Different strategies for financing new stadiums, problematic approaches to cutting property taxes, and a misguided attempt to generate five-star online reviews. From the wild and wooly world of real estate, here are our Hits and Misses for the week of June 2-6.
Hit: A New Approach to Stadium Building. Now, here’s something that we don’t see every day: a professional sports team that is willing to pay for a new stadium without any public funding. Major League Soccer’s Chicago Fire has reached a deal with its hometown’s officials to self-finance a new 22,000-seat stadium. Team owner Joe Mansueto, the founder of the financial data firm Morningstar, agreed to pay for the $650 million venue in Chicago’s downtown with nary a dollar from taxpayers. “It would definitely slow down the process to have to engage with political leadership to secure financing,” said Mansueto, who is doing Chicago taxpayers a big favor by putting his wealth into this endeavor.
Miss: The Old Approach to Stadium Building. Sadly, other professional sports teams are not following the example of the Chicago Fire, and they have found politicians willing to do their bidding. The Cleveland Browns are waiting for $600 million from the Ohio state government to help finance a new stadium – there are dueling proposals on where the money will be coming from – while the Missouri state legislature is now in special session to craft legislation that will finance up to 50% of the construction or renovation on the stadiums occupied by the Kansas City Royals and Chiefs. Now, if only those lawmakers showed the same degree of intensity and energy for bringing down crime, creating affordable housing or improving their public school systems.
Hit and Miss: Too Much of a Good Thing, Part 1. Wyoming Sen. Bob Ide, a Republican, is advocating for the elimination of the state’s property taxes – this would encompass both residential, commercial, industrial and personal property taxes. “We need to shift to a new system,” said Ide, who put forth a motion to draft a bill repealing most of Article 15 of the Wyoming Constitution. “A sales tax is the only way we’re going to muck out all of this layered minutia of property taxes.” Ide deserves a Hit for his boldness in working to remove the property tax burden from Wyoming homeowners, but he also gets a Miss for offering an alternative that could potentially create an expensive problem rather than an equitable solution.
Hit and Miss: Too Much of a Good Thing, Part 2. A new bill before Maine’s state legislature would eliminate property taxes for homeowners aged 65 and older. Property tax rates in Maine average 1.17%, above the national average of 0.9%, with the typical Maine homeowner paying $2,855 a year in bills. This deserves a Hit for trying to make life easier for the state’s older population, but it also deserves a Miss because one-quarter of Maine’s population is over 65, which creates a new problem for homeowners under 65. Maura Pillsbury, a state and local tax policy analyst with the Maine Center for Economic Policy, warned, “This could end up increasing property taxes for other folks in the community. This could put municipalities in a position where they can’t fund local services and education.”
Hit: A Very Generous Offer. President Donald Trump is looking ahead to the creation of his presidential library, and Florida Atlantic University is making him an offer that he may not be able to refuse. The Wall Street Journal reports the university is ready to give Trump a 100-year free lease for his presidential library. Florida lawmakers are also eager to this proposed venue – recent legislation will now provide the state with full regulatory control over presidential libraries, thus preventing local governments from obstructing this type of project. In comparison, former President Joe Biden is having problems securing a site and raising donations for his presidential library.
Miss: How Not to Buy Favor. An Australian real estate agency became the center of negative attention after offering tenants at one of their properties a week’s worth of free rent in exchange for a five-star review on Google. Ray White Rockhampton in Queensland made the offer in an email to tenants at one of its rental properties, claiming it was an “exciting opportunity.” However, the email was shared on the social media site Reddit, where the reaction was scathing – with some angry readers doing the opposite of what the company sought by leaving one-star reviews on Google. Oddly, the business did not suffer from bad reviews – it enjoyed an average rating of 4.8 stars from 851 reviews prior to the story going live. Go figure!
Phil Hall is editor of Weekly Real Estate News. He can be reached at [email protected].
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