Meant to report on this yesterday, but got sidetracked: In St. Louis, it turns out that that trick for getting around the requirement for a referendum on any new stadium spending — approved by voters after the Cardinals got a bunch of public money without a public ballot — by using the old stadium money to pay off the new stadium while using new money to pay off the old stadium (deep breath…) may not actually work, for the simple reason that so darn much new money will be needed. Speaks the St. Louis Post-Dispatch:
“If all they’re doing is taking longer to pay it off, that’s one thing. But I’m assuming they’re actually getting new money, which is what they want,” said Peter Salsich Jr., a retired St. Louis University law professor.
Salsich warned that no one will really know until the deal’s details are revealed.
Still, he said, “It’s going to be tough to argue that a vote is not required.”
The funding plan for the proposed new St. Louis stadium, in fact, remains beyond murky. Currently the public is paying $24 million a year ($12 million state, $6 million county, $6 million city) toward the bonds that were sold to pay for building the Edward Jones Dome 20 years ago to lure the Rams in the first place. There’s about $100 million in principal left to pay, which when interest costs are added is expected to be off the books by 2021.
To fund the new stadium, St. Louis Sports Commission chair Dave Peacock has proposed refinancing the bonds, and using the proceeds to somehow pay off not just the remaining $100 million on the Jones Dome, but around $400 million toward a new Rams stadium. They could do this by just extending the bonds, but even at a 3% interest rate over 30 years they’d still need almost $32 million a year to pay it off, which is significantly more than $24 million. So unless St. Louis officials know some bond buyers who’d be willing to take a 1.5% return on their investment, new taxes are going to be needed somewhere here, on top of extending the current ones.
Could St. Louis figure out a way of using any new city spending only to pay off the old stadium, while funneling the old taxes to the new one? Mmmmmaybe, though it’d take some pretty fancy financial and legal footwork. Jones Dome board chair Jim Shrewsbury told the P-D that the question would likely end up in court, which means St. Louis could be looking at months of legislative battles, followed by months of court battles, followed by months of a referendum campaign before knowing if its stadium plan would actually fly. All of which means that in addition to “Does Stan Kroenke really want to move to L.A.?” we should probably add “Can Stan Kroenke be patient for his $400 million check?” as questions for if and when Kroenke ever picks up the phone.