Funding tools considered for county sports facilities

A series of proposals offering counties tools for sports facility projects were heard by the Revenue Committee March 19.

LB615, introduced by Bellevue Sen. Abbie Cornett, was an amalgam of three other Cornett bills — LB616, LB617 and LB618.

The first provision of LB615, also found in LB616, would modify the Municipal Infrastructure Redevelopment Fund Act to become the County and Municipal Infrastructure Redevelopment Fund Act. The fund currently uses state cigarette tax revenues to fund city infrastructure projects and it is set to expire July 1.

LB615 would extend the fund and allow counties to participate. The act would be funded with $2.5 million of state-collected cigarette taxes.

The second portion of LB615, also in LB617, would expand the authority of counties to create community building districts to finance facilities used for community, social and athletic purposes. The bill also would allow substantially urbanized counties to form community building districts in a manner similar to sanitary and improvement districts.

In addition to constructing facilities, counties could place local option sales taxes of up to 1.5 percent on taxable sales within community building districts with the consent of county boards. Districts could issue bonds to finance facilities with repayment made by local option sales taxes.

The final section of LB615, adapted from LB618, would permit political subdivisions to create Family Entertainment and Sports Attraction Districts, which would house a sports facility expected to attract more than 100,000 spectators per year. Qualifying facilities must hold occupancy agreements of at least 20 years.

Political subdivisions could place a 0.5, 1 or 1.5 percent local option sales tax within the district if a municipal sales tax does not already exist in the area. Furthermore, the subdivision could be reimbursed up to 75 percent of the state sales tax collected within the district, which could be used to finance bonds issued.

Cornett said the proposals would provide tools to keep a AAA baseball team in Nebraska, which she said is an economic development project that would benefit the entire state. She said the tools offered in LB615 have been used for similar projects in the past and represent a “reasonable, balanced approach” for accomplishing the bill’s goal.

Sarpy County has developed outside city bounds, Cornett said, and the county needs a means to develop sites.

Kermit Brashear, representing Sarpy County, testified in support of all four bills. He said a proposal for a stadium in Sarpy County for the Omaha Royals is the only way to retain affiliated baseball, as opposed to independent baseball, in Nebraska, which he said would be a difference of $211 million for the state’s economy.

Brashear said the new stadium being constructed in downtown Omaha to host the College World Series does not accommodate a typical baseball franchise. According to a Forbes study, minor league baseball teams are most successful when they play in stadiums similar to the facility proposed in Sarpy County, he said.

Sarpy County is a unique political subdivision, Brashear said, as unincorporated areas in the county are the third most populated area in the state. Therefore, the county needs development tools offered in the bills, he said.

Omaha Sen. Mike Friend said he is concerned that the divorcing of the Royals and the College World Series, made permanent by a new Sarpy County facility for the Royals, would result in an underused facility in downtown Omaha.

“The fear that I have is … we are going to have a stadium downtown that is used two weeks a year,” Friend said. “If you build it, we just don’t know if they will come.”

Omaha Sen. Tom White expressed concerns regarding a bidding war between the city of Omaha and Sarpy County for the Royals franchise once both stadiums are constructed.

“Somebody is going to lose,” White said. “Some taxpayer-backed facility will lose.”

Lynn Rex, executive director of the League of Nebraska Municipalities, testified in opposition to LB615. She said cities are responsible for planning growth, not counties. She said LB615 would create pockets of limited growth that cities would have to grow around.

“Sarpy County wants to be a city. Sarpy County isn’t a city,” Rex said.

Gretna city attorney John Green also testified in opposition. He said the provisions of LB615 would adversely affect the long-term growth of cities by creating “black holes” with significant debt burdens.

Jack Cheloha, representing the city of Omaha, testified in a neutral capacity. He said the bill would use existing tax revenue, as opposed to revenue generated from the project in question.

The committee took no immediate action on the bills.