Little more than three years after buying CommunityAmerica Ballpark from the Kansas City T-Bones, City Hall has replaced a 20-year lease agreement with the baseball team with a new deal that has taxpayers helping pay the ballpark’s property taxes and utilities.
The Board of Unified Government of Wyandotte County/Kansas City, Kan., Commissioners last Thursday voted to approved a management agreement with the T-Bones in place of a lease reached in 2014, the product of the UG Commission’s decision that year to buy the ballpark amid the team’s financial struggles.
Instead of collecting lease payments from the T-Bones, the UG believes Kansas law would consider the stadium exempt from property taxes under a management agreement with the T-Bones. That would save the UG $246,000 a year in property tax obligations, giving the UG flexibility to restructure its financial arrangements with the T-Bones.
The UG still needs file for its tax exemption.
“We will have to file the case before State tax officials, but given the way other municipal stadiums and even Providence Amphiteatre are treated (all tax exempt) we are confident the tax status will be changes to tax-exempt,” UG spokesman Mike Taylor said in an email to The Star.
The UG bought the stadium for $5.5 million, using sales tax revenue (STAR) bonds generated by the Village West development. An additional $2.5 million in STAR bonds was pledged for stadium repairs and upgrades.
Commissioners who voted in favor of the new deal said it was better to have the T-Bones playing in the city-owned stadium rather than risk having it sit empty.
“People have spent a lot more on stadiums and teams than we have,” said UG Mayor Mark Holland. “I think of the Chiefs and the Royals. Jackson County gave almost $600 million to the Chiefs and Royals.”
Commissioner Angela Markley, who opposed the UG’s 2014 purchase of CommunityAmerica Ballpark, said there’s no scenario where public money is not involved with the stadium.
“We’re stadium owners,” Markley said. “We’re going to pay for it regardless.”
The UG’s ownership of CommunityAmerica Ballpark has not solved the T-Bones’ financial struggles. The T-Bones played their first game in KCK in 2003; the team plays in an independent baseball league and has no affiliation with Major League Baseball clubs.
Annual attendance has dropped steadily since 2010, when attendance was about 275,000, to 2016, when 213,000 ticket holders crossed the stadium’s turnstiles.
The UG’s lease agreement with the T-Bones required, among other things, $33,000 in annual lease payments, as well as the team paying taxes on a parking lot serving the stadium and common area maintenance fees.
In 2016, the UG sent a letter to the T-Bones demanding that the team catch up on its taxes and fees. The team replied that it had not generated enough revenue to cover its obligations, and the UG ended up paying $125,000 for property taxes on the parking lot and common area maintenance fees.
"The T-Bones have survived over a decade and a half due to spectacular fan support," T-Bones president Adam Ehlert said in a statement. "But even with that, we’ve never had a realistic structure of public/private shared costs, and therefore have had to heavily subsidize baseball in Wyandotte County for that decade and a half. And in the face of increasing competition, from heavily publicly financed facilities, our private subsidization no longer was sustainable. I appreciate our partners at the Unified Government studying, and understanding that. This new agreement, while by no means a giveaway, is closer to a level playing field, recognizing the reality of our small and independent business."
Under the new management agreement, the UG is responsible for paying property taxes on the stadium parking lot ($119,000 a year) and common area maintenance charges ($25,000 a year). By paying parking lot property taxes, the UG ends up paying itself about 45 percent, or $54,740, of the $119,000 bill.
The UG has also agreed to cover 55 percent of utilities owed at the stadium, with the T-Bones paying the rest.
Jeff Bryant, vice chairman of the Board of Public Utilities, spoke against the new T-Bones deal, saying smaller businesses don’t get the types of breaks the baseball team would receive.
“I am looking at this new agreement, and it’s showing the UG would pay 55 percent of the utility bills,” Bryant said. “The UG is not paying 55 percent, it’s the residents of Wyandotte County that are paying 55 percent.”
Another BPU board member, David Alvey, is running against Holland in the UG mayoral election later this year. Alvey led the charge in May against discussions to have the BPU write off half of the T-Bones’ outstanding utility balances, which then totaled $497,000 including utility charges and taxes, according to a BPU spokesman.
Guests at Thursday’s UG Commission meeting largely spoke in favor of the new agreement with the T-Bones.
Bill Hurrelbrink, a former spokesman for Holland and public announcer for the T-Bones, said the team generates a $4 million annual economic impact.
“I think they’re a great partner for our community,” Hurrelbrink said.
The UG’s new agreement with the T-Bones expires on Oct. 31, 2022; the previous lease contract was set to expire in 2034.