plans.

Nicole Gainer, a spokesperson for the Sixers on arena matters, said it was “no surprise the same people who are collaborating with opponents of the 76ers’ arena plans are trying to cast doubt about the city’s independent analysis.”

“They know if the facts about the benefits of a new arena to Market East and the city as a whole — from thousands of new jobs and millions of dollars of additional tax revenues — are confirmed, the project will win overwhelming support.”

In this case, activists who oppose the arena “are essentially calling the hardworking city employees and talented professionals who will lead this study corrupt,” she said. “They don’t deserve that.”

When asked about the studies last month by the Crossing Broad website, Sixers co-owner and lead developer David Adelman said he was “really glad the city’s doing it, because this way, if someone thought I did it, they’d think I had my thumb on the scale. If Chinatown did it, they had their thumb on the scale.”

Kenney announced in April that the city would undertake an independent, comprehensive evaluation of the effects, opportunities, and challenges of the Sixers’ plan to build on East Market Street. While an arena represents “an exciting opportunity,” the mayor said at the time, “we must understand the impact it may have on the surrounding communities before any plans move forward.”

The headline on the city’s news release said, “City to Independently Evaluate Impacts of Proposed Arena on East Market Street.” At the time, a spokesperson for the Sixers’ development partnership, 76 Devcorp, said the organization fully supported the analysis and looked forward to collaborating with city leadership.

“It’s absolutely a conflict of interest,” said the Rev. Mark Kelly Tyler, co-director of civic engagement for POWER, an interfaith, multiracial people’s movement in Philadelphia. “The only group that should be paying for this impact study, in all fairness, is the city itself.”

Imagine, he said, if arena opponents were to finance the studies. People who endorse the project would immediately claim bias.

“The only way for it to be impartial is for the city to pay,” said Tyler, who is pastor of Mother Bethel A.M.E. Church.

PIDC will select the firms that will be tasked with evaluating three main aspects of the arena’s influence on its environs and the city: economics, building design, and community, the last including an angered Chinatown, the closest residential neighborhood to the 10th and Market Streets site.

Eleven firms applied to be hired: three to study community impact, six for economic analysis, and two for building design, according to PIDC.

The community-impact assessment will cost $530,625, and the economic analysis $125,000. The cost of the design study is still to be determined, according to the city.

That money, had the city chosen to pay for the studies itself, amounts to a tiny fraction of Philadelphia’s $6 billion budget.

An advisory committee was created to review and evaluate the responses from applicants, and to offer suggestions to the city and to PIDC as they select the consultants, according to the agency. That committee includes staff from the city Department of Planning and Development and the Mayor’s Office of Public Engagement, from PIDC, and from the Philadelphia Chinatown Development Corp. and the Save Chinatown Coalition.

City Councilmember Mark Squilla, whose 1st District contains the arena site, said he initially spoke up to say the city should pay the cost of the studies to assure independent evaluations. That view did not prevail.

“The city said, ‘Why should we use taxpayer dollars for somebody who’s trying to do a development? … We’ll run it, but they should pay for it,’” Squilla said on Tuesday. “I thought that was a valid point.”

PIDC’s view, Squilla said, was that the Sixers were only providing the resources to conduct the studies. The agency would issue the formal request-for-proposals, discuss what aspects would be studied, and pick the consultants themselves.

As the district Council member, Squilla holds sway over the project’s ability to progress through the local approval process. In Philadelphia, the tradition of “councilmanic prerogative” gives the 10 members who represent geographic districts the ultimate say on land-use decisions in their territory.

That means Squilla holds veto authority over a huge Center City investment, one that will help determine the future of the Sixers, Chinatown, and the hope for revival on a downtrodden area of East Market Street.

The arena would stand on the footprint of 10th to 11th and Market to Filbert Streets, claiming the Greyhound bus station and one-third of the Fashion District mall — and touching Chinatown at Cuthbert Street. Neighborhood surveys show more than 90% disapproval of the arena.

The city and PIDC announced late Wednesday that consultants had been selected to conduct two of the three analyses.

BJH Advisors, a New York real estate planning company, will conduct the community-impact assessment, partnering with Sojourner Consulting, a Philadelphia-based firm. CSL International, a planner that specializes in sports and entertainment, will carry out economic analysis and projections. The company has offices in Texas, Minnesota, and New York.

No firm has been chosen to study design issues concerning the arena, as the Sixers have not yet submitted a design proposal for consideration.

The Sixers intend to move in 2031, when their lease expires at the Wells Fargo Center in South Philadelphia, where they are a tenant to arena owner Comcast Spectacor, which also owns the Flyers. The Sixers say a new arena will bring investment, vitality, and foot traffic to East Market, and help move the region into a greener future by encouraging fans to take public transportation to the games.

The team has said it will take no city money for the project but is open to accepting state and federal funds.

Mary Yee, a Chinatown representative to the advisory committee, and who previously worked as a Redevelopment Authority planner, said she and others expressed their distress over having the Sixers pay for the studies. That concern was not addressed, she said, as PIDC’s consultant-selection process went forward.

Seshadri said that having the Sixers fund the studies compromises the results.

“The appearance of impropriety matters as much as whether there is actual impropriety,” he said. “It’s especially hard to believe the folks at PIDC and the city, who have years if not decades of experience, didn’t anticipate the reaction. They knew, and they didn’t care.”