Mayor, Navy Hill officials try to sweeten the pot for $1.5B Coliseum plan approval
Jeremy M. Lazarus | 1/17/2020, 6 a.m.
Can a series of revisions save the massive $1.5 billion Coliseum replacement and Downtown redevelopment plan that for months has appeared to be headed for rejection by Richmond City Council?
That’s the hope for Mayor Levar M. Stoney and Thomas F. Farrell II, the top executive at Dominion Energy who is spearheading the proposal through the Navy Hill District Corp.
With only about six weeks left before the proposal is scheduled for a vote by City Council and apparently short of the seven votes needed for approval, the two men Monday served up changes they hope will make the project more palatable to council members who currently seem committed to rejecting the plan as a council-appointed advisory commission has recommended.
One of the biggest changes, according to Mayor Stoney, is the potential for a larger infusion of state sales tax dollars into the project, reducing the amount of city tax dollars that might be needed to cover the cost of building the state’s largest arena to replace the Richmond Coliseum.
The mayor cited a bill introduced in the General Assembly by Richmond Delegate Jeff Bourne that would allow the city to capture part of the state sales tax generated by the project — a deal that the legislature previously granted on arena projects for Norfolk and Virginia Beach.
Those who are bullish on the project and see it generating big taxable revenues at the 30 restaurants and retail stores that are proposed are suggesting the Bourne bill could generate $60 million to $70 million in additional revenue over 30 years.
According to Mayor Stoney, that would allow the city to reduce by half the Downtown Tax Increment Finance District where growth in real estate taxes would be earmarked to repay the money to be borrowed to build the arena.
The cost of the arena is projected to run between $570 million and $620 million, depending on the interest rate and number of years it takes to pay off the debt.
However, the mayor could offer few details of what impact the Bourne bill would actually have. He indicated that he would seek to amend the ordinances now before City Council once more informa- tion is available.
Under the current plan, the Coliseum debt is to repaid by taking the real estate tax growth from the 10-block development area near City Hall and from an additional 70 blocks of Downtown, including the Dominion Energy’s new office tower and a second that is planned. The company has not yet committed to building the second tower.
Others are more skeptical. Paul Goldman, leader of the Put Schools First campaign, noted the estimate of sales tax collections from the TIF District are based on rosy projections that might not materialize.
“You can make up any numbers you want when you are talking about 20 to 30 years in the future,” Mr. Goldman said.
“How could you trust the numbers?” John Gerner, who served as vice chairman of the disbanded Navy Hill Development Advisory Commission that recommended City Council reject the project, urged caution, given that the state has yet to issue an estimate of the amount of sales tax that could be diverted and because the General Assembly bill has not yet been approved.