Image courtesy of HOK
City taxpayers would pay $215 million more than previously reported for a new NFL stadium in downtown St. Louis under a plan submitted to officials by the stadium task force, headed by Dave Peacock and Bob Blitz.
Documents obtained by St. Louis Magazine through a Sunshine Law request show that the city’s obligations to cover debt retirement would jump from about $6 million per year at present to $9,785,000 in 2020, then increase every year to a staggering $15,975,000 in 2051.
The new obligation, noted in section 4.6 (f) of the proposed agreement, is outlined in an appendix titled "City Event Day Tax Appropriation Amount."
The new schedule is in addition to another one that essentially mirrors the existing payments made by the city toward payoff of the Edward Jones Dome (about $6 million annually).
The city's current contribution toward bond payments on the dome would have disappeared after 2021, when the bonds would have been paid in full. But backers of the stadium contend that continuing at approximately that level going forward still reflects no new tax increases.
Most critically, this was a key argument advanced by city officials in arguing against the need to put stadium funding before the voters under an ordinance passed by the Board of Aldermen in 2002.
The city survived a legal “challenge” in which the stadium backers essentially sued themselves to have the ordinance invalidated. But until now, it was widely assumed that the victory meant that city taxpayers would be supporting the new stadium at the same level as the old one.
Now, in addition to conveniently ignoring that the current bond payments would have disappeared in 2021, the task force has quietly asked the city to back Regional Sports Authority bonds for the project at a dramatically higher level than suggested before. This presumably is needed to cover the gap in funding created when County Executive Steve Stenger refused to avoid putting the issue to a vote in the county, prompting Gov. Jay Nixon—a key stadium advocate—to remove county taxpayers from the picture.
In an attempt to persuade city officials to support the higher spending, stadium backers presented a schedule of projected stadium revenues—and thus, city tax revenues—that almost defies description in its optimism. Among the eye-popping details of the projections:
- The new stadium is projected to generate $63 million in revenues by 2019—as opposed to the current level of just $36 million—representing a staggering increase of 75 percent in what Rams fans, corporate suite holders, and sponsors are presently spending.
- The projections assume that 63,000 seats will be sold in the new stadium, as compared to the current average attendance of 52,112.
- Most incredibly, the documents forecast a compounded annual 3 percent increase in those revenues through the year 2051.
Even if one assumes that St. Louis fans would initially fill a new stadium in excitement over retaining an NFL team and the novelty of a state-of-the-art facility, that’s precisely what happened at the Edward Jones Dome 20 years ago. In real-life history, as opposed to rosy projections, initial years of sellouts and then on-the-field success gave way to declining attendance when the team performed poorly (and long before there was any thought that it might try to leave town).
Nothing in recent history suggests the city should count on a steady, compounded annual 3 percent growth rate going forward. And from an economic standpoint, even if one accepts the assumption that fans and companies would instantly spend 75 percent more in a new stadium, the region might wonder where those new dollars are coming from.
There is no indication in the documents that the city's commitment to the project would be reduced if the projections are not achieved.
Peacock and the mayor's office could not immediately be reached Tuesday afternoon.
SLM co-owner Ray Hartmann is a panelist on KETC Channel 9’s Donnybrook, which airs Thursdays at 7 p.m.