Big Winston-Salem Journal front-pager on the city financed downtown stadium. Much of it is stuff those following the story already know, but it’s good primer for anyone needing to catch up. And the big lesson remains the same —- don’t go into business with your brother-in-law.
But Laura Graff does rise the issue of exactly how Forsyth County will tax the stadium. Winston-Salem City Manager notes “Governments don’t pay taxes.”
Pete Rodda, the Forsyth County tax assessor, said he had not seen the city’s latest deal with the ballpark and could not be sure how the completed stadium and land would be valued. Part of the value, he said, would depend on the city’s lease agreement with the stadium. The tax value, Rodda said, could be based on how much the stadium and land cost, but the value could also be based on how much similar stadiums around the country sell for, or how much the city earns from the lease.
“If the city holds title to it, that raises an interesting question,” he said of the stadium. “Is it going to be taxable?”
Right now, the land and partially built stadium are owned by Brookstown Development Partners — Prim’s development company — and are valued for taxes at about $32.1 million.
If the stadium and land are valued at $58.7 million — the estimated final cost includes $40.7 million for the stadium and $18 million for the land — Prim could pay $390,920 a year in county taxes. All of that money would stay in the county’s coffers.
The city’s deal is different. It promised Prim tax incentives for the second part of the development — the offices, shops and restaurants. But when the cost of the stadium started to rise beyond the original price tag of $22.6 million, Prim asked city officials if they would give him a tax break for anything spent on the stadium beyond $22.6 million. City officials agreed, meaning that even though Prim’s company could pay an additional $271,150 a year in taxes, much of that money could be returned.
How much the city would return would depend on how much Prim developed his surrounding property. There’s a cap of $8,012,252, or 25 years, whichever comes first.
Prim’s lease with the city also ends in 25 years. Garrity said that the city would probably negotiate a new lease with whatever baseball team is in town. And if there is no team nor a company to lease the stadium to, he said, the city would not be required to pay taxes.
“Governments don’t pay taxes,” Garrity said.
