MU arena tax burden may outstrip revenue

JEFFERSON CITY, Mo. -- University of Missouri officials anticipate mandatory donations for the privilege of purchasing season tickets to Tigers' basketball games at the school's new arena will annually generate between $300,000 to $1.8 million more for athletic scholarships than the university currently receives.

Meanwhile, Missouri taxpayers next year will begin making annual payments of nearly $3 million for 20 years to retire bonds sold to help finance the project.

House Majority Floor Leader Jason Crowell, R-Cape Girardeau, voted against the arena plan when it came before the Missouri Legislature in 2001. While he opposes public funding of sports stadiums in general, Crowell said it appears taxpayers could be spending more for this facility than the economic return it will generate.

"I still haven't really heard a satisfactory answer on why the university needs this other than 'We want it,'" Crowell said. "In today's budgetary climate, that just isn't good enough anymore."

The new 15,000-seat facility at the university's flagship Columbia campus is under construction and slated to open in October 2004. Both private and public money is paying for the $75 million construction tab.

The state sold $35 million in bonds in November 2001 to help finance the project. Paying off the principal and interest will cost taxpayers $55.6 million, according to the Missouri Office of Administration.

Mario Moccia, MU's senior associate athletic director, said the project wouldn't have been possible without taxpayer assistance.

"Donations alone would not cover the building itself and its $75 million price tag," Moccia said.

The 2001 resolution authorizing the state's financial participation in the MU arena circumvented the normal process for approving and prioritizing capital improvement projects. Supporters said the extraordinary action was needed to secure a $25 million pledge from Bill and Nancy Laurie of Columbia, the owners of the St. Louis Blues hockey club.

The measure enjoyed solid support in the Senate but cleared the House of Representatives with only one vote to spare.

Under the university's fund-raising plan, top donors will be asked to make a one-time payment of $25,000 to secure up to eight courtside seats in the 2004-2005 season. An additional annual charge of up to $5,000 per seat will also be required. Those donations don't include the actual price of tickets.

Other seating areas will require much smaller one-time donations of $125 to $1,000 per season package and annual contributions of $125 to $2,000 per seat. Some seats will be available to nondonors.

Moccia said that over the long haul, season ticket packages at the new facility will be cheaper than those at the 31-year-old Hearnes Center, where the Tigers currently play.

The best seats at Hearnes require an annual donation of $7,500 per seat but no one-time contribution. Four seats over five years cost $150,000, Moccia said. At the new arena, that same package for five years, including the one-time donation, would cost $125,000.

The one-time contributions are expected to generate as much as $1 million a year for the first three years the facility is open before tapering off sharply. That money will be earmarked for a variety of capital improvement projects at MU athletics facilities.

The annual donations will go into the university's athletic scholarship fund.

John Rasmussen, director of the fund, said such donations for ticket privileges at the Hearnes Center raised $5.3 million last year.

If 80 percent of the seats requiring contributions were filled at the new facility, that figure would climb to $5.6 million a year, he said. The annual take would around $7.1 million if 100 percent of those seats were filled.

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