CLEVELAND, Ohio – The Cleveland Indians have struck a proposed $435 million deal with the city of Cleveland, Cuyahoga County and the state of Ohio to renovate Progressive Field and extend the team’s lease in Cleveland for at least 15 years.
The deal was rolled out Thursday morning by team owner Paul Dolan, Gov. Mike DeWine, Cleveland Mayor Frank Jackson, County Executive Armond Budish and County Council President Pernel Jones Jr., who gathered at Progressive Field to make the announcement during a virtual press conference.
Local and state taxpayers would be footing roughly two-thirds of the cost, with the soon-to-be-named Cleveland Guardians contributing the rest.
Over the life of the 15-year deal, the city would pay roughly $117 million, the county would pay about $138 million, the state would pay $30 million, and the team would pay $150 million, according to documents obtained by The Plain Dealer and cleveland.com.
The deal, which must win approval from both city council and county council, calls for no new taxes or tax increases. All public funding would come from existing revenue sources.
The 15-year lease allows the city and county to exercise two additional five-year extensions, keeping the team in Cleveland through 2036, and possibly through 2046.
The agreement would include approximately $200 million worth of fan-oriented improvements to the publicly-owned ballpark, as well as capital repairs, property taxes, and operational costs for the non-profit Gateway Economic Development Corporation, which enforces the Indians’ and Cavaliers’ leases and serves as landlord for the ballpark and arena.
With hundreds of millions in taxpayer dollars on the line, the agreement could draw fire from community members and organizations opposed to the plan, similar to the outcry against the 2016 Rocket Mortgage FieldHouse renovation that was funded in large part by the public. Opponents criticized that deal as a give-away to a wealthy sports team owner as the city’s neighborhoods suffered from disinvestment.
However, Jackson, Budish and DeWine on Thursday lauded the Progressive Field agreement as one that will maintain the ballpark as an economic engine for Greater Cleveland.
The ballpark, according to a news release, is projected to generate $3.22 billion in visitor spending over the next 15 years, and $21 million annually in state and local taxes. It draws an average of 1.7 million people to downtown Cleveland each year.
“We are one of a few cities that have three major sports teams all located in a central business district,” Jackson said in the release. “This shows that sports are important to the economic vitality of our hospitality industry, and baseball specifically is critical to Cleveland’s future.”
Said Budish: “All of our suburbs are affected in many ways by the health and progress of the central city. Progressive Field generates tax revenue, job creation, and other economic upsides that benefit every community and resident in Cuyahoga County.”
Dolan said the deal would help keep Cleveland’s baseball venue on par with others in the league.
“Our organization is proud to continue our long-term commitment to Cleveland by ensuring we keep our ballpark competitive,” Dolan said in the release. “We want to give our fans, our community and our players the best ballpark experience possible.”
Budish in the release also called the deal a “responsible investment,” noting that a renovation would be less expensive than building anew. A new ballpark could cost upwards of $1 billion, he said, and other cities with newer ballparks than Cleveland’s have already moved to replace their facilities completely.
The ballpark, then-known as Jacobs Field, opened in 1994. The county is slated to pay off bonds from the original construction in 2023, coinciding with the expiration of the current lease. Under the terms of that lease, taxpayers are responsible for paying major capital repairs over $500,000.
The proposed lease extension would cover major capital repairs going forward, along with the proposed renovations, such as a reconfigured upper deck concourse, a larger “social space” in the dugout, and an overhaul of the areas off left field, including the Terrace Club, the release said.
About half of the Indians’ $10 million-a-year payment will be used for such improvements to the fan experience.
Where the money comes from
In addition to the Indians’ contribution of $150 million and $30 million from the state, city and county taxpayers would pay roughly $255 million.
The county would chip in about $14.5 million upfront, then issue bonds to raise proceeds for the remaining public portion of the financing, along with $68 million in bonds that would be paid back by the team, the documents state.
The public portion of the bonds, including principal and interest, would be repaid using a variety of city, county and state revenue sources. Here’s what the documents say about how the city and county would generally pay for their portions of the debt each year:
City of Cleveland
Sports facility reserves: $3.2 million
Parking garage revenues: $2 million
Half of admission tax proceeds from baseball games: $2.6 million
Garage naming rights: $333,000
Unspecified source: $350,000
Cuyahoga County
Bed tax: $3 million
Sin tax: $2.5 million
General fund: $2.5 million
Unspecified sources: about $300,000
The state funds could “potentially” come from the Department of Development, a DeWine spokesman told cleveland.com. And though the governor will “likely” need legislative approval for the money, that will ultimately depend on the final proposal, which the governor plans to develop in discussions with legislators, the spokesman said.
The sin tax was originally levied to pay for construction of the ballpark and arena, and later extended to pay for capital repairs (a portion also goes to the Cleveland-owned football stadium). And the county raised the bed tax by one percentage point in 2019 to, in part, pay for future improvements to Progressive Field.
The sin tax was originally levied to pay for construction and repairs at the ballpark and arena (a portion also goes to the Cleveland-owned football stadium). And the county raised the bed tax by one percentage point in 2019 to, in part, pay for future improvements to Progressive Field.
This is a breaking news story and will be updated.
