The Tacoma Rainiers have been engaged in talks with the city of Tacoma over extending their lease, set to expire at the end of 2010. A major component of these talks is a bond package that would help fund remodeling of the minor-league Cheney Stadium.
The city’s bond issue will generate $28 million. Pierce County will contribute another $2 million. The city will pay about 30 percent of the debt service, while the Rainiers and other investors will cover the remainder through taxes on ticket sales, revenue from concession sales and other sources. The new lease will turn maintenance responsibilities over to the team.
Relatively speaking, the price tag of $30 million is not bad at all, considering that new minor-league facilities built from scratch can cost up to $70 or $80 million. But in tough economic times, asking people for more money and building upon public debt is a very slippery slope. Still, city and team officials are arguing that the arrangement will establish a revenue source that will more than pay for the level of debt needed to service the project.
They may be right considering how low interest rates - right now expected to "persist well into 2010" - work to the advantage of the debtor. Moreover, construction costs are low as a result of the housing sector fallout, and a major renovation project such as this could provide a job boon in a city facing somewhat decreased (from earlier this year) yet still high unemployment.
There are two measures relevant to the project:
- Resolution No. 37919: This authorizes the execution of a 30-year agreement for the lease of Cheney Stadium from January 1, 2011 through December 31, 2041.
- Ordinance No. 27852: In order to rehabilitate Cheney Stadium, acquire land, and construct and improve other capital projects, this measure provides for the issuance/sale of up to seven series of limited tax general obligation bonds with the aggregate principal not exceeding $51,000,000.
The city council is expected to hold a first reading of the bond issue measure tomorrow, with a second hearing following next week. Voting on the measure is also scheduled for next week. Expect to hear more about this issue as updates become available.
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