Worth the Cost? A New View of Ballpark Village
This week, the long-stalled Ballpark Village came back from the dead, one decade after it was first announced. The new project, consisting of an office building that will soon rise north of Busch Stadium, takes a much-reduced form from its original conception. Tim Logan reports on the Post-Dispatch‘s Building Blocks blog that the City’s Missouri Downtown Economic Stimulus Authority voted Wednesday to recommend the project to the St. Louis Board of Aldermen, which will consider legislation authorizing the project in the coming weeks.
Ballpark Village, April 2010, View to Northeast
The anchor tenant for the development, Stifel Financial, will relocate from its present downtown St. Louis headquarters, which stands six blocks north of Ballpark Village. Tax dollars, in the amount of at least $35 million and potentially increasing to $188 million, are essential to the project’s financing. These monies will be spent up-front by the developers, assuming that the project’s bonds find willing buyers. Despite assurances that the city of St. Louis will not need to cover potential shortfalls on the project’s bond revenues, the St. Louis Comptroller’s Office has reportedly expressed concern about the size of the proposed financial package and its fiscal impact on St. Louis city government.
Taxing districts at both the local and state levels will forgo revenues that they would otherwise collect in order to fund this project. The Missouri Downtown Economic Stimulus Act, like Tax Increment Financing, allows an authorized project to capture revenue growth from activities on the site. Unlike TIF, however, MODESA funding allows a development project to capture state tax dollars in addition to local tax dollars. Keep in mind that this off-budget spending will come from a city government that claims its inability to provide basic services should the earnings tax go away!
In the absence of economic growth, publicly funded projects like Ballpark Village simply move economic activity from one site to another, which may cause governments to run deficits. Government, therefore, must either cut spending by $35 million or raise taxes and fees to cover this shortfall.
Is increasing bonded indebtedness by a minimum of $100 per city resident worth the cost? Is this what city taxpayers signed up for a decade ago, when the city of St. Louis eliminated the “Amusement Tax” on Cardinals tickets?
You be the judge.