When the announcement came that MLS was negotiating with the Haslam/Edwards group, I reported that a source had told me that the deal was “largely done.” And that was true, inasmuch as a buyer had been identified, and potential land located (and essentially approved by MLS). But with deals of this nature, it’s the fine print that can trip you up. And so it was as details emerged about what was going to be necessary aside from having a big-money purchaser and a plot of land.
We got a hint of what was left to do when the parties released the Memorandum of Understanding, which outlined the obligations of the Haslam/Edwards group, the City of Columbus, Franklin County and the State of Ohio. I went into detail in that post, so I won’t rehash things here. But I did want to dig down into what each party was agreeing to do, because there was one piece of the puzzle missing.
So there were four elements needed to make this deal work by the 12/31/18 deadline. The City of Columbus came through on their end, passing an ordinance to adopt the MOU and contribute $50 million to redeveloping MapFre. Franklin County unanimously ratified the MOU on December 18 contributing $45 million to the project. Both the Ohio House and Ohio Senate passed Senate Bill 51, which allocated $15 million to the stadium and was signed today by Governor John Kasich.
Well, that’s that, right? MLS Commissioner Don Garber can send out a press release congratulating Columbus, and fly out there for the ribbon cutting! Well, almost. Eagle-eyed readers may see that there is a missing chunk of money there. In the third bullet point, there is an agreement for $45 million in other public sources.
The $15 million from the State, which I confirmed with Ohio Rep. Mike Duffey was a “one-time” contribution, means we’re missing $30 million. Now before Crew fans start freaking out and heading to the nearest convenience story to play the lottery, it looks like that $30 million has already been identified through a unique legal mechanism in Ohio Law called New Community Organizations/Authority (NCA).
To prevent everyone from falling asleep at this point while I go through each section of the statute, I’m going to summarize this with the help of some Columbus City officials, who kindly walked me through what this law does.
“The area for Confluence Village that includes the new stadium is eligible for a 15 year, 100% tax abatement because it is part of the Community Reinvestment Authority,” said Robin Davis, Director of Media Relations for the Columbus Mayor’s Office. “The City proposes a new Community Authority that will allow developers to assess themselves taxes otherwise paid and additional charges that will be reinvested in the development.”
So essentially, the taxes that would normally be due based on your standard tax assessments (property taxes) would be set aside for the purposes of reinvesting in the property on a yearly basis, up to $30 million. And because the property is eligible for a full tax abatement, the parties are agreeing to “tax” themselves a set amount and divert the funds for use by the NCA. So, we’ve got our $30 million accounted for. However, there are a couple of other steps.
This “governing” body needs to be established, and rules drafted and implemented. “The New Community Authority will have to adopt rules and a formal schedule of charges,” said Steve Schoeny, Department of Development for City of Columbus. [The City] council will set up the Authority and set the rules for the appointment of the members of the Authority board.” Once that is done, the Board will be in charge of the rules and spending the money.
The Board itself will be made up of city, county and private partners who will determine how the money is spent, according to Ms. Davis. With the NCA in place, the last funding piece of the puzzle is in place.
Lastly however, is determining the timeline to get the NCA up and running. Schoeny told me those next steps are being decided, but the agreements are still in place, the City has the authority to establish the NCA, and the amount contemplated ($30 million) is there; it’s just a matter making sure the math gets you there. That said, it’s unclear if the NCA needs to be set up before this all gets done. I can’t imagine that’s the case, given it’s likely this will stretch into the new year (the City Council doesn’t even meet until then), nobody is opposing this, and MLS wants this wrapped by the end of the year.
So, everything seems to wrapped up into a nice little bow. As a (unrelated) bonus, MLS and the City of Austin announced today that they have completed the lease/development agreement down there, which paves the way for Anthony Precourt to take his MLS operating interest down to Texas, and the sale of the Crew to the Haslam/Edwards group can occur without (much) further delay. One final hint that we’re almost done is that the 2019 schedule is set for imminent release, and all expectations are that the Crew will be a part of it. So the marathon is almost over; just need to take those final steps.
[…] Columbus ownership/stadium saga finish line in sightWhen the announcement came that MLS was negotiating with the Haslam/Edwards group, I reported that a source had told me that the deal was “largely done.” And that was true, inasmuch as a buyer had been identified, and potential land located (and essentially approved by MLS). […]
[…] that all of the government forces have completed their obligations per the Memorandum of Understanding (MOU) and Austin has completed their lease development […]