Comm Voice
The city, the county and the Rays: A path forward
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Reports of the death of the Tropicana Field deal have been greatly exaggerated. There is too much at stake for anyone to walk away, and if the basic contours of the deal made sense before the hurricanes, they still make sense today.
The Rays want to stay in St. Petersburg. There are lots of reasons for that. The Rays leaders are personally invested in our community and are raising their families here. More importantly, it makes good financial sense for the team to stay where they have an existing fan base, an identified location and financial strategy to get a new ballpark built, where they generate significant television revenues, and where they have already invested $50 million in design, engineering and prep work for their project.
Major League Baseball also wants the Rays to stay. Moving the team to another market would preclude an expansion team wherever the Rays land, and MLB would forgo expansion fees they would get for a new team. For more than a decade the Rays have flirted with the idea of leaving St. Pete, but there really is no better city for them. If there was, they probably would have already announced their plans to depart.
Most people in our community want the Rays to stay. They are solid corporate citizens, and so far, they have fulfilled all their obligations as part of this deal. They also contribute significant economic benefits to local businesses – just ask EDGE District staples like Ferg’s and Green Bench Brewing. And the city will generate significant new taxes from the $6.5 billio n project that will be developed over the next 20 years.
Concerns about aging public infrastructure, climate change and severe weather are all very real. Reasonable people can debate the value of spending public money on a ballpark when there are many other places that need investment. But the way to update aging infrastructure from neighborhoods built in the 1950s isn’t to shut down future growth. The best strategy encourages thoughtful development, built to withstand future hurricanes, and uses impact fees and new tax revenues to pay for upgrades throughout the city. Otherwise, existing taxpayers will be on the hook for all the costs of infrastructure improvements.
This isn’t a choice between either investing in infrastructure or investing in a ballpark out of fixed, existing city funds. It’s not a binary decision. St. Petersburg plans to finance this project from future taxes that will be paid, in part, from new development surrounding the ballpark as part of the Intown Community Redevelopment Area (CRA). That’s one reason it is important to start the development as soon as possible. The Historic Gas Plant development will also spin off hundreds of millions of dollars of new revenue, not captured by the CRA, that city leaders can, and should, devote to public infrastructure. These are new dollars that local taxpayers will not have to pay to fix the existing problems we are already dealing with.
Funds from Pinellas County going towards the ballpark are also restricted, and can only be spent on tourism related infrastructure. But new county taxes that will come from this project will flow into the Pinellas County general fund and can be spent on county-wide infrastructure projects – or whatever else commissioners prioritize. The county is basically trading restricted funds for unrestricted money that can be used wherever policy makers see the greatest need. This is a good deal for Pinellas County.
The City of St. Petersburg and Pinellas County should honor the agreement they signed in July. That sends the right message to other folks who may consider investing in our community. And the Rays should make it clear that they fully intend to move forward with this project at this location, working with their development partner Hines. Hurricanes Helene and Milton made the next three years more complicated and expensive, but they didn’t alter the basic terms of the larger real estate deal. It’s still a good deal for everyone.
One thing that Hurricane Milton did showcase was the need for a reimagined ballpark, built to current Florida building codes that will withstand future storms. It has created both a challenge and an opportunity. The challenge is obvious. The Rays need somewhere to play for the next few seasons. Wherever they go, they will lose money, with smaller crowds and a revenue sharing agreement with whoever controls their temporary home.
Assuming the Rays also honor the July agreement and fully commit to staying in St. Petersburg, the city, county, and Rays should work together to address their operational funding gap. The city could offer to give the Rays whatever their deductible would be for fixing Tropicana’s roof. The city is legally on the hook for this one way or another, anyway. This could be paid in increments over the next three years, so the city doesn’t have to come up with the funds all at once. Then, the city and Rays should negotiate with Tropicana’s insurance provider to get additional liquidated damages for the costs to fix the roof. These funds will offset some of the losses the Rays will take over the next three years. This is at least a partial solution.
Playing elsewhere is also an opportunity to build audiences for the Rays in other places around Tampa Bay. And building a new ballpark, and the adjacent first phase of the rest of the Historic Gas Plant development, becomes much simpler (and quicker) without having to share the construction site with an active Major League ballpark, managing parking, media, fans and other logistics 86 days a year for the next three years. This alone may not make up enough time to get the stadium open by 2028, but it will help. Ultimately the Rays must make a business decision about the delay and their ability to manage the buildup and build out for a new home.
What happens if the city and county honor their bonding commitment, but the delay means that the economics of the project don’t work, and the Rays decide to leave?
Under the terms of the original use agreement for Tropicana Field, the city has a contractual obligation to offer a suitable ballpark and the Rays have a contractual obligation to play in St. Petersburg for three more years. If the Rays decide to move, this obligation still exists. Instead of offering their deductible and any insurance settlement money to the Rays over the next few years, the city should commit all due diligence to fixing Tropicana Field so it can open by 2027 and then require the Rays to come back to finish the term of their 30-year contract, ending their relationship with St. Pete in 2030.
Hopefully the city would be able to amend the development agreement with Hines instead of tossing it out and starting over with a new RFP. The City and Hines would need a strategy for developing the 20 acres of city-owned land where the stadium would have been built. This would probably require a new masterplan of the entire site and renegotiation of the terms of the agreement, likely with a different sales price since the land was originally discounted to help finance a ballpark. And this new agreement may not include the Rays as a development partner if they terminate the deal.
Even if the deal proceeds as currently negotiated, but without the ballpark, the city could sell the 20 acres of land to Hines, or another developer, at full market value, without any community benefit provisions. These funds could go to infrastructure improvements, affordable housing or other urgent needs. Hines is a world-class developer and has the capacity to deliver an amazing project, even without the ballpark, but it needs an anchor project to be fully successful.
There are lots of possible anchors for the site – though probably none as valuable as a MLB team and ballpark. The $300 million that the County was going to put into a stadium could be reallocated to a highly-amenitized 200,000 square foot conference center attached to a private 750 room, convention-quality hotel, matching Hines’ existing hotel room commitment. Visit St. Pete Clearwater would have an additional asset to sell in Pinellas County. A state-of-the-art conference center, in a highly desirable entertainment district, would attract a different kind of traveler to Pinellas County. The city would also have $270 million in CRA money over the next 30 years to spend on things like the Mahaffey Theater, pedestrian improvements to Central Avenue, support for cultural institutions and reimagining Al Lang Stadium. This isn’t ideal. A conference center doesn’t have the economic punch of Major League Baseball, but St. Pete would survive.
The best possible solution is that the city and county both honor the commitments on bonds they have already agreed to, and the Rays find a way to move forward with expedited construction on the new ballpark. With that assurance, the city and county should find ways to support the Rays over the next few years and all parties should look for ways to shave some time off the construction timeline to open, as planned in 2028.
Allen P Coyle
December 4, 2024at1:50 pm
The majority of residents do NOT want this. The money is better doesn’t elsewhere
Brad Kay
December 4, 2024at1:14 pm
The city has refused it’s obligation to fix Tropicana Field. The Rays should ask for payment for damages.
The city’s refusal to fix Tropicana has nothing to do with the new stadium agreement. The city and the county are both in compliance with their responsibilities under that agreement.
The Rays say they’re willing to proceed with the new stadium agreement but that they are unable. Willingness is irrelevant when the ability is lacking. For example, I am willing to pay second base for the Rays.
By lacking the ability to comply with the new stadium agreement the Rays are in violation of the agreement. The Rays should lose redevelopment rights due to inability to comply with the agreement and should get damages from the city due to the city’s refusal to fix Tropicana.
Brad Kay
December 4, 2024at1:05 pm
One thing not mentioned in economic impact statements is that without a sports team people would still spend that money. It’s not like the Rays bring in most of their revenue from outsiders.
The biggest single expense for a baseball team is player salaries. Most of that money isn’t spent locally. Players spend half the season on the road and most don’t live here in the off season.
I’m sure Ferg’s ete can come up with promotions to get on the days the Rays would have played. But it’s a lot easier for them when the city does it by funding a team.
Frank Lyons
December 4, 2024at1:01 pm
Screw the Rays. Let them go and save the taxpayers money
Dan Mayer
December 4, 2024at12:26 am
The taxpayers don’t want it. This city constantly spits in the face of its citizens and backs corporate greed.
And big out-of-state interest. They have ruined our community here. The people in charge are so foul. It’s disgusting Bunch of drunk drivers and traffic issues twice a week at ljust to fill a bunch of corporate big wigs pockets. They keep.
Filling our communities with affordable housing crime-ridden communities.
The southside is a cesspool And the government.
Officials do nothing
Peter Kent
December 3, 2024at11:10 pm
A possible compromise solution for the Rays, the city, and the county could involve renovating Tropicana Field by replacing its current roof with a four-corner gable design over a clear glass ring wall, similar to the roof design of the new stadium. To accommodate parking needs, two municipal parking garages could be built along I-375 as necessary.
The estimated $300 million renovation and garage costs could be funded through the county’s Tourism Development Tax (TDT) and the city’s Tax Increment Financing (TIF) taxes. Additionally, the stadium would be granted property tax-exempt status. In return, the Rays would lease the renovated stadium for 30 years at a rate of $2 million per month and void all existing contracts.
This proposal offers a way to modernize Tropicana Field while addressing both the Rays’ needs and the financial interests of the city and county.
Jason M Crandall
December 3, 2024at10:53 pm
Rays have the leverage. If the county or city terminates the current deal the Rays still maintain redevelopment rights. There are cities out there that are ready to step up. The costs are locked in for the county and city. The Rays are responsible for all costs overruns.
Nicholas Obregon
December 3, 2024at5:26 pm
The contours of the deal didn’t make sense before the hurricane. The current location is the fewest residents within 30 minutes of ANY MARKET IN BASEBALL. The Trop redevelopment/new stadium combo was a relief, but it was always the last, final hope. It was not healthy for the team or metro area long-term in any sense except keeping them in the area. Hopefully, Tampa can give them one more look.
Robin Davidov
December 3, 2024at5:17 pm
“The extensive study of the economic effects of stadiums on host communities demonstrates that sports venues have limited economic and social benefits, which do not justify the significant public subsidies that they typically receive. Even if limited spillover benefits exist, subsidies are no more warranted for sports venues than they are for other private businesses that confer inframarginal external benefits on surrounding community that typically operate without public assistance (e.g., fine restaurants, amusement parks, and shopping malls).” The Economics of Stadium Subsidies: A Policy Retrospective John Charles Bradbury, Dennis Coates, and Brad R. Humphreys; Kennesaw State University, University of Maryland-Baltimore County, West Virginia University, January 30, 2023. The taxpayers have a right to see the actual financial projections (ticket prices, rental revenue, etc.) and to contractually hold the Ray’s accountable if the promised future economic benefit is not realized. Other Cities have that protection and St. Petersburg should as well.
Christopher Lerbs
December 3, 2024at4:56 pm
The voters elected two new County Commissioners and two new City Council members because they openly and honestly criticized the current stadium deal. It’s time that business leaders respect the will of the voters. It’s also time to set the record straight on tax increment financing (TIF). The approx. $700 million of future taxes generated by both the downtown and midtown CRA (not just the gas plant) are not restricted funds. They can be used to address the $5 billion need to improve aging water, wastewater, stormwater and power systems in our City. Economists warn that the result of diverting $700 million of TIF dollars will be a hole in the City’s funds; and that hole will have to be filled by higher property taxes on all residents. The independent Florida Tax Watch report did not endorse this deal because two important deal points are not included. Voters have spoken. The Rays can play in the $55 million renovated Trop Field. If they leave, the Field can be converted into a multi-use arena which will serve the residents and visitors. Commissioners and Councilmembers must vote NO on the stadium bonds.
Gary Berkowitz
December 3, 2024at4:31 pm
I just saw one of the new Pinellas County Commissioners on television last night, claiming that the election of some new members has consequences. Apparently he thinks that the County can walk away from the contract they signed over the summer without consequences.
I have been in a lot of courtrooms. In every one of them, the County Commission would be laughed right out the door for arguing that the newly constituted Commission had changed its mind. Any court would call that breach of contract.
The City of St. Petersburg is already in breach of contract with the Rays. A commercial landlord that fails to provide an inhabitable place of business for its tenant is subject to recession of the lease. There is no location in St. Petersburg, or anywhere in Pinellas County that is a substitute for Tropicana Field.
The only thing keeping the Rays here is the possibility of future profits. The Rays will lose substantial revenue, probably lose money, until they can play in a Major League ballpark. I wouldn’t blame them if they left town for good.
The County should drop its adversarial attitude today, and its attorneys should tell their client to shut up.
MelvinJunior
December 3, 2024at2:08 pm
Nothing on any large scale will be “developed” there anytime soon without a stadium to anchor it. PERIOD. End of Story. And, in the meantime, MILLIONS of $$$’s, THOUSANDS of jobs, and HUNDREDS of businesses, who are currently, highly dependent on the Rays being there, will all just be outta luck. And, St. Pete will NEVER be this “major Class-A city” that all of these commissioners, Etc. speak and dream of… NOT without a major ‘state of the art’ stadium for major events. And, oh… Not to mention LOSING their ONE and ONLY Major Professional Sports TEAM. Do they even realize just HOW RARE it is for a city, especially the size of ST. PETE, to have a major sports franchise in the first place, that calls the city THEIR HOME!? No, they wanna argue over what NAME they put across their chest. LoL. THESE are not ‘serious’ PEOPLE.
With a brand new state of the art stadium, St. Pete could become a major player as a ‘destination’ for major events. Without it, they are NOT. It is really that simple. And, the city will go back to being mostly, a ghost town, & “heaven’s waiting-room,” again. Tampa is already getting the brand new USF Stadium for upper ‘mid-level’ events, & a new Bucs stadium is not far off from now either, probably within the next 10-15 years. And you KNOW they’ll do ‘that one’ RIGHT… It will be REAL NICE. St. Pete could even get a Men’s “Final-4” and more, IF they do it right!!!! I just wonder if they have even thought about anything like that… The possibilities of landing such ‘big-time’ events (and making sure that the facility is built and ‘set-up’ in order to do so)!? There WON’T be anymore WWE/WWF “Royal Rumbles,” or “Wrestle Manias” bringing in 100’s of THOUSANDS of people without a stadium… That, I CAN tell you. These are REAL IDIOTS.
Lyn Wilkinson
December 3, 2024at7:00 am
What a load of horse hockey! Just like many other opinion pieces appearing in the local media over the last 18 months, this one is full of the Rays talking points, but does not accurately represent the reality of this one-sided deal. Point 1: “Most people in our community want the Rays to stay.” Baloney. Every poll that bothered to ask the public clearly showed the public a) wanted a vote and b) when they understood the terms of the deal, were outraged by the financial imbalance. Point 2: The Rays want to stay in St. Pete so they can enjoy developing, at their leisure, over 30 years, the 60+acres of land they are buying at a fire-sale price. They split the stadium deal from the land deal precisely so they could walk when/if needed, and still retain some of the best downtown land currently available in America. Point 3: The Rays clearly and publicly stated they would not move forward without more $$ from a City reeling from back to back catastrophic storms; the City should “not fix the Trop” and “the deal is dead”. That in itself should be a termination of all contracts. This deal has NEVER been about the team staying – they have been trying to leave for years! It’s always been about the land grab facilitated by a compliant Mayor and Council, who will be long out office when the true costs come due. Let them go and sell/redevelop the land with a partner invested in the long-term success and benefit for all Pinellas County tax payers – not just the chosen few beholden to a billionaire.
Irv Cohen
December 2, 2024at9:18 pm
Jason, very thoughtful analysis
I agree with your ideal solution
Both parties should take a step back and agree to the original negotiated deal
Dave
December 2, 2024at8:03 pm
Jason, that was a well written piece, that offered a fair view of different options and potential outcomes for the paths forward.
tom voight
December 2, 2024at5:48 pm
Rays are “HERE TO STAY” as long as “WE PAY”
They call me Mr Pitiful.
Who wrote that for you Mathis? STU?