The financial plans we have been seeing for the Downtown Boise Stadium are built on a sinking foundation.
The city of Boise expects the Greater Boise Auditorium District (GBAD) to pay $5 million for the construction costs. However, the city’s proposal does not appear to meet the legal requirements necessary for the use of GBAD money in a project.
GBAD collects a five percent lodging tax from hotels, motels and rented rooms over an area ranging from Eagle Road to Highway 21. Just this past year GBAD collected nearly $6 million. Its statutory responsibility is to use this revenue “to build, operate, maintain, market and manage” public projects such as auditoriums, convention centers and sports arenas. GBAD has a legal responsibility to meet all five criteria with its projects, not just one.
These five criteria were put into Idaho statute to ensure that auditorium districts do not just subsidize crony capitalists, but rather that projects serve a public purpose.
The current plan for the stadium has GBAD meeting just one criterion: putting $5 million towards the construction of the stadium. Agon Sports, owner of the Boise Hawks, would be the one to operate, maintain, market and manage the facility.
GBAD’s $5 million contribution is a substantial piece in the overall funding. It accounts for 12.5 percent of the projected stadium costs and more than half of the initial funding for this project. Similar to the importance of a down-payment when purchasing a home, the initial equity is integral for securing future financing. The majority of the funds for this project are expected to come through the sale of bonds, making the initial financing an integral piece.
When GBAD’s role in this project is compared to the Boise Centre, GBAD’s other facility, the differences are stark. There, GBAD oversees the daily operations, its own employees manage, market, maintain and operate the facility. GBAD does contract out some services, but it is directly responsible for oversight and managerial responsibilities.
The differences also extend to the secondary list of priorities GBAD’s Board of Directors has set for each of its projects such as a plan for full utilization of the facility, proof of public support for the project, and evidence that the new facility would increase the number of hotel guests who stay in Boise. Though the Boise Centre arguably meets these criteria, the proposed stadium does not. The stadium would shut down through the winter; there has been minimal public involvement, and not only a lack of support but vocal opposition to the stadium; and, minor-league sporting events are unlikely to lure out-of-town guests to local hotels.
GBAD’s role in this project seems to have come as an afterthought to the stadium’s biggest proponents and negotiators- the private developers, the mayor and councilmembers, and the city’s urban renewal agency. The Auditorium District has not been party to any negotiations nor has a formal proposal come before GBAD’s board of directors for a vote.
The board’s next meeting is October 26 and as the discussion begins then, we will get our first glimpse at what GBAD might do with a stadium.