St. Louis MLS stadium project overcome tax credits hurdle

Article posted by Coliseum, March 27^th, 2020

Image: St. Louis MLS

St. Louis’ Major League Soccer (MLS) franchise in US recently received $5.7 million in State tax credits to help pay for the construction of a soccer complex on the western edge of downtown St. Louis.

The approved figure is significantly less than the $30 million in tax credits originally sought for the $461 million development.

The St. Louis MLS team is a MLS expansion franchise that is expected to begin play in 2022. The club will be based at St. Louis, Missouri, in US, with home matches to be played at a planned 22,500-seat soccer-specific stadium – St. Louis MLS Stadium. The stadium is scheduled to be completed by the start of the 2022 MLS season.

Media reports stated that the Missouri Development Finance Board voted unopposed to give the team’s ownership group the tax break, three months after Missouri Governor Mike Parson’s administration blocked the project from receiving $30 million in tax credits.

“I feel a lot better about this project,” exulted Board Chairwoman Marie Carmichael.

She asserted, “It is certainly more doable.”

The agreement will facilitate the team’s owners to pay for the rerouting and installation of utilities.

Although Board Treasurer John Mehner voted in favor of the project, he, nevertheless, raised concerns about beginning it at a time when the whole world is overwhelmed by COVID-19.

He suggested waiting at least two months before actions are initiated on the tax credits – “I’m worried about the optics, and whether this is the exact right time to take action.”

Otis Williams, Director of St. Louis’ Land Clearance for Redevelopment Authority, urged the Board to green light it to pave way for the stadium to be ready for the start of the 2022 season.

Lieutenant Governor of Missouri Mike Kehoe, who sits on the development board, said he views the board’s action as sending out a message to people grappling with the coronavirus outbreak that the State is committed to creating jobs.

“We want people to understand we will get through this,” an optimistic Kehoe told board members.

Looking back, in December last year, the State Department of Economic Development had refused the $30 million tax credit request for the stadium development — which included $15 million in credits for both 2019 and 2020 — citing it was too much and would require increasing its $10 million annual limit on credits. Though much of the stadium project is being financed privately, the tax credits are considered pivotal to the funding package.

Following the initial denial, the ownership group said it remained in constant touch with the State as it moved forward with its project. A lawyer told city aldermen in February that the tax credit rejection created a “tremendous amount of pencil sharpening and erasing and relooking at things” by the stadium design team.

The expansion franchise has started initial construction work on the project and said it was aiming for a formal groundbreaking this spring. The development, which covers more than 30 acres, places the team’s 22,500-seat stadium north of the Market and its offices and training facility just south of Market Street. New renderings for the project were released recently by the ownership group.

St. Louis’ MLS team will begin play in 2022. The club’s ownership group includes the Taylor family of car rental giant Enterprise Holdings and Jim Kavanaugh, head honcho of Missouri-headquartered technology service provider World Wide Technology.

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