Toronto F.C. won the first round in its quest for public money to expand BMO Field from 21,000 to 30,000 seats, as the Toronto city council’s executive committee voted overwhelmingly on Thursday to kick in $10 million toward the $120 million project. The city money would supposedly be repaid by added parking revenues from the expanded stadium, though if SBNation’s Toronto F.C. blog is correct, this is just a projection, not a guarantee.
In any event, Maple Leaf Sports and Entertainment, which owns the soccer team and is perpetually rumored to be interested in luring the Argonauts CFL franchise as well, still needs to get $10 million apiece from the province of Ontario and the Canadian federal government, neither of which is nearly as sure a thing as the Toronto money.
You can read more of the Toronto agreement here, though it doesn’t actually spell out all that much, and is of course completely mum on the provincial and federal funds, or on how (or whether) they’d be repaid at all. There’s still a long way to go for this project — and, since this is Canada, it’s an extra ten yards farther.
Toronto city councillor (and Exhibition Place chair, because that’s how they roll in Canada) Mark Grimes tells the Toronto Sun that Maple Leafs Sports and Entertainment, which owns Toronto F.C. in addition the Maple Leafs, is “getting close” to a deal to expand BMO Field for both the soccer team and possibly the CFL Argonauts, who currently play at whatever SkyDome is called these days. As for what the deal would look like, though, it’s about as vague as when MLSE first discussed it last month, with Grimes saying only, “It is going to cost us money to expand, there is a portion that we would pay that we’d be guaranteed back.” (Eeeagh, comma splice!)
The big question remains whether “guaranteed back” means actual revenue to the city to repay the money it would be fronting, or some bogus “repayment” involving taxes the teams would have to be paying anyway. It would be really, really nice if someone with better access to the principals involved — I don’t know, maybe some Toronto newspaper named after Earth’s nearest star? — would ask these kinds of questions at some point, but I guess there’s only so much one can ask, even of Canada.
Toronto F.C., the MLS team owned by the Maple Leafs, is planning a major expansion of the city-owned BMO Field in time for next year’s Pan Am Games, with “the majority of the burden” promised to fall on the private sector, according to team CEO TIm Leiweke — hey, that’s where Tim Leiweke ended up!
As for specifics on who would pay for what how, Leiweke couldn’t have been more hand-wavy:
The total, he said, could amount to “twice” the price tag for the original [$63 million] project. He said Toronto taxpayers would probably make some initial payment. But he said MLSE would later return money to the public purse.
“I think if there is any contribution, it’ll be one where they get paid back over a period of time and get a healthy rate of return. So the significant majority portion of this is going to end up being us, and we get that,” he said.
“One of the things the city’s asked for is that we backstop a minimum revenue stream annually that would get their money back, plus some, over the period of the lease. So the city wants certainty. We’re working through that.”
The city fronting the money and getting paid with interest over time is certainly a legitimate investment model, though you really have to wonder why Maple Leaf Sports and Entertainment (which also owns the Raptors) couldn’t just borrow from a bank, given that they’re a $2 billion company. The trick here is assuring that the money being repaid is real revenue from the team, and not, say, increased tax revenue that would be going to the city regardless of how the expansion was financed.
This is Canada, not the U.S., so those kinds of shenanigans are trickier to get away with, though as we’ve seen elsewhere, not impossible. Hopefully Toronto’s elected leaders will be on the ball enough to keep on top of the situation and assess the costs with a calm, clear — oh, right.