FCC: we won't build in West End

FC Cincinnati says it won't build its potential soccer stadium in the West End, citing tax asks from CPS and what it says is the cost of a community benefits agreement.

click to enlarge Rendering of a potential FC Cincinnati stadium - Provided
Rendering of a potential FC Cincinnati stadium

Following weeks of working to negotiate a land swap with Cincinnati Public Schools, FC Cincinnati won’t build a stadium in the West End, the team announced March 16.

The team says costs — tax payments to the school district and a community benefits agreement — would make it too expensive to locate in the neighborhood.

“As with any business, FC Cincinnati must consider the economics surrounding this significant investment,” a statement from the team read. “By CPS adding $50-$60 million in CPS and West End neighborhood costs to the investment by FC Cincinnati of approximately $400 million, the economics of privately funding a stadium in the West End community are impractical.”

Should it win a Major League Soccer franchise, FCC potentially wanted to build a soccer stadium on the site of the district's Stargel Stadium and, in exchange, would have rebuilt Stargel on nearby land at a cost of $10 million.

The team's proposal saw two major sticking points: a community benefits agreement CPS wants to see negotiated with neighborhood groups and the amount of property taxes or payments in lieu of property taxes FCC will pay.

FC Cincinnati officials say that the community benefits agreement with neighborhood groups asked for totaled $50 million — a $30 million upfront payment and $1-$2 million annually.

But West End United, the group working on negotiating a CBA with the team, says that’s not true. WE United says they never gave FCC a number because they were still formulating their ask of the team.

As we told FC Cincinnati leaders yesterday, there is no completed CBA yet,” the group said in a March 16 press release. “We are still forming our coalition and developing a coalition consensus around a request to FCC.  We clearly told FCC: ‘We don’t have a number.’ We remain committed to pursuing an authentic CBA with FCC, but these negotiations take time.”

The Cincinnati Board of Education outlined what it wanted from FC Cincinnati for a land swap involving the district's Stargel Stadium in the West End earlier last week.

The gist of its ask: FCC needed to pay its fair share in property taxes to the district, draw up formal documents about a replacement for the school’s stadium — to be built just across Ezzard Charles Drive — and work with community groups on a community benefits agreement.

In exchange, the team could have taken ownership of CPS land to build a soccer stadium in the West End and receive a deferred payment schedule for its contributions to the district.

"In the Board's view, FC Cincinnati should be required to pay an amount of property taxes that is consistent with the 1999 agreement framework — or $2 million annually based on the club's current estimated value of the new stadium," a March 14 letter from the district reads.

The team made initial offerings of $70,000 a year (what a few property owners of parcels east of Stargel pay now) and another deal that would have paid CPS roughly $4 million over the next 12 years. The district rejected both of those offers.

On the morning of March 14, FCC sent the Board of Education a letter with what it framed as a final offer: $750,000 a year for 10 years. The team gave the district until 5 p.m. that day to respond, citing a pending $1 million real estate deal needed to move forward with a stadium in the West End.

“If we can’t even get the CPS piece done, then it’s probably a real waste of a lot of money, upwards of $1 million on real estate in the area,” FCC President Jeff Berding told radio station WVXU.

The payments on offer were less than the roughly $2 million a year a commercial project like the $250 million stadium would pay under the city's current tax abatement policies, which have been in place since 1999. It's also less than the full tax burden such a stadium would incur, which the district estimates would be $2.8 million a year.

In the missive, the Board of Education also said the team's 5 p.m. deadline was "unreasonable" and asked the team to submit a more formal proposal detailing payments, the nature of its community benefits agreement with neighborhood groups and details about its promise to build a new Stargel Stadium. 

FCC is still considering either Newport or Oakley for the site of its stadium. Newport, being across the river, obviously won’t generate money for CPS. The team has claimed that the Oakley site wouldn’t generate any either — FCC is exploring an ownership structure in which the Greater Cincinnati Redevelopment Authority owns its stadium, making it tax exempt.

Hamilton County Commission President Todd Portune, however, has said that city and county leaders could structure that deal in such a way that the team is still forced to make payments in lieu of property taxes to the district.