What the Royals and Chiefs say they’ll give Kansas City in exchange for stadiums tax
The Chiefs and Royals announced Wednesday a set of agreements saying they would contribute a combined $266 million over the next 40 years toward various vaguely defined social and economic causes if Jackson County voters approve a sales tax to help pay for renovations of Arrowhead Stadium and a new Royals ballpark.
The teams shared broad outlines of those agreements on Wednesday afternoon in a three-page news release less than two weeks before Election Day. They did not share the actual documents themselves, and the teams did not respond to The Star’s request for those agreements with the county’s negotiating group. It is unclear who was party to the negotiations.
The Chiefs said their share would be $126 million, and the Royals would give $140 million. The money would be distributed by separate governing boards, which would be appointed by the county and the teams. Those boards would decide specifically where the money would go.
What the news release did not say is that the Royals’ contribution, at least, would be in annual installments of $3.5 million. Over the 40-year term of the sales tax and lease, that adds up to $140 million.
That’s according to a letter that the Royals sent to county legislators with Tuesday’s date on it that was obtained by The Star before Wednesday’s announcement.
Half of that three-page letter to legislators highlights how the money would be distributed, and the other half touts the team’s current “robust charitable contributions and program” in Jackson County through the Kansas City Royals Foundation.
Under the terms of the community benefits agreement, the Royals would pay $3.5 million each year into a fund administered by a newly established county governing board, whose members would be chosen by the county and the Royals. The team would have the right to appoint up to 45% of its members.
That board would then distribute the funds no less than once a year, according to the letter, “to various nonprofit and charitable programs, initiatives, and objectives” from nine broad categories.
They would include employment benefits, such as workforce training and education; workforce assistance; affordable housing and child care for workers.
Also on the list: health care, which would include anti-violence initiatives and mental health awareness; education programs; public transportation and a category labeled environment and sustainability. Examples under that heading include efforts to reduce carbon emissions.
The team said the agreement would be binding, including certain goals for hiring businesses owned by members of minority groups and women. The team promises that a third of the work during construction would go to minority-owned businesses and 10% to women business enterprises. For any “material project” at the stadium for the term of the 40-year lease, the minority-owned participation would drop to 30% and the one for women-owned businesses would stay at 10%.
What about the Chiefs?
The community benefits said to be part of the Chiefs’ agreement are nearly identical to the Royals’.
In the team’s letter to legislators that legislator Manny Abarca posted on X, formerly Twitter after the announcement, the Chiefs promised to contribute at least $2 million a year into a community benefits fund with an escalator that would increase that amount after year 11. The Chiefs would also get to pick 45% of their CBA fund’s board.
At a community forum and debate Tuesday night, former Kansas City mayor and ballot campaign spokesman Sly James previewed the agreement in general by characterizing it as more generous than previous ones on public projects in Kansas City, such as during the construction of the new terminal at Kansas City International Airport. The terminal’s debt is being paid back through airport revenue, not a county-wide sales tax.
In the letter sent to legislators, the Royals characterized it this way:
“This agreement is in the top tier of community benefits agreements across all professional sports, and contains unprecedented M/WME engagement goals for Kansas City region.”
The news release quoted several local officials with similar words of praise. Abarca and county legislator DaRon McGee called the agreement historic.
Urban League of Greater Kansas City CEO Gwendolyn Grant, who was in the center of the negotiations, said the minority and women business participation goals set a precedent for future projects.
“It’s a triumph for diversity, equity and economic empowerment,” she said.
Critics say teams’ commitments fall short
Some groups that were part of the negotiations early on were dissatisfied with the negotiating process and broke away from the talks. On Tuesday, a group that advocated for a more generous Royals community benefits agreement to benefit low-wage workers announced its opposition to the sales tax.
Gathered outside the Jackson County Courthouse in downtown Kansas City, members of the Good Jobs and Affordable Housing for All Coalition chanted “Hey, Hey, Ho, Ho, Vote No, Vote No, Vote No” as group leaders gave short speeches faulting the Royals for not meeting their demands.
“We’re not asking for a handout. The Royals are,” said Terrence Wise, one of the leaders of Stand Up KC, a group of people who work for minimum wage that is part of the Good Jobs group.
In a statement issued after today’s announcement, the coalition characterized the Royals agreement as insufficient.
“At the end of the day, the Royals are asking for $1.7 billion in taxpayer financing for their new ballpark and entertainment district, while offering relative pennies and dimes in terms of community benefit,” the coalition said.
County Executive Frank White Jr. also issued a statement after Wednesday’s announcement that said the team’s promises do not represent community benefits agreements “in any formal capacity” and also criticized the negotiating process, which he was shut out of after attempting to keep the sales tax off the ballot.
“Statements from numerous community, civil rights and labor organizations has revealed a collective dissatisfaction with the negotiation process, leading to their withdrawal,” White said. “Their departure highlights profound issues within the negotiation framework and casts substantial doubt on the inclusiveness and potential impact of the benefits proposed.”
He continued, “The ‘commitments’ made in these letters are yet another instance where the teams ask voters for their trust without providing a concrete basis for it.”
On Tuesday, the Royals were also in talks with the Kansas City Public Schools, who want the team to compensate the district for the property taxes it would lose if a stadium is built in the East Crossroads as planned. According to the district, the Royals agreed to make up for that lost revenue which the district estimates to currently be about $900,000 a year paid by owners of properties within that six-block footprint.
But other smaller taxing districts have not been contacted by the team. Among those awaiting a call is the Kansas City Public Library, which would lose about $90,000 a year.
“For us, that’s two library staff positions,” said interim library director Debbie Siragusa. “So we are very, very interested in being part of discussions for the community benefit. At a minimum we would want to be made whole so that we don’t lose any of our current tax funding.”
This is a developing story that will continue to be updated.
This story was originally published March 20, 2024 at 2:54 PM.
