Kansas City ballpark tax will go to voters in Missouri’s Jackson County

Bonds

In an April 2 special election, voters in Missouri’s Jackson County, home of Kansas City, will decide whether to impose a countywide sales tax to direct more than $50 million per year for 40 years toward a new ballpark in the Crossroads district of midtown Kansas City.

In addition to funding a new stadium for Major League Baseball’s Kansas City Royals, the tax revenue would also be used to renovate Arrowhead Stadium, home of the National Football League’s Kansas City Chiefs. The Royals’ home since 1973, Kauffman Stadium, sits next to Arrowhead on the city’s outskirts.

Royals owners have said they will contribute $1 billion in private funding toward the new ballpark, which they hope to open by the 2028 season. The total cost is estimated to be over $2 billion.

A rendering of the new ballpark shared by the Kansas City Royals on a website promoting the proposed development.

KCballparkdistrict.com

The referendum, which Jackson County legislators approved in a January meeting, would let voters sign off on a ⅜-cent sales tax. The tax will be the only question on the ballot in the special election, which will cost the county $1.5 million. 

Jackson County Executive Frank White Jr. vetoed the referendum ordinance when it first passed.

“There is no clear understanding or assurance regarding the teams’ commitments and contributions to the county,” he said in a Jan. 18 statement. “It’s not a good deal for taxpayers and I cannot support an agreement that is not in their best interest.”

A county executive public relations officer said it was their understanding that the sales tax monies would not be enough to cover the remaining $1 billion needed to build the stadium.

“As a result, the team has said it would ask the state of Missouri and city of Kansas City to contribute funds to fill that gap,” she said. “At this time, there have been no commitments to do that from either of those government entities.”

Jackson County legislators overrode White’s veto in January. An earlier public statement by one of the legislators, Sean Smith, noted that “key terms have been verbally agreed upon,” but the two sports teams, the Jackson County Sports Complex Authority, and the county had been unable to put anything in writing. 

“The escalating political pressure on our county legislators is a matter of concern and highlights the need for clear, informed decision-making,” White, who played second base for the Royals for 18 seasons through 1990, said in a Jan. 22 statement reacting to the sudden support of additional legislators for the sales tax ordinance.

Smith later voted with seven other legislators to override White’s veto. Chairman Jeanie Lauer and Legislator Megan Marshall were the lone ‘no’ votes.

A document the county executive’s office shared with The Bond Buyer says the Royals have largely balked at seven of the ten concessions White has sought. Among those are: transitioning insurance costs to the Royals and the Chiefs for $20 million in taxpayer savings; restoring $3.5 million annually from a parks levy; a fair rental fee from each team; and enforceable agreements for long-term community benefits.

For their part, Royals ownership and the developer, Populous, told the Associated Press that the new ballpark will build the brand of Missouri’s largest metropolis. A spokesman for the Royals declined to respond to questions. 

“The proven success of ballpark-adject districts often sees the area become a staple public destination throughout the entire calendar year, well beyond the 81+ days home games are played,” a website promoting the new stadium declares.

“It’s brazen to lie like this,” said Robert Baumann, economics professor at College of the Holy Cross, when shown the promotional claims. He said economic studies have “proven” no such thing.

“There is very little non-game activity at baseball stadiums,” Baumann said. “This statement is not supported by the experiences of other MLB stadiums, new or otherwise. This is particularly concerning because these issues are verifiable by the experiences of the many areas that built stadiums.”

Baumann is the co-author of a 2023 academic study finding that not only are standalone sports stadiums not economic growth engines, but mixed-use developments anchored by stadiums often have negative returns, too. 

“Ancillary developments do not improve the fiscal returns of stadium projects,” Baumann and his co-author, John Charles Bradbury, wrote. Their findings, they wrote, were “consistent with the conclusion of the academic literature that stadiums do not confer substantial positive fiscal benefits to host jurisdictions.”

Baumann added that three nearby restaurants just shuttered last month in the neighborhood hosting one of the stadiums he and Bradbury studied: Polar Park in Worcester, Massachusetts, home to the Minor League Baseball Worcester Red Sox.

As for Kansas City, the ballpark plans also call for an extension of the South Loop Park and the P&L Park Link Pedestrian Bridge to link the stadium to neighboring attractions.

Stadium developments tend to siphon spending away from other city businesses, Baumann said, so “creating a new entertainment district may make things worse.” There will be traffic to the area, but stadiums come with concession stands, and the congestion from games may even drive customers away from neighboring restaurants.

Why the current boom in publicly funded stadium developments, then? Several reasons, Baumann said. One, it’s good for teams and developers. And two, when one city commits public money toward building a stadium, it creates competitive pressure and even a bit of a “shield” for officials in other cities to do the same.

Meanwhile, team owners and developers often produce impact studies that promise economic benefits contradicting all the scholarly research on public financing for stadiums.

“There are consultants happy to provide inflated numbers, but you’ll notice that none of them publish independent research and many do not have training in economics,” Baumann said.

“Sports is part of a local identity, and the potential of losing that shakes people,” he added. “Ownership knows this and preys on it.”

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