How will stakeholders split the Rays stadium bill?

Pinellas County, Tampa Bay Rays and St. Petersburg city officials all realize they will likely split the estimated $1 billion cost of a new ballpark; the question is, what’s fair?

Immediately following his Jan. 30 selection of the Tampa Bay Rays and Hines’ joint proposal to redevelop Tropicana Field and the historic Gas Plant District, Mayor Ken Welch told reporters the “once-in-a-generation venture” would require strong partnerships. Specifically, he noted the county commission’s support through bed tax funding would help define the “local share.”

The stakeholder groups – including the Tourist Development Council (TDC) – will now begin the arduous task of defining how they should split the cost of a new 30,000-seat semi-covered stadium that will anchor the expansive redevelopment project. Commissioner Charlie Justice told the Catalyst that County Administrator Barry Burton met with team officials in the days following Welch’s announcement, to establish a negotiation timeline.

While Welch said he hopes a term sheet for the stadium development is complete by mid-year, Justice said, “I certainly am not going to let the county be rushed into making a decision.”

“We’ve talked around this thing for 10 years that I’ve been on the commission, but we haven’t ever had a true conversation of what that means, as far as a percentage of one penny of the bed tax or a flat dollar amount,” Justice explained. “So, there’s a lot of details to be worked out on our side.”

The price tag

Pinellas County Commissioner Charlie Justice

Justice said the estimated cost of a new stadium was $1 billion last year and believes it could now reach $1.1 billion, depending on the facility’s “bells and whistles.”

The cost aligns with Major League Baseball’s newest ballpark, the Texas Rangers’ Globe Life Field, which opened in 2020 with a $1.2 billion price tag. The City of Arlington contributed $500 million through a half-cent sales tax, and a 2% hotel and 5% car rental tax.

In November 2022, the Kansas City Royals’ owner told stakeholders his proposed new stadium would cost $2 billion.

At the Jan. 30 press conference, Welch told reports that the Rays and Hines’ plan to raise $1.8 billion through financing was a deciding factor in his selection. He also noted the city’s consultant projected the total redevelopment construction costs at $4 billion.

Team officials previously suggested they would pay half the cost of a $700 million boutique stadium when pitching their failed split-season concept between Tampa and Montreal in 2021. The even split would mimic the Rangers and Arlington’s agreement, although that came with a $500 million city spending limit.

“It’s a big commitment,” said Justice. “It’s a big project; it’s a big ask.”

He noted other local leaders created special tax zones surrounding ballparks and corresponding entertainment districts, something Rays and Hines officials pitched in their proposal. An additional tax on purchases in those areas could help offset the stadium cost. However, he said negotiations would determine the feasibility of such an initiative and who would receive the money.

Creating a special tax district around the stadium could help offset costs. Screengrab.

Next Steps

While an extensive negotiation process will determine most of the details, Justice said the county’s 6% bed tax on hotel stays is the only funding source “that we would even consider.”

According to the TDC website, the bed tax generated $89.33 million last year. Justice explained that 60% of its “healthy” revenues must fund Visit St. Pete-Clearwater and marketing initiatives. Commissioners reserve the remaining 40% for capital projects that boost tourism.

He said that once team or city officials come to commissioners with a funding proposal – which could be a concept rather than a dollar amount – county staff would then ascertain what benefits the project provides for residents and negotiate accordingly.

The TDC would then review the proposal and offer its recommendations. Dr. Hank Hine, executive director of St. Petersburg’s Dali Museum, asked the TDC for $34 million in October 2022 to help fund a significant expansion.

At the time, Clearwater Mayor Frank Hibbard said his city – which includes Clearwater Beach – generates the most bed taxes in the county. He relayed his expectation that a funding request for a new Rays stadium would soon come before the council and said “there should be some level of equity” on how the TDC spends its bed tax money.

While the council has yet to formally discuss funding a new ballpark, Justice said its members are “generally supportive” of keeping the team in Pinellas County. He said it all comes down to the specific request.

“As long as you have a major league stadium, I don’t know that everything else gets divvied up 100% based on geographic balance,” Justice added. “I’m not so concerned about the county has to be in 50-50 with the city … I don’t want to get into those kinds of specifics until we see what a final price tag is.”

If the TDC approves the initial request, the commission has the final say on what the county will contribute. Justice expressed his optimism that they would reach an agreement but noted Pinellas recently welcomed four new commissioners since the last stadium funding discussion – a spring training facility for the Toronto Blue Jays in Dunedin.

“This board, in the past, has shown that we’re willing to partner with our city brethren on issues that are important to them,” Justice said. “And so, I would say that we will be a partner again, but what level of a partner is really kind of the magic thing.”