Image Credit: Shawn Collins (CC BY 2.0)
The city of Arlington, Texas recently took the steps to refinance the debt owed toward AT&T Stadium, home of the Dallas Cowboys. The strategy will help pay for both AT&T Stadium and the construction of Globe Life Field, future home of the Texas Rangers. Arlington is expected to contribute $500 million towards the construction of Globe Life Field and still owes $171 million in principal and interest towards AT&T Stadium.
Globe Life Field will be erected down the street from the Rangers’ current home stadium; Globe Life Park. AT&T Stadium is located in the same vicinity as well. The Texas Rangers organization recently broke ground on Globe Life Field. The original maturity date for the bonds that were used to pay for the construction of AT&T Stadium was 2034. Before refinancing, the city of Arlington was well ahead of that payoff date (2020) thanks to making larger payments than what was required. After refinancing, the city will still save in excess of $100 million in interest and fees than what AT&T Stadium’s debt was first projected to be in 2004.
There are three components that generate the revenue for the city to pay for the two stadiums; a 5% tax on car rentals, a 2% tax on hotel rooms and a half-cent sales tax paid for by local taxpayers. The usage of local tax dollars to subsidize the construction of sports stadiums has recently come into the spotlight following the ongoing national anthem protests in the National Football League. There is also a bipartisan bill that is picking up support and will prohibit public tax dollars from being used to finance the construction of stadiums and arenas for sports teams.
The bonds that will be used to pay for the construction of Globe Life Field will be issued in 2018. The Texas Rangers have lobbied for a climate-controlled ballpark with a retractable roof to shield fans from the Texas summer heat. Globe Life Field will also be part of a mixed-use development known as Texas Live!. Texas Live! will resemble The Battery Atlanta; a mixed-use development outside of Suntrust Park (home of the Atlanta Braves).
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