Yahoo Finance Top Kansas Republicans pitch Chiefs on moving to state, back plan to help finance stadium
Top Kansas Republican lawmakers are supporting a plan to bring the Kansas City Chiefs across state lines by deploying a controversial bond program to help finance a new stadium.
The GOP leaders’ backing of the proposal comes at a crucial moment, two weeks before the Legislature returns to Topeka for a special session. Lawmakers are expected to focus on tax cuts, but proponents of bringing one or both teams into Kansas see the session as a window of opportunity to ensure the state mounts a credible bid.
House Speaker Dan Hawkins, a Wichita Republican, and Senate President Ty Masterson, an Andover Republican, on Tuesday released an undated letter sent to Chiefs chairman and CEO Clark Hunt urging the team to consider Kansas and comment on the proposal.
“With our strategic location, a vibrant fan base, robust economic incentives, and the exceptional tools at our disposal, we are poised to make the Kansas City Chiefs even stronger,” Hawkins and Masterson wrote.
After Jackson County voters rejected a county sales tax for the teams in April, a Kansas proposal would authorize Sales Tax and Revenue – STAR – bonds with 30-year terms to pay up to 100% of the cost of building a new stadium across the state line. Rep. Sean Tarwater, a Stilwell Republican, first offered the plan in the final days of the regular session but lawmakers didn’t vote on it.
STAR bonds finance major attractions in Kansas designed to spur nearby development. The sales taxes from districts surrounding those attractions pay off the bonds. Kansas is one of just three states with STAR bonds, which are backed solely by future sales tax revenue from the projects.
Kansas typically authorizes municipalities to issue STAR bonds for up to 50% of a project’s costs. But Tarwater’s proposal to allow for bonding up to 100% set off alarm bells among some lawmakers and stadium finance experts, who warn no stadium project could generate enough revenue to pay for an entirely bonded project.
The Kansas Department of Commerce, which would sign off on any STAR bond district, has since said it doesn’t anticipate authorizing a 100% bonded project, even if state law gives the agency the authority.
“The rich tradition and history of the Chiefs are beloved across the entire Kansas City region and throughout Kansas. The potential to establish a home for the Chiefs family here on the Kansas side of the state line is an opportunity that deserves a thorough conversation,” Hawkins and Masterson said in a statement.
The two Republican leaders signaled that the Chiefs had already reacted to their overture.
“We’re excited that the Chiefs are open to this conversation and look forward to seeing what mutually beneficial opportunities might lie ahead for both the people of Kansas and the Chiefs franchise,” Hawkins and Masterson said.
The Chiefs declined to comment. The team has previously indicated it is looking at all options.
“We were obviously very focused on Arrowhead, and as I mentioned earlier, it’s a special place for our fan base. And I believe it could be a special place for our fan base for another 25 years with the right renovation,” Hunt said in April.
“But we’re just going to have to be open-minded in how we approach this. And that may involve a new stadium — it could be an open-air stadium, or it could be a dome stadium.”
Hawkins and Masterson’s announcement came as an intense lobbying effort for the proposal begins to take shape.
According to Kansas business records, Scoop and Score, Inc., was incorporated on May 13 by Paje Resner, who served as chief of staff to former House Speaker Ron Ryckman, an Olathe Republican. The group has 20 registered lobbyists, including Ryckman, according to state lobbyist records.
Ryckman has been working with unnamed parties interested in attracting the Chiefs. Both he and Tarwater have used the phrase “scoop and score” to refer to Kansas mounting a bid for the team after the Jackson County vote.
In a statement, Ryckman said Scoop and Score’s mission is educating, advocating and marshaling grassroots support for the initiative. “We’ve got a once-in-a-lifetime opportunity to make Kansas the permanent home of the Chiefs,” Ryckman said.
A website paid for by Scoop and Score making the case for the legislation was also live on Tuesday. “The Professional Sports Franchise STAR Bond Project seizes a unique opportunity to elevate Kansas into a top-tier destination for professional sports,” the website says.
The Scoop and Score website also takes direct aim at fears that Kansas would authorize a 100% bonded project – essentially a free stadium for the Chiefs. The website labels the idea a “myth” and says any stadium would be a “public/private partnership with the franchise owner contributing hundreds of millions of dollars to the project.”
Fully financing a Chiefs stadium could mean issuing $2-3 billion in STAR bonds, and potentially $1.5 billion to $2 billion for the Royals. As of 2020, $1.1 billion total in STAR bonds had been issued in total, according to a state audit.
The Star has previously spoken to academics and other experts on stadium financing and municipal bonds who have cast strong doubt on whether a Royals or, especially, a Chiefs stadium and surrounding development could produce the sales tax revenue necessary to pay off on time a project 100% financed with STAR bonds. The amount of revenue needed would be significant, and sales taxes can be fickle, fluctuating with the larger economy and the popularity of the teams.
The STAR bonds program also experienced its first default last year, with the Prairiefire project in Overland Park unable to make a $15 million payment on time. The project has struggled for years to meet sales tax projections.
The proposal potentially faces opposition from Americans for Prosperity-Kansas, a group supported by Wichita billionaire Charles Koch that vehemently opposes STAR bonds.
“STAR Bonds are an egregious form of income redistribution from Kansas families and small businesses to the political class. We see far less competition when we allow Government to pick winners and losers, encouraging private businesses to focus efforts on lobbying government instead of the consumer,” AFP-KS state director Liz Patton said in a statement last month.
