Saying it’s “do or die time,” the Charlotte Knights baseball team asked the city of Charlotte on Thursday for $11 million to help build a minor-league stadium uptown.
The Triple-A team has tried to move uptown from the Fort Mill area for at least six years and faces a number of county-imposed deadlines, including starting construction in the fall.
Mecklenburg County has already pledged $8 million for stadium infrastructure and $24 million in uptown property. If the city approves the $11 million, taxpayers would pay for more than half the project’s $78 million cost, including land.
This was the first time the Knights have asked the city for help for the Third Ward stadium.
After team officials requested the Charlotte City Council economic development committee’s support, Deputy City Manager Ron Kimble said the city would explore using money from a countywide hotel/motel occupancy tax, primarily paid by visitors.
With the economy improving, money from that tax – restricted by state law for tourism – is growing. The tax last year brought in $36 million.
Another option for the stadium, Kimble said, could be using a portion of new property taxes created from the 10,000-seat stadium.
But any public funding could face political hurdles.
The city, for example, may consider a property tax increase later this spring for road and sidewalk construction and for other capital projects.
Council member James Mitchell, a Democrat, supports using city money for baseball. But he said city staff “must be creative” to find money that couldn’t be used to build streets or hire police officers. One such way would be the hotel/motel tax, Mitchell said.
“We can’t have baseball up against sidewalks,” Mitchell said.
But Mitchell said public support for baseball uptown is growing.
“Usually you just hear from the ‘no’ people,” Mitchell said. “I’m hearing from people who say they will be the first ones in line (to buy tickets).”
Democrat David Howard said he hasn’t made up his mind, though he spoke favorably about the stadium during the meeting.
Howard said the city has a long history of successful public-private partnerships, such as expanding the airport.
“We shouldn’t have the NASCAR Hall of Fame around our necks,” he said.
The NASCAR Hall of Fame, paid for by a 2 percent hotel/motel tax, was supposed to attract 800,000 people in its first year. Instead, it attracted 272,000.
Council member Claire Fallon, a Democrat, is wary of subsidizing another sports-related uptown project.
“(The public) doesn’t trust us anymore,” Fallon said.
A development catalyst?
The Knights play in the Fort Mill area, where they draw only 300,000 fans and lose money. The team expects attendance to double uptown.
Center City Partners, which has worked to bring the team back to Charlotte, said the Third Ward site would be a “super catalyst for development.” Michael Smith of Center City Partners envisions the stadium spurring housing and offices in an area that’s mostly surface parking.
Economists present different views
The team has cited a study by UNC Charlotte economist John Connaughton, who projected a new stadium would support 490 full- or part-time jobs. The Knights support 308 jobs in the Fort Mill area, according to the team.
Other economists nationwide have questioned whether new minor-league stadiums produce a significant economic impact – or just take entertainment dollars that might be spent elsewhere.
Under a lease extension approved by Mecklenburg County commissioners last year, the Knights cannot ask the county for more money toward stadium construction. It also requires the team to hit benchmarks, including securing at least two major corporate sponsors by the end of this month and submitting a stadium financial plan by June 30.
The city’s economic development committee is scheduled to discuss the $11 million request at its April 4 meeting.
Kimble said Charlotte’s first task is to vet the team’s request. He said the city must make sure any money given to the Knights wouldn’t interfere with another city project.
“How do we do that in a way that doesn’t adversely affect any current projects?” he said.
The hotel tax
Most of the 8 percent countywide tax on hotel and motel rooms – which generated $32 million last year – goes to the Charlotte Regional Visitors Authority.
Some money goes to the NASCAR Hall of Fame and the Charlotte Convention Center.
Another portion of the tax is used to promote and bring people to the city. That pot of money could be used to help build a stadium, Kimble said.
The CRVA uses that money to attract meetings and conferences; to attract amateur sports events; and to promote the city. It’s unclear how much of that money the city might use, and whether the CRVA would have to adjust its budget.
The city has also refunded a portion of property taxes to a number of companies that have relocated or expanded in Charlotte, such as SPX and Siemens. Those payments are known as Business Investment Grants.
But the city usually requires that new jobs pay the regional average, which is just under $45,000.
It’s unclear how much Knights-supported jobs would pay. Many are part-time positions such as ushers and ticket-takers.