JEFFERSON CITY • Gov. Jay Nixon doesn’t need legislative approval to issue bonds for a new St. Louis Rams stadium, members of his administration asserted Tuesday.
That set off a stream of rebuttals from state legislators.
At a state House budget hearing, Doug Nelson, Office of Administration commissioner, said a law passed more than 20 years ago allows the Nixon administration to issue such bonds. The law states that Missouri or any agency or department of the state can enter into a contract, agreement or lease to finance or develop a convention or sports facility.
“This is not an indication of what we’re going to do,” Nelson said. “This is an indication that we believe we have that authority.”
But legislators quickly rebuked the declaration.
“For the governor to think he could put us in debt ... without the action of the Legislature is outrageous,” said Sen. Rob Schaaf, R-St. Joseph, who filed a bill Monday that would require legislative approval to extend any existing bonds for more than $50 million.
Rams owner Stan Kroenke has announced plans to build an 80,000-seat National Football League stadium and 6,000-seat performance venue in the Los Angeles area.
The Rams were bound by the team’s lease at the Edward Jones Dome to stay in St. Louis until 2025. But local officials failed to keep the dome in the “top tier” of NFL stadiums, as required by the lease, allowing the Rams to go year-to-year. The team sent a note to dome managers on Monday, committing to stay in St. Louis through next season, but not any longer.
This month, a two-member task force appointed by Nixon revealed plans for a 64,000-seat, open-air stadium on the Mississippi River, just north of downtown St. Louis, in an effort to keep the Rams in the city. The new stadium would cost nearly $1 billion, with as much as $405 million paid by taxpayers.
To cover much of that public cost, the task force — Jones Dome attorney Robert Blitz and former Anheuser-Busch President David Peacock — suggested “extending” payments that now go to pay off Dome debt.
Of that, the state pays about $12 million a year for Dome debt and upkeep.
But legislators, so far, have not responded kindly to the notion of Nixon making a decision without them.
Rep. Jay Barnes, R-Jefferson City, warned of litigation if the governor takes this step without running it through the Legislature.
“If the Nixon administration chooses to bind taxpayers for ... new debt without a vote of the people and their representatives in the General Assembly, those bonds should have an asterisk to say ‘subject to litigation,’” he said Tuesday.
Scott Holste, Nixon’s spokesman, said the governor would address financing options after he was satisfied with the stadium plan.
Senate Majority Leader Ron Richard disagreed with the idea that the executive branch could unilaterally extend the bonds.
“After reviewing it, I believe they need legislative authority to agree to that,” said Richard, R-Joplin. “I don’t believe they can do it on their own. I believe we should be part of that discussion and that approval process,” he said.
That being said, he doubted that the overwhelmingly Republican Legislature would agree to take on more debt for a sports stadium.
“The sense of it is, right now, it’s meeting deaf ears,” Richard said.
Richard said he wasn’t sure how he would vote on a bond extension because many details remain hazy.
“It depends on what the owners are putting in,” Richard said. “I’ve talked to Dave Peacock about it. I’m not sure (extending the bonds is) even what they’re trying to do.”
If Nixon’s administration goes ahead on its own, legislators would still control appropriations bills needed for the annual debt service payments on the bonds. And they might balk at paying the tab, Richard said, a move that could put the state’s credit rating in jeopardy if the state were to default on the bonds.
Even the suggestion from legislators that they might refuse to pass a budget with annual bond payments for a new stadium could lead to increased costs on any such bond measure, finance experts said.
House Speaker John Diehl, R-Town and Country, previously has said that public money to fund the new stadium would be “a pretty hard sell.” He had no further comment Tuesday.
Democrats agreed that, practically speaking, the Legislature would have to be consulted.
“Issuing additional bonds without approval from voters or from the General Assembly is just not a realistic option,” said Rep. Stephen Webber, D-Columbia, a member of the House Budget Committee.
“You cannot use a now 24-year-old bonding authority to add another $250-plus million that the state is obligated to pay off,” Webber said. “It would be incredibly damaging for the state’s bond rating, it would be incredibly damaging for the General Assembly’s relationship with the entire St. Louis area. I think they would have a very difficult time passing an appropriations bill to pay off that bonding.”
Peacock and Blitz issued a statement Tuesday afternoon emphasizing that they are working with state legislators and local politicians, and are still exploring funding options.
“We will certainly comply with any laws regarding public financing once an approach is determined,” the two said in the statement. “This private-public approach is consistent with successful stadium projects throughout the nation, both in NFL markets and beyond. We’re optimistic it will be every bit as successful here in St. Louis.”
The bill is Senate Bill 319.
Virginia Young and David Hunn of the Post-Dispatch contributed to this report.