BRADENTON, Fla. – A new deal to build the National Football League’s Atlanta Falcons a $1 billion stadium is emerging after a previous proposal for public financing ran into political opposition at the state level.
The new proposal calls for the Atlanta Development Authority, which calls itself Invest Atlanta, to issue $200 million of revenue bonds backed by a portion of a local hotel-motel tax as the public contribution to the facility. The team would pay the remaining construction cost.
The City Council must approve the stadium deal, and extend the hotel-motel tax to 2050. It currently expires in 2020.
The Falcons want a new stadium to replace the 20-year-old Georgia Dome in downtown Atlanta, which is owned by the Georgia World Congress Center Authority. It sits on public land purchased by the state, and was built with $214 million of bond proceeds issued by the GWCCA. About $100 million of bonds are outstanding.
The GWCCA and Falcons, an economist as well as officials representing tourism, the chamber, economic development and city staff delivered a full-court press for building a new stadium to the Atlanta City Council’s finance committee on Wednesday.
“Not only is this an important decision for us to make,” said the city’s chief operating officer, Duriya Farooqui, “there are far-reaching implications in terms of economic impact, the development of the city, and our future competitiveness.”
Another consideration is what happens if no deal is reached to build a stadium in downtown Atlanta by the time the team’s lease ends in 2017, said Falcons president and chief executive officer Rich McKay.
“We would have no choice but to consider pursuing another option elsewhere in metro Atlanta,” McKay said, adding that it was not a threat to move the team. “No, that’s just a reality of what we have to do as our lease is about to end.”
Well over a dozen speakers from the public either opposed the project, or said the City Council should require public improvements and consider impacts on surrounding neighborhoods.
Council member Felicia Moore, chairwoman of the finance committee, said another session will be held Feb. 20 to answer numerous questions about the project, including why a new stadium is needed.
“We just had a Super Bowl in a facility that had gone through a hurricane and been renovated, and they seemed to have a great Super Bowl,” Moore said, referring to the New Orleans’ Superdome. “We need to understand why [Atlanta’s] Dome is not meeting our needs” before discussing a new stadium.
The $200 million in public financing is less than a $300 million prior proposal that would have required legislative action to extend the bonding capacity of the GWCCA. State lawmakers refused to support it.
The structure of the financing proposed for the Atlanta Development Authority is still being developed, though it is envisioned that the portion of the hotel-motel tax currently going toward debt service on the existing Georgia Dome bonds would be redirected to the bonds financing the new stadium, according to Atlanta’s chief financial officer Jim Beard.
“Legal counsel is evaluating the proper vehicle to make this occur,” Beard said Thursday. “We are still evaluating the retirement or refunding of the existing debt. We should have more answers in the next two weeks as we continue to work with all of the parties.”
As proposed, the new stadium would have a retractable roof and would be constructed near the existing Dome.
Public financing would be about 20% of the cost, and would not require new taxes or use of the city’s general fund for a backstop.
The hotel-motel tax is 7%, and 39.3% of tax revenues are dedicated to the existing stadium bonds.
A number of finance committee meetings will take place to vet the stadium issues.
The committee will make a recommendation to the full City Council whether to approve resolutions extending the hotel-motel tax and approve a funding agreement for the new stadium.