Hillsborough County considering $500 million in tax hikes to fund new Rays stadium

The indefatigable Noah Pransky of WTSP-TV has unearthed some documents from law firms working with Hillsborough County that show how the county is considering raising public funds to help pay for a new $600 million–ish Tampa Bay Rays stadium. And the options are:

  • Raising the county bed tax from 5% to 6%, which could provide another $6 million a year, enough to pay off close to $100 million in stadium costs.
  • A $2 a day hike in car rental taxes would generate $15 million a year (enough to pay off around $250 million total), though with ridesharing on the rise it would risk driving people out of the car rental market and thus providing significantly less than that.
  • Extending the Community Investment Tax sales tax surcharge that currently funds payments on the Buccaneers stadium beyond 2026. This could provide $10 million a year (enough to pay off about $160 million worth of stadium), but the Bucs could also want some of that money when their lease expires the same year as the Rays’.

Put it all together, and you’re certainly in the ballpark (sorry) of the $450 million in public funds that would be needed if the stadium comes in at $600 million and Rays owner Stuart Sternberg sticks to his guns about only chipping in $150 million from his own pocket. Of course, the fact that Hillsborough County can come up with $450 million it can raise by taxing its own residents (and visitors) doesn’t mean that it should — that’s a hell of a lot of money to hand over to a sports franchise just so that it doesn’t move to a city that probably doesn’t exist, not to mention for a franchise that is actually profitable right now under baseball’s revenue-sharing system. The documents Pransky uncovered don’t talk about what the effect on the local economy would be of raising multiple taxes by this much, or how a Rays stadium compares to other projects that could be funded by similar tax hikes, but I’m sure Pransky will be examining those questions in coming weeks and months.

Anyway, this is far more information than Pransky got by following local politicians around and asking repeatedly, so kudos, Noah! Sometimes journalism is mostly about finding the right people to pester.

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30 comments on “Hillsborough County considering $500 million in tax hikes to fund new Rays stadium

  1. Is anyone else concerned that this stadium discussion is for a team that never seems to have fans at the ballpark? I know this is just empirical and even if they sold out every game it still doesn’t mean public funds should go towards building a new stadium.

    Maybe I am just being a snarky AL East rival (I live in Canada), but it does seem odd that such a seemingly unpopular team has this kind of leverage. Again, a popular team should not do this either but still it seems more disturbing that it is this one.

    Also seems odd that in a place with such great weather Florida really doesn’t seem to like either of its baseball teams. Everyone may now begin to correct me with data and remind that the Jays will be destroyed this year by the Sox and Yankees.

    1. Low attendance is why they need a new stadium!

      Of course, if their attendance were high, it would be why they deserve a new stadium. Attendance figures are a win-win, if you’re a team owner.

      1. If low attendance is why they need a new stadium, does this mean that Miami also needs another new stadium?

        1. That would solve Jeter’s problem of the big ugly fountain in the outfield he doesn’t like but can’t get rid of of.

    2. For some reason, even seemingly unpopular teams have leverage when it comes to these things. (See the Cincinnati Bengals, though that could have been more about the power of the NFL than the Bengals themselves.)

      The reasons for the Rays not drawing have been debated for two decades now. Is the ballpark on the wrong side of the Bay? (As someone who grew up on the Hillsborough side, I am always going to believe that has something to do with it, but is not the whole explanation.) Is it because of bad teams? Even when they were making the playoffs under Maddon, they were a below-average draw. Is it because so many Floridians are from somewhere else and still swear allegiance to the Yankees, Red Sox, Tigers, et al? That probably has an effect, too.

      I do not believe the Rays’ front office is full of geniuses, though I DO believe they market the team. I know under Namoli, they made a bunch of anti-community and anti-fan decisions and there is probably some residual effect from that.

      If I were to try to refute the premise that people in the Bay area and South Florida just don’t like the game, I would be hard-pressed to do so using the available evidence. I do know both markets have a rich history of and appreciation for the game itself. For whatever reason – and maybe a lot of little reasons whose cumulative effect is large – it does not translate to consistently robust ticket sales.

      As a Rays fan (who lives out west now), I can tell you the Trop experience is not the best, but it’s not the worst, either. I figure a new park on the Hillsborough side would help, but would not be a panacea.

      Even if they had a spiffy new park nearer the population center and a consistently competitive team and a creative front office, I am not sure they would fill the new place regularly. Maybe they would. Maybe not.

      But as to your question – why a poorly supported team has leverage – it seems to be at least partially explained by our society’s skewed emphasis on sports, elected officials who still believe the ephemeral b.s. about the economic benefits of using public money for private businesses (and citizens who are either too dumb to know better, too partisan to care or get sold out by their elected representatives, who then sometimes reap the kickbacks) and team owners who are only too happy to perpetuate the nonsense that benefits them.

      My opposition to public money being used for stadia that don’t bring a return on investment and don’t revitalize communities remains, even though this is my team and my hometown. This madness has to stop. If that means you follow through on your threat to decamp to Montreal, knock yourself out.

      1. As someone who only visits Florida once a year or so I might posit a more specific case of the classic “it is nice and there are things to do outside” defense. Florida really does have some strongly competing options for “taking family to baseball game” that say Minnesota or wherever does not. Specifically the beach and going out in boats on the Ocean. Both of which are relatively affordable if not cheaper than going to a ball game, and just as likely to entertain families and the early 20 somethings that are two big pillars of the sports market.

        I know when I am traveling for business in say Raleigh or Nashville I might at least consider going to a professional sports game if I have down time. If I am in Miami I go to the beach, or out on a boat.

        I mean other towns have mountains, or a better arts scene or whatever. But the beach is a large low cost amenity that is quite a bit of fun.

      2. KT…a few thoughts from snowy NY…

        1. Totally agree of your assessment of the Trop (and everything else you wrote, too). When I visited it wasn’t dazzling, but it was certainly a comfortable, friendly place to take in a game.

        2. I’ve always felt the issue with baseball in a Florida is that it’s so parochial, and so much of Florida is made up of transplants from elsewhere who come there with their own teams who they may pay to see once a year. But these people never really form a connection with the local teams. (You can tell me I’m dead wrong about this.)

        3. A question for you…having visited the area a few times, it feels to me like Tama and St. Pete are treated like they’re Brooklyn and Queens, when geographically they more resemble San Fran and Oakland. Feels to me like for a daily sport the trek across the bay to the other side (to the Trop or whichever side a new park would be on) is an utter ordeal, especially at rush hour. Am I wrong about that?

        1. On the last point, you might be onto something there. I compared the distance between AT&T Park/Oakland Coliseum and downtown Tampa/Tropicana Field, and latter was actually greater by some 3-4 miles. It also doesn’t help that there are basically no public transit options between Tampa and St Pete, and that the population base (and the disposal income) in TB is nowhere near that of the Bay Area…

          The hope for the Rays, and really any major sports franchise in Florida, is that there will eventually be enough young people who grow up rooting for the local teams to build up and sustain a reasonably-sized fanbase, at which point they could be convinced to shell out $$ for season tickets. On the other hand… since a huge percentage of them also grow up with the mentality that you don’t need to go to games to be a diehard fan, it’s not a foolproof strategy by any stretch.

    3. “…it does seem odd that such a seemingly unpopular team has this kind of leverage.”

      Leverage in these cases is highly independent of rational analysis. Great teams have it, bad teams have it. Teams that would never leave their cities in a million years have it. Rich teams get it, poor teams get it. So it’s really not odd at all that a seemingly unpopular (but profitable) team could somehow convince local pols that taxpayers should be responsible for 80% of the cost of a new stadium.

  2. I can’t believe people in Florida will fall for the “build a better stadium and more fans will come” argument again. Unless people in Tampa are unfamiliar with the Miami Marlins.

    1. Except they do….at first. Marlins’ attendance went from 1,520,562 in 2011 to 2,219,444 the first year of Marlins Park. (They have been last in the league ever since.)

      The Twins’ attendance went from 2,416,237 in 2009 at the Metrodome to 3,223,640 in 2010 at Target Field and they drew 3M plus in 2011 as well. They then dropped every year before moving back up over 2M last year.

      Even the Braves saw a half-million more people last year in their new suburban taxpayer ripoff yard.

      They do come. For a bit. But not everyone can keep them. I figure the Rays would do better in a new park on the other side, but I do not believe it would last, nor do I believe it is worth the taxpayer money to find out.

  3. This is a key point:
    ” it would risk driving people out of the car rental market and thus providing significantly less”

    Neil, do you know if any research has been done on whether the expected windfall from increasing car rental or hotel taxes actually arrives (or what portion of it does if not)?

    It’s easy to say we generate $8m from a 1% tax now. So if we triple it we will generate $24m. If that were true, GM could solve it’s financial problems by selling every poorly built commuter car it builds for $45k rather than $15k, and I could triple my consulting rate and work 65% less because all my customers would simply pay the increased fee.

    As all sports franchise owners know, every marginal increase in price does put some (small but definable) number of prospective ticket buyers out of the running. My assumption would be that rental car and hotel taxes do the same… Some travelling fans may not come because of (among other things) the tax increases. Others who live within a driveable but lengthy distance may choose to make day trips instead of staying overnight.

    1. I have not seen any studies of the elasticity of rental car demand, but I’m sure they exist. This can be a fun research exercise for FoS readers, maybe? (I’d do it myself but am swamped the next couple of weeks.)

      1. Oh it often is for business travel. I rent cars much less than I did 10 years ago, in part due to how fees make it not price competitive with ride sharing… Though ride sharing has even more-so absolutely cratered my cab usage.

  4. It’s possible that rental car and hotel demand are highly insensitive to small price increases because so much of the usage is business related. Companies don’t forgo sales trips, or send sales people elsewhere, because rental cars went up 5% in City X. I travel a lot for business and I don’t give a hoot what a rental car costs – the client or my employer is paying. Maybe there are exceptions, but I can’t imagine anyone in business saying “don’t go to Tampa, they just increased the rental car tax.”

    1. True, but not 100% of the fans in any sports arena will be in that city on business trips and taking in a game during off hours. The largest proportion should be home fans, followed by travelling fans who are there primarily for the game, and then people who in town for other reasons and walk up while there.

    2. I doubt you see it in that way. But people are aware of costs on a large scale level. My clients notice renting a car is crazy expensive from Logan in Boston. And that trips out there are generally expensive. As such I have fewer trips there than to a similar problem in say Nashville. Now that isn’t solely rental car costs, but if you have a 1% increase and that results in 997 people not changing plans and 3 changing plans, that is now eating half or more of your increase when you account for other taxes.

      I have been given work in Hawaii for example where they flat out said “come up with whatever plan you want, but you are not going to Hawaii regardless of how necessary, it is just too expensive”.

      1. Yes. With all due respect to other business owners (who’s experience may be different), when I am deciding where I stay or what other “pass through” costs I incur when working, I do have to consider the effect of these added costs on my customer.

        In any given job, an extra $50-100 over a week or two isn’t going to be ‘the difference’. However, over the long haul, those kinds of costs will affect who my customers hire in future. If we want to stay in business, we need to watch costs (like everyone else).

  5. Meanwhile, back in the real world, the Rays are currently averaging just 3,817 per game attendance for the 2018 spring training games, continuing its steady decline since 2009, which pretty much mirrors the regular season trend for declining per game attendance over the past decade. Never has so much public money been up for grabs to entertain so few. That being said, I will be at opening day having bought a $40 ticket for a 300 level seat (normally $15) supporting this charismatic team.

    Year spring training regular season
    2017 4,542 15,477
    2016 5,274 15,879
    2015 5,105 15,322
    2014 5,616 17,858
    2013 5,349 18,646
    2012 5,495 19,255
    2011 5,819 18,879
    2010 6,060 23,025
    2009 6,453 23,148

    1. Have they ever studied simply de-doming the dome? Sure it would be hot and lots of rain outs, but people aren’t digging the roofed air conditioned rain free environment either, so what have they go to lose?

      1. I live about 8 blocks away. There are many pubs, restaurants along Central Ave. The main drawback to the Trop (from what people tell me) is they don’t enjoy going in on a beautiful sunny day (whether it’s humid or not) and not being able to see outside. They would rather watch the game from the bars, and enjoy the sunshine.

    2. Very interesting that their spring training attendance is collapsing at more or less the same rate their reg season attendance is falling.

      Does this mean that the stadium has little to no effect on attendance? Or that they actually need two new stadia to be viable.

      New theme: “Charlotte Sports Park is killing the Rays!”

      1. The quality of the stadium is way less important than the quality of the team. The Rays are now totally devoid of any marquee players. Since its World Series year of 2008, the following ‘star’ players have left:
        Carl Crawford at end of 2010 season
        James Shields at end of 2012 season
        David Price during 2014 season
        Ben Zobrist at end of 2014 season
        Evan Longoria at end of 2017 season

        Not surprisingly, team performance and fan interest has trended downward in lockstep.

  6. Please read “Grade F: The Math Simply Fails for a Stadium Relocation” at http://tampabaybeat.info/index.php/2018/02/09/grade-f-the-math-simply-fails-for-a-stadium-relocation/ and “If Only Florida’s Ruling Class Loved Public Education as Much as Tourism and Billionaires” at http://tampabaybeat.info/index.php/2018/02/13/if-only-floridas-ruling-class-loved-public-education-as-much-as-tourism-and-billionaires/ to get the full skinny on the Rays’ quest for a new stadium.

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