Soccer stadium plan gets boost from St. Louis aldermen | St. Louis Public Radio

Soccer stadium plan gets boost from St. Louis aldermen

Nov 28, 2018

St. Louis aldermen signaled strong support for a downtown Major League Soccer stadium by unanimously approving a non-binding committee resolution laying out the terms of the plan.

And while the ownership group is footing most of the bill, Board of Aldermen President Lewis Reed’s resolution that passed Wednesday lays out how certain state and local tax incentives factor into the price tag.

The Taylor family, which owns Enterprise Holdings, and World Wide Technology CEO Jim Kavanaugh are heading up the effort to build the stadium, which would be located west of Union Station. Kavanaugh was part of a group that emerged in 2017 to help bring in Major League Soccer to St. Louis. That proposal floundered after voters rejected directing millions in use taxes to help pay for the stadium’s construction.

“We believe this is a golden opportunity for the city,” said Carolyn Kindle Betz, a member of the ownership group known as MLS4THELOU. “We have two local families that are very committed to the success of our city and want to see the city of St. Louis continue to thrive and prosper.”

The ownership group is seeking some state and local tax breaks, which were laid out in the resolution. Reed’s measure, which passed the Board’s Housing, Urban Development and Zoning Committee unanimously, has 15 co-sponsors, the exact number needed to pass at the Board of Aldermen, which is expected to consider it soon.

“It makes me so happy and so enthused about the future of our city,” Reed said. “This is a big project. And it’s an important one. And it’s one that we could not do if we did not have such committed private investors like we do in the Kavanaugh and Taylor family with a female-led ownership group.

“We’re going to show America how to do it,” he added. “This is bringing real football back to the city of St. Louis.”

If MLS awards St. Louis a team, the ownership group will pay for the vast majority of the stadium’s costs. That’s in contrast to the 2017 proposal, which would have steered roughly $4 million a year in use taxes to pay for the stadium. And it’s also different from a failed 2015 proposal to build a riverfront football stadium that would have extended bonds that helped build the Edward Jones Dome.

The ownership group is seeking state tax credits — and assistance in cleaning up land that the Missouri Department of Transportation currently owns. Other incentives include:

  • Creation of a community improvement district, a transportation development district and a port improvement district that could each levy a 1-percent tax on products purchased within the stadium. The money would go toward “infrastructure and other construction costs.”
  • A 50-percent exemption on the city’s amusement tax. All proceeds from remaining amusement tax proceeds would go into a fund to pay for stadium improvements or, if necessary, demolition of the stadium.
  • A $5-million exemption from sales tax for construction materials.

Reed’s resolution is also asking for the city’s Land Clearance for Redevelopment Authority to purchase land from MODOT and have the ownership group enter into a 30-year lease.

Aldermen Tom Oldenburg, center, Jack Coatar and Brandon Bosley look through information about the proposed resolution before voting.
Credit Carolina Hidalgo | St. Louis Public Radio

Warm, but cautious, reaction

For the most part, the group’s plan got a positive reception from aldermen. Some liked how the plan uses substantially less public money than other stadium proposals  — and added that they’re optimistic that Major League Soccer can bring excitement to St. Louis.

“Overall, this is a far better deal than we’ve seen before,” said Alderwoman Annie Rice, I-8th Ward. “I agree that this is an exciting opportunity for St. Louis, particularly in that area that would solidify our city. There’s kind of a big hole in the middle of downtown and midtown right there. And I think that would be great. Soccer is a really approachable sport. We have a lot of history on that.”

While the lease would reimburse city agencies for costs associated with acquiring the property, team owners would not have to pay property taxes because they wouldn’t own the stadium or the land. According to financial information from the proposal, the property tax exemption is estimated to be about $27.1 million over 25 years.

William Kuehling, an attorney with Thompson Coburn, said requiring the facility to pay property tax would make the proposal “financial unviable.” He noted that neither the St. Louis Cardinals nor the St. Louis Blues pay property taxes on their respective stadiums.

“If property tax had to apply, this would be a real tipping on this and be a very difficult situation,” Kuehling said.

Reed noted that because the stadium site is owned by the state, it hasn’t been generating property taxes for many years. “We haven’t gotten a dime off this property in 60 years. MoDOT controls it,” he said.

Others want greater assurances that the ownership group will pay for future upgrades on the stadium. Some aldermen felt burned when owners of the St. Louis Blues asked for pricey renovations for the Enterprise Center after private money primarily paid for the city-owned facility.

Rice, for instance, asked what would happen if the ownership wanted a stadium expansion that cost more than what was collected from amusement taxes. Betz replied that the ownership group would be willing to pay for stadium improvements in such a scenario.

“So that was what I was looking for from the ownership group: That kind of commitment from the ownership group that should that money not be there that we wouldn’t come back to the taxpayers for that,” Rice said.

St. Louis Public Schools Superintendent Kelvin Adams speaks in support of the proposed MLS stadium plan.
Credit Carolina Hidalgo | St. Louis Public Radio

Adams supports plan

One of the people who spoke up in favor of the deal was St. Louis Public Schools Superintendent Kelvin Adams. He noted that the Taylor family has already voluntarily donated millions of dollars to SLPS — and said a MLS team could help cultivate soccer programs throughout the district.

He said he was “100 percent comfortable with the plan,” which will bring more than $1 million to SLPS through sales tax revenues over a 10-year period.

“It hits the right buttons all the way around,” Adams said. “And more importantly than anything else, it’s about the partnerships that being created. The Taylor family has really worked hard to create those kind of partnerships. So it’s a group that’s already vested in the city and already reaching out by choice to do things others have historically not done.”

Asked if his support of the plan could clamp down on concerns that a property tax exemption could deprive SLPS of needed funds, Adams replied: “It’s my hope that it can.”

“But my intent here is simply to say that we have a group that has been incredibly thoughtful about supporting this community in the past,” Adams said. “And with all of the issues that to have be resolved, I’m confident that they’d be willing to sit down and work out agreements that would make it benefit everybody — but especially the city of St. Louis.”

Reed said Adams’ support for the stadium proposal was unprecedented.

“I’ve been here for awhile,” he said. “And I have never seen that happen.”

Assuming his resolution passes, Reed said aldermen will take up a bill implementing some of the incentives if the ownership group is able to secure a MLS franchise. The ownership group is forming a bid to present to the MLS. It does not have a timeline for the work.

Follow Jason on Twitter: @jrosenbaum