LIMIT STADIUM TAXPAYER EXPOSURE

It will be a hard sell to convince taxpayers that a new Chattanooga Lookouts stadium that is now at least 60% more expensive than it was just a year and a half ago is a bargain. But does that mean it shouldn’t go forward?

That’s what city and county government, sports authority and team ownership officials will have to decide in the next month or so if the team is to play in the stadium in 2025, much less start the season there as has been the plan.

We believe all parties involved want to see the possibility of ugly foundry land now serving as a welcome mat for visitors who come into the city on Interstate 24 turned into something useful and inviting, so we don’t see the deal collapsing. But we hope negotiations over the next month make it look a little better than what has apparently been on the table for nearly a month and a half but not revealed to taxpayers before Hamilton County Mayor Weston Wamp did so with the Times Free Press last week.

To wit:

› Atlanta-based Hardball Capital, owner of the Lookouts, and Chattanooga-based land owner Perimeter Properties have offered to cover the $40 million difference from the original $72-plus million cost (not including interest) and the new $127 million price. They plan to secure a loan that would be paid back using new property tax revenue generated in the special tax district around the South Broad stadium site.

However, the loan would not be paid back until after the 30-year, $80 million bond issued for the stadium by the sports authority is paid off. And the city and county would not reap all of the property tax benefits from the tax district as soon as they would have if there were no loan, which county officials project could be a possible payout of $100 million (including interest) over 30 years.

› The cost of the road infrastructure to access the stadium is another $10 million. Wamp said the city of Chattanooga has agreed to pay the $10 million, but Jermaine Freeman, chief of staff for Chattanooga Mayor Tim Kelly, said officials have not yet determined who would pay that cost.

Wamp said that amount may be a drop in the infrastructure bucket since most of the area that would be developed around the stadium is a brownfield and will require perhaps tens of millions of dollars of remediation. “I can’t tell you who will pay for that,” he said, predicting there would be “further [public] asks.”

› When the city and county (prior to Wamp’s election) proposed the stadium in 2022, it was suggested $350 million of development in the new tax district would be what was needed to pay off the bonds of the stadium, together with annual lease payments by the Lookouts, sales taxes generated in the stadium, parking revenues and about $1.4 million each from the city and county.

Now, according to Hamilton County Chief Financial Officer Lee Brouner, the project is likely to need $500 million of development to cover the $80 million bond issued by the sports authority (since the original $350 million was calculated as if it would be on the tax rolls when the stadium opened), then another $500 million in development on the loans taken out by the team owner and property owner.

› Details about a community benefits agreement have yet to be revealed.

A briefing for the Chattanooga City Council, Hamilton County Commission, the Lookouts, the landowners, the master developer and other relevant parties on how things have changed in the project will be hosted by the Chattanooga Chamber of Commerce on Thursday. It would be our hope clarity on questions that project skeptic Wamp has and the sunshine and rainbows approach by the city and sports authority spokespersons might be fully addressed.

Hamilton County Commission Chairman Jeff Eversole, R-Ooltewah, who called for such a meeting, probably spoke for many when he told this newspaper: “I don’t want this thing sabotaged if indeed it’s the right thing to do. Nor do I want this thing to cost taxpayers one penny more than what the prior commission and prior mayor already committed to.”

He also said what we’ve have maintained throughout — that the team ought to have skin in the game.

“[T]here has to be a commitment on both sides,” Eversole said. “It can’t be just one side.”

Wamp went further, saying he’d been willing to reluctantly honor the county’s commitment.

“We’ve tried to sharpen it and make it better,” he said, “but it still has gotten incredibly bigger. I would never have let it start without a cash benefit from the developers.”

In the next critical weeks, as the final details are hammered out, any additional risk to taxpayers must be minimized and ought to be the No. 1 goal of all parties involved. It seems all but a foregone conclusion that tax revenue for governmental expenses and community assets will be delayed with the new figures, but robust development in the district would at least ensure that it comes down the road.

Perhaps that is the best we can hope for at this point.