wasteland
10-08-2009, 12:21 PM
LOVES PARK — The Rockford RiverHawks and the stadium the team plays in have both consistently lost money for team ownership.
That’s part of the reason lawyers for the team and stadium have been writing letters to the Rockford School District, Winnebago County and the Rockford Park District, among others, seeking tax breaks.
And it’s also bringing to light some of the financial problems faced by a professional sports franchise that has tried to make a go of it in the Rock River Valley.
“Without the abatement, Park Stadium LLC stands to potentially lose the stadium to foreclosure and the community stands to lose a resource,” attorney Aaron Szeto wrote in a letter to School District officials seeking an abatement of the more than $25,000 the stadium pays to the district in property taxes.
According to Winnebago County records, the stadium has a fair market value of $1.4 million and in 2008 owed $38,245.32 in property taxes. The School District’s $25,622 was by far the highest share of that bill.
Since the letter was made public during a School Board committee meeting Monday night, Szeto has backed off the claim a bit, saying the ownership is “not in foreclosure and is in no way in default.”
The wording Szeto said was “extrapolation in my head” of one possible scenario facing the stadium if new funding for the team can’t be found.
Loan renewal unlikely
The problem is, said Kurt Carlson, majority owner of the team and the stadium, the Chicago bank that gave him and his partners money to build and operate the facility most likely won’t renew their loan.
“We were told it’s not likely, so we’re looking at all funding options,” he said. Carlson said he and his partners will subsidize the team and the stadium for about $250,000 this year.
“On average it’s about $500,000 a year, and it was as high as $800,000 when we first started out because we did a lot of advertising and promotions,” he said.
Carlson said he’s also working with Winnebago County to try to get a loan through government bonding that would take the place of the bank loan he expects won’t be renewed.
Sue Mroz, the county’s director of regional planning and economic development, said so far her office has only gotten a letter from Carlson’s attorney about a possible tax abatement, but that the loan did come up in conversation.
“It’s something that would have to go through the board process,” Mroz said. “We haven’t talked specific amounts yet.”
Mroz said talk centered on the Recovery Zone Economic Development Bond program, which was authorized in February as part of the federal stimulus program. It allows counties and municipalities of more than 100,000 residents to apply for low-interest bonds for projects in recovery zones.
A recovery zone is defined as “an area having significant poverty, unemployment, home foreclosures or general distress; or an area that has already been federally designated as an Empowerment Zone or Renewal Community” by the United States Treasury Department.
Mroz said the county, “because of its poverty and unemployment,” qualifies as a recovery zone, but that does not guarantee that money would be forthcoming from the federal government.
‘30 days to resubmit’
Meanwhile, Carlson’s hopes for a tax break from the School District could face an uphill battle.
“Well, we gave them 30 days to resubmit their proposal,” said Harmon Mitchell, who chairs the board’s operations committee.
“It’s kind of what we did for the charter schools; we told them to keep trying until they got it right.”
The problem, said Mitchell, is both the state law and the district’s policy regarding tax abatements require that it be a new project to qualify.
“So they shouldn’t have come forward with this now; they should have done this when they built the stadium years ago,” he said.
http://www.rrstar.com/news/x1992003451/RiverHawks-make-pitch-for-relief-on-taxes
That’s part of the reason lawyers for the team and stadium have been writing letters to the Rockford School District, Winnebago County and the Rockford Park District, among others, seeking tax breaks.
And it’s also bringing to light some of the financial problems faced by a professional sports franchise that has tried to make a go of it in the Rock River Valley.
“Without the abatement, Park Stadium LLC stands to potentially lose the stadium to foreclosure and the community stands to lose a resource,” attorney Aaron Szeto wrote in a letter to School District officials seeking an abatement of the more than $25,000 the stadium pays to the district in property taxes.
According to Winnebago County records, the stadium has a fair market value of $1.4 million and in 2008 owed $38,245.32 in property taxes. The School District’s $25,622 was by far the highest share of that bill.
Since the letter was made public during a School Board committee meeting Monday night, Szeto has backed off the claim a bit, saying the ownership is “not in foreclosure and is in no way in default.”
The wording Szeto said was “extrapolation in my head” of one possible scenario facing the stadium if new funding for the team can’t be found.
Loan renewal unlikely
The problem is, said Kurt Carlson, majority owner of the team and the stadium, the Chicago bank that gave him and his partners money to build and operate the facility most likely won’t renew their loan.
“We were told it’s not likely, so we’re looking at all funding options,” he said. Carlson said he and his partners will subsidize the team and the stadium for about $250,000 this year.
“On average it’s about $500,000 a year, and it was as high as $800,000 when we first started out because we did a lot of advertising and promotions,” he said.
Carlson said he’s also working with Winnebago County to try to get a loan through government bonding that would take the place of the bank loan he expects won’t be renewed.
Sue Mroz, the county’s director of regional planning and economic development, said so far her office has only gotten a letter from Carlson’s attorney about a possible tax abatement, but that the loan did come up in conversation.
“It’s something that would have to go through the board process,” Mroz said. “We haven’t talked specific amounts yet.”
Mroz said talk centered on the Recovery Zone Economic Development Bond program, which was authorized in February as part of the federal stimulus program. It allows counties and municipalities of more than 100,000 residents to apply for low-interest bonds for projects in recovery zones.
A recovery zone is defined as “an area having significant poverty, unemployment, home foreclosures or general distress; or an area that has already been federally designated as an Empowerment Zone or Renewal Community” by the United States Treasury Department.
Mroz said the county, “because of its poverty and unemployment,” qualifies as a recovery zone, but that does not guarantee that money would be forthcoming from the federal government.
‘30 days to resubmit’
Meanwhile, Carlson’s hopes for a tax break from the School District could face an uphill battle.
“Well, we gave them 30 days to resubmit their proposal,” said Harmon Mitchell, who chairs the board’s operations committee.
“It’s kind of what we did for the charter schools; we told them to keep trying until they got it right.”
The problem, said Mitchell, is both the state law and the district’s policy regarding tax abatements require that it be a new project to qualify.
“So they shouldn’t have come forward with this now; they should have done this when they built the stadium years ago,” he said.
http://www.rrstar.com/news/x1992003451/RiverHawks-make-pitch-for-relief-on-taxes