If the proposed High Point baseball stadium and downtown rejuvenation project is as well backed and well planned as that city’s pitch to the Guilford County Board of Commissioners, it will be a raging success.
However, some county commissioners question if the huge undertaking has been as well thought out as it needs to be. They question, for instance, whether developers will jump in and build restaurants, bars, apartments and other facilities around the proposed stadium. That’s a key component of the plan meant to bring High Point’s downtown back from the dead.
A Thursday, August 17, afternoon work session in the Blue Room of the Old Guilford County Court House looked like a meeting of Who’s Who of High Point. The city’s leaders pulled out all the stops in their effort to get the county commissioners on board. High Point Mayor Bill Bencini, City Manager Greg Demko, High Point University President Nido Qubein and former Guilford County Commissioner Bruce Davis were just some of the presenters who asked the Board of Commissioners to grant the city one wish: a 20-year commitment of expected future county tax revenues created by the new growth.
The High Point leaders want Guilford County to use tax revenue from the anticipated increase in property values to help cover some of the stadium’s cost. Though much of the projected cost will be covered by other revenue sources – such as the team’s lease payment, a facility fee charge on game tickets, parking surcharges and stadium naming rights – part of the city’s financial plan calls for the Guilford County Board of Commissioners to create a tax increment financing (TIF) zone covering the area, which would allow Guilford County’s portion of the increase in tax revenues to go toward stadium repayment for a 20-year period.
TIFs are public financing methods through which local governments divert new property tax revenue from increases in property values in a certain district, for a set period of time, and use those funds to pay for an economic development project or to fund some type of infrastructure enhancement meant to benefit the community. In this case, Guilford County would take tax revenue from the (expected or anticipated) property value increase for a period of 20 years and use those funds to help pay off the debt on the baseball stadium.
Supporters of the move argue that Guilford County wouldn’t be losing anything because, only if property values in downtown High Point increase will that future revenue stream come into play. If the tax base of the planned renovation zone stays the same, Guilford County won’t lose a dime.
While the prominent citizens showed a unified front in requesting that Guilford County adopt the special financing for the downtown renovation project, the board’s backing at this point is anything but certain. Most of the commissioners say they don’t know how they’re going to vote. On the one hand, the commissioners certainly want to see High Point’s downtown rejuvenated since that would be to everyone’s advantage. On the other hand, the commissioners don’t want to put their stamp of approval on an embarrassing flop like Project Haystack or Say Yes to Education Guilford – grand plans that left egg on a lot of faces.
At the end of the presentation on August 17, Chairman of the Board of Commissioners Jeff Phillips spoke about the concerns he shares with some other commissioners.
“I want to compliment you with regard to your passion,” Phillips said. “We want it to succeed beyond measure and in droves.”
If it sounds from that as though Phillips was about to add a “but” – well, he was.
“But I’ve not seen those details,” Phillips said. “I have to see them. It’s just how I’m built. You can argue that there is a healthy degree of skepticism in every decision I make as a commissioner.”
“Details, details, details are critical to getting my attention,” Phillips added.
The chairman also said that area developers may “passively support” the project, but that’s different than offering a “commitment.”
“It’s an important distinction,” he said.
The chairman also said the Board of Commissioners has a lot on the line when it comes to the decision.
“We cannot be wrong; we must be right,” Phillips said. “We have to know that this project cannot fail. Some have said and others have suggested that it’s ‘no big deal’ – that it’s no skin off the county’s nose if it doesn’t work. That’s just not true. That’s not true – I want to make that clear. Because there is reputational, and there’s arguably political capital of all of us here, and many of you there, that we have worked for many, many years to accrue. So those words don’t resonate with me very well – ‘Don’t worry about it if it doesn’t work.’”
Phillips also said it appears to him that High Point is moving forward with the stadium and the other parts of the High Point Downtown Catalyst Project no matter how the county commissioners vote on the tax financing portion of the plan.
“I sense that, with or without us – our decision – you’re moving on,” Phillips said.
The High Point officials said they want the Board of Commissioners to approve the TIF at the board’s Thursday, Sept. 7 meeting. Several commissioners said at the work session that they want more time to decide, but High Point officials said the city already has a schedule in the works that requires the county’s decision in September.
Demko said High Point was scheduled to provide a financing plan to the Local Government Commission – a state financial oversight body that must sign off on some types of debt issued by local governments.
Demko told the commissioners that High Point has an ownership group willing to purchase a baseball team. He said that might not be the case two years from now.
The new stadium is the high-profile centerpiece of the project meant to bring economic activity to the vacant lots and empty buildings in an 11-acre zone south of North Main Street, west of Martin Luther King Drive, north of Lindsay Street and east of Gatewood Avenue. Some of the expected new development will also happen on connected lots around that central area if the plan is successful. Earlier this year, the City of High Point spent $15 million to amass property on which to put the $30 million stadium.
According to Demko, the commissioners should agree to the move because the project would “stop a downward spiral in a key part of the county’s second largest city.”
“If we don’t do it, my gut tells me, this is going down,” Demko said of the property tax revenue the county now gets from that area.
The city manager said the international furniture market held in High Point each year has “a $5-billion impact” on this area, but the rest of the year there’s nothing going on there.
“Those two weeks we have intense activity,” Demko said, “For 50 weeks, it’s gone.”
“We have a pop-up city,” he added.
According to Demko, it’s vital that High Point be able to attract and keep millennials. For that to happen, he said, the city needs a “walkable community” downtown rather than what’s there now.
“It’s blight – there’s nothing else you can really call it,” Demko said.
The plan calls for Samet Corp. to head up the stadium construction. The construction is estimated to create 137 new jobs and $6 million in earnings for workers.
The well prepared High Point officials clearly knew Commissioner Carolyn Coleman would ask about Minority and Women-owned Business Enterprise (MWBE) program participation in the project, which she did. High Point Assistant City Manager Randy Hemann told Coleman that High Point has a standing 10 percent target for the city’s projects but added that discussions with Samet gave cause to hope this one would have 20 percent to 25 percent MWBE participation.
Coleman also wanted to know if the blighted area included residential property or if it was entirely a business district.
Hemann said there were “a few houses” in the area, but he added, “It will not take away residential area.“
Hemann told the board that a study found there would be a demand for 500 apartments and a 90-room hotel downtown and also said the city was using very conservative estimates for its financial projections.
High Point officials have been working the commissioners for months to get their support for the TIF, but Guilford County Commissioner Alan Branson said he hadn’t been included in those discussions.
“I’m a little uncomfortable that I have not been contacted on this project,” Branson told the assembled High Point leaders, adding that he’d only had one casual conversation in a parking garage about the stadium project.
The three county commissioners who represent parts of High Point are Commissioners Carlvena Foster, Alan Perdue and Hank Henning.
Perdue and Henning said this week that they are weighing the arguments on both sides and they haven’t yet made up their minds, but Foster said she’s solidly behind the project. At the August 17 work session, she said she’s very well acquainted with the importance of baseball to a community.
“I get it,” Foster said. “My husband was a number one draft choice out of High Point University for the Boston Red Socks.”
Hemann said the stadium could draw other sports as well.
“We feel like there may be an opportunity for us to have some professional soccer in here,” he said.
“One of the reasons we really like this site is that two blocks away is a parking deck,” Hemann added.
He also said that, currently, the giant deck is now only used two weeks out of the year.
High Point officials estimate the new project will increase the city’s tax base in the development zone by $99 million after 10 years. The total value for that area is currently $805 million, which is projected to rise to $904 million over a decade. After a 20-year period, the revenue from additional tax values will revert back to Guilford County.
Hemann said that there’s little to no hope for that area without this intervention.
“It will tell you it will not occur if we do not do this project,” Hemann said of growth in the zone.
Some commissioners expressed concern over complaints they have been hearing from High Point residents about the methods used to advance the project. Some have complained that city leaders were secretive until it was nearly a done deal and they pointed out that the stadium project wasn’t put on the ballot for voters to decide.
He said citizens have been included.
“We’ve spoken to between a thousand and 1,500 people on this,” he said. “I will tell you that while there is some negativity out there, the overwhelming response has been positive.”
Commissioner Skip Alston asked what happens if development fails to follow after the construction of the expensive stadium.
“What if it doesn’t happen?” Alston said of the expected downtown growth. “The debt will be there.”
“The county won’t be responsible for that,” Demko responded.
One of the points that High Point officials have been making behind the scenes is that, if the endeavor is a big bust, High Point leaders will take the brunt of the political fallout, and they’ll be ones who have to find money to pay for the stadium if the other revenue streams never materialize.
Commissioner Kay Cashion wanted to know the status of the stadium’s naming rights.
Qubein said that, on Wednesday, Sept 6, at High Point University, he’ll give an update.
“I will have a progress report,” Qubein said, adding that the naming rights period will be for 15 years and it will provide “hundreds of thousands of dollars” in each of those years.
Qubein also used Cashion’s question as an opportunity to make his pitch.
“It is really important to know that you’re not spending money,” he told the commissioners. “As a business guy, this is a no brainer to me. This is the moment of truth. This is not amateur night.”
Qubein also addressed the fact that the stadium project was never put on the ballot.
“I love democracy,” he said, but he added that people elect leaders to make these types of decisions. “I send about 50 percent of my income to [elected leaders] and they don’t call me up and ask me about their decisions. I either trust them or I don’t. If I don’t trust them, I need to throw them out.”
Cashion said most of the people she hears from want to see the High Point project move forward.
“I’m hearing about 3 to 1 in favor of this process,” Cashion said. However, she added that some citizens felt left out.
“They didn’t feel that they were included,” she said. “I don’t know how you go back and undo it – I don’t think you can.”
Hemann told Cashion, “We had to move in a stealthy manner to secure the site,” and he added, “There will be continued effort to receive public comment.”
Commissioner Justin Conrad had clearly been doing his homework on TIFs. At the work session, he read excerpts from several studies and spoke about some unsuccessful TIF projects. He said the City of Greensboro recently put bond referendums on the ballot for major projects such as this to let voters decide.
“One of the knocks of TIF financing is not having that input,” Conrad said.
High Point City Councilmember Cynthia Davis, the only city councilmember who voted against the baseball stadium project, said, “Hear, hear,” several times when Conrad spoke – which caused Phillips to instruct everyone to remain quiet while others had the floor.
Hemann tried to address Conrad’s concerns.
“There are certainly examples of poorly done TIFs out there,” he said. “No one will deny that. But we have control of the land and have done our homework. Look at this as a case by case basis and judge this by its merits.”
Hemann said that, while he knows healthy skepticism is required, the city officials were providing the commissioners with “400 pages of healthy skepticism remover.” He was referring to a detailed report about the proposal.
At the commissioners’ regular meeting, immediately after the work session, the board heard from several speakers who objected to the cost of the project and who said they didn’t appreciate being excluded from the decision process.
One speaker, Jimmy Morgan, said he was just “an old country boy,” and said he didn’t like what he was hearing about the project.
“Somebody’s making some money someway, somehow,” Morgan said.
Davis, the High Point city councilmember who was kept from saying “Hear, hear” during the work session, spoke from the floor and used her three minutes to complain about the “lack of transparency” in the way the project was pushed forward by the rest of the High Point City Council and other city leaders.
A stadium in downtown Greensboro built just over a decade ago is currently seeing a good deal of construction and development going on around it, albeit that growth is happening about 11 years after it opened.
Though High Point brought a large delegation to the work session that afternoon, High Point City Councilmember Chris Williams, the liaison to Forward High Point, was the only other High Point city councilmember besides Bencini and Davis in attendance. Forward High Point is the nonprofit group heading up the city’s downtown revitalization project.