CHICAGO — An independent arbitration panel has picked the St. Louis Rams’ estimated $750 million renovation of the Edward Jones Dome over the St. Louis Convention and Visitors Commission’s more modest plan as the only option that meets a lease requirement to bring the stadium into top-notch condition.
The panel was charged with reviewing the proposals submitted by the commission, the public agency that operates the stadium that is home to the National Football League team, and the Rams after the two sides could not come to agreement.
The CVC is required under its lease with the team that expires in 2025 to ensure that the stadium is maintained in a condition that is in line with the top eight NFL stadiums by March 1, 2015, or the lease shifts an annual term after the 2014 season. The final maturity date on appropriation-backed bonds issued for the stadium does not come until 2021.
The panel heard testimony last week and late Friday issued its order concluding that “the Rams’ 2012 plans will produce a first-tier stadium and that the CVC 2012 plans will not,” the ruling said. The CVC first proposed a $48 million publicly-funded upgrade but the team nixed it. The commission then floated a $124 million renovation proposal that split the cost between public funds and the team.
The team rejected the second version and then floated a plan estimated at $700 million to $750 million by city and commission officials that was rejected by the commission, sending the issue to arbitration. The Regional Convention and Sports Complex Authority issued $256 million of 30-year revenue bonds under a complex agreement between the city, county, state, commission and team in 1991 to finance the stadium and an expansion of the A.J. Cervantes Convention Center.
The stadium opened in 1995 and the Rams relocated from Los Angeles. The state, St. Louis and St. Louis County together pay $20 million annually for debt and $4 million for maintenance. Annual appropriation pledges secure individual tranches of bonds. The city and county tap hotel and motel taxes to cover their share.
The convention commission now has 30 days to decide how to proceed. “The more likely outcome of this proceeding will be that effective March 15, 2015, the Rams lease will be converted to a year-to-year lease. The Rams’ decision with regard to its plans beyond that date is of course up to them,” said Greg Smith, the commission’s attorney.
Many believe discussions now will center on financing a new stadium although any plan would need to incorporate the continued repayment of the existing debt.
The panel noted the exceptionally high standard set to bring the stadium into a first-tier league given the opening of so many newer stadiums over the last 17 years. Ratings reports on the double-A rated bonds have noted the 2025 expiration date of the lease that comes four years after the bonds are retired as a strength, but warned of the risk due to the “first tier” provision.