The deal is off.
Salt Lake County Mayor Peter Corroon said Wednesday that funding a professional soccer stadium with hotel tax money doesn't make sense and is too costly.
Real Salt Lake wants $35 million from the county, but to get that kind of cash, the county would have to bond for $48.5 million — a figure Corroon said he can't stomach. Plus, interest payments over the life of the bond would have ended up costing the county $87.5 million to pay off the original bond.
"Spending an additional $18 million up front for interest payments is not a good use of taxpayer money," Corroon said Wednesday. "I can't support this, I just can't."
Real Salt Lake hopes to break ground on a proposed $145 million stadium in Sandy this August. However, team representatives said the stadium project, which includes an adjoining hotel and broadcast studio, will not happen unless there is some form of public funding.
Team officials declined to comment on the mayor's decision.
"We are completely focused on our upcoming game this weekend, prior to which we will be hosting a press conference with Dave Checketts and myself to address the stadium issue and answer questions from the media," said Dean Howes, Real's chief executive officer, in a written statement Wednesday.
The team wanted the county to contribute $35 million in hotel room taxes and Sandy to pitch in $10 million through redevelopment agency (RDA) money. Both funding options arose after two separate bills passed in the 2006 legislative session, allowing Real to receive multimillions in public dollars.
One bill gives the county the option of using hotel taxes for tourism projects, including the Sandy soccer stadium. Although not in the bill's language, the Legislature made it clear to county officials that the hotel taxes could not be used for anything but the stadium.
House Speaker Greg Curtis, R-Sandy, who pushed the project's potential funding through the recent legislative session, said Wednesday he hoped county officials "would not be disingenuous to say the money is not there to do the soccer stadium, but we have a whole list of other projects there we want to do instead."
Both Corroon and council chairman Cort Ashton promised Curtis the hotel taxes would not be used for other projects if the stadium is not funded.
Sandy Mayor Tom Dolan said he was disappointed in the county's decision to deny funding. But the city does not feel the project is lost. Dolan said the city will aim to find a funding solution that works "for all parties involved."
Randy Sant, the city's economic-development director, said he was surprised by the announcement. "We feel that Salt Lake County's decision was premature, based on incomplete financial assessments," Sant said.
Corroon said he is still willing to work with Real. The county went through 19 different versions of the original funding plan, but because of high interest payments, none of the plans worked. If someone can come up with a plan to funnel hotel tax dollars to the stadium without costing the county millions, Corroon said he's more than willing to look at it.
The County Council is also interested in exploring other funding plans.
"Two months ago this seemed like a done deal. Not anymore," councilman Mark Crockett said. "This project had merit and still has merit. I would encourage the team to look at other funding models."
But additional funding plans are few and far between.
One option is putting a general obligation bond on the already-crowded November ballot. However, the County Council would have to approve it before the issue goes to voters. Waiting for voter approval would push back stadium construction indefinitely, Corroon said.
For Sandy's part, officials in the city of 90,000 say they have stuck to the original funding plan of $35 million from the county and $10 million from the city. Sandy could not contribute additional RDA funds, because based on the cost of the stadium, state law caps Sandy's RDA money at approximately $10 million.
"We haven't been working on other plans," Sant said.
The city, county and Real have a partnership to build the stadium, Sant said. "But the other partner has not sat down with us to look at other funding options," he added, referring to the county.
Councilman Joe Hatch said possible Sandy funding options should be looked at before the county stops all negotiations with Real.
"I'm not going to defend Real at all," Hatch said. "They've done six or seven really silly things. I call them chowderheads."
"What I'm most concerned about is not Real," he added. "I'm most concerned about our relationship with Sandy city. If there isn't a deal, I want it not because Salt Lake County didn't try its damnedest, not because Sandy city didn't try its damnedest, but because Real didn't try its damnedest."
Bad blood between the county and Real this week had nothing to do with Corroon's decision, Hatch said. Real officials were upset with the county after the team's financial data was leaked to the media last week.
The Deseret Morning News, The Salt Lake Tribune and a county resident filed a public-records request last month with the county for the documents. Corroon decided to release the team's operating model, but Real appealed the decision, saying it was proprietary business information. Before the appeals process was completed, someone leaked the documents, prompting Real to stop all negotiations with the county on Tuesday.
When asked Tuesday if Corroon was afraid of legislative backlash for denying Real's hotel tax funding plan, he said: "Let the chips fall where they may. I'm making a decision that I feel is in the best interest of the citizens of the county."
Wednesday night, Salt Lake City Mayor Rocky Anderson suggested that the Legislature could have treated Real Salt Lake more fairly by allowing it to locate in downtown Salt Lake City.
The team's trouble are "a product of the worst kind of politics," Anderson said. "If we ever see this team go to San Antonio, we know who to thank."
The Legislature hurt Salt Lake City's bid during the 2005 session when it prohibited the use of redevelopment agency money for recreation facilities, specifically including stadiums. Salt Lake City courted the team for months but ultimately couldn't provide the amount of land that the team wanted for satellite development around the stadium.
Any bid that Salt Lake renewed for the stadium, however, would have to include the same transient-room tax money that Corroon disallowed for the Sandy stadium, Anderson said.
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