MLS public funding answers could lie in proposed sales tax bill - KMOV.com

MLS public funding answers could lie in proposed sales tax bill

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A rendering of the proposed MLS stadium that would be built near Union Station. Credit: MLS A rendering of the proposed MLS stadium that would be built near Union Station. Credit: MLS

ST. LOUIS (KMOV.com) -- St. Louis residents now have answers on how a new MLS stadium would potentially get funded, but finding them takes a bit of digging.

Two St. Louis City Board of Alderman bills were introduced Wednesday, both sponsored by Alderwoman Christine Ingrassia.

Both propositions revolve around voters approving a sales tax increase within the City of St. Louis, which would cascade into a second vote.

First, Bill 227 proposes an Economic Development Sales Tax, which would raise the sales tax on retail sales in St. Louis one half of one percent.

Revenue from that increase would be used in five areas, including the establishment of the North/South MetroLink line. The expansion would create a line spanning from West Florissant Avenue near Interstate 270 to Meramec Bottom Road in south St. Louis County.

Funds would also be earmarked for neighborhood development, workforce development, anti-crime infrastructure (described as an increase in anti-crime security cameras and a monitoring system for those cameras) and upgrading the city’s infrastructure.

The second bill, which pertains to stadium funding, is entirely dependent on the passage of the first.

If the sales tax increase is passed, the city use tax will increase by the same amount. The use tax is paid by local businesses when they purchase goods from out of state, essentially acting as a local sales tax on items that would normally be exempt.

Voters do not vote on use tax increases, and normally do not vote on how revenue generated from use tax increases is spent.

But Bill 226 asks voters to decide on whether or not part of that money will be allocated toward the construction costs of a new MLS stadium. The language in the proposition rolls the funding of the stadium in with job training and business development, linking the two in one proposition.

“Shall the use tax paid by businesses … be used for the purposes of minority job training and business development programs, and a portion of the construction costs but not construction cost overruns, of a multipurpose stadium for soccer, local amateur sports, concerts and community events.”

To clarify, none of those funds would exist without the passage of the sales tax increase proposed in Bill 227. Essentially to fund the stadium, the use tax must increase. To increase the use tax, the sales tax must increase.

If residents want funding for an MLS expansion stadium, they have to approve the MetroLink expansion, infrastructure improvements, and anti-crime measures.

Whether or not that funding gets used for stadium construction is dependent on a second vote, but one cannot happen without the other in this particular case.

Potential MLS ownership group SC STL has previously said they may ask for as much as $80 million in public funding to help fund the $205 million cost of the stadium.

However, even if both bills pass and the public agrees to use use tax revenue for stadium construction, Mayor Francis Slay’s office has laid out conditions for team owners.

First, an MLS team must actually come to the city. Second, the team owners group must pay for construction cost overruns and the cost of upkeep and maintenance at the stadium. Third, owners must sign a 30-year lease.

However, some city aldermen are wondering why stadium funding is so high on the priority list.

“It really needs to be thought out how we do this,” said 21st Ward Alderman Antonio French. “This idea of having all these potential tax increases on the same ballot is a disaster.”

French pointed to numerous other issues the city has yet to solve, including funding for police officers, the demand for upgrades of the Scottrade Center and the completion of the multi-phase Ballpark Village development. He said he has concerns about voters getting fatigued over overwhelmed if the city asks for a litany of tax increases all at once.

“I haven’t had one constituent come to me and say, ‘You know what? We really need a new stadium built,” French said. “You can have real priorities get rejected because you asked for too much at the same time.”

Both bills will be introduced at the Board of Alderman’s Friday session. In order to be on the April ballot, the board needs to approve the measures and Mayor Slay must sign them by January 24.

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