FC Cincinnati Stadium Financing Plan Gets Preliminary Approval
The Greater Cincinnati Redevelopment Authority is authorizing preliminary terms for financing FC Cincinnati's proposed stadium in the West End. The Redevelopment Authority, also known as the Port Authority, will issue the various bonds needed to build the stadium and associated roadway and utility projects. Those include approximately $200 million in lease revenue bonds and $22 million in Property Assessed Clean Energy (PACE) bonds.
The port will own the project but the team will be responsible for everything related to ownership, meaning the team is on the hook for all assets and liabilities, not the Port.
The deal also includes $7-11 million in annual New Community Authority (NCA) bonds, similar to the Liberty Center project in Butler County. This gives the team authority to add a two percent tax on tickets, merchandise and admissions. The tax would only apply on the stadium property.
FC Cincinnati benefits from the deal because port authorities don't pay real estate taxes on properties they own, says CEO Laura Brunner. "The real estate tax abatement is the primary driver for (the team)," she says. "We also have the sales tax exemption on construction materials that exists with any property that the Port Authority owns." A rough rule of thumb, she says, is that half of a vertical construction budget is spent on materials.
The Redevelopment Authority is requiring it be included in the Community Benefits Agreement to be made between the team and the West End Community Council. Brunner says the role would be fiduciary.
As for the affordable housing portion of the stadium deal, FC Cincinnati will assign its parcels to the authority which will determine how to proceed, for example, by working with a developer.
The deal also includes a provision that would require the team to purchase the stadium should it terminate the lease.