Hillsborough County projected to have $194 million for a Rays stadium

Last week, former local reporter Noah Pransky took to Twitter to share his findings from a public records request he made from the Tampa Sports Authority regarding emails and other materials provided to the government by Irwin Raij, one of their consultants on stadium issues.

Mr. Pransky shared the requested documents with us, and we’ve picked out a few items we thought would be of interest to our readers, including stadium financing and also insight into what travel around a Ybor stadium might look like. Today we’ll look at some of the financing ideas; in the second part of this report, we’ll discuss mobility.

Hillsborough County has $193.7 million projected for a Rays Stadium

As of January 16, 2022, according to calculations passed on to the Tampa Sports Authority (TSA) by Raij, there is approximately $193.7 million projected to be available for funding a new Rays stadium from Hillsborough County taxes, a figure that falls well short of the $1 billion costs for a permanently roofed stadium, but is also not the full story.

For now, here is an analysis of the money currently available:

• $155.27 million - Tourist Development Taxes
• $19.54 million - Property Taxes (“PUF/Special District Assessment”)
• $18.86 million - Other sources (“Admission Charges”)

It should be noted this is likely not comprehensive of the tax dollars that could be made available by Hillsborough County. The city and county could also create additional tax breaks, or grant public land toward the stadium or its parking lots in order to facilitate the project.

In the analysis, the Tourist Development Tax is a six-cent tax ($0.06) levied on hotel stays in the County. The tax had been just 5% for a number of years, and much of that revenue fulfills commitments to the Convention Center and to Amalie Arena. But the tax was increased to 6% in 2019, and that last penny is not currently obligated for any fixed expenses. In his calculations, Raij is assuming that the Rays stadium could have 75% of that “sixth cent” dedicated to its debt service.

The property taxes noted above are derived from Special Districts and are separate from any Tax Incremental Financing districts that could be established to benefit a stadium construction project. A long awaited report on the feasibility of a new Rays stadium commissioned by the TSA from two different consultants, as summarized by Raij, was reviewed by the Tampa Bay Times on Sunday night, and per that reporting laid out what a new district could look like:

Paying much of the public portion of the stadium costs through a potential levy or assessment within a new “ballpark district” that takes in the stadium site and areas beyond it. The boundaries are roughly Palm Avenue east into Ybor City, south to Adamo Drive and back northwest around Booker T. Washington Elementary School to Nebraska Avenue.

That same report from the Times notes that, “An additional $14 million a year in property taxes from nearly 6 million square feet of “ancillary development” in Ybor City” could also bolster the finances available for Hillsborough County’s contribution. The Times did not report what amount the County is projecting it can provide the Rays, and it’s not clear where those property taxes fit in the analysis reviewed.

Ultimately, none of these additional contributions would significantly move the needle for a Rays construction project unless there is an extension of the controversial Community Investment Tax, a 0.5% addition to sales tax that was implemented in 1996 and currently expires in 2026. It is the elephant in the room, and continues to go unmentioned.

The Community Investment Tax (CIT) covers a wide array of local projects, including school construction; and a small part of it has been dedicated to debt service on Raymond James Stadium (home of the NFL’s Buccaneers) to leverage $168.0 million toward its construction. CIT dollars pay back the financing to build the stadium and also fund $750,000 of maintenance costs annually.

The correspondence we reviewed did not include any discussion of the CIT; however, the legal documents regarding Raymond James Stadium’s construction (which includes these figures) were referred to. Using some back of the napkin math, if the Rays were to receive a proportional amount of CIT funds, that same contribution to Raymond James Stadium would be equal to $299 million in 2022 dollars.

So, what does all of this mean?

Hillsborough County currently has almost $200 million of funds available for a Rays stadium project. If the County were to foot 50% of a $1 billion construction project, it would need to find approximately $300 million in funds; or, roughly the amount of what a CIT extension could generate, based on the way the 1996 tax was allocated.

A study published by the County in 2016 reported that the CIT had raised $2 billion for public projects (including stadiums) just 20 years into the 30-year project. So while the CIT may have been conceived as a stadium fund, it has also become a source of great public good that far outweighs the initial needs for a stadium project. And Hillsborough County residents are already paying this tax — extending it would not involve a tax increase but would rather be a continuation of an existing tax.

Will Hillsborough County look to extend the CIT beyond its 2026 sunset? And if it does, could it once again package community projects high on the priority lists of county and city officials as well as the general public with funds for a new baseball stadium?

Such a suggestion could face strong headwinds.

Even if county officials decide to put an extension of the tax on the ballot, every dollar of CIT given to the Rays would be one less dollar for education, public safety, transportation, water (e.g. wastewater, reclaimed water, stormwater), parks, libraries, museums, or government facilities (e.g. fire and police stations).

Also, the Glazer Family (the owners of the Buccaneers) would no doubt be looking for a piece of the pie for improvements too, as provided in the current CIT, or better yet a replacement for Raymond James Stadium. Previously, our site laid out how redevelopment at Raymond James Stadium could be the ideal location and opportunity for a new Rays stadium.

In closing, we would like to be clear on one important matter: we are not advocating that the county spend half a billion on a stadium. Even if revenues could be identified that would not directly increase the tax bill of residents, it still represents a transfer of wealth from the taxpayer to wealthy team owners. There are practical and ethical reasons to look critically at such a deal.

And there are further complications: the Rays front office has not yet rescinded its comments declaring the Tampa Bay region incapable of supporting a full season of Major League Baseball, and recent public polling shows that fans do not believe the team has made a good faith effort to remain in Tampa Bay.

This article is merely noting that if local officials and their constituents are interested in putting funds into a stadium, a path is starting to take shape that could make it happen.

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Coming tomorrow: Transportation issues, Ybor City, and the Rays stadium plan.