Wednesday, April 17, 2024

Jerry’s Playbook: White Sox Confident They Can Secure Public Funding For New Stadium

-

The White Sox are seeking $1 billion in public money to fund their proposed new stadium in the South Loop. According to a report from Crain’s Chicago Business, that is, on top of an expected $500 million subsidy for infrastructure from a city Tax Increment Financing that covers the proposed site. 

While many fans are rightfully up in arms, there is a good chance that White Sox owner Jerry Reinsdorf will be able to secure the funding he needs for the project. 

History Repeats Itself

Say what you want about Jerry Reinsdorf, but he is no dummy. You don’t amass the money he has in a lifetime without being a good businessman. 

In 1991 Resinsdorf threatened to move the White Sox to St. Petersburg, Florida, before financing came together at the last minute to fund a new stadium which was built directly across from the original Comiskey Park. 

Homage Advertisement

Now the White Sox the White Sox current agreement with the Illinois Sports Facilities Authority, which owns Guaranteed Rate Field, is a very team-friendly deal. The city of Chicago and the state of Illinois contribute $5 million annually to help fund the ballpark. The White Sox only pays $1.5 million in annual rent and controls revenue from ticket sales, concessions, parking, and merchandise. 

In 2009 the Illinois Sports Facilities Authority paid roughly $7 million to build ChiSox Bar & Grill, a restaurant attached to the outside of the stadium. The White Sox only chipped in $1 million for the project, according to a previous report from the Chicago Tribune. 

Under the agreement, the White Sox didn’t have to pay a fee to use the stadium until 2008. The deal rewards the White Sox for poor attendance. According to the Chicago Tribunes report the White Sox must pay a fee on each ticket sold over 1.93 million in paid attendance, a total the White Sox have reached just once (2022) in the last decade. In the first ten years of the lease, the club did not have to pay rent if annual attendance fell below $1.5 million. 

You don’t get that type of deal without some leverage, which it probably wasn’t a coincidence that rumors that the White Sox were considering a move to Nashville began to circulate a few months before plans to build a new stadium were released. 

At this stage, it seems unlikely the White Sox would turn back given all the momentum the new stadium project has garnered. The project has already received support from the Chicago Federation of Labor, Mayor Brandon Johnson, and MLB Commissioner Rob Manfred. Reinsdorf is also not going to move locations unless he gets another team-friendly deal that is better than the current agreement he already has.

Reinsdorf Confident In His Chances 

According to Crain’s report, Reinsdorf is confident in his chances of getting the state’s stamp of approval for his financial plan to build a new stadium. That plan includes getting private investment funds from housing, bars, and restaurants that want to build next to the stadium. They also want to build a 4,000-spot parking garage and parks around the stadium from the state subsidy to give the state a return on its investment. 

According to a previous report from Crain’s, Related Midwest, who owns the 78, has already secured Tax Incremental Financing that would help support the project. Reinsdorf and the White Sox are expected to request state legislators to authorize the Illinois Sports Facilities Authority to extend or issue new bonds, utilizing the existing 2% hotel occupancy tax currently allocated for repaying bonds associated with Guaranteed Rate Field. This proposal doesn’t involve imposing a new tax but aims to extend the duration or potentially introduce new bonds.

The Chicago Bears, who are also looking to build a new stadium in Arlington also need the Illinois Sports Authority’s assistance. Crain’s report indicates that the two teams have not met to create a joint plan. 

Developers hope the White Sox can attract additional funding and tenets, with their stadium serving as the anchor of The 78. Currently, an academic building known as the Discovery Partners Insititute is set to be the first tenet on The 78. The MLB hopes the move will attract more fans with added entertainment and transportation options. 

Using public money for stadiums usually spells disaster for the state. Local governments rarely get a return on their investment. 

When Related Midwest released renderings of the stadium, they projected that the facility would draw 5 million annual visitors. This is despite the fact the White Sox have drawn over 2 million in total attendance just once in the last decade. For reference, the Cubs, who are a much more popular team and play in a historic tourist destination at Wrigley Field, have ranked in the top five in the MLB in total attendance. The most they have drawn in total annual attendance in the last decade is just over 3.2 million people. Even with concerts and other events at the White Sox new stadium, it is hard to see them consistently drawing 5 million in annual visitors, especially once the novelty of the new stadium wears off. 

Reinsorf has yet to meet with Illinois Governor JB Pritzker, according to Crain’s. But Related Midwest President Curt Baily has already been meeting with elected officials, businesses, and labor leaders. Pritzker was asked about the stadium last week and said that the renderings were “beautiful” but added that his administration needed to be “careful with public dollars” when considering if the stadium would actually benefit Illinois. 

As previously mentioned, the Illinois Sports Authority still owns Guaranteed Rate Field. If Reinsdorf wants their financial backing they will need to come up with a contingency plan for what to do with Guaranteed Rate once the White Sox lease is up.

2 COMMENTS

Notify of
2 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments
NoMoreSpam1999
NoMoreSpam1999
Feb 20, 2024 2:52 pm

No public money should be given out. Ebenezer Jerry has already shown he cannot be trusted and is liar.

I wish he’d just die already, so we get a shot at a new owner for who make the needed improvements to this one proud team.

Wes P
Wes P
Feb 19, 2024 12:02 pm

Reinsdorf may be able to get available funds for his ballparks but he never seems to be able to get the talent they need to win games! I wished he’d sell his shares to someone who loves the game and puts an effort into winning championships.

Chicago SportsNEWS
Recommended for you

2
0
Give us your thoughts.x
()
x