Dave Peacock didn’t mince any words about how important it is to get a stadium financing plan through the Board of Aldermen.
“We don’t have a plan if they don’t,” said Peacock, one member of Gov. Jay Nixon’s two-person stadium task force.
With those stakes looming, Peacock joined other stadium backers in testifying Thursday before the board’s Ways and Means Committee. Their goal: to get aldermen to pass a financing package that would fund the city’s portion of the roughly $1 billion project.
As St. Louis Rams owner Stan Kroenke mulls moving his team to Inglewood, Calif., Peacock and other stadium proponents say their plan is a way to keep professional football in St. Louis and revamp a drab portion of the city’s riverfront. And while the bill doesn't guarantee that the Rams will stay or that Kroenke would agree to build a new stadium here, Peacock emphasized the importance of the legislation -- especially since NFL officials have said financing needs to be in place for a stadium plan to be viable.
“I just think for St. Louis, we can’t keep losing things,” Peacock said. “We can’t keep being a city going backwards. And I believe building is better than letting dilapidated areas stay the way they are. I know that if we don’t build this stadium on that site, contrary to what people may think, 20 years from now my kids will drive by that site and it will be the same dilapidated area.”
Under the terms of the legislation and a financing plan, the city would issue about $70 million in bonds that would be paid off over a roughly 35-year period. The city would pay between $4.5 million and $8.99 million a year in debt service through 2051, which amounts to a little more than $233 million when accounting for interest.
The St. Louis Regional Convention and Sports Complex Authority would then use a recently signed naming rights deal as collateral of sorts to issue $75 million in bonds. Since naming rights deals are typically seen as team revenue, the city will rebate about 64 percent of “game day” taxes to the NFL squad that plays in the stadium. (That means the city would keep about 36 percent of sales and earnings taxes emanating from the facility.)
Alderman Tammika Hubbard, D-5th Ward, said the bill would not only provide an economic development jolt on the riverfront – but would create a bevy of well-paying construction jobs. She also touted a minority hiring plan that could help African Americans get a leg up in the building trades.
“Some of you might not like football. I haven’t always been a fan. I’m more of a Super Bowl person,” said Hubbard, who is sponsoring the bill along with Alderman Jack Coatar, D-7th Ward. “But that’s why when it comes to this bill, my main focus is the jobs component, which can create greater opportunities for people to sustain themselves and possibly be in a position to spend money where they choose to and enjoy some of our sports and some of the other jewels of our city.”
Heavy skepticism
The Ways and Means Committee was never likely to rubber stamp the proposal. And that became evident as the three-hour committee hearing rolled along.
The votes of at least five of the eight members of the committee are up in the air: Aldermen Chris Carter, D-27th Ward, Terry Kennedy, D-18th Ward, Sam Moore, D-4th Ward, Antonio French, D-21st Ward, and Scott Ogilvie, D-24th Ward.
That means there are three scenarios for the bill to pass out of the committee: The first is for two of the five "skeptics" to vote for it along with three probable "yes" votes. The second possibility is for some potential "no" votes to skip out on voting altogether. The final one is for one "skeptic" to vote "yes" and for Board of Aldermen President Lewis Reed to break the tie.
The other members of the committee are Stephen Conway, D-8th Ward; Beth Murphy, D-13th Ward, and Joseph Vaccaro, D-23rd Ward.
Some aldermen were displeased that the funding plan won't be put up for a public vote. Others have philosophical objections to publicly financing stadiums -- or question whether this particular deal makes fiscal sense for the city.
For instance Alderman Christine Ingrassia, D-6th Ward, challenged the idea that it made sense to devote more resources to a stadium when the city has so many other problems.
“I think people are upset because we have critical infrastructure needs that we’re not addressing with respect to bridges and roads in the 6th Ward – parks, rec centers and levels of crime,” said Ingrassia, who is not on the Ways and Means Committee. “And we keep telling constituents and residents that we don’t have the money to fix those things, but somehow we’re going to come up with money to indebt the city for a number of years and still not address those needs.”
Added Moore: “When you have people living in third world conditions and squalor, and we find revenue and resources for a stadium Downtown when we already have a stadium, shame on you, shame on you, shame on you.”
French questioned whether the minority participation plan was detailed enough – or could actually be executed effectively.
“This is just a lot of bullet-points, this isn’t a contract or a memorandum of understanding,” French said. “What is confusing is how do we have any agreements for minority inclusion when there apparently is not even a contract for the general contractor or a contractor with the labor unions.”
In response to that question, Peacock suggested that aldermen could put finalized minority hiring details into the text of the legislation. He said after the committee hearing that “his objective would be that subcontracting minority firms come out stronger in every case, and that the participation and the participants are able to get a career in the building trades – and not just get a few hours.”
“I’m the last person in the world who should write an inclusion plan, because I’ve never built anything and I’ve never written one,” Peacock said. “So we have people who have worked in that space. The only input I gave was upfront and saying ‘I’ve heard issues of apprentices not getting enough hours to become journeymen. I’ve heard of repeated layoffs that don’t give people a real opportunity to grow and create a career. I heard that minority-owned businesses and subcontractors get the short end of the stick.’ This needs to not do that.
“So we need to put whatever conditions, resources and oversight in to ensure that those types of things don’t happen,” he added.
The Ways and Means Committee will hold another hearing on Saturday at 11 a.m. within the footprint of the proposed stadium, 1230 N. 2nd Street. The committee is expected to vote on the legislation in several weeks.
State concerns
While Peacock emphasized that the Board of Aldermen's potential action is critical, other problems can be seen on the horizon.
Some aldermen questioned the idea that the state, not the city, would be responsible for cost overruns on the project. That’s especially the case since lawmakers from both parties are threatening to not pay for payments on state bonds if they’re issued without a legislative or statewide vote.
And some influential lawmakers on the House and Senate budget committees expressed similar sentiments:
There is ZERO chance the state will cover cost overruns. This is not "fluid." https://t.co/QpVgK5Xpgj
— Ryan Silvey (@RyanSilvey) November 12, 2015
Absolutely not. https://t.co/uVKZwKa3RY
— Scott Fitzpatrick (@FitzpatrickMO) November 12, 2015
When Alderman Megan Green, D-15th Ward, asked Peacock if he was concerned by those legislative threats, he replied: “Everything about this project concerns me. Every single thing.”
“At this point, we have a clean bond opinion from the state standpoint from bond counsel,” Peacock said. “And we’ve got banks that have indicated they feel they’re marketable and they’d buy the bonds. So I don’t know if the risk falls on them – those who purchase the bonds. I don’t know.”
When Green was told that the state typically pays off its debt obligations, she said “that’s fair to say that it occurs in generally every instance up until now.”
“But we’re at a point where it’s not just the Republicans in Jeff City. This is a bipartisan coalition that is saying ‘We do not agree with you bypassing us,’” Green said.
For his part, Peacock said anybody who would be buying the stadium bonds would be doing so with the assumption the legislature won’t withhold payments for more than 30 years. But he also said that the legislature shouldn’t be shut out of the process.
“I do think the legislature needs to be engaged or has to be engaged in any process,” Peacock said. “This has to be a group effort in the region and across the state. And I think we’ve got a good plan. We’ve got a proposal that can work. At the end of the day, I think we need to bring everybody under the tent and they feel comfortable with what they’re doing.”
Click here to read more about Wednesday's stadium developments and here for more coverage of the battle to keep professional football in the city.
