Despite some pointed questions from city councilors, Worcester officials say Polar Park, home of the Worcester Red Sox (Triple-A; International League), is paying for itself and could add funds back into the general fund in time.
Polar Park is regarded as the most expensive Minor League Baseball built, with the city issuing $146 million in bonds to cover construction costs, paid back over 30 years with taxes generated by growth in the area. For sports economists styling the issue, these increased taxes were inevitable–though development proposals in the ballpark area were scarce–so they shouldn’t be attributed to the ballpark. By their reckoning, the $160-million-plus ballpark is poised to lose between $40 million to $60 million for the city, based on assumptions made in 2018.
However, the development in the area is expected to generate enough new revenues to cover the bonds, according to City Manager Eric Batista at a meeting of the City Council’s Standing Committee on Finance Tuesday. The finance package was expected to run at a deficit for the first several years–a common situation on new TIF districts–and that was shortfall covered by the sale of city property. As more projects are finished, the revenues will go up, per the Worcester Telegram:
McGourthy said the DIF reserve should begin to grow in the coming years as new projects come underway and additional revenue streams are activated. He said fiscal 2024 is expected to be the tightest year as it will be before they can collect revenue from some of the new developments, expenses are also expected to outpace revenues this fiscal year.
According to city figures, the reserve started fiscal 2023 with $2.7 million. The district made around $3.4 million in revenue and paid $5.2 million in debt service expenses. At the end of fiscal 2023, the city projected about $954,487 in the reserve.
For fiscal 2024, the city projects revenues of about $5.5 million and debt service expenses of about $6.2 million leaving around $310,179 in the reserve.
Opponents of Polar Park public funding have been correct in criticizing city officials about being opaque at times about the current state of bond repayment figures and budgets vs. the 2018 numbers used to justify the bonding: a lot changed since 2018 (some proposals were scrapped, others added and expanded, and COVID-19 certainly affected things).
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