State lawmakers on Monday continued to tackle the issue of funding for St. Louis’ proposed riverfront football stadium. At a House Budget Committee hearing in Jefferson City, legislators questioned each other, as well as a number of experts, on the proposed $985 million project, which is aimed at keeping the Rams in St. Louis.
One of the main concerns expressed by Rep. Jay Barnes, R-Jefferson City, and Sen. Rob Schaaf, R-St. Joseph, who testified together, was the legality of the governor’s stadium proposal.
According to Barnes, the stadium proposal supported by Gov. Jay Nixon, a Democrat, would be illegal for three reasons. Barnes said refunding bonds are not allowed to increase the amount of principal or interest owed, bonds cannot extend beyond 50 years, and a new stadium would have to be built adjacent to an existing convention facility.
The proposed stadium would extend until 2051 bonds that were used to fund the Edward Jones Dome, Barnes pointed out, which would be more than 50 years from the original date of the bonds.
The proposed location along the Mississippi River is not adjacent to an existing convention center, Barnes said, though the city of St. Louis contests that claim.
According to Barnes, the current payment of $10 million a year for the Edward Jones Dome is set to expire in fiscal year 2022, but the proposed stadium would extend those payments to fiscal year 2051.
The lawmaker also raised concerns about the prospect of building a new stadium and still having the Rams move to another city. Even if a stadium were built, Rams owner Stan Kroenke would be able to keep the Rams in the Edward Jones Dome, then move the team to a new city without signing a contract to use the new stadium, Barnes said.
He also expressed doubts about the future health of the NFL, suggesting that in 2051 the league may not be the powerhouse that it currently is. Rep. John Rizzo, D-Kansas City, disagreed with Barnes’ sentiment, citing the Kansas City Royals’ stadium, which was built in 1973 — and renovated between 2007 and 2009 — as an example of a longstanding stadium success.
Schaaf argued that while the St. Louis stadium would bring in tax revenue, most of that money would be spent at other locations in the area whether the stadium was there or not. Rizzo took issue with this idea, rhetorically asking if the hundreds of thousands of people who attended the Royals’ World Series parade would have spent money downtown no matter what.
Joseph Miller, a policy analyst at the Show-Me Institute, said there was a consensus among academic economists that stadiums don’t create economic growth, spur urban revitalization or greatly increase tax revenues.
Ray McCarty, president of Associated Industries of Missouri, said his association teamed up with Nixon’s task force and hired policy analyst Brian Schmidt to assess what would happen if a new stadium was built. Schmidt and McCarty said the analysis found that the Rams and visiting players, who pay an athletes and entertainers tax, would mean about $10 million per year in tax revenue.
According to Schmidt’s calculations, for every dollar the state puts into the stadium project, it will get $1.38 back, primarily in the form of sales and income tax. That return on investment would increase to $1.47 when including indirect forms of economic activity, Schmidt projects.
The analysis also estimates construction of the stadium would bring with it $14 million of income tax and another $7.7 million from other economic activity from 2016 to 2019.