Illinois state leaders have told the Bears and White Sox they will not support separate public funding plans for their respective stadium aspirations.
In an effort to meet everyone’s needs, the Bears and White Sox worked to create a joint public financing plan capable of meeting the needs of both teams, the city and the state.
But it’s no easy task, as evidenced by the city’s recent rejection of part of the teams’ joint plan.
According to Crain’s Chicago Business, the city rejected a proposal from both teams to use the city’s entertainment tax on ticket sales at their respective stadiums to help pay off debt from the Illinois Sports Facilities Authority (ISFA) bonds attached to both at Guaranteed Rate Field and 2003. Soldier Field Renovations.
“ISFA’s current debt is supported by a 2 percent tax on Chicago hotel stays, intended to provide enough revenue to meet its annual debt payments,” Justin Laurence wrote for Crain’s. “When these revenues fall short, as has been the case over the past three years, the share of Chicago taxes that the state distributes to municipalities each year is used to cover the difference.
“In order to increase tax revenue on the overall pie to be shared among the teams, an idea to set aside the portion of the city’s entertainment tax revenue from ticket sales at stadiums was proposed to the city but apparently rejected, according to close sources. “with the meeting.”
The entertainment tax, according to Crain’s, is a 9% tax on entertainment services, including sporting events, theaters and concerts. This tax is expected to raise about $262 million in 2024, according to the report.
It’s not yet clear where the teams plan to generate more tax revenue to support ISFA bonds.
Initially, the White Sox hatched a plan to generate taxes from a myriad of places, including sales tax revenue from the surrounding areas of their hypothetical stadium. The 2% hotel tax was part of this plan, but they had no plans to increase the tax as part of their plan.
The Bears, on the other hand, have not worked out their public financing plan. They did, however, state that they would need public funding for infrastructure, i.e. sewers, roads, etc., to support this aspect of the stadium. The Bears said this during their public meeting with Arlington Heights in June 2023.
Both teams will continue to try to find a solution to obtain public funding. However, time is running out because a General Assembly in May could shift support from state lawmakers.
That being said, the Bears have the upper hand in a scenario where the city/state chooses a plan. Remember, the Bears will undoubtedly have an opportunity to generate more revenue with an enclosed stadium that is open year-round and has a larger-scale operation.
“I think it would make sense for them to work together because there is the danger that they won’t get picked if they try to go in alone. Granted, that risk is lower for the Bears, but it’s still there.” said Fred Smith, an economist and professor at Davidson College, in a text conversation with NBC Sports Chicago in March.
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