Transcription

1

2

3 MISSOURI DEVELOPMENT FINANCE BOARD TAX CREDIT FOR CONTRIBUTION PROGRAM APPLICATION NEW RIVERFRONT STADIUM COMPLEX IN ST. LOUIS, MISSOURI SUBMITTED BY THE REGIONAL CONVENTION AND SPORTS COMPLEX AUTHORITY JULY 1,

4 MISSOURI DEVELOPMENT FINANCE BOARD TAX CREDIT FOR CONTRIBUTION PROGRAM APPLICATION NEW RIVERFRONT STADIUM COMPLEX IN ST. LOUIS, MISSOURI CONTENTS Application Form Attachment 1: Explanation of Tax Credit and Contribution Request Attachment 2: Description of Presently Anticipated Proposed Project Site, with Photographs and Map Showing General Boundaries Attachment 3: Estimated Project Costs and Anticipated Financing Sources Exhibit A: Project Narratives and Renderings Exhibit B: Beneficiary Information Exhibit C: Alien Employment Certification Exhibit D: Cost-Benefit Analysis Exhibit E: Applicant Authorizing Resolution Exhibit F: Financial Statements Current Unaudited Year Ending December 31, 2014 Year Ending December 31, 2013 Year Ending December 31, 2012

5 MISSOURI DEVELOPMENT FINANCE BOARD TAX CREDIT FOR CONTRIBUTION PROGRAM APPLICATION The undersigned Applicant hereby submits this Application and requests the Missouri Development Finance Board (the Board ) accept a Contribution, and, to the extent described herein, apply the proceeds of such Contribution for the purpose of financing the Project described below (the Project ) pursuant to the Board s Tax Credit for Contribution Program. The undersigned has read the Board s Tax Credit for Contribution Program Description and Guidelines. Date: July 1, 2015 Total Estimated Project Budget/Cost $ 998M Total Amount of Proposed Contribution: $ 30M (See Attachment 1) Total Tax Credit Amount (50% of Contribution): $ 15M (See Attachment 1) Name: Address: Regional Convention and Sports Complex Authority 901 N. Broadway City St. Louis City County: N/A Zip Code: Contact: Brian McMurtry Telephone: (314) Title: Executive Director Fax: N/A mcmurtry@stlrsa.org A. THE APPLICANT 1. Organization: What type of governmental entity is the Applicant? Local political subdivision, created pursuant to Sections to of the Revised Statutes of Missouri, as amended. 2. Legal or In-House Counsel to the Applicant: Firm Name: Address: Blitz, Bardgett & Deutsch, L.C./Thompson Coburn LLP 120 S. Central--Suite 1650/One US Bank Plaza City St. Louis State: MO Zip Code: 63105/63101 Contact: Kevin Fleming/Debbie Rush Telephone: (314) /(314) Title: Partner/Partner Fax: N/A KFleming@bbdlc.com/DRush@thompsoncoburn.com 3. What is the total population of the Applicant? N/A 4. In which state legislative District(s) is the Project located: House: 78--Rep. Hubbard Senate: In which U.S. Congressional District: 5--Senator Nasheed 1--Congressman Clay 5. Taxpayer Identification Number: (1) (Rev. February 2014)

6 6. Facility s NAICS* Number: Promoters Performing Arts, Sports, Sim. Events w/facilities (Use the NAICS number for the facility(s) to be constructed or improved with the contribution.) *NAICS North American Industry Classification System. The Federal Office of Management and Budget (OMB) adopted the NAICS as the industry classification system used by the statistical agencies of the United States. NAICS replaces the 1987 Standard Industrial Classification (SIC). The NAICS is used for classifying business establishments to assist with gathering data related to measuring productivity, unit labor costs, and the capital intensity of production, employment and other information. Missouri businesses are assigned a NAICS when the company files a Report to Determine Liability Status with the Missouri Department of Labor and Industrial Relations, Division of Employment Security to determine Unemployment Tax Liability. Normally, a general business employer becomes liable for the tax and responsible for providing unemployment insurance for its workers when it: " Pays $1,500 in wages (cash and in-kind) in a calendar quarter, or " Has an employee in some portion of a day in each of 20 different weeks, or " Becomes liable under the Federal Unemployment Tax Act (FUTA) and employs a worker in Missouri, or " Acquires and continues without interruption substantially all the business of a liable employer. B. THE PROJECT 1. Project Description: Type of Project: Construction of new infrastructure Acquisition of real estate Construction of new facilities Acquisition of existing facilities Additions or improvements to existing facilities Acquisition of equipment Business Address/Location of Project Site: SEE ATTACHMENT 2--DESCRIPTION OF PRESENTLY ANTICIPATED PROPOSED PROJECT SITE, WITH PHOTOGRAPHS AND MAP SHOWING GENERAL BOUNDARIES. (Street) (City) (County) (%) (Rev. February 2014)

7 Legal Description of Property: SEE ATTACHMENT 2--DESCRIPTION OF PRESENTLY ANTICIPATED PROPOSED PROJECT SITE, WITH PHOTOGRAPHS AND MAP SHOWING GENERAL BOUNDARIES. Consolidated legal description of property included in Project to be prepared when all parcels acquired and consolidation plat prepared and filed. What is the expected date of commencement of construction of the Project? Date: Early 2016 (Commencement of remediation, demolition, site preparation) January, 2017 (Commencement of stadium construction) What is the date the Project is expected to commence operations? Date: August, Project Costs: On the following table, state the costs reasonably necessary for the acquisition of the site and/or construction of the proposed Project together with any machinery and equipment in connection therewith, including any utilities hook-up, access roads, or appurtenant structures. (&) (Rev. February 2014)

8 Description of Estimated Project Costs Non- Contribution Amount A. Acquisition of Land $ $ Acquisition of Existing Buildings $ $ B. Infrastructure Costs: $ $ 1. Filling, grading and provision of drainage $ $ 2. Storm water retention $ $ 3. Installation and extension of utilities (offsite): $ $ a. water $ $ b. sewer $ SEE$ Cost Financed With Contribution Proceeds c. sewage treatment $ $ d. gas $ ATTACHMENT $ 3 e. electricity $ $ f. communications and similar facilities $ $ 4. Installation and extension of utilities (onsite): $ $ a. water $ $ b. sewer $ $ c. sewage treatment $ $ d. gas $ $ e. electricity $ $ f. communications and similar facilities $ $ 5. Construction, Extension or Improvement of Roads and/or Rail Lines $ $ 6. Extension of sidewalks and curbing $ $ 7. Elimination of Blight (please describe) $ $ 8. Other (please describe) $ $ C. Facility Construction Costs (exclude inventory and working capital): 1. Architectural and Engineering $ $ 2. Site Preparation $ $ 3. Materials $ $ 4. Labor $ $ 5. Construction Contracts $ $ 6. Utilities Connection $ $ 7. Paving and Landscaping $ $ D. Renovation Costs $ $ E. Machinery and Equipment $ $ F. Furniture and Fixtures $ $ G. Interest During Construction From To $ $ H. Accounting, Legal, Miscellaneous $ $ I. Contingency $ $ TOTAL PROJECT COSTS $ $ (') (Rev. February 2014)

9 Source of Funds: State amount and sources of financing for all of the Project costs listed above. Sources Amount Contribution Proceeds $ Applicant s Funds (Describe Sources) $ Federal Funds (Describe Sources) $ SEE State Funds (Describe Sources) $ ATTACHMENT 3 Private Funds (non-contributions) $ Other (Describe Sources) $ TOTAL $ Provide a detailed description for all State, Federal, Private or Other funding sources listed above. Include agency and program name, respective amounts if more than one source is involved on the same line, and a copy of the funding commitment or approval setting forth the terms of funding. If approval has not been received, provide an explanation of where the application or request is in the review process, and the expected date of approval. The ability to demonstrate a high level of certainty in obtaining all funding identified to complete the project as presented is a factor the Board considers. SEE ATTACHMENT 3 3. Certified Minority (MBE) and Women-Owned Business Enterprise (WBE) Participation The Board encourages the involvement of minority and women-owned businesses as certified by either the Missouri Office of Administration (OA) for State agency applications, or the municipality submitting the application for local projects. If the application is from a local government, please attach a copy of the Applicant s MBE/WBE Policy and Procedures pertaining to this subject, or the link to the local government s web site where this information can be obtained. If the Applicant has policies and procedures in place, adherence to these policies and procedures will be a stipulation of the use of Contributions. If policies are not in place, please denote same and note that you will be required to contact OA to develop a plan to address this matter. The Office of Administration list of certified businesses by region can be found at for those communities that do not maintain their own certification program. (() (Rev. February 2014)

10 Please estimate the number of each type business the Applicant and/or Principal User expects to utilize in the construction and equipping of the Project. No. of Firms Amount Minority Business Enterprise (MBE) $3M Est. Avg. $ 205,000,000 (25%) Est. Women Business Enterprise (WBE) "(,$%)'& #'-'+$*,!usiness Enterprise $3M Est. Avg. $ 41,000,000 (5%) Est. $3M Est. Avg. $ 24,500,000 (3%) Est. Please note that the MDFB will require the Applicant, or Principal User if different from the Applicant, to submit a written report upon the completion of the Project providing the number of firms used, dollar amount of contracted value, and brief description of the type work or services contacted for each category above. 4. Ownership: Present legal owner of Project site: Between 40 and 50 different property owners. If presently owned by Applicant, indicate date of purchase, reason for purchase, and current use of site: No property presently expected to be included in the Project is currently owned by the Applicant. Is there a relationship legally or by virtue of common control between either the current Project user or owner or the proposed Project owner and user or seller of the Project: Yes 4 No If yes, please give details. 5. Employment: New Full-Time Jobs 50 Estimated Average Wage $75,000 Est. Avg. Annual Part-Time Jobs 2,600 Estimated Average Wage $19 Est. Avg. Hourly Temporary Jobs Included in Part-Time Average Wage Included in Part-Time Jobs during Construction Average Wage Estimated--3,000 Full-Time Equivalents Estimated--$60,000 Per Year Annualized Estimated length of Construction period 3 1/2 years (approximate) It is anticipated that remediation, demolition, and site preparation will commence in early 2016, construction of the stadium structure will commence in January 2017, and that the stadium structure will be ready for occupancy in August, (Rev. February 2014) ())

11 C. FINANCIAL INFORMATION 1. Financial Statements: Attach audited financial statements for at least the last three (3) fiscal years, including the most recent interim statement (not more than 90 days old). SEE EXHIBIT F. 2. Financial Difficulties: Has the Applicant, or any corporation formed by or on behalf of the Applicant, ever defaulted on its debt obligations, been involved in bankruptcy, creditor s rights, or receivership proceedings, or been involved in criminal proceedings bearing on the handling of financial matters? Yes 4 No If yes, please give details. 3. Litigation: Is the Applicant presently involved in any litigation which could have a material effect on its financial solvency? Yes 4 No If yes, please give details. 4. Please list the Applicant s general fund and other key fund surpluses (or deficits) for the last four years. Year As of 12/31/2011 As of 12/31/2012* As of 12/31/2013 As of 12/31/2014 General Fund ( ) for deficits $ million $ million $ million $ million Fund ( ) for deficits Fund ( ) for deficits *The adoption of new GASB accounting policies in FY 2013 resulted in the restatement of RSA's FY 2012 net position. The restated position is approximately $10.9 million less than previously stated. Amounts shown in this section are the RSA's net positions as shown in the attached audited financial statements. 5. Has the Applicant ever defaulted on any obligation or failed to appropriate for any lease or any other annual appropriation obligation during the last 20 years? Yes 4 No If yes, please give details. (*) (Rev. February 2014)

12 D. PROJECT REVENUES (Not required for projects in small cities/rural areas) Attach a cost benefit analysis showing the total tax revenues generated that will be collected by the local governmental jurisdictions and the State as a result of the Project, and the cost of all local and state governmental assistance provided to the Project. Revenues and costs should be identified by each recipient or payee (private and governmental). SEE EXHIBIT D. E. IDENTIFICATION OF CONTRIBUTORS Has the Applicant identified who the contributors would be? 4 Yes No If Yes, please list below or attach a list of names of potential contributors. Contributors tentatively identified may be (a) property owners; and/or (b) private for-profit entities, including but not limited to the owner(s) of professional sports franchises and/or the National Football League; and/or (c) non-profit organizations. If No, please explain why the Applicant believes such Contributions are likely to be obtained. Provide a timeline of fundraising activities. Include when you expect the first contribution to be made and when you expect to have the fundraising for this project complete. Please be as specific as possible. The Applicant expects that the $30 million contribution associated with the 2015 tax credits requested in this Application will be made in late 2015 or early 2016 and that fundraising for the Project will be completed in 2015 in anticipation of the receipt of the tax credits that will be requested in 2016 and Construction will commence in Funds raised in anticipation of 2016 and 2017 tax credits will not be contributed to the Infrastructure Development Fund until 2016 and SEE ATTACHMENT 1. F. USE OF THE PROJECT If the Project will be used for (or will substantially benefit) an entity in addition to the Applicant, please complete Exhibit! for such user of beneficiary. SEE EXHIBIT B. (+) (Rev. February 2014)

13

14 ATTACHMENT 1 EXPLANATION OF TAX CREDIT AND CONTRIBUTION REQUEST In this application, the Regional Convention and Sports Complex Authority ( RSA ) requests that the Missouri Development Finance Board ( MDFB ) approve an award of $15 million in tax credits in calendar year 2015 for $30 million in contributions for the development of a new stadium complex, including ancillary utility and transportation facilities (the Project ). The RSA will request additional contribution tax credits in calendar years 2016 and 2017 such that the RSA s total request for contribution tax credits for the Project equals $50 million, per the following schedule: $15 million in tax credits for contributions from the calendar year 2015 allocation $17.5 million in tax credits for contributions from the calendar year 2016 allocation $17.5 million in tax credits for contributions from the calendar year 2017 allocation TOTAL REQUESTED AWARD: $50 million in tax credits for contributions TOTAL EXPECTED CONTRIBUTION AMOUNT: $100 million The Project is vitally important to the State of Missouri (the State ) and the St. Louis Metropolitan Area (the St. Louis region ). That economic significance of this Project to the State and the St. Louis region is the basis for the RSA s request that, in addition to formally approving $15 million in contribution tax credits in calendar year 2015, the MDFB recognize and support the RSA s request for awards of $17.5 million in tax credits for the Project in each of the calendar years 2016 and The RSA recognizes that the actual award of tax credits in future calendar years is subject to the MDFB s approval of applications submitted by the RSA for those credits in those years. Note that all tax-credit related contributions and tax credit issuances are contingent upon evidence satisfactory to the MDFB that (a) the National Football League ( NFL ) and/or an NFL team has committed to financially contribute to the Project s development; and (b) an NFL team has committed to play its home games in the proposed stadium facility. The RSA will solicit contributions for the Project from various sources. See Attachment 3. The RSA anticipates receiving the first contributions totaling $30 million in late 2015 or early The RSA understands that the tax credits awarded in a calendar year will remain available to the RSA and its donors in calendar years subsequent to a calendar year in which the MDFB awards the credits and that credits will be issued in the year in which contributions are actually made. All contributions for which tax credits are requested will be transferred to the MDFB for deposit in the Board s Infrastructure Development Fund. Concurrently with the applications for tax credits, the RSA requests that the MDFB make grants to the RSA from the Board s Infrastructure Development Fund (the Fund ) equal to the amount of contributions to the Fund, less the amount of any fees that the MDFB may impose. The RSA will use such grants to fund a portion of the Project s development costs. See Attachment 3 for detail on amounts anticipated to be available for investment in the Project as a result of the requested tax credits and the associated contributions to the Fund. Attachment 1 1-1

15 ATTACHMENT 2 DESCRIPTION OF PRESENTLY ANTICIPATED PROPOSED PROJECT SITE, WITH PHOTOGRAPHS AND MAP SHOWING GENERAL BOUNDARIES The map below shows the general area in the City of St. Louis (the City ) in which the proposed Project is anticipated to be located. The Lumiere Place and Four Seasons Hotel development, completed in 2007, set the stage for the redevelopment of the approximately 88-acre proposed Project site immediately to the north. Over the past twenty years, the City and its development agencies have made several investments in the proposed Project site in anticipation of its redevelopment. Other than the Lumiere Place development, little development activity has occurred on or adjacent to the proposed Project site. The vast majority of the proposed Project site remains blighted and undeveloped. The photographs on the following pages show the blighted condition of the proposed Project site, with much of the property in the area abandoned and most of the few remaining structures decaying and in need of demolition or significant rehabilitation. In 2014, the City, Great Rivers Greenway, the Laclede s Landing Merchants Association, the Missouri Department of Transportation, the Bi-State Development Agency, and other stakeholders began PROPOSED PROJECT SITE LUMIERE PLACE MAP SHOWING GENERAL BOUNDARIES OF PRESENTLY ANTICIPATED PROPOSED PROJECT SITE collaborating on a redevelopment plan for the area north of Eads Bridge, east of Interstate 70, south of the new Stan Musial/Veterans Memorial Bridge, and west of the Mississippi River (the North Riverfront ). The overall goal of the plan is to promote economic revitalization of the North Riverfront by transforming vacant property along the Mississippi River into public parks and recreation amenities and by stimulating private investment in the area. The Project is anticipated to occupy a portion of the North Riverfront planning area and plans for the Project have now been integrated into the broader North Riverfront planning effort. The proposed Project will revitalize a significant portion of the seriously distressed and blighted North Riverfront area and provide a much-needed anchor for revitalization of the broader area. The proposed Project will produce significant economic and other intangible benefits for the State and the St. Louis region by providing a venue that will allow the State and the region to Attachment 2 2-1

16 retain a professional football team. The proposed Project will also provide a first class venue for other events that generate economic activity, some of which might not otherwise choose to locate in the St. Louis region or include the State and the St. Louis region in their touring schedules. Additional development that is anticipated to occur around the Project will also produce significant benefit for the State and the St. Louis region. AERIAL OVERVIEW OF PRESENTLY ANTICIPATED PROPOSED PROJECT SITE KEY TO PHOTOGRAPHS Attachment Deteriorated Infrastructure

17 2. Vacant Land & Deteriorated Utility Infrastructure 3. Abandoned & Deteriorated Building 4. Vacant, Unmaintained, and Littered Property (Looking Southwest to Lumiere Place) Attachment 2 2-3

18 5. Abandoned and Deteriorated Building For Sale 6. Abandoned & Deteriorated Building 7. Rail Cars Temporarily Parked on Rail Spur Attachment 2 2-4

19 8. Vacant Deteriorated Building with For Sale Sign 9. "Powerhouse" Anticipated To Be Rehabilitated 10. Deteriorated Infrastructure and Underutilized Property Burdened with Old Demolition Debris and Drainage Issues Attachment 2 2-5

20 11. Abandoned Property with Demolition Remnants (Looking South to Metropolitan Square and Gateway Arch) 12. Vacant Land and Vacant Deteriorated Building 13. Deteriorated and Underutilized Building Attachment 2 2-6

21 14. Abandoned Land with Demolition Remnants (Looking South to Dr. Martin Luther King and Eads Bridges) 15. Abandoned Building and Abandoned Property with Demolition Debris (Looking Northwest to Mississippi River) Attachment 2 2-7

22 16. Deteriorated Building and Site 17. South Entrance to Riverfront Trail 18. Vacant Deteriorated Property with Drainage Issues Attachment 2 2-8

23 ATTACHMENT 3 ESTIMATED PROJECT COSTS AND ANTICIPATED FINANCING SOURCES ESTIMATED PROJECT COSTS: TOTAL ESTIMATED COST CATEGORY COST Construction (Including Stadium and $ 820,000,000 Parking Construction, Site and Riverfront Development, Site Clearance, Demolition and Remediation Per HCKL Joint Venture) Land Acquisition 60,000,000 Soft Costs (Including Design and Other 118,000,000 Professional Fees, Miscellaneous Costs, and Owner Contingency) ESTIMATED TO BE FINANCED WITH CONTRIBUTION PROCEEDS Contributions and Contribution Tax Credit Proceeds May Finance Portions of Any of the Costs at Left ESTIMATED TO BE FINANCED WITH OTHER SOURCES Other Financing Sources May Finance All or Portions of Any of the Costs at Left TOTAL ESTIMATED COSTS: $ 998,000,000 $ 47,500,000 $ 950,500,000 ANTICIPATED FINANCING SOURCES: ESTIMATED ANTICIPATED FUNDING SOURCE AMOUNT NFL Team Ownership $ 250,000,000 NFL G4 Program 200,000,000 Net New RSA Bond Proceeds (State) 135,000,000 Net New RSA Bond Proceeds (City) 66,000,000 Estimated Proceeds from Sale of Seat Licenses 160,000,000 Estimated Amount of State Tax Credit Proceeds, MDFB Infrastructure Fund 187,000,000 Contributions, and Other State and/or City Incentives TOTAL ALL ESTIMATED SOURCES: $ 998,000,000 All of the amounts on this page are subject to change. See the following page for possible contribution alternatives and use of the requested tax credits. Attachment 3 3-1

24 Alternatives for Contributions and Use of Requested Contribution Tax Credits OPTION 1 RSA Contributes Funds Raised for Project 1. The RSA donates a total of $100 million in funds raised for the Project to a non-profit. 2. The non-profit contributes $100 million to the MDFB Infrastructure Development Fund. 3. The MDFB issues a tax credit to the non-profit for 50% of the contribution amount ($50 million). 4. The non-profit sells the credit. The amount of credit sales proceeds will vary depending on the market for the credits at the time they are available for sale; this Application assumes the tax credits will be sold for 95% of face value. 5. The non-profit contributes the credit sales proceeds to the RSA to fund a portion of the Project s development costs. 6. The MDFB returns the $100 million in contributions made to the Infrastructure Development Fund to the RSA as grants from the Infrastructure Development Fund; the RSA uses the grants to fund a portion of the Project s development costs. OPTION 2 Unrelated Donor Contributes Cash, Property or Marketable Securities for Project 1. One or more unrelated donors contribute a total of $100 million in cash, real property, and/or marketable securities to the MDFB Infrastructure Development Fund. 2. The MDFB issues a tax credit to the unrelated donor for 50% of the contributed value ($50 million). 3. The unrelated donor (a) uses the credit against eligible Missouri tax liability; or (b) sells the credit. 4. The MDFB returns the $100 million contribution to the RSA as grants of money and/or real property from the Infrastructure Development Fund to fund a portion of the Project s development costs. The above options do not reflect fees which the MDFB may impose, which will reduce the amounts available to the RSA as grants from the Infrastructure Development Fund. DETAILED FUNDING SOURCES DESCRIPTION: It is anticipated that the NFL team owner will provide $250 million in private funding as a grant to the RSA for development of the Project. It is also anticipated that the NFL will, per the league s G4 program, loan an additional $200 million to the NFL team owner and that the team owner will also contribute that amount to the Project as a grant. The RSA anticipates that licenses to preferred football game seating will be sold and estimates that that the proceeds of these license sales will equal approximately $160 million. It is anticipated that the State and the City will appropriate lease payments on the new facility. Attachment 3 3-2

25 In addition to the Contribution Tax Credits incentive requested in this application, the RSA is applying for Brownfields tax credits and anticipates the use of Brownfields credit sales proceeds as a funding source for the Project. Note that all costs shown in the above Estimated Project Costs table will vary as the Project budget is refined based on actual construction contracts and other agreements that will be executed if the Project moves forward. Sources of funding shown in the above Anticipated Financing Sources table will also vary and will be further refined as Project planning moves towards a construction start, definitive markets for the anticipated new bonds and anticipated tax credit are established, and amounts and types of other anticipated financing are finalized. Attachment 3 3-3

26 EXHIBIT A PROJECT NARRATIVES 1. Provide a description of the project, including land, buildings, improvements, machinery and equipment to be acquired or constructed, and the principal use of the facilities once complete. The RSA anticipates that the Project will include the following development that will result in an approximately $998 million outdoor stadium complex suitable for professional football games as well as other sports, entertainment and tourismrelated activities: a. Acquisition of the anticipated Project site (see Attachment 2, Map Showing General Boundaries of Presently Anticipated Proposed Project Site). b. Site preparation, including demolition of existing structures, remediation of environmental hazards as required for the intended use, and remediation of problematic soil conditions as well as relocation of certain railroad and utility infrastructure. c. Design of the new stadium complex and related utility and transportation infrastructure. d. Construction of the new stadium complex and related utility and transportation infrastructure. e. Purchase and installation of furnishings, fixtures, and equipment required for the operation of the stadium. The new stadium complex will be owned by the RSA. Associated ancillary infrastructure, including parking facilities and transportation rights of way, are anticipated to be owned by the RSA; however, the RSA may collaborate and/or contract with other entities in relation thereto. Graphics on the following pages show the anticipated initial design of the proposed stadium complex and are subject to change. A-1

27 ANTICIPATED INITIAL DESIGN PROPOSED STADIUM COMPLEX Anticipated Aerial View Proposed New Stadium Complex Anticipated "Powerhouse Plaza" View--Proposed New Stadium Complex A-2

28 Anticipated Football Field View--Proposed New Stadium Complex Anticipated Deck View--Proposed New Stadium Complex A-3

29 Anticipated Ancillary Trail Network--Proposed New Stadium Complex Anticipated Terraced Riverfront Plaza--Proposed New Stadium Complex A-4

30 2. Describe the public policy objective(s) that will be supported by the Project. The Project will allow the State and the St. Louis region to retain a professional football team. It is clear from various news reports that without a new stadium the St. Louis region will not retain or attract a professional football franchise. The Cost-Benefit Analysis attached as Exhibit D demonstrates that the loss of a professional football franchise in the St. Louis region will cause the loss of millions of dollars of tax revenue each year in the State and the St. Louis region. Retention of a professional franchise will preserve those revenues and permit them to grow over time. Completion of the Project will also promote and enhance economic development in the State and the St. Louis region. Construction of the Project will increase the number of construction and related jobs in the St. Louis region and surrounding areas and in the State, and retention of a professional football team will foster expansion of the State s and the St. Louis region s business bases. Because the St. Louis region is the State s primary center of commerce and population and the State s primary source of general and other revenues, the St. Louis region s ability to maintain and grow its business base will be of significant benefit not only to the St. Louis region but to the entire State. The presence of the Project further supports economic development by enabling development in an area that is blighted, underdeveloped and underutilized. The proposed Project will preserve and increase tourism in the State and the St. Louis region. The proposed Project will attract visitors from other parts of the United States as well as other parts of the State to the greater St. Louis region s hotels, restaurants and retail establishments. 3. Describe and quantify the project s primary beneficiaries or targeted audience/clientele served. The Project will serve as the anchor for revitalizing a severely distressed and blighted area of the City immediately north of downtown St. Louis and will catalyze the attraction of new economic activity in and adjacent to the area occupied by the Project. The State, the entire St. Louis region, and the City will benefit from the ancillary development that is expected to occur as a consequence of the Project. The Project will retain significant numbers of permanent jobs directly associated with the professional football franchise. In addition to preserving highly paid jobs for professional football players, coaches, and staff, the Project will also preserve other permanent, part-time and temporary jobs associated with professional football games in the new stadium facility and the provision of services and supplies that support such games. The Project may also create new permanent part-time and temporary jobs associated with other entertainment and sporting events that may take place in the new facility. In addition, the Project will produce significant numbers of new construction jobs. Residents of the St. Louis region and the State will benefit from preserving existing permanent jobs, from the availability of new A-5

31 construction jobs, and from the availability of any new jobs that may result from a new state-of-the-art outdoor event venue. The Project will make it possible to retain a professional football franchise in the St. Louis region and provide a venue for new tourism and entertainment activities. Retention of a professional football franchise and the new venue will have a positive impact on the State and the St. Louis region. The team and the new venue will help retain and attract businesses and employment and enhance quality of life in the State and the St. Louis region, as well as preserve and enhance the overall reputation of the State and the St. Louis region. Construction of the new facility and retention or attraction of an NFL franchise will avoid the negative impact on the images of the State and the region that would result from loss of a professional football team: outsiders will not consider St. Louis to be a big league region if it loses a professional football team. The Project will have many other direct and indirect beneficiaries, as follows: Businesses that provide supplies and services for professional football games and other events in the new facility will preserve and expand their customer bases. The State and the St. Louis region will benefit from the retained and increased economic benefit generated by the region s thousands of professional football fans and visitors from outside the region that patronize the region s restaurants, hotels and other attractions when they attend home NFL football games. The State and the St. Louis region may benefit from new non-football sporting and entertainment events at the Project and the direct and indirect tax revenues that may be generated by such events. Prospective patrons of other entertainment and tourism-related events may also benefit from the Project: the new facility may enable the St. Louis region to attract events that might otherwise bypass the region and even the State. 4. Explain the economic impact this project will have on the State of Missouri and the community in which it is located. In addition to the quantifiable economic impact, the presence of an NFL team has and will continue to have a profound impact on the reputation of the State and the St. Louis region and on the State s and the region s ability to retain existing businesses and employees and to attract new businesses and employees. Construction of the Project will produce direct and indirect economic benefit for the State and the St. Louis region, primarily by retaining the State and local tax revenues associated with a professional football team and creating a venue in which A-6

32 those revenues can grow. Such recurring State and local tax revenues include personal income and earnings taxes paid by individuals highly paid football players and other tax payers of varying incomes working at the Project and sales taxes paid by attendees at football games. Estimates of direct benefits to the State and the St. Louis region s taxing jurisdictions are quantified in the Cost-Benefit Analysis attached as Exhibit D. In addition to estimated direct economic benefits, the Project is expected to produce indirect economic benefits that have not been quantified, including taxes on sales of goods and services to players, coaches, and team personnel. Indirect economic benefits may also include taxes on profits earned by businesses participating in operation of the new stadium. The Project will also produce new direct economic benefit for the State and the St. Louis region. Construction workers will pay individual payroll-related taxes on wages. Estimates of those direct construction-related tax revenues are included in Exhibit D. Indirect construction-related tax revenues may include taxes on spending by construction workers and corporate income tax on the net profits of contractors and suppliers associated with construction of the stadium and ancillary facilities. The Project will allow the State and the region to not only retain or attract a professional football team, but may also result in attraction of other new sporting and entertainment events that may produce new jobs and new tax revenues for the State and taxing jurisdictions in the St. Louis region. Development of the Project in a portion of the North Riverfront area of the City, immediately adjacent to previously developed portions of downtown St. Louis, will enable the North Riverfront area and adjacent distressed areas to attract new economic activity, benefitting both the State and the St. Louis region. Revitalization of the North Riverfront area is also expected to support the retention of existing businesses in, and attraction of new businesses to, downtown St. Louis, one of the region s and the State s major economic engines. 5. Explain the non-economic benefits this project will have on the community and State. The new facility will enable Missouri and the St. Louis region to retain their big league images. Big league status is important to both the St. Louis region and the State: loss of that image may result in a reduction of tax revenues and loss of businesses. Further, loss of that image would likely have a detrimental impact on citizen satisfaction with the community in which they live and work. In addition to avoiding negative impact on the images of the State and the St. Louis region resulting from the loss of a professional football team, the Project will enhance those images by creating a state-of-the art facility that can attract events new to the region and the State. 6. Describe the local Governmental financial support for the project, both direct and indirect. A-7

33 It is anticipated that the City and the State will provide support for the Project by making lease payments that will provide the RSA with revenue to pay principal and interest on new RSA bonds issued to pay a portion of the Project s costs. The City and the State may also provide other incentives for the Project. 7. How did you determine the amount of local city/county cash or local non-profit cash to be dedicated to the project? Amounts estimated in this application were derived from discussions with outside financial experts and representatives of the State. 8. Describe the fundraising history of the organization and how they intend to be successful in raising funds for this project using tax credits. The RSA previously developed and currently owns the Edward Jones Dome. The Edward Jones Dome is part of America s Center, the St. Louis region s premier convention and sports complex. To support its efforts to implement the Project and provide information to the NFL, the RSA has engaged professionals experienced in a range of activities required for Project development. It is anticipated that the RSA will engage other professionals and/or organizations with experience in tax credit-based fundraising as and if needed to raise funds for the Project using the requested tax credits. In addition, the Project working group includes individuals with significant experience in raising funds from a variety of sources for various civic endeavors. 9. Explain how this project will be financially self-sustainable upon completion. Operation of the Project is expected to generate recurring revenues from rents and user fees paid by a professional football team and other users of the facility. Other users of the facility are expected to include concert promoters and convention organizers and may include other sports teams. A-8

34 EXHIBIT B PROJECT USER BENEFICIARY INFORMATION It is anticipated that the RSA will enter into a long-term lease with an NFL team to use the new stadium complex for its home football games and certain of its operations. Since NFL team home games are typically only ten dates per year, many other dates will be available for other sporting and entertainment events at the new stadium complex. The NFL team and other entities that may use the new stadium complex have not yet been identified. B-1

35 EXHIBIT! #$-/&%&#!/&+* +%!(&$* $),(+1)$*/ #$% (Rev. February 2014)

36

37 EXHIBIT D COST-BENEFIT ANALYSIS D-1

38 LOCAL COST-BENEFIT ANALYSIS: CONSTRUCTION OF A NEW STADIUM COMPLEX AND RETENTION OF A NATIONAL FOOTBALL LEAGUE TEAM IN THE ST. LOUIS REGION BACKGROUND According to widely-publicized news reports, the current owner of the Rams ( Rams ) National Football League ( NFL ) team, which now plays its home games in the City of St. Louis (the City ), intends to move the team to California. If that intention becomes reality and another NFL team does not replace the Rams, the State of Missouri (the State ), the City and taxing jurisdictions in the St. Louis region will lose significant amounts of tax revenue. Of equal importance, loss of an NFL presence will significantly impair the St. Louis region s status as a metropolitan area attractive to businesses and residents. In 2014 the Governor appointed a task force to work with the Regional Convention and Sports Complex Authority (the RSA ), an entity created by Missouri law to address the region s need for convention and sports facilities, to develop a plan to address this threat to the State s and the region s economic health. NFL officials have made it clear that without a new stadium the region will not retain an NFL team. For that reason, the Governor s task force and the RSA have worked with the region s business leaders and others to develop a plan to build a new stadium that meets NFL standards. In January 2015 the RSA released a proposal for construction of a new outdoor stadium complex, including ancillary transportation and other infrastructure, in a deteriorated and underutilized area on the St. Louis riverfront north of the Gateway Arch. The cost of the proposed project is currently estimated at $998 million and the new stadium s seating capacity is currently estimated at 62,500. If construction begins in early 2016, the new stadium will open in time for the 2019 NFL season. The purpose of this analysis is to examine the potential local economic impact if the proposed new stadium complex is constructed and an NFL team plays its home games in the new complex. A companion analysis performed by the Missouri Economic Research and Information Center ( MERIC ) analyzes State benefits anticipated to be associated with the new stadium proposal. This analysis is based on preliminary data provided by the task force and certain of its consultants as well as other available data consistent with the MERIC analysis. Unlike the MERIC analysis, this analysis estimates only direct local revenue impacts and ignores the positive impact of indirect revenue that may result from application of "multipliers" e.g., the D-2

39 additional local tax revenue generated when workers and businesses spend their stadium complex and football-related revenue on other taxable goods and services. If multipliers were applied in this analysis, one-time local revenues from stadium complex construction and recurring local revenues from stadium complex and NFL operations would be greater than are estimated in this analysis. Retention of an NFL team in the St. Louis region is necessary to preserve the region s big league image and the positive impact of that image on the region s ability to retain and attract businesses and employees. A new state-of-the-art stadium complex can also be expected to enhance the region s reputation. This analysis does not attempt to quantify intangible and indirect economic impact resulting from such preservation and enhancement of the region s image or associated business retention and attraction. This analysis ignores any revenues that currently accrue to St. Louis County (the County ) from NFL team operations and that may accrue to the County as a result of the construction of the new stadium complex and the retention of an NFL team. The current NFL team practice facility is located in the County; it is therefore likely that the County receives sales tax revenues from spending by players and team staff during time spent at that facility. It is also likely that some portion of the taxable material purchases required for the new stadium complex s construction will occur in the County. And it is also likely that the County receives hotel tax revenues from visiting team players and home team players who do not reside in the St. Louis region. Like the City, the County also benefits from the enhanced regional image associated with the presence of an NFL team and will experience the same intangible negative impact as the City if the region loses professional football. In addition to NFL games, it is also anticipated that sporting and other entertainment events new to the region will take place in the new stadium complex and that those events will also produce direct recurring revenue for the City and its taxing jurisdictions. This analysis ignores the economic impact of those new events. Finally, it is anticipated that a new stadium complex will stimulate additional economic development in the broader North Riverfront area. This analysis does not include the economic impact of such anticipated additional development. LOCAL IMPACT ESTIMATES: CONSTRUCTION OF A NEW STADIUM COMPLEX AND RETENTION OF A NATIONAL FOOTBALL LEAGUE TEAM Construction of the proposed new stadium complex will not begin unless an NFL team commits to play all of its home games in the new stadium complex and the team and/or the NFL commit to a substantial financial investment in the stadium development. D-3

40 This analysis assumes that arrangements for construction of a new stadium and retention of a professional football team in the St. Louis region are finalized before 2015 year-end and that either the Rams or another NFL team will play home games in the existing Edward Jones Dome (the Jones Dome ) through 2018 and will play home games in the new stadium in 2019 and thereafter. If the new stadium complex is constructed, the City is expected to benefit significantly from one time earnings and payroll tax on the wages anticipated to be paid to the new stadium s construction workers from the beginning of 2016 through the first half of This analysis also anticipates that the City will receive a minimal amount of sales tax revenues from stadiumrelated construction materials and equipment purchased without use of the RSA s tax exemption certificate. In the second half of 2019 and thereafter, the presence of a new, state-of-the-art stadium complex is expected to produce growth in recurring NFL-related direct City revenues in excess of what could be expected merely from the effects of across-the-board inflation on the status quo. When the new stadium complex opens in 2019, it is anticipated that football fans as well as others in the region will want to experience the new complex and that professional football s renewed commitment to the region will engender more regional loyalty to the sport. As a result, it is also anticipated that NFL ticket pricing, the number of NFL tickets purchased, and actual attendance at NFL games will increase. The MERIC analysis assumes that NFL games at the new 62,500- seat facility will be sold out for the first three years after the new stadium opens. It is further assumed that the average St. Louis NFL ticket price in 2019 will be the national average 2019 NFL ticket price. Because it is also assumed that the number of people who actually attend NFL games in the new stadium will be a higher percentage of the number of tickets purchased than is currently the case at the Jones Dome, percentage increases in football-related food, beverages and merchandise sales will outpace the percentage increase in number of tickets purchased. Anticipated increases in football-related sales are expected to increase direct revenues from certain taxes imposed by the City on various types of sales. Other modest direct revenues associated with football operations in the new stadium are expected to be derived from the City s parking tax and from earnings and payroll tax applied to NFL player and staff earnings at the stadium complex and the earnings of game day and other staff employed by the RSA and its subcontractors at the stadium complex. It is anticipated that the RSA will employ 2,600 parttime people at the stadium complex on each NFL game day and 50 new full-time staff to manage the stadium complex. Other governmental entities that impose taxes in the City are also expected to benefit from recurring revenues if NFL football remains in St. Louis. One example is the St. Louis Board of Education, the City s public school district that operates only in the City and imposes a tax on sales in the City. In addition, the Regional Convention and Visitors Commission ( CVC ) and the Regional Arts Commission ( RAC ) are expected to receive minimal direct recurring revenue from a statutorily dedicated hotel tax applied to NFL-related hotel room sales. MERIC assumes that 65% of the local disposable income projected to be spent on professional football-related purchases would be spent on other taxable purchases in Missouri if not spent on NFL-related purchases in St. Louis. MERIC therefore discounts its sales tax estimates D-4

41 accordingly. The MERIC 65% discount has not been applied to City or Board of Education direct revenue estimates because the City and the Board of Education receive no revenue from taxable spending in other parts of the region and it is unlikely that regional consumers will substitute other spending in the City for football-related spending in the City: most people who attend football games in the City do not live in the City and the City offers few attractive opportunities for substitute retail spending other than baseball and hockey. Baseball and hockey seasons do not overlap professional football seasons to any significant degree. The MERIC discount has not been applied to the CVC and RAC revenue estimates because those projections are based only on estimated hotel room sales to football fans from outside the region and such sales would not occur if professional football leaves the region. The Metropolitan Parks and Recreation District ( Great Rivers Greenway, or GRG ) imposes two sales taxes in the City. Because St. Louis County imposes both GRG sales taxes and St. Charles County imposes one GRG tax and because it is likely that substitute local spending would occur in one of those counties, MERIC s 65% discount has been applied to the GRG revenue estimates. The task force proposal currently anticipates that the new stadium project will be financed with a variety of public and private funding sources, including new bonds issued by the RSA and a total of $450 million in contributions from the NFL and/or an NFL football team. Although the City has taken no action with respect to any aspect of the proposed new stadium complex development, the task force proposal currently anticipates that the State and the City will lease the new stadium complex from the RSA, that the new lease will replace the State s and City s current debt service commitments for the Jones Dome, and that the RSA will use the lease payments made by the State and the City to pay debt service on the new RSA bonds. The current task force proposal and this analysis assume that the City will make lease payments of $5 million each year through 2023, $5.5 million in 2024, and $6 million annually through The City will ultimately decide whether to enter into the proposed new lease and whether to provide other incentives that may be requested for the development which this analysis does not take into account. The RSA has not discussed the contents of this MDFB application with the City. The table on the following page summarizes direct revenues estimated to accrue to the City and other jurisdictions that impose taxes in the City as a result of new stadium complex construction and professional football retention, taking into account the amounts of City lease payments anticipated by the task force proposal. This analysis involves certain assumptions and judgments relating to future events and economic and other conditions over a 35-year time period. Therefore, this analysis should not be viewed as a prediction or assurance that the revenues estimated herein will be realized. Actual revenues over the 35-year period will vary from the estimates in this analysis. See the General Notes following the table for additional information related to this analysis. D-5