CHICAGO – A billion here, a billion there – soon you’ll be talking about real money. The late Senator Everett Dirksen may not have said exactly that, but he repeatedly raised this concern about the spending of tax dollars.
For reference, $1 billion is more than the budgets of the Chicago Park District, Cook County Forest Preserves, and the Greater Chicago Food Depository combined. Chicago police’s annual spending is about $2 billion, while Chicago Public Schools’ budget exceeds $9 billion.
Now, Illinois politicians face the Chicago Bears’ request to build a new, publicly owned, enclosed $3.2 billion stadium on Chicago’s lakefront. The state’s top leaders have expressed reluctance, but Chicago Mayor Brandon Johnson is all for it.
So what exactly is proposed, what else is at stake and how will it play out? Here are some highlights.
What is proposed
Bears chairman and CEO Kevin Warren envisions a stadium south of the Bears’ current home at Soldier Field, on the site of what is now a parking lot. The facility would seat about 65,000 for football, with standing room for 70,000 and 77,000 for basketball.
The structure would have a fixed, translucent roof and a glass wall at the north end to overlook the horizon. Unlike Soldier Field, it could hold year-round events, including concerts, football, the college basketball playoffs or, once in a while, the Super Bowl.
Soldier Field would be demolished, but its colonnades would be saved and 14 acres of athletic fields and open spaces would be added between and to the north of the colonnades, for use by local sports teams, graduations and other events. If approved this year, the stadium will open in 2028.
A little context
The stadium would be designed by Manica Architects, who designed Allegiant Stadium in Las Vegas. That stadium, referenced by the Bears in their presentation, also has a translucent roof and opened in 2020 at a cost of $1.9 billion, with $750 million from taxpayers.
What could it cost
The Bears say they would pay $2 billion, a huge private investment, plus $300 million requested from the NFL. Only the remainder of the stadium’s $3.2 billion cost would be paid for with $900 million from the state. The team said another $325 million would be needed for infrastructure, including better road access and public services, as part of up to $1.5 billion for construction complete with extras such as a hotel.
The public money would be borrowed through bonds issued by the Illinois Sports Facilities Authority, or ISFA, which previously financed the construction of Guaranteed Rate Field, where the White Sox play, and the renovation of Soldier Field in 2003. The bonds will be repaid. in 40 years by the 2% city tax on hotels.
Some context
The first problem is that the hotel tax was not enough to pay for even the previous work at Sox Park and Soldier Field. The state still owes around $430 million for this, which would have to be refinanced, with interest totaling $1.3 billion, calculates ISFA.
Borrowing $900 million in new spending would add an additional $2.6 billion in interest, plus a $160 million interest-bearing reserve, for a total stadium cost approaching $4.8 billion.
This is without counting the 1.5 billion dollars in infrastructure costs, or the billion dollars already paid for the two existing stadiums.
The Bears say that’s an unfair way of looking at things. Home mortgages typically cost double the value of a home, but no one quotes the interest cost as part of the sales price. To be consistent, the team’s investment, to be paid with equity and debt, would also have to be accounted for with interest.
No reply
How the state would pay for the $1.5 billion in infrastructure. Officials have proposed using federal and state subsidies, but it’s unclear how much they could get.
What reaction are the Bears getting?
State lawmakers would have to approve such a deal for that to happen, but leadership is against it.
Governor JB Pritzker called the Bears’ proposal “flawed.”
“I didn’t say there’s never a possibility of having a domed stadium in Chicago, I never said that,” the governor said recently. “I said, however, that it is not a huge priority for taxpayers and, very importantly, it has to be a good deal for taxpayers. So there are a lot of questions about whether the deal could be done.”
House Speaker Emanuel “Chris” Welch and state Senate President Don Harmon have said the chances of passage are low.
In contrast, the state just announced that Rivian would make a $1.5 billion investment in its electric vehicle factory in Normal, with a 30-year, $827 million incentive package from the state, mostly coming from tax credits.
The nonprofit Friends of the Parks issued a statement questioning the rush for a new stadium on the lake, saying it could be built elsewhere and raising numerous questions, such as: “It seems reasonable that the Chicago Bears should obtain their needs are satisfied immediately while poor neighborhoods suffer from benign neglect?”
The group failed when it challenged the renovation of Soldier Field, but successfully resisted filmmaker George Lucas’ proposal for a museum on the same site.
What are the economic impacts
Warren says public money is not a donation, but an investment.
The Bears project $8 billion in regional economic impacts during construction, with 43,000 job-years. Once operational, the team projects 4,000 permanent jobs, generating $450 million in annual regional impact, although only about 25% will be new.
Economists are often skeptical of such estimates, saying policymakers should consider how else they could spend money to promote public benefit and productivity.
What is unknown
The Bears did not specify what they would expect in return for their investment. Pritzker said the Bears are asking for revenue from other events at the stadium, including tickets, concessions and parking. This could represent an important source of revenue for the owner, the Chicago Park District, which is budgeted to earn $54 million from Soldier Field in 2024.
What happens if this doesn’t work out?
Last year, the Bears paid $197 million to buy the old Arlington Park speedway. Similar to its pitch for a Chicago stadium, the team proposed building a $2 billion domed stadium in Arlington Heights, while also saying it would need unspecified public assistance for infrastructure. The main difference was that the suburban stadium would be surrounded by a $5 billion mixed-use development with housing, hotels and entertainment that would generate significant revenue and taxes.
That project stalled after the team was unable to reach an agreement with local school districts over property taxes, even though they were only a few million dollars apart — a pittance compared to the overall costs. Warren said that plan is now off the table as the team pursues Chicago, but noted that the Bears remain the largest property owners in Arlington Heights.
Village officials are biding their time, saying they think the Bears will be back. Mayor Tom Hayes said “we are ready, willing and able” if the Bears want to return to the suburbs.
