Taxpayers are "on the hook ... for less than a third" of the proposed new Atlanta Falcons stadium, and those funds are "repaid from money that comes from outsiders."
Nathan Deal on Thursday, November 29th, 2012 in a television interview
Deal makes premature claim on Falcons stadium bid
The public may be wary, but key elected officials are warming up to the idea of helping the Atlanta Falcons build a new stadium for the low, low price of $1 billion.
Taxpayers would help finance a projected $300 million to construct the retractable-roof colossus, but boosters say the burden is smaller than it seems. A cautious Gov. Nathan Deal recently told WSB-TV reporter Lori Geary that the plan could make fiscal sense.
"I think that, overall, if we get a new facility that’s upgraded and meets the current demands and needs of the future, then being ‘on the hook,’ so to speak, for less than a third – that is repaid from money that comes from outsiders – I think that’s probably a pretty good deal," the governor said.
There’s got to be a catch, right?
A stadium can cost more than the price of on-site construction. Off-site roads, bridges and other infrastructure may need upgrades to accommodate crowds.
Looks like it’s time for the Truth-O-Meter.
If the Falcons get their wish, the 20-year-old Georgia Dome would be razed in favor of a facility with luxury suites and other features that could boost the team’s bottom line.
Skeptical taxpayers stand in their way. The public fully financed the Dome. But in the decades since, voters have soured on helping sports teams build new arenas.
Under the current proposal, they would pitch in big time.
The facility would be owned by the Georgia World Congress Center Authority, which owns the Dome, the Georgia World Congress Center and Centennial Olympic Park. Each year, a portion of the budgets for the Dome and World Congress Center come from a cut of an 8 percent tax on hotel and motel rooms within Atlanta’s city limits and unincorporated Fulton County.
The GWCCA would help the Falcons pay for stadium construction with a bond backed by revenue it expects this tax to make over the next 30 years. The projected amount: about $300 million.
We emailed Deal spokesman Brian Robinson for more information. He said the governor was speaking about the burden the stadium would put on state funds, and Deal overstated the cost.
"In reality, it would come at no cost to STATE taxpayers," Robinson responded.
We think viewers may have gotten the impression that Deal was talking about the total burden to taxpayers. The financing the governor mentioned in the interview would be backed by the local hotel/motel tax, not state funds.
We’ll take both interpretations into account.
This brings us to the first part of our fact check. Are taxpayers "on the hook ... for less than a third" of the stadium’s cost?
This appears to be a matter of arithmetic. The $300 million contribution from local motel/hotel taxes is less than one-third of the projected $1 billion construction cost.
If this were the only pot of public funds going to the stadium, then this portion of Deal’s claim would be correct. But there’s more to the story.
In a "term sheet" approved in December that outlines the deal, both parties agreed that the GWCCA would buy land for the facility.
Deal earmarked $15 million from the state budget in 2012 to buy land that could be used for the complex. Land acquisition costs could rise depending on which site planners select.
In addition, roads and other infrastructure near the stadium may need hundreds of millions of dollars in upgrades. Atlanta Mayor Kasim Reed said in September that these improvements could push the stadium’s total cost to $1.2 billion. This could push the cost to the public upward of $500 million.
The Falcons expect to seek government help. The term sheet says that the GWCCA will cooperate with them "in pursuing other possible governmental funding sources with respect to such offsite infrastructure as may be required."
Reed floated the possibility of using an additional $53 million in city economic development dollars.
WXIA-TV recently reported that the stadium could receive millions of dollars in tax breaks from the state through an economic development program for projects of "regional significance."
And furthermore, state money that the Georgia Department of Transportation gives local governments for road maintenance could be available, state DOT spokeswoman Jill Goldberg said. The project may be eligible for federal funds, too.
Goldberg stressed, though, that no plans have been made, and the project may need no state money.
Robinson told PolitiFact Georgia that he did not "foresee" state DOT money being used, but there are no set plans.
"There’s too many unknowns at this juncture," Robinson said in an email. "There’s no deal at this time."
Let’s move on to the second part of Deal’s claim. Will the public’s share of the cost really be paid for by "outsiders"?
Not entirely. As we mentioned earlier, the GWCCA would use state funds to buy the site, and state, local and federal funds could be used for infrastructure.
But the majority of the projected $300 million in hotel/motel taxes for stadium construction would be paid by outsiders.
Some 86 percent of those who stay in hotels in unincorporated Fulton and the city of Atlanta are from out of state, Atlanta Convention and Visitors Bureau spokeswoman Lauren Jarrell said.
Regardless of how you interpret Deal’s claim, it fell short.
Yes, a large portion of the public’s contribution would come from local hotel/motel taxes, and these are overwhelmingly paid by "outsiders."
But the state will buy land for the stadium, could chip in to help with hundreds of millions in infrastructure costs, and could provide substantial tax breaks.
The total share for taxpayers could easily exceed $300 million.
Deal’s claim is premature. And it leaves out important details.
The governor gets a Half True.