COLUMBIA, S.C. - Columbia has given its final major endorsement to building a $35 million public stadium that would bring professional baseball back to the capital city.
City Council on Tuesday voted to commit the city to borrowing that much money and repaying it with meal taxes for the next 30 years.
The vote was 4-1, with Councilman Moe Baddourah casting the only no vote. The District 3 representative said later that he opposes public funding on a stadium, wants a cost/benefit analysis before a vote and supports a public referendum on whether to build a stadium.
Councilwoman Leona Plaugh, a critic of using taxpayer money to build a year-round ballpark, and Councilman Brian DeQuincey Newman, a supporter of the stadium, did not attend the meeting at City Hall.
The second and final vote on construction funding took all of three minutes an anticlimax to months of often strident debate among council members and Columbia residents. Their arguments centered on those who complained the ballpark will be a boondoggle doomed to lose money and supporters who contend its the ticket to an explosion of new construction in the city center.
Even as she voted for seeking a loan of as much as $35 million with a $29 million cap on public spending for the stadium, Councilwoman Tameika Isaac Devine asked out loud, Whos responsible for any (cost) overruns?
The answer Devine got from assistant city manager Missy Gentry is that architects the city plans to hire will help assure that public money will not exceed $29 million.
Hardball Capital, the Atlanta-based company the city has hired to run the stadium, is investing $6 million of its money in the construction of a facility that is to hold up to 8,500 baseball spectators, music fans at concerts or guests at other public events.
Mayor Steve Benjamin proposed and won support for changing language in the loan agreement and the agreement with Hardball Capital. His change would allow for some infrastructure expenses associated with the ballpark, including costs for allowing private, taxable construction on top of portions of the stadium, to not count toward the $29 million city cap.
Council tentatively adopted the loan on June 24 on a 5-1 vote.
The terms of the loan council authorized Tuesday call for the city to repay borrowed money from taxes on prepared foods and beverages through 2043.
The vote came days after Hardball Capital owner Jason Freier filed paperwork with Minor League Baseball seeking permission to move a team to Columbia.
Freier would not say Monday which team he would relocate to Columbia or whether he would buy a third team if Savannah, where he owns a team, replaces its outdated facility.
Projections for stadium construction costs are that the city would have to borrow $32,180,000 to net the $29 million it needs to build the facility. The $35 million loan is a maximum that would be adjusted downward depending on the bond market when the loan is approved, said Columbias chief financial officer, Jeff Palen.
Supporters say the stadium will attract 500,000 visitors yearly to the downtown area and will produce $411.5 million in taxes, wages and spending.
Interest on $32.1 million would amount to $28.9 million by the time the 30-year loan is paid off, according to estimates from Palen, and City Halls financial adviser, Brent Robertson.
A projected $693,000 would go toward paying Robertson, bond attorneys who will advise the city as well as for the underwriters and the fees the bank would impose, Palen said as recently as Monday.
The city also must set aside $2,485,000 in a reserve account to pay debt service in the event Columbia runs into trouble coming up with the money for that annual payment, Palen said.
Annual payments toward the debt are expected to amount to $1.3 million for 30 years. Thats on top of roughly the same amount due yearly for the first meal tax loan that dates to 2003.
That means taxpayers will pay $2.6 million in debt service for both loans through 2025, city figures show. But the annual debt payment will drop only slightly, to $2.5 million, beginning in 2026 after the first loan is paid off, Palen said.
The citys 2 percent tax on prepared meals and beverages first imposed in summer 2003 is projected to generate $9.7 million for the fiscal year that ended June 30. Final figures for 2013-14 are likely sometime next month, Palen said.
For the fiscal year that began July 1, the tax is projected to produce somewhere between $10 million and $11 million based on rising collections from the past four years.
Read more here: http://www.thestate.com/2014/07/15/3566611/columbia-oks-spending-35-million.html?sp=/99/205/&ihp=1#storylink=cpy
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