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Kansas City schools and libraries stand to lose millions in tax revenue from new Royals stadium

Giant spines of books appear to be sitting on a lawn. They form the exterior of a building. Leafy trees frame the top of the image.
Carlos Moreno
KCUR 89.3
The downtown branch of the Kansas City Public Library is located a mile away from the proposed Royals stadium. The stadium would not pay property taxes, which would mean a loss in revenue for the public library.

Owners of the proposed Royals stadium won’t pay property taxes because the land it's on would belong to Jackson County. That means tax beneficiaries like the Kansas City Public Library may lose out on property tax revenue that makes up 95% of their budget.

It costs the Kansas City Public Library about $45,000 to hire one library staffer.

That’s about the same amount of money the library district received in property taxes last year from the 41 businesses located in the Kansas City Royals’ proposed stadium footprint.

If the Kansas City Public Library received property taxes from the Royals new Crossroads stadium once it’s built, it would receive $71.5 million over 40 years, according to Jackson County.

“That’s a significant number for us,” said Debbie Siragusa, interim executive director at the Kansas City Public Library. “We would most certainly prefer it to be that way.”

The stadium itself will not generate property tax revenue, though, because Jackson County would own the land and lease it to the Royals, making the stadium a tax-exempt property.

An analysis from Jackson County obtained by KCUR found a new ballpark at the proposed Crossroads location would result in nearly $1.4 billion in missed property tax revenue over 40 years.

“It would be such a win if the library had that much additional money for us to do the services that we do every day,” Siragusa said. “The outreach that we do to the community for digital inclusion, for technology, for workforce development, for just having our library facilities available for everyone to have complete access to them.”

For most economic development projects in Kansas City seeking tax incentives, developers are required to put their projects through a financial analysis to prove they need a subsidy. The Royals have not provided that kind of analysis.

Aerial image showing a busy downtown area where a large, glass-walled building (Kansas City Star former location) is central to the image. A highway runs at left and other smaller buildings can be seen at right.
Carlos Moreno
KCUR 89.3
Overview (Feb. 2024) of the approximate area where the Royals have proposed building their new stadium.

The team estimates the stadium and ballpark district will generate $1.2 billion in annual economic output. Still, most economists agree that stadiums do not provide an economic boon to cities.

Absent a financial analysis from the team, the Jackson County Assessment Department developed its own analysis estimating how much the stadium would pay in property taxes if it were a private development. KCUR obtained that analysis through a public records request.

“From a Jackson County negotiation standpoint, we looked at the other value that we were providing to the team, such as the county owning it, (which) creates a tax-exempt property,” said Caleb Clifford, chief of staff in the county executive’s office.

“It saves them, without question, hundreds of millions of dollars,” Clifford said of the Royals. How much it would save the team over time, he said, “is arguable.”

Clifford said those savings are an additional benefit to the revenue that would come if voters renew the 3/8ths-cent sales tax on Tuesday. The tax is expected to bring in $1 billion over 40 years to the Royals, or an estimated $27 million per year.

The county’s analysis assumes the value of the $1 billion ballpark increases each year, meaning the amount of property taxes it theoretically paid would also increase each year. The county estimated a private entity would have paid property taxes at $29.9 million. That amount increases to $30.1 million the next year.

For taxing jurisdictions like the Kansas City Public Library — where 95% of its operating budget comes from property taxes — a potential loss in crucial property tax revenue is a looming concern as the Royals pursue the ballpark project in the Crossroads.

Removing businesses that are already paying property taxes with a development that will not means those taxing districts — the library, Kansas City Public Schools, the Jackson County Mental Health Fund, Metro Junior College and Kansas City — will lose out on revenue they would otherwise receive.

A lack of information makes it difficult for the public library and other taxing districts to understand how the project will impact them, Siragusa said.

“It should at least have that same kind of scrutiny: third party analysis, transparency, information shared with all affected parties that includes taxing jurisdictions, it includes the neighborhood and any other government organizations that need to know,” she said. “It should have gone through the basics of a tax incentive project.”

Kansas City Royals owner John Sherman said on KCUR’s Up to Date on March 28 that discussions are underway with taxing districts.

“If that property goes off the tax rolls and they're losing revenue, it's very reasonable to expect that we will keep all those whole,” Sherman said.

Existing property taxes

The 41 parcels that exist in the Royals’ proposed stadium footprint reflect a total market value of $33.8 million.

According to an analysis conducted by KCUR, those parcels collectively paid $921,614 to Jackson County in 2023. (That number would be higher if not for some properties currently receiving a tax abatement that lessens their tax bill.)

Local property taxes make up 68% of Kansas City Public Schools’ overall revenue. According to the county’s analysis, the district would miss out on $16 million in property tax revenue in the ballpark’s first year. Over 40 years, a taxable stadium would have paid the district $744.8 million, according to the county.

That amount would be enough to cover the district’s deferred maintenance costs of more than $400 million.

A sign stuck into the grass off a sidewalk says "I (heart symbol) KC Public Schools" with the KCPS logo
Zachary Linhares
The Beacon
Kansas City Public Schools receives the largest chunk of a property tax bill. The Royals have committed to "making the district whole" by ensuring the district does not lose out on property tax revenue.

The Jackson County Mental Health Fund’s $11 million annual budget is entirely funded by property tax revenue, said executive director Bruce Eddy. The fund received $8,985 in property taxes from businesses in the stadium footprint in 2023. That’s the minimum the organization stands to lose if those properties are replaced by the stadium.

“It's sort of like death by a thousand cuts,” Eddy said. “That's not going to break us. But the problem is, there are so many properties that are tax abated. … Cumulatively, it is harmful to us.”

That taxing district supports agencies in Jackson County that provide mental health services and support for people experiencing homelessness. According to the county’s analysis, the mental health fund stands to lose $14.3 million in property tax money over 40 years because the new ballpark would not pay property taxes.

“It basically means that the community loses that much capacity for mental health treatment over that time,” Eddy said. “We have a pretty high poverty rate, and we have a pretty high rate of uninsured. Those are the people that we serve. And so people that are uninsured, underinsured, it's going to be that much more difficult for them to get the care that they need.”

The Royals have committed to annual payments of $3.5 million to Jackson County as part of a community benefits agreement, which still needs to be approved by the legislature. Over 40 years, that’s about $160 million for initiatives that include transportation and affordable housing.

The team also struck an agreement with KCPS that would assure the district does not lose property tax funding throughout the life of the stadium tax, if it’s approved. The district said in a statement that it was unable to come to an agreement with the Royals on demands to pay for programs funded with federal pandemic money, and money for a youth housing program.

“We acknowledge that the County-negotiated CBA will include dollars for education and we are committed to being good partners with those working on education initiatives in Kansas City,” the district said in a statement. “However, there is no guarantee of support for KCPS. We had advocated for a KCPS Community Benefits Agreement to secure the type of direct investment that would substantially move the needle on literacy in Kansas City.”

The Kansas City Public Library has not received a similar commitment from the Royals. Siragusa said they first spoke with representatives from the team this week. Eddy said the Jackson County Mental Health Fund has not heard from the Royals.

Siragusa said, at minimum, the library wants the Royals to compensate the district for the amount of money they would lose in property tax revenue, based on the property taxes paid currently by existing businesses. She said the library also hopes to strike a community benefits agreement with the team to contribute funding to library programs.

“Whatever the outcome is of the stadium, we should not lose money,” Siragusa said.

The Midwest Newsroom’s Daniel Wheaton provided data editing for this story.

As KCUR’s Missouri politics and government reporter, it’s my job to show how government touches every aspect of our lives. I break down political jargon so people can easily understand policies and how it affects them. My work is people-forward and centered on civic engagement and democracy. I hold political leaders and public officials accountable for the decisions they make and their impact on our communities. Follow me on Twitter @celisa_mia or email me at celisa@kcur.org.
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