Episode 6 - OKC Mayor Holt talks $1B NBA Arena

In this episode of The Connection podcast, co-hosts Marshall Macomber and Mary Scott Nabers welcome Mayor David Holt of Oklahoma City as their guest. Mayor Holt provides insights into the leadership and development initiatives driving Oklahoma City's growth. H  

The conversation highlights a major upcoming project: the construction of a new arena, which Mayor Holt describes as a critical endeavor for maintaining Oklahoma City's status as a big-league city. He discusses the challenges and strategies involved in securing public support for such a significant investment, emphasizing the importance of clear communication and framing the project as an investment rather than a tax burden. 

Episode 6 covers the intersection of government leadership, infrastructure development and community engagement in fostering urban growth and economic vitality. 

Meet the expert co-hosts: 

Marshall Macomber is a visionary executive with a unique blend of business development, political strategy, communications, and public sector experience. He is founder and president of ThinkP3, a DC-based consulting and lobbying firm promoting innovative infrastructure solutions and alternative delivery models such as public-private partnerships (P3s). He played a key role in the 2021 infrastructure bill, initiating a vital USDOT program for state DOTs. Macomber is also a former Chief of Staff to Congressman Mike Rogers and holds an MBA from Georgetown University. A member of George Washington University’s ESG & Infrastructure Steering Group and other boards, he is a frequent speaker, panelist and moderator at industry events.  A driving passion for growing public transit, building walkable and equitable cities, decarbonizing America’s energy grid, and improving railroad infrastructure and operations gets him up in the morning and keeps him up at night. 
 

Mary Scott Nabers is President/CEO of Strategic Partnerships, Inc. (SPI). A recognized expert regarding P3s, she is the author of Collaboration Nation – How Public-Private Ventures Are Revolutionizing the Business of Government & Inside the Infrastructure Revolution – A Roadmap for Rebuilding America. Her articles have been published by media outlets, including Forbes, CNBC, The Hill, & POLITICO.  Mary was the President and General Manager of two media firms. In government, she served as the Commissioner representing Business at the Texas Employment Commission where she was a high-profile, proactive business advocate who founded The Texas Business Council. Then, Commissioner Nabers moved to the Texas Railroad Commission, the state’s regulatory agency for the oil and gas industry, which at the time regulated approximately $65 billion of the state’s economy annually. 

Meet the expert guest: 

Mayor David Holt served as chief of staff to the OKC mayor from 2006 to 2010 before becoming a state senator from 2010 to 2018. Elected as OKC's first Native American mayor in 2018, he was reelected in 2022 with the highest votes since 1959. Holt's national influence is seen through his roles in the U.S. Conference of Mayors, where he currently serves as first vice president and is set to become the first Native American president in 2025-2026. He has actively contributed to national initiatives, including his involvement as the national co-chair for passing the Bipartisan Infrastructure Law in 2021. Within the Conference, he holds key positions such as vice-chair of the International Affairs Committee and co-chair of the Task Force on Electric Vehicles.  

Transcript

Marshall Macomber (00:00) 

Welcome back everyone to The Connection. It's a podcast of government market news. I'm Marshall Macomber with ThinkP3 in Washington DC. I'm your co-host here and I'm joined as always by my co-host and colleague Mary Scott Nabers who's president and CEO of Strategic Partnerships in Austin. Hi Mary. We have an it's going to be a great show. We've got another terrific guest today Mayor David Holt of Oklahoma City, Oklahoma. Mayor, thanks for being here today. 

Mary Scott Nabers (00:17) 

Good morning, Marshall. We've got a good show today. 

Mayor David Holt (00:31) 

Sure, thank you, Marshall. Thank you, Mary. 

Marshall Macomber (00:33) 

It's, uh, you know, we're looking forward to the conversation here, Mayor. Your name comes up in a variety of, uh, leadership capacities, the fascinating and exciting things happening in Oklahoma city. First of all, give us a background. Give us your quick bio, who you are and tell us a little about the city you represent and Mary's got a couple of questions we'll get into after that. 

Mayor David Holt (00:52) 

Sure, I'm born and raised in Oklahoma City. I went out to DC to go to college, George Washington University. And I worked for the Speaker of the House and then for President Bush coming out of college. So all in, I was in DC for seven years. I worked in the White House Office of Legislative Affairs from ‘02 to ‘04. But I'd met my wife by then who's from Philly, convinced her to come back to Oklahoma City, my hometown.   

And I had a sense that I wanted to get engaged in what was happening here. And in that time period, we were sort of on the cusp. We had started to make some investments in our quality of life, some infrastructure investments, but maybe they hadn't fully blossomed yet. And that was soon to come. And I got to be right in the middle of it because ultimately after my return in 2004, I became chief of staff to my predecessor mayor, Mick Cornette, who was mayor for 14 years. I served there for about five years.   

And then I was elected to the state Senate, representing kind of a part of Northwest Oklahoma City where I had grown up. And I served there for eight years. And that's where I was when I was elected mayor in 2018. Um, and now I've been, I'm coming up on six years in office, reelected in 2022. Um, a little bit about Oklahoma city. I mean, just real nutshell, just so people have a sense of it, obviously, hopefully they know where it is. It's Oklahoma, just above Texas. We're kind of like, uh, I kind of think sometimes our growth means that we're just the next big Texas city, you know?  

And we certainly are a part of that ecosystem. But we're America's 20th largest city now, counting the people who live in the city limits. So like when I stand with other mayors, there's only 19 who have more constituents than me. But as a market size, we're about 42nd, if you count the suburbs. And so you know, we're kind of on the edge for a lot of people of being a big city. And obviously, we haven't been in that mix for a long time. And it's only recently that we've seen that growth, you know, we moved from 

I think maybe 37th largest city when I was born to being the 20th largest city today, passing DC and Nashville. So we're in a new conversation and it's an exciting time for our city. But to a man, woman and child, everybody in Oklahoma City would tell you that the reason for this growth and the reason for the success is investment in ourselves, investment in infrastructure, specifically quality of life infrastructure. And it's really kind of, it continues to be a really exciting time in Oklahoma City's history. 

Marshall Macomber (03:12) 

Mary. 

Mary Scott Nabers (03:14) 

Okay, so Mayor, you just skimmed over a lot of your accomplishments, but one of them that we're very thankful for is you were the co-chair of the U.S. Conference of Mayors Outreach Initiative and Advocacy to Pass the Bipartisan Infrastructure Law, which has provided trillions of dollars across the United States. And I speak at a lot of conferences about big comprehensive public-private partnership projects. 

And I find a lot of public officials who are a little timid, a little hesitant, not eager to rush out there because this is something sort of new to just launch these big projects and turn them over to a partner. But you've been very, very visionary. So I want you to talk about a big project that you have come in. 

Almost a billion dollar project, a big stadium. And I want our listeners to know that this is an upcoming opportunity. So no partners have yet been selected. I think they would love to know about that. I know the private sector listeners would. And then the public sector listeners would love to hear any advice you might give them. Anything you wanna share will be good at this point, but talk about your upcoming new stadium. 

Mayor David Holt (04:43) 

Sure, sure. And I'm a pretty hardcore sports fan. So I draw a distinction, a nuanced distinction between arenas and stadiums. And I would say this is an arena, but... No, it's all right. It's all right. You gotta kind of live and breathe this stuff to care about that distinction. But let me talk about that. And then I'll try to put it in a little bit of context for Oklahoma City, the different pathways that we've chosen through the years to build things. And we've been building a lot of things.  

But this particular project came out of, you know, what happened 15 years ago, 15 to 18 years ago, because the story took a few years to develop. And that was our arrival as a big league city, a city that hosts a major league professional sports team in one of the top three leagues. And what I often point out is the reason you associate big cities with major league sports is that 33 of the top 35 markets have a team from either the NFL, the MLB or the NBA.  

And by the way, the only two in case you're curious are Columbus and Austin. And there's sort of some weird geographic reasons for that. But you always assume that if a city truly is a big city, that it's going to have a team from the NFL, the MLB or the NBA. Well, we're, as I said a moment ago, we're the 42nd largest market. So we're right kind of on the bubble. Like it doesn't necessarily make sense for us to have a team in those leagues.  

But we know that that's the that's the gateway to being considered a legitimate upper tier, you know, city and in America, you know, we have no other method to bestow these blue ribbons. It seems that made having one of those teams tends to be the signifier. So we got a chance in 2005 to basically audition for the NBA, we got to host the what became the New Orleans, Oklahoma City Hornets for two years. 

 And that opportunity sort of allowed us to prove ourselves because they were relocating due to Hurricane Katrina, but they had to go back to New Orleans. And so we did prove ourselves. And so a group of our businessmen went out and they bought the Seattle Sonics and ultimately relocated to Oklahoma City commencing in 2008. We had already made some investments and I'll talk about that in a minute to make that possible. But we signed at that time a 15 year lease and that expired last year. 

 Um, and listen, we're the 42nd largest market. We're now sitting on an arena. That's over 20 years old, which is actually relatively old by NBA standards. It's the second cheapest arena in the NBA. It's the smallest arena by square footage. Um, we were not really. By any reasonable or rational standard offering a package that was very likely to secure a long-term lease with this team. And in fact, the team said we're not going to sign a long-term lease to play in this existing arena.  

The arena we now play in is known as Paycom Center. That's a sponsorship name, a local company. So two years ago, you know, is when we started this conversation at least and quickly came to the conclusion, we were gonna need a new arena. This is no easy task. I mean, really, if you look across America, you know, publicly funded arenas in big cities have sort of gone out of style.  

You know, people have had to try to find other ways to make it happen. The problem is in Oklahoma City, we're too small. No one's going to build an arena in Oklahoma City. So if we want these things, we have to do it ourselves. And so it's like two, two trends were coming, you know, we're colliding. One was the reality that no one else is going to build our arena. And the second was the political reality that voters have not been approving arenas in American cities of late. 

 Um, so I knew going into this that I was going to have to do a lot of explaining. I was going to have to kind of educate an entire city of 700,000 people, um, into becoming, you know, business, uh, sports business experts, you know, so they could fully understand the dilemma that we were in, that if we wanted to keep the thunder of the MBA, that we were going to have to make some major investments and comparing us to San Francisco, you know, arrangements in San Francisco or Brooklyn was not going to be very relevant, that we were going to have to do what small markets do and that there aren't very many of us, so there's not a lot of comparisons.  

But ultimately, I dedicated most of two state of the city addresses to this topic. And we've got a great platform for state of the city addresses here in Oklahoma City. We get 1,500 people to come out. It feels old fashioned that you can kind of move people with the speech. 

 The first time I did it was a total surprise. Like people were not expecting this issue. It wasn't on their radar at all. You know, nobody had the date circled on their calendar that the NBA Leafs was about to expire. I had to take this issue from nowhere to top of the list in one speech and was able to do that. And then for the next two years, you know, kind of continue that educational process. 

 And keep up a lot of dialogue with the people of Oklahoma City so they would better understand what we were dealing with. And knowing that I could see these initiatives, if they're even attempted, often fail around the country because people just didn't understand. I think a few things going in our favor was we were able to position it as not a tax increase, it was a sales tax that was taking the place of a sales tax that would be expiring. That's another infrastructure initiative. 

We were able to talk about that. We were able to, obviously we secured a promise of a long-term lease from the Thunder. So they would basically commit to Oklahoma City for 30 years if we voted yes. And then I think we just had to really explain ourselves but also be able to point out because one of the biggest problems in any community for voting for arenas is often, well, aren't there more important things? Don't we need to work on homelessness? Don't we need to work on education? Don't we need to fix our roads? 

 Well, the important thing there was that we had just finished a run over a five-year period of voting for a billion dollars for street repairs, voting for a billion dollars for school infrastructure, voting for a billion dollars for MAPS-IV, which is a quality of life initiative that included key priorities like mental health and homelessness and domestic violence and other really important issues. And so we were able to say, look, we've been kind of like... 

 You know, just checking the boxes of key priorities. And now maybe we can do this thing. And by the way, if you really think about it, you know, the presence of the team, which is certainly at risk here, is partly why we have the economic power to do all those things. That, you know, we weren't doing those things in the 80s and 90s. They're not doing those things in smaller cities. 

 We're only able to do that because of the growth that we've had and that growth essentially leaves town with the team You know if we if we take a step back out of big league status So all of that penetrated in the end, I'd say pretty darn well because we got 71% in December on this vote and You know in politics 60% is a landslide. We don't have a word for 70% you know. 

We don't even know like what how to describe that and we've actually had two straight infrastructure elections that got over 70%. So we're very proud of that. And now ahead of us, we have basically this nearly billion dollar project. A little bit, and I think your audience is a little bit more technical, so they'll maybe enjoy the weeds I'm about to enter, but the sales tax is sort of delayed so that we could, the collection of the sales tax is a little delayed so that we could finish out this other sales tax collection for MAPS 4. 

 And so we could advertise it as not a tax increase. And so the sales tax collection won't even start until 2028 and will conclude six years later in 2034. In the meantime, and this is atypical for us on these sales tax funded projects, we typically build them, pay cash and go as, pay as we go. But in this case, because we need this arena sooner rather than later, because the team, wants the arena sooner rather than later for their commitments. 

 And we'd love to open it, we said in 2029, we're gonna borrow money, probably not through bonds necessarily, but through banks and kind of more like a line of credit, to sort of make it sort of make sense. And we will do that over the course of the next few years. And then commence construction, we hope, by 26 or 27 and knowing that it'll take a couple of years to open it. 

And then we'll begin, you know, the collection of the tax will begin almost as we're opening it and obviously continue for a while. And then we'll be paying it back. But because we're paying it back at a relatively quick pace compared to like selling a 30 year bond, you know, the borrowing costs are less than maybe we're used to for bond issues. But it's a little bit of a different approach. Basically. And this is where I'll kind of give some context. Basically, in Oklahoma City, we've had two different paths. We do bond issues for core infrastructure. 

 That's how we build streets and other basic amenities of a city, fire stations and water pipes and drainage and all that stuff. We'll do that through bond issues and we pass those about every 10 years and those have been pretty easy to pass. The thing that's been a little bit more different, has made Oklahoma City unique, is also about every 10 years we've passed a one cent sales tax initiative called MAPS and we started that in 1993. It stands for Metropolitan Area Projects. 

 And it's always been focused on quality of life. Things that you would arguably say are not as necessary for basic human survival, but as it turned out, have been pretty existential for a city's survival. And the lack of having those types of quality of life initiatives, really was impacting us in our economy and in our population growth for a long time until we started this work. And in 1993, MAPS One got 53%, really out of desperation.  

And obviously, community that was very conservative, preferred a low tax philosophy, but realized that we didn't have anything. Our downtown was dead, we had no entertainment or visitor amenities. And it started to change with MAPS, which built the arena that we're now talking, that we're now replacing, Paycom. It also built the downtown ballpark for our AAA baseball team. It put a canal through the middle of our entertainment district, kind of like San Antonio. 

 It put dams on our river just so it had water in it. We were sick of mowing our river twice a year. You know, we finally had a great, beautiful river, which ultimately turned into an Olympic training site for rowing and other paddle sports. And then MAPS 2 was focused on school buildings. We called it MAPS for Kids. And then MAPS 3 built a 70 acre downtown park, a $300 million convention center, a downtown streetcar. 

 And we're just now finally wrapping up MAPS three. And then in 2019, after I became mayor, I got the opportunity to present MAPS four and it's $1.1 billion, 16 projects, um, again, focused on quality of life. And that's what's going to be the predecessor initiative to the arena project tax when it starts in 20, uh, 28. So we've got, I think an incredible history of investing in ourselves. No, Columbus city. Our people are really bought into it. They really know the story that I just told you their mission focused. 

 And I look at other cities and I recognize we're a little bit of an outlier. Um, but it has been kind of a long journey to be this overnight success. I mean, it took 30 years of building trust with the voters and now MAPS four got 72%, the arena tax got 71%. There's a high level of trust now and no, uh, and, and it seems no inclination to stop investing in ourselves because we've seen how it pays off. 

Mary Scott Nabers (16:40) 

Marshall, I'm going to turn it back to you, but I just got one more question here real quickly. Okay, so Mayor, we've got people listening to this podcast who are going to want to compete to perhaps help build that. So talk about your timelines. When do you think you might be ready to start dropping some solicitations? Is there someone there that interested parties can come and talk to about the project? 

Mayor David Holt (17:07) 

Yeah, we'll begin that process. I mean, we're engaged in that process now to some extent. We are in a bit of a rush by government standards. People thought probably that locally thought that when I said we wanted to open this by 2029, they wondered why we would take so long. But the reality is that's very aggressive for our history. This is actually the fourth arena that we've built in city history. And every one of them opened a good 10 years after the vote. And we're hoping to open ours six years after the vote. So. 

Um, for that reason, I would tell your folks to pay attention. Yeah. I mean, get locked in now. Um, if they have no existing relationship with the city of Oklahoma city, uh, to date, and they want to get on the lists, you know, I may just suggest send an email to mayor at okay. C. Dot. Gov. That's mayor at okay. C. Dot. Gov. And, you know, just say I'm so and so, and I'd love to be added to any, um, you know, notices related to the arena project. And I'm sure we can accommodate that. 

Um, but yeah, I would say we hope to be choosing architect and other design aspects of it this year. Um, we're going to cite it probably in the next few months. And, uh, and then we're off to the races and yeah, we hope to be, you know, in construction mode, probably two to three years from now, so yeah, it's a, it for us anyways, it's, it's sort of a, an aggressive timeline. Um, so yeah, get engaged and we we'd love to have as many. 

Many interested parties as possible. I can't see any downside to that.  

Marshall Macomber 

I have a feeling this is not the last time we will talk to Mayor David Holt of Oklahoma City about this project. I think it's important for all city officials, elected officials to see some of those lessons learned. He's clearly in touch with his community. He handled the notion of a tax increase or a continuation of the existing sales tax and talked about that as an investment. Very, very important messaging to your point. 

Mary Scott Nabers 

Yes. 

Marshall Macomber  

Well, we have a lot to learn. It's going to be a lot of fun. And any other final comments or thoughts here, Mary, before we close out? 

Mary Scott Nabers  

Okay. 

No just that I am so excited about the other guests that we have and we're doing one of these every two weeks. So stay tuned. 

Marshall Macomber (21:19) 

Thanks for joining us everybody. We'll talk with you soon.