ATLANTA - Cobb County officials said Thursday a mix of existing tax revenue as well as new levies on business and tourism will be used to fund the public portion of a new $672 million Braves stadium planned for 2017.
Under the terms of a 30-year deal released by the county, the Braves would put in $372 million, or 55 per cent, and Cobb County would be responsible for the remaining $300 million, or 45 per cent. The Cobb County Board of Commissioners is set to consider the deal on Nov. 26.
"It's an excellent deal for Cobb County," commission Chairman Tim Lee said in an interview. "It's great to have a national organization like the Braves relocating to Cobb County. It's creating jobs and stimulating the economy."
Key details of the planned financing was revealed days after the Braves announced the team was leaving downtown for the suburbs, moving about 10 miles north on Interstate 75. The decision caught many by surprise, including Gov. Nathan Deal and Atlanta Mayor Kasim Reed. Deal has said he's happy the team is staying in Georgia, while Reed has been defending his decision not to compete with Cobb County's offer.
The public contribution for the Cobb County deal is far lower than initial reports of up to $450 million and also below the average of nearly 70 per cent cited by experts.
The Braves said in a statement the team would be assuming more than 90 per cent of the upfront costs for the 42,000-seat stadium, minimizing the amount of bonds that would be issued. The stadium would be owned by the Cobb-Marietta Coliseum and Exhibit Hall Authority and operated by the team. The Braves would pay $6.1 million annually in rent and payments from naming rights, parking and advertising revenue, and that money would cover the team's annual bond obligation, according to information provided by the county.
"This is a very sound deal for the Braves, the Cobb taxpayer and the Cobb business community," said Mike Plant, the Braves' executive vice-president of business operations.
The team has no plans to use personal seat licenses to help pay for the stadium, said Derek Schiller, the Braves' executive vice-president of sales and marketing. The licenses have been an unpopular element of other stadium deals and require an upfront fee from season ticketholders.
Under the plan, the county would use a mix of $9.61 million in existing revenue and $8.29 million in new taxes on business and tourism to collect the $17.9 million per year to cover the principal and interest of its share of the 30-year bonds that would be issued, according to the terms. It was not immediately clear what revenue sources might be used for capital maintenance expenses to be shared by the team and the county.
Georgia State University economics professor Bruce Seaman said the plan appeared balanced with multiple sources of revenue, although he cautioned transportation must be a priority given existing traffic congestion in the area.
"Additional congestion is a property value killer," said Seaman, who has done some fiscal analysis for the Braves. He said traffic could adversely affect any property value appreciation included in the county's revenue estimates.
The project does include $14 million toward transportation improvements, although the long-term infrastructure plan remains to be seen. Of the new taxes, the county plan calls for $5.5 million would be generated annually through a new levy on area businesses, as well as $400,000 in a new 3 per cent car rental tax in unincorporated parts of the county and $2.7 million from a new $3 per-room, per-night charge for surrounding hotels and motels.
Brooks Mathis with the Cobb Chamber of Commerce said the deal has the support of the business community and noted there were no plans for residential tax increases.
"The businesses in the immediate area are all on board," Mathis said. "They know that they will benefit directly from this investment by the Braves in the community."
Cobb County officials also plan to reallocate $8.67 million annually in existing property tax revenue. That money is currently being used to pay off another bond that will expire in three years, when the stadium bonds are expected to be issued, according to the commission chairman. In addition, a local business improvement district has pledged $10 million.
Atlanta's mayor has said the city couldn't afford to match Cobb County's offer, saying the city would have been forced to take on some $200 million in debt to appease the Braves while facing a $900 million backlog in infrastructure projects. Through a spokesman, he declined comment Thursday on details of the Cobb financing.
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