JEFFERSON CITY • A new riverfront stadium for the St. Louis Rams would generate a net benefit for the state relatively quickly, even if taxpayers took on debt to help build the project, a state analysis projects.
The study, by the Missouri Department of Economic Development, predicts a cumulative net return to the state of $295 million over 30 years.
The biggest chunk of the money would come from personal income taxes paid by football players, staff and coaches. They will pump an estimated $9.6 million into state coffers this year, an amount that is projected to grow by at least 3 percent a year and probably, “significantly” more.
“I was very conservative on these estimates, and I think it shows a pretty good return” for the state, said Mike Downing, director of the Missouri Department of Economic Development.
Downing, who presented the study to a House committee, said the analysis took into account only the direct benefits of building a new stadium and keeping an NFL team in St. Louis. He said there were “too many unknowns and variables” to calculate the project’s indirect benefits, such as money that players, coaches, stadium workers and fans would spend in the region.
The study drew polite but skeptical reviews from the House Government Oversight and Accountability Committee. Some legislators questioned the premise for subsidizing a sports stadium.
“Why are we involved in this at all, rather than just letting private industry compete for it?” asked Rep. Tom Hurst, R-St. Thomas.
Dave Peacock, part of a two-man team appointed by Gov. Jay Nixon to try to keep the Rams in St. Louis, said subsidies have become commonplace and “some level of public financing is going to be very important” to make the project happen.
Peacock said planners have received no guarantees from the NFL that St. Louis will continue to have a football team.
“What we have been told from the (National Football) League is, if you accomplish financing your portion and you can demonstrate you’ve got the property, the land and a design that works ... you will, quote, control your own destiny as it relates to an NFL team,” Peacock said.
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.
Rams owner Stan Kroenke has announced plans to build an 80,000-seat stadium in the Los Angeles area. Under NFL relocation guidelines, teams must exhaust all efforts to settle stadium issues in their current markets before being allowed to move to other cities.
To keep the Rams in St. Louis, Peacock’s planning team has proposed a 64,000-seat, open-air stadium on 90 acres along the Mississippi River, just north of downtown. The new stadium would cost nearly $1 billion, with as much as $405 million paid by taxpayers.
Benefits to the state would include upgrading the area and maintaining the tax base, Peacock said.
“It’s redeveloping an area that has been kind of ignored for years, for the most part,” he said.
Most of the public money would come from extending payments that now go to pay off debt on the Edward Jones Dome. Of that, the state pays $12 million a year for Dome debt and upkeep.
The Nixon administration contends the current stadium bonds could be extended without a vote of the Legislature. Some legislators oppose that approach and have filed bills to prevent Nixon from proceeding on his own.
The project also might be eligible for a total of about $50 million in tax credits from the Missouri Development Finance Board and the state’s brownfield program, which covers the cost of cleaning up contaminated sites. Those subsidies are not counted in Downing’s analysis.
Speaker John Diehl, R-Town and Country, asked the committee to examine the project’s costs and benefits. Committee Chairman Jay Barnes, R-Jefferson City, said the panel would not try to determine whether the governor had the legal authority to extend the bonds.
In a statement she submitted, social welfare advocate Jeanette Mott Oxford of Empower Missouri cited studies that suggest the rate of return on investing in a stadium is extremely low — or even negative.
Tom Sullivan of University City attended the hearing on behalf of a group called the Coalition Against Public Financing for Stadiums. He said that because of local ordinances pushed by the coalition, any decision to extend the current stadium bonds would require voter approval in St. Louis and St. Louis County.
Talk of the governor extending the bonds on his own, Sullivan said, “should not be taken seriously.”