From baseball bleachers to material breaches
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From baseball bleachers to material breaches
Keizer’s sweetheart lease with stadium contains several foundational terms that aren’t being enforced
Y’all remember when Volcanoes Stadium hosted that christofascist, homophobic, anti-vax conspiracy fest called ReAwaken America in April 2022?
Turns out, that shameful (and dangerous) event might have resulted in a material breach of the lease between the City of Keizer and Jerry & Lisa Walker, the owners of Volcanoes Stadium.
And that might not have been the only time they potentially violated the terms of the nearly 30 year-old sweetheart lease of 20 acres of prime commercial, city-owned land to the Walkers.
Before we dig in:
I am not an attorney. Despite spending one year in law school and sometimes in social settings I claim to be ⅓ lawyer, I do not have any special legal qualifications, and zero professional hands-on expertise with respect to real estate or contract law. Although I do remember being completely lost in Contracts as a 1L. But, y’know…I read good. And the interpretations that follow are reasonable. Might an actual attorney look at this analysis and find deficiencies that a journalist might not see? Maybe? But this is a good-faith exploration of some wild contrasts between what’s in the lease, and what happens in real life.
Open Section 4, Get on the Floor, Everybody Walk the Dinosaur
Remember that song? “Walk the Dinosaur.” So good. Find that on Spotify (or whatever). It’s by an 80s band named “Was (Not Was)” and it is a very, very quintessential 1980s song.
Right - so, there are 4 areas of this lease agreement that smell funky. And, weirdly enough, they ALL SPRING FROM SECTION 4 OF THE LEASE! Isn’t that weird? We think so.
Here’s the link to download the lease, if you’re some type of legal dork who wants to read along at home.
Section 4.1: Lessee shall maintain and operate the business in a first-class manner
“Lessee shall maintain and operate the business during the entire Term with due diligence and in a first-class manner to produce the maximum Percentage Rent to Lessor.”
“Lessee acknowledges that any violation of the foregoing provisions of this section by Lessee constitutes a material breach of this Lease.”
After more than 2 decades, the Walkers were unable to maintain a relationship with their Major League Baseball affiliate - the San Francisco Giants. Despite the fact that the Giants reportedly never gave the Walkers a solid reason for ditching them in 2020, the Salem-Keizer Volcanoes lost their MLB affiliation. Rent payments (based on percentage of ticket sales and parking fees) made to the city were dwindling even before the Giants ghosted the Walkers in 2020, but they’ve certainly not reversed that trend since.
And with Volcanoes Stadium currently home to a fledgling independent league the Walkers created on their own, it’s difficult to imagine an interpretation of Section 4.1 of the lease generous enough to describe the current state of business as “first class.” In fact, reasonable folks might argue that “first class” left town when the Giants (and MLB) split.
And it definitely doesn’t feel right describing the current “percentage rent to lessor” as maximum by any stretch of the definition of the word “maximum.” In fact, based on what nearby city-owned properties in Keizer Station (the shopping complex Volcanoes Stadium sits directly adjacent to) are worth, the “percentage rent to lessor” is best described as “minimum” or “far below average.”
According to language of section 4.1, “any violation of the foregoing provisions of this section by Lessee constitutes a material breach of this Lease.”
Section 4.2: Any and all references to the team shall include Salem-Keizer
“The name of the team shall be the "Salem-Keizer" followed by a nickname that Lessee shall choose at its discretion. Any and all references to the team shall include Salem-Keizer, and the team in any advertising or publicity whatsoever shall not shorten or abbreviate the name or omit specific reference to Keizer or the City of Keizer.”
Keep in mind this section was first written in 1997 when the structure of the Volcanoes business was materially different than it is today. In place of an MiLB team to apply this provision towards, the Walkers now have created an independent league.
The “team” is no longer the product being marketed to the public, and instead has been replaced with Mavericks League at Volcanoes Stadium. The league is the primary brand under which they market their business now. You can see this reflected on their website (notice the domain name) and their promotional efforts in the community.
Again, it’s difficult to see how the Walkers are adhering to Section 4.2 of this lease as it does not adhere to the spirit of the provision set out in the lease. Perhaps if the Walkers had renegotiated this point when they got dropped by the Giants and started their own indy league - but there’s no evidence that happened.
This section also carries language suggesting adherence is material to the lease agreement: “Lessee understands and agrees that this requirement is a material term of the Lease.”
Section 4.3(b): Parking Lot Events shall not be unruly or significantly disruptive to surrounding properties.
(b) "Parking Lot Events" are those events which use the parking lot for any purposes except for parking vehicles while the occupants of such vehicles use the open space referred to in Section 4.3(a) above, or the Stadium. Such Parking Lot Events shall not be unruly or significantly disruptive to surrounding properties.
When the Walker family agreed to host the Reawaken America event in the parking lot in April 2022, this lease term was not adhered to. Dozens of stores in Keizer Station closed because of the event. Community members were harassed by attendees. And folks peacefully demonstrating against the event were targeted as they left Keizer Station.
Additionally, the event - factually described as a christian nationalist political rally advancing bigotry, homophobia and dangerous disinformation about vaccines and election integrity, among other things - was widely viewed as disruptive to the community and deeply damaging to the reputation of Keizer.
Reasonable people would agree this event was “significantly disruptive to surrounding properties.” However, Section 4.3 in the lease is not clearly defined as “material” to the contract itself.
Section 4.3(d): Lessee shall provide for reasonable public safety, security and traffic control relating to the operation of the parking lot.
(d) Lessee shall provide for reasonable public safety, security and traffic control relating to the operation of the parking lot. Lessee shall provide adequate and qualified labor to operate the parking lot for all events, except Community Events. Such labor shall include, but is not limited to, sufficient personnel to assist motorists entering and leaving the parking lot and such other personnel as may be required to conduct the parking and exiting of vehicles in a prompt, safe, and efficient manner.
During the ReAwaken America event, Lessee failed to provide adequate security and, eventually, relied on Keizer Police to guard the event. Collaboration between KPD and unprepared event security has been documented. It’s reasonable to conclude that this represents a violation of this subsection of the lease agreement.
The potential violations of Section 4.3 (b) and (d) of this lease also raises questions about the City of Keizer’s response to this event.
When asked by the community why they were allowing the Walkers to use city-owned land to bring such a fringe-extremist event with clear deleterious effect on the community, Keizer Mayor Cathy Clark feigned that the city couldn’t do anything without violating the Oregon Constitution.
“To answer the question about whether the city may restrict which people and what organizations come to Keizer is that this is something the city cannot do.
The Oregon Constitution is explicit about our limitation to deny rights of assembly or speech.”
Except a reasonable interpretation of the lease that actually governs the relationship between the lessee (the Walkers) and the lessor (City of Keizer), shows ample evidence that the Reawaken America event might have violated that lease, regardless of specious free speech claims.
That’s because the terms of the lease in question represent an agreement between parties to limit those rights of speech and assembly. For example, from Section 4.3(b), “Parking Lot Events shall not be unruly or significantly disruptive.” That’s a mutual agreement to limit speech and/or assembly for the good of the community.
The “constitutional” argument for letting the Walkers hold this gross event doesn’t appear to hold water. It’s a swing-and-a-miss, you might say (I am morally obligated to include one baseball pun).
So, either Mayor Clark was (and maybe still is) entirely unfamiliar with the terms of the lease that governs what the Walkers do on that city-owned parcel…or she knew and decided to twist the situation into a defense of free speech (which, as we know, is a common hiding place for poor arguments).
With multiple potential material breaches of lease, along with the unrelenting underperformance of the Walker’s indy league on that 20 acres of prime commercial, city-leased land…what justification exists for Keizer continuing to ask its citizens to subsidize a private business with public funds?
We know what OUR answer is to this question. But, it would be great to see Keizer officials take their duty to the public seriously and, at the very least, publicly review the Volcanoes Stadium lease and justify a decision to not enforce these seemingly material breaches.