Friday, October 19, 2018
News Roundup

Task force says new Rays stadium is affordable — with taxes

TAMPA — Word from Tampa Bay's business leaders is in: The area can afford a new baseball stadium. That is, as long as one makes rosy assumptions about construction costs and the public's willingness to spend tax money.

A $500 million, roofed stadium for the Tampa Bay Rays could be financed without "imposing new taxes on local residents,'' announced a joint chamber of commerce study group from both sides of the bay on Monday.

Even so, tax sources that the chambers do contemplate could prove controversial: sales tax and Penny for Pinellas funds in Pinellas; Community Investment Tax and downtown development money in Hillsborough; a new auto rental surcharge at Tampa International Airport; and additional tourist taxes in both counties.

Chuck Sykes, co-chair of the Baseball Stadium Financing Caucus, acknowledged that a new stadium poses financial and political challenges. But the Rays are a major regional asset, and principal owner Stuart Sternberg has said the team will not be playing at Tropicana Field when its contract expires in 2027.

"We are a great market with attendance problems,'' said Sykes, president and CEO of Sykes Enterprises in Tampa. "I don't think time is on our side.''

The Rays could be expected to pay 20 to 40 percent of the cost, the chamber group said. A 30 percent share would be $150 million.

In a prepared statement, Rays president Matt Silverman thanked the group "for identifying potential funding sources for our next ballpark."

"Regional cooperation like this is sorely needed as we all move forward and work together to secure the future of Major League Baseball in Tampa Bay.''

The group grew out of a standoff between Sternberg and St. Petersburg Mayor Bill Foster. Sternberg wanted to look at potential sites in Tampa. Foster, citing the Trop contract, said no.

The caucus was formed by the Greater Tampa Chamber of Commerce and St. Petersburg Area Chamber of Commerce. They consulted with the Rays, and public officials in both counties.

The analysis made several assumptions.

• The stadium would seat 35,000 to 37,000 fans.

• The $500 million construction bill does not include land cost, parking garages or infrastructure, which could be $30 million to $150 million, depending on the site.

These costs were patterned on the new Miami Marlins stadium, Sykes said. That was built on public land during the depths of the recession for $515 million, plus $95 million for parking garages.

The chamber study group did not include factors that would hinge on a specific site, like compensation for St. Petersburg if Hillsborough built a stadium, or sale of the Trop acreage if a new stadium were built in Carillon.

• Bonds would run 33 years, with interest rates ranging from 3.5 to 4.5 percent for government bodies, and up to 6 percent for the Rays.

Interest costs might be lowered by programs that encourage foreign investment in exchange for U.S. green cards, but the study did not take that into account.

There were major differences in how each county could finance a stadium.

In Tampa, a big chunk would come from a downtown development district that now pays for the convention center. Those bonds will be paid off in a few years and could contribute $13 million a year toward a stadium.

The report suggested that $70 million to $80 million in construction costs could come from the Hillsborough Community Investment Tax, which helped finance Raymond James Stadium, among other projects.

The county has already bonded out its portion for more than a decade, but the city could apply part of its share to a stadium in three years, Mayor Bob Buckhorn said. In the past, the city share has paid for things like police cars, fire trucks and part of Curtis Hixon Park, he said.

The chamber report lays out options, Buckhorn said. "It is vastly premature to discuss which would be more appropriate, but it gives both Pinellas and Hillsborough a good road map of what is out there.''

In Pinellas, the study presumed that the city of St. Petersburg could continue to chip in the $6 million a year it now spends on Trop bonds. Those will be paid off in 2016. The money could be applied to police, parks or tax reduction — unless it goes to a new stadium.

The caucus suggested stadium financing should be in place before those Trop bonds expire.

"Those revenue sources may be reallocated to other projects,'' the report said. That would make stadium financing "increasingly difficult.''

The study also suggested that as much as $12.2 million a year could come from a half-cent sales tax the city now uses for other purposes.

Foster did not return a phone call for comment.

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