A conservative-leaning think tank is asking Mayor Greg Fischer and the Metro Council to give taxpayers more time to consider paying a $30 million bond to assist Louisville City FC in building a soccer stadium in Butchertown.
Fischer says the public-private partnership, which would erect a 10,000-seat facility, is a good use of taxpayer money that will put acres of underused land to good use.
And investors say they need to move swiftly on a new home field to stay in the professional United Soccer League. Since its inception three years ago, Louisville City FC has played at the Louisville Slugger Field baseball stadium.
“They’re moving too quickly,” said Jordan Harris, executive director of the Pegasus Institute. “There are a lot of outstanding questions that the community hasn’t had the opportunities to raise.”
But the fast-track is necessary because the city’s option on the land expires on Nov. 10, Fischer’s office and some council Democratic leaders said on Monday.
“Any delay has the potential to impact the project, but we believe that most questions and concerns will be answered at (Tuesday’s) hearing,” said Fischer spokesman Chris Poynter.
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Two committee hearings are scheduled Tuesday afternoon in City Hall to discuss the measure to purchase 40 acres of land as well as the entire $200 million project, which will be the first public hearing on it.
Democratic Councilwoman Marianne Butler, chairwoman of the Budget Committee, said “it is an optimal time to move forward” with the plan.
But Council Republican spokesman Stephen Haag Jr. said his members haven’t heard anything about the urgency of voting the bond out of committee on Tuesday. He said GOP members, “could have a hard time voting to take on such debt with only a week to review the proposal.”
This week the Pegasus Institute delivered a memorandum to council members, including Fischer’s deputy chief of staff, that says subsidizing professional sports stadiums rarely result in cities recouping the initial costs.
It asks roughly a dozen other questions about how the deal will work and its cost, including what is the public good of the project; what are the city’s plans if the private funding isn’t secured; and whether other costs, such as the city’s increased pension contributions, put too much strain on Louisville’s fiscal condition.
“The public has a right to answers and there needs to be a defense for some of these things,” Harris said. “There needs to be a defense for why this is a public good for the people of Louisville.”
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Louisville City FC board member Mike Mountjoy said Monday that the team’s investors have answered every question that the Pegasus memo has posed to city officials before.
“The main thing for us is, our architects have us on a strict timeline,” Mountjoy said. “We have to play our first game in the new stadium by March 2020 or we don’t get to stay in the USL. We’ve got to move. We can’t sit on our hands, but we’ve been sitting on our hands for a long time already.”
Under the measure, the city is taking out a bond to buy the land for $25 million with the remaining $5 million going toward public infrastructure.
Fischer’s office has stressed no local tax dollars will be used for the stadium’s construction and that Louisville City FC will repay the city $14.5 million from sales of land and stadium rent.
The 20-year bond would cost about $42 million, including interest, which Pegasus says amounts to the taxpayer losing more than $26 million on the investment.
The project includes separate plans to build restaurants, hotels and office buildings that could generate additional property tax revenue over the bond’s lifespan, city officials have said.
While investors and the mayor’s office cannot guarantee that the development surrounding the stadium will ever return the city’s investment — nor that the club will eventually make the leap to MLS — they point to the soccer club’s growth in recent years as a sign of optimism.
“What I wish they would understand is, it’s not an expense for the city,” Mountjoy said. “It’s an investment that’s going to yield a return. We have $185 million of capital private debt in it ourselves.”
Louisville City FC has also paid for an economic impact study that was conducted by Commonwealth Economics, which Mountjoy said will be distributed to council members Tuesday morning. He said he wasn’t sure if its findings will be released to the public but that it primarily examines the steps for applying for a special tax district with the state.
The project’s financing hinges on that being approved and it remains unclear how much the state would provide to the project through its tax-increment financing, or TIF, district. Club owners previously said they would seek between $30 million and $35 million in TIF assistance.
Mountjoy said he assumed Metro Council had “at least preliminary numbers” from their economic impact study. “I think council members we’ve talked to understand that this generates large leverage by leveraging private dollars,” he said.
The council’s Labor & Economic Development Committee is holding its public comment hearing on the project at 4 p.m. while the Budget Committee, which could vote on the bond, is discussing the proposal at 6 p.m. at City Hall, 601 W. Jefferson St.