FC Cincinnati stadium fight heads to city council

Questions remain about whether the roughly $52 million on offer from the city and county will be enough for FC Cincinnati and whether the city’s portion is too much for council members.

click to enlarge Rendering of proposed FC Cincinnati stadium - Provided by FC Cincinnati
Provided by FC Cincinnati
Rendering of proposed FC Cincinnati stadium

The $200 million plan for a soccer stadium in Oakley funded entirely by FC Cincinnati is out. The team’s request for $75 million in infrastructure help from the city of Cincinnati and Hamilton County and lower counter-proposals from both governments are in.

But the fight over another major stadium in Cincinnati is far from over. Next, it heads to Cincinnati City Council.

Questions remain about whether the roughly $52 million on offer from the city and county will be enough for FC Cincinnati and whether the city’s portion is too much for council members.

Some have already made their positions clear. Two — Amy Murray and Kevin Flynn — are leaning toward supporting the deal. Democrats Chris Seelbach and P.G. Sittenfeld say they're against it. Others are still mulling their options.

"The question to our community, and specifically to Cincinnati’s elected leaders, is whether or not to involve the city and its taxpayers in the building of a new soccer stadium,"Sittenfeld wrote in a lengthy statement Nov. 22, citing timing, lack of community engagement, unanswered questions about the deal and other concerns as reasons for his opposition. "The goal is great. The timing, lack of due diligence, specific financing arrangement, and location are, at minimum, questionable, and, at worst, wrong."

Meanwhile, the team continues to mull Newport as a location for the stadium it says it needs to compete for a Major League Soccer franchise. The application for that franchise — with a stadium plan — is due Dec. 14.

There is a bigger question opponents of the deal are asking. Is the public money spent on infrastructure for the private project worth it?
Cincinnati Mayor John Cranley says the stadium will spur the local economy, and boosters say another major league sports team would be a huge boon to the region.

“I’m willing to promise that thousands of jobs will follow this public infrastructure when completed,” Cranley said at a Nov. 17 news conference. “FCC is part of our city’s renaissance, and it’s an amazing opportunity to expand this big-league city from two major professional franchises to three — the Reds, the Bengals and FCC.”

But experts disagree on the economic impacts of sports stadiums, and it’s worth considering that FCC’s owners, who stand to benefit from the public spending, are big donors to local political campaigns.

Cranley dealt the last of the major cards left to be played in the ongoing stadium drama Nov. 17 when he proposed $36.8 million in spending on infrastructure around the stadium site to support FC Cincinnati’s plan for a 21,000 seat stadium on the former CastFab site near Oakley Station.

The city-funded work around the site could include expanding Vandercar Way and Madison Road to five lanes near the stadium and building a five-lane loop around the stadium site. That would make the site more car-friendly and most likely less walkable.

Cranley wants to pull the money from three sources, including $9.5 million from existing tax increment financing districts in Oakley. TIFs capture property tax revenue increases related to development. Another $7.3 million would come from the city’s 2015 sale of the Blue Ash Airport. The plan would also rely on proceeds from the city’s portion of the Hamilton County hotel tax up to $1.5 million a year and up to a total of $20 million for as long as 30 years.

That fund brings in varying amounts of money every year, sometimes less than $1.5 million.

“That will be a risk that FCC will have to take,” Cranley said of possible shortfalls. “The city would not guarantee the $1.5 million.”

Hamilton County Commissioners have offered up as much as $15 million for a parking garage, albeit reluctantly. They’d rather see FCC pursue an MLS bid involving use of Paul Brown Stadium, but the team and the league have demurred, saying MLS must be able to control revenue and scheduling at an expansion team venue. The county's money would probably only cover a 1,000-car garage, which would leave FCC needing an exemption from a city rule requiring one parking space for every five seats at a stadium.

Another benefit offered to FCC: The stadium and land would be property tax exempt under Cranley’s proposal because it would be owned by the Port of Greater Cincinnati Development Authority. That’s raised opponents’ hackles.

“Don’t underestimate how expensive of a sweetheart deal to the billionaires this is,” Bill Capell of No More Stadium Taxes, an anti-stadium group, tweeted last week. “Several million per year of taxes they get to avoid paying.”

The team’s owners have given more than $50,000 to county commissioners in recent years, campaign finance filings reveal. They've also given smaller amounts to six council members, including stadium supporter Murray and opponents Seelbach and Sittenfeld. And in 2017, several owners and their families gave big to Cranley’s re-election campaign.

Carl Lindner III, who leads the ownership team, gave the individual limit of $1,100 during the primary and again in the general election. Overall, the tight-knit Lindner family, which runs United Dairy Farmers, gave more than $15,000 to Cranley in 2017. Chris Lindner, another FCC owner, also gave Cranley the individual limit in the primary and general elections.

Other owners, including Great American Insurance Senior Vice President David L. Thompson and petroleum entrepreneur Steve Hightower, have also given the individual limit. All told, owners gave Cranley more than $15,000 in 2017, according to all records available so far. (Another post-election campaign finance report is due in December.) Their families gave much more.

What will the more than $50 million in public money on offer to FCC get taxpayers? It’s unclear. The team has been a powerhouse when it comes to drawing people to games, outpacing every other team in the second-tier United Soccer League by almost 10,000 fans last season. Winning a major league franchise would surely buttress that momentum.

But economists tend to doubt the fiscal benefits of stadiums for the general public.

“If you ever had a consensus in economics, this would be it,” Temple University sports economist Michael Leeds told NPR’s Marketplace in 2015. “There is no impact.”

Stadiums mostly employ low-wage workers other than the small group of players themselves, who often live outside the cities they’re playing in. Stadiums rarely, if ever, have the predicted boosts to tourism and other local economic activity that boosters tout, according to economists.

“In every case, the conclusions are the same. A new sports facility has an extremely small (perhaps even negative) effect on overall economic activity and employment,” economists for the Brookings Institute wrote the year after Cincinnati’s last stadium deal, a Hamilton County sales tax increase that is still paying for Paul Brown Stadium and Great American Ball Park.

FCC General Manager Jeff Berding was involved in promoting that deal, considered by many national observers to be one of the worst in the country for taxpayers.

Cranley, Berding and other boosters point out this deal is different. The team is paying for the stadium, and the site in Oakley is largely undeveloped and inaccessible. It will need development and infrastructure regardless of what project goes there.

But critics say not all development and infrastructure are the same, and other projects would need less public investment.

Council will probably first consider Cranley's proposal at a Budget and Finance Committee meeting next week, with full approval possible by Nov. 29.

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