Commissioner, city councilman address stadium project concerns
Representatives from the two local governing bodies that will soon vote on new Tampa Bay Rays stadium agreements attempted to assuage concerns from their political base at a recent event.
The St. Petersburg Republican Club provided a rare opportunity to pose pointed questions to City Councilmember Ed Montanari and Pinellas County Commissioner Brian Scott at an April 10 town hall meeting. The council has “target dates” May 9 and 23 to discuss contract details, and votes could occur June 6 and 13.
The county will own the roughly 13 acres housing a $1.3 billion ballpark, and commissioners will vote on contributing $312.5 million following the council’s approval. Scott began the discussion by stressing that bed tax funding can only go towards tourism development projects.
“It’s kind of like laundering money,” Scott explained. “You’re putting money in that has very limited use, and the money that we’re going to get paid back with over time has any use that we want with it. From that point of view, I think it’s a good exchange of dollars.”
He also noted that the commissioners will not finance their entire contribution. The town hall Wednesday night immediately followed the release of a Florida Tax Watch report that pegged the county’s total cost at $587 million when accounting for interest.
Scott said beach renourishment funding will factor into the equation. He believes local officials and coastal property owners will resolve ongoing issues with the Army Corps of Engineers, reducing the need to finance much of the county’s stadium contribution.
Hypothetically speaking, Scott said the county would accrue “a little over” $12 million in annual interest if it financed $200 million over 30 years. The bed tax generated about $100 million in 2023, and the Rays will pay $1 million annually to lease the stadium.
“At the end of the day, what we’re talking about is not really a lot of money when you look at it in those terms,” Scott said. “Any really big project in life requires financing, and financing costs money.”
In addition, Scott said conservative estimates show the county receiving over $450 million in property tax revenue between 2027 and 2056. He noted the property currently produces “nothing.”
Scott said his hypothetical funding gap is about $36 million – which he hopes to shrink through ongoing negotiations – and does not account for the surrounding development’s additional sales and bed tax revenue. He added that the city and county regularly subsidize business entities “that are expanding or relocating to the area.”
Montanari said keeping the Rays in St. Petersburg is a personal priority, as that is exponentially easier than securing a new franchise. He also expressed the importance of the $6.5 billion project’s 1,200 housing units and office and retail space in a growing city.
The city plans to contribute $287.5 million through tax-exempt bond revenues to stadium construction and infrastructure upgrades. The Tax Watch report states that the total cost with interest is $704 million.
Montanari stressed that the city would not raise taxes to cover its contribution, and residents would benefit from economic impacts. Utah-based Victus Advisors believes the redevelopment could generate $11.9 billion and support nearly 18,000 sustainable jobs over 30 years.
Scott said the redevelopment’s additional revenues could result in lower taxes. Montanari said he wants to support institutions that make the city “who we are,” like the Rays and Tampa Bay Rowdies.
“We spend a lot of money on the arts … we subsidize libraries,” Montanari added. “But it all goes into the quality of life in our city.”
Commissioner Brian Scott (left) and Councilmember Ed Montanari repeatedly stressed that negotiations are ongoing and draft agreements are not final. Screengrab, Facebook.
Questions became increasingly pointed before the event concluded. Montanari noted that city and county officials would not sign any contracts unless the Rays agree to another “ironclad” non-relocation agreement.
He also explained that the City would pay for area infrastructure improvements with or without a new stadium. An attendee said the total public contribution would surpass $1 billion. “I think your math is off,” Montanari replied.
Another person said city and county officials lacked the Rays/Hines development team’s aggressiveness during negotiations. Scott and Montanari repeatedly stressed that the process is ongoing.
Scott said stakeholders, including Major League Baseball, all have “skin in the game. So, to suggest that this is completely lopsided, and the county and city are shouldering all the risk, is just not accurate.”
The discussion ended after an attendee said a Democratic mayor and officials are “pushing through” a stadium agreement because they will financially benefit from the project. He added that the Rays support Black Lives Matter and LGBTQ organizations “devoted to destroying American institutions” and asked how that aligned with Republican values.
Scott and Montanari, registered Republicans, said the team’s philanthropic support has no bearing on the project or negotiations. Scott noted that some Oakland residents expressed similar thoughts before the city’s professional football and baseball franchises decided to leave the city.
“The people that were saying what he just said – I don’t think they think it’s a positive that they lost two teams,” Scott said. “And that’s completely outside the scope of what we’re talking about here.”
Jeremy
April 20, 2024at8:53 pm
Can’t have anything nice these days. We live the Rays and they bring a lot to this city. This project is going to make money. Plenty of other projects to complain about. Most the people want it. Only the people that don’t comment. Let’s go Rays! Thanks city council and county commission for doing the right thing.
Drew
April 17, 2024at9:49 am
“Do you really think the Trop area will be redeveloped and taken over by the arts?”
Let’s give them $700 million dollars and find out.
Sounds better than giving it to a sport no one cares about.
Christopher
April 16, 2024at5:20 pm
You’d have the tax revenue if the owners of these new high rises that get rubber stamped got taxed by unit not location. The stadium provides jobs, full and part time, for people who I’m guessing are not like many of those commenting, need these jobs. Do you really think the Trop area will be redeveloped and taken over by the arts? When’s the last time any of you purchased local art.?
Ryan Todd
April 16, 2024at4:11 pm
I may be a Republican, but I will be voting against Montanari for his seat in the Florida senate for supporting this deal. Way to go ahead and ruin your chances before you even run, Montanari.
Hugh Hazeltine
April 16, 2024at2:24 pm
I have been to the Riverwalk in San Antonio many times staying at the Crockett hotel near by. It is an artificial environment that mainly targets tourists. I think we can do better.
To say that taxes will not be raised is a promise that will be hard for Councilman Montanari to keep. I hope he was misquoted. I know him to be careful and thoughtful in all his statements. He is set to leave office on Dec 31, 2024 if not earlier due to his seeking the Florida house seat. After that, future city councils are obligated by law to have a balanced budget. They do that by adjusting the property tax mileage rate.
Drew
April 16, 2024at8:59 am
Baseball is on the decline and we are talking about centering St Pete’s billion plus downtown investment around it? That’s absolutely ridiculous.
It has taken 20 years and a lot of forward thinking to change the image of St Pete from “God’s waiting room”, which it was known as for decades, to a vibrant artistic community that young people are excited to call home and invest their lives in. Why would we go back on all that progress and center our city around a dying sport that only old white men care about?
Save the money, develop the Gas Plant district at a reasonable pace and cost and let the wider community have a reason to invest their lives in this part of the city that has so much potential. Not to mention the traffic for games clogs up our streets even worse than they are.
Also, why are we glossing over the stark fact that the recent WWE event at the Trop shattered Rays attendance numbers by over 100%. The Rays have struggled to bring in fans, setting a 104-year low for postseason baseball attendance last year.
The Rays are a drain on the city: financially, logistically, AND socially. Give us our city back and stop bending the arm of the city leadership and the taxpayers. JUST LEAVE. Saint Petersburg is better without the Rays. FULL STOP
Steve D
April 16, 2024at7:08 am
I’m generally not pro-government anything, but the commenters on this sight make Councilman Montanari seem like the reasonable one. There is risk in any big project, and every deal is different. However, Hines is a good, trustworthy partner. They have done huge projects in other places where I’ve lived, and generally did exactly what they said they would do. This is St. Pete’s only chance to keep The Rays within a larger, fantastically imagined improvement. Therefore, I’m (unusually) for it.
Alan DeLisle
April 16, 2024at5:55 am
Any Councilmember who studies the Development Agreement language will not be able to support this deal. It will haunt them with voters forever. I was hoping for substantial improvement from the deficient Term Sheet, but the Development Agreement is even worse. Read my analysis.
If the Kriseman Administration brought this junk forward, the Council would have been calling for impeachments!
Steve
April 15, 2024at9:00 pm
Get it built
Ryan Todd
April 15, 2024at7:10 pm
How can any self-respecting conservative support the government subsidizing a private business to the tune of $600million?
Councilman Montanari must have broken all of the mirrors in house.
Frank Phillips
April 15, 2024at6:32 pm
Even in a completely biased, shortened format, Neither one of these two public representatives had a single serious, factual point for supporting this scam of a project.
Mr Scott had a completely flippant response about “life being risky” – something I bet he wouldn’t indulge in if this was HIS personal money. Yet it’s ok to “launder” the money (his term) to a Wall Street billionaire. The rest of us can deal with debt and inflation and financial ruin.
Mr Montanari is personally committed to keeping a team here that means subsidizing a billion dollar business, but sharing none of the profit. If he thinks maxing out the city’s credit will be beneficial or magically result in lower taxes, he’s delusional.
Karyn Mueller
April 15, 2024at4:19 pm
Republicans vote NO on this massive corporate welfare proposal. This is the very definition of fiscal irresponsibility. Strike a Better Deal!
The current development terms include giving the 60 acres of publicly owned land away to the Rays/Hines group for only $25,000,000. The Rays are entitled to 50% development rights, but they are paying only $25,000,000 for land appraised at $279,000,000 in 2023. Hines just bought a warehouse on October 11, 2023 in Tampa for $46,000,000 but $105,000,000 is a fair price for 60 acres of prime real estate?? (“Hines Buys East Tampa Warehouse” TBBJ)
In addition, to pay for the $287,500,000 for the stadium subsidy and $130,000,000 gift to the Rays/Hines for infrastructure, we have to take out debt in the form of bonds. The bonds have interest and result in a total cost of $704,000,000 to taxpayers to pay for these developer subsidies. To pay the bonds back, we have to take 50% of the property taxes from the Intown CRA, which includes the most valuable real estate in the city, the high rises on Central Ave and Beach Drive, and obligate those taxes for 30 years to pay for the stadium.
When property taxes are siphoned off to become TIF money, it leaves a hole that other taxpayers have to make up. Right now we may have enough in our general fund to cover our budget. However, as costs rise and 50% of the taxes in the Intown CRA are already obligated, it’s very possible that property taxes will have to raised in the future to meet the budget.
In regards to the audience member’s question, it IS over a billion dollar price tag since the cost of the stadium is $1,200,000,000 when you add to the $704,000,000 the value of the land the stadium sits on (at least $100,000,000) and the lost property taxes ($463,900,000) and the fact that we are giving the $20,000,000 earned interest on the bonds to the developer as well.
In addition, the property tax revenues from the development that the economic impact study promises are based on full build out. Currently the developer has very vague performance requirements on the development of the mixed-use site. Rays/Hines is prioritizing the stadium build to be completed by 2028 while the rest of the site as reflected in the development agreement has very weak minimum development requirements. In the 10/26/23 Committee of the Whole meeting, Michael Harrison with Hines said that they would not pay property taxes until buildings were put into service.
In addition, the Economic Impact Study assumed full attendance at all games and 30 non-game day events a year. We know this is not realistic, however, there are no contract provisions such as claw back provisions to have the developer pay the City taxpayers back if they don’t meet their estimations.
The Stadium project is well planned, coordinated, financed and managed by the Rays, but the non-stadium development is not, leaving the City in the dark. This directly impacts the amount of property tax revenue projections, making the rosy scenario of 100% build out much less likely. We could very easily end up giving the Rays a substantial stadium subsidy and then not getting the build out and tax revenues we were expecting and not having any control over the site.
Write City Council and County Commissioners today and tell them to vote NO!
In the agenda from the 10/26/23 Committee of the Whole meeting, you can see the City slide entitled “Estimated Sources of Repayment vs. Bond Debt Service” that Rays/Hines only pays $50 million over the first 12 years toward the purchase of the property. In the meantime, the City and taxpayers are responsible for giving them $130 million in infrastructure PLUS allowing them to assess the future property owners for their own infrastructure contribution of $54 million.
The Chamber cites that the Economic Impact Study done for the Rays/Hines project was the strongest of all proposals but this claim is false. The City completed the Economic Impact Study on the Rays/Hines proposal assuming full build-out, not based on the project as reflected in the development agreement that only requires weak minimum development requirements.
The economic impact is based on full build-out and a full stadium plus 30 non-game day events a year. We know that is not realistic whatsoever.
The City gave away all its leverage when they awarded the job to Rays/Hines before asking them to submit development terms. Now they’ve asked for literally everything, leaving the City and taxpayers with nothing. No revenue sharing, no naming rights, not even the $0.50/turnstile turn.
There is only 8 weeks before City Council votes, write to them today and tell them to negotiate a better deal!
John Donovan
April 15, 2024at4:00 pm
There is more “there’ there for the city of St Petersburg. In many cases no out of pocket cost to the Rays, but nonetheless very valuable to the city. I’d like to see a new baseball stadium and full redevelopment. The alternative is a soccer stadium, an outdoor concert venue and a larger (15,000 seats) indoor concert venue. We have options.
Adrian Gansen
April 15, 2024at3:53 pm
And yet that comment drew the loudest positive response from the audience that evening. But I digress. The format allows 45 seconds to comment/question the panel. Needless to say, there’s little chance of a meaningful back and forth between the panel and the public. It allows venting. Nothing else. A straw poll was taken and people were overwhelmingly against the stadium. Bottom line… if it’s such a good deal, let the taxpayer vote on it.
L. A. Weiner
April 15, 2024at3:38 pm
What happens to the financial projections if we suffer another epidemic similar to Covid or a Category 5 hurricane during or after construction? What contingency plans are in place to address these low probability high cost events?
Steve Sullivan
April 15, 2024at1:15 pm
What a weak response to a homophobic and discriminatory statement by the audience member. Do you really want that type of hate and chaos to be the normative for St. Pete. I think not