How much will Missouri pay to help build the new Royals stadium? Here’s what we know
AI-generated summary reviewed by our newsroom.
- The Royals plan to contribute $800 million toward the $1.9 billion stadium.
- Public funding is expected to cover about one-third of first phase costs.
- The law allows funding up to 50% for Kansas City pro teams' new stadiums.
Missouri Gov. Mike Kehoe was noncommittal about the state’s contribution to the planned new Royals Stadium near Crown Center at the team’s celebratory announcement on Wednesday.
Last summer, Missouri lawmakers passed the Show Me Sports Investment Act in a special legislative session. It established a framework where the state could fund up to half of the construction costs for new stadiums for Kansas City’s professional sports teams.
It passed as the state desperately competed with Kansas as it ramped up efforts to poach a Kansas City sports team.
But at an announcement on Wednesday, Royals leaders and politicians involved in the deal said that public funding would make up about one-third of the overall construction costs for the first phase of a roughly $3 billion mixed-use development. The stadium itself is expected to cost about $1.9 billion.
Last week, Kansas City passed an ordinance authorizing the City Manager Mario Vasquez to negotiate a deal with up to $600 million in public bonds and tax increment financing toward a new stadium. Royals chairman and CEO John Sherman said the team plans to put $800 million toward the $1.9 billion stadium.
Kehoe, a key backer who campaigned on keeping the Royals and Kansas City Chiefs in Missouri, didn’t share exactly how much the state would contribute beyond sharing roughly one-third of the costs with the city and other public backers. When pressed, he noted the average annual figures the Royals contribute in tax dollars every year.
“We said all along that the estimate on the dollar figure on the taxes they produce is somewhere in the $15 to $17 million a year range, is what that will work on,” Kehoe said.
Kehoe stressed that the details of the project continue to be ironed out.
“A project this big with a lot of complex parcels and pieces and partnerships, it takes a while to continue to work it out,” Kehoe said.
It remains unclear how much money Missouri plans to contribute to the stadium project. While the state’s massive incentives package allows state officials to pay for up to 50% of the stadium’s construction costs, the state’s true portion is likely to fall below that threshold.
The remaining two-thirds of the investment will be from the Royals and other private investors in the entertainment district.
The state may begin funding the stadium as it radically alters how it collects taxes. Missouri voters will be asked whether the state should shift how it collects taxes from predominantly income taxes. Kehoe said he doesn’t think the proposal will impact the state’s ability to meet its obligation.
“Should Missourians approve that, next year’s legislature will work through what a potential new tax code would look like since our current one was developed in the 1930s; it’s probably time for an update,” Kehoe said.
Missouri faces a projected $2 billion general revenue shortfall in fiscal year 2027, which begins on July 1. Some progressive advocacy groups have come out against the proposal, framing it as a giveaway to rich team owners.
“Despite this looming, self-imposed budget crisis, lawmakers in Jefferson City are prepared to contribute $900 million in taxpayer money to billionaire John Sherman’s vanity project,” the Missouri Workers Center, a progressive advocacy group, said in a statement. “This is a clear case of misplaced priorities and misuse of tax dollars.”
State and local officials touted the economic benefits of the stadium, saying that the teams leaving would have a financially deleterious impact on the region.
“It is business retention, I think it is business growth for the future of Kansas City,” Mayor Quinton Lucas said. “If they had left their revenues and their tax receipts would have left with them.”
Decades of academic research have shown that stadiums are not major drivers of economic activity.
