A BOSTON GLOBE EDITORIAL
Fenway financing gaps
Red Sox executives have finally come out with a plan to pay for a new ballpark. While the team makes a strong case that they need a new park, the financing plan remains unpersuasive.
The Sox promise to spend $352 million of their own money to build the stadium, but they do not yet have specific sources of financing for $128 million of that amount. The team has decided - regrettably but probably inevitably - to sell naming rights to the park. The rest of the gap will have to be filled by unspecified private investment or surcharges on ticketholders.
The Sox ought to be able to find this extra money, but it will leave them hard pressed to reduce their requests for public subsidies. They want $135 million from the state for parking garages and street improvements, a reasonable figure. The state would get back much of the money from parking fees and would benefit from increased tax revenue generated by ballpark customers.
But the team expects the city to put up more than the state - $140 million to buy the land and prepare it for construction. This would be an unprecedentedly high level of support for a private project in Boston. And it is far from clear where the city would get the $13 million to $14 million needed each year to pay off the bonds that would buy the land.
The best the Sox can suggest is that the city would realize $6 million a year from property taxes on new development that replaces the old Fenway Park. As it is, the Fenway area is ripe for development. If the city does nothing, it will probably experience a tax windfall from new construction there.
The Red Sox also suggest $6 million in unspecified revenue sources, analogous to the extra hotel taxes and surcharges on tourist activity that financed acquisition of land for the convention center. These sources of income can only be tapped once, and there is a stronger case for the city aiding the convention center, a public facility, than the privately owned Red Sox.
The team hopes to have a finance plan approved by the state before the Legislature ends its session in July. The team needs to find other sources of private money and specify how the city will get a return on its investment before it seeks legislative support.
This story ran on page A10 of the Boston Globe on 5/20/2000.
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