Some Kansas lawmakers see a chance to lure Kansas City’s two biggest professional sports teams across the Missouri border, but an effort to help the Super Bowl champion Chiefs and Major League Baseball’s Royals finance new stadiums in Kansas fizzed over concerns about how it might look to taxpayers.
Members of the Republican-controlled Legislature pushed a bill Tuesday that would have allowed Kansas officials to authorize at least $1 billion in bonds to cover the entire cost of building each new stadium, paying the debt off with tax revenues generated in the area over 30 years. But GOP leaders didn’t bring it up for a vote before lawmakers adjourned their annual session early Wednesday.
Some critics derided the plan as corporate welfare. Others were receptive but didn’t want to pass the proposal until the Legislature approved a broad package of tax cuts for their constituents that Democratic Gov. Laura Kelly would sign — which didn’t happen either.
Legislators’ work on a plan began in earnest behind the scenes after voters on the Missouri side of the Kansas City metropolitan area decisively refused earlier this month to extend a local sales tax used to keep up the complex housing the Chiefs’ Arrowhead Stadium and the Royals’ Kauffman Stadium for more than 50 years.
The bill’s biggest champion, Kansas House Commerce Committee Chair Sean Tarwater, a Kansas City-area Republican, said supporters want to give the two professional sports teams another option should they contemplate leaving Kansas City, which he said would be devastating to both states.
“You miss 100% of the shots you don’t take,” Tarwater said. “We need them to stay in the metroplex.”
The idea isn’t dead yet.
Kelly and her staff signaled Tuesday that she’s likely to veto the last tax package lawmakers approved, cutting income, sales and property taxes by a total of almost $1.5 billion over the next three years. Lawmakers expect Kelly to call a special session of the Legislature to try to get lawmakers to pass a tax plan that she’ll accept — and they could consider the stadium financing proposal then.
“We just need a little time on it — we’ll be OK,” said Senate President Ty Masterson, a Wichita Republican. “I mean, we’re serious about trying to incentivize the Chiefs to come our direction.”
The proposal would allow the bonds to finance 100% of the construction of each of two new professional sports stadiums with at least 30,000 seats. State and local officials would have a year to sign off, and the teams would be on the hook if local tax revenues weren’t enough to pay off the bonds.
“It was just a concern of running it before we gave real tax relief to our constituents — kind of that juxtaposed look of what appears to be corporate welfare before you’re getting tax relief to the people,” Masterson said after deciding against having a Senate vote.
Before the local sales tax vote in Missouri, the Chiefs wanted to use their share of the revenues to help pay for an $800 million renovation of Arrowhead. The Royals planned to use their share to help finance a new, $2 billion-plus ballpark district that would be part of a larger nationwide wave of sports construction.
The current lease lease on the two teams’ complex lasts through Jan. 31, 2031. Royals owner John Sherman has said the Royals will not play at Kauffman Stadium beyond the 2030 season, the Chiefs are hopeful of remaining at Arrowhead Stadium.
“We’ll be in a situation where we go back to the drawing board,” Chiefs owner Clark Hunt told reporters last week. “I do feel very much a sense of urgency, and we will approach it from a broader perspective going forward.”
Backers argue that the Kansas plan is ideal because the money to pay off the bonds would come from new taxes generated only when the area around each stadium develops. Also, professional players will have to pay the state’s income tax on the portion of their earnings made at the stadiums in Kansas.
But Americans for Prosperity-Kansas, a small-government, low-tax group that has long opposed the use of such bonds, also opposed the stadium financing proposal. The group is influential with Republicans and told lawmakers it would consider their votes in evaluating their records.
Critics have long argued that allowing the bonds to finance big projects represents the state picking economic winners and losers instead of the free market. The same kind of bonds have financed multiple projects, including NASCAR’s Kansas Speedway in Kansas City, Kansas.
One northeastern Kansas lawmaker, Democratic Sen. Tom Holland, called the stadium proposal “economic development for millionaires.” He added that it’s “total foolishness” to have taxpayers subsidize the stadiums — either through taxes they pay when they visit or because the state forgoes revenues that would flow into its coffers.
Another northeastern Kansas lawmaker, conservative GOP Sen. Dennis Pyle, said: “We’ve got a lot of priorities in Kansas, and I’m not sure that’s one of them.”
Other lawmakers were critical because the Legislature had no public hearings or debates before three senators and three House members met in public this week to hash out the details of the proposal.
“As much as I would love to see the Chiefs and the Royals both come to Kansas, this is a very large expenditure of tax money that merits careful consideration, not a last minute scheme,” said Democratic state Rep. John Carmichael, of Wichita.
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Skretta reported from Kansas City, Missouri.