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Details of O-Royals/Sarpy County lease revealed

The proposed agreement for a new $26-million ballpark project in Sarpy County calls for the Omaha Royals to pick up half the cost of the facility, paying $2 million up front and $450,000 in rent annually.
A day after a Sarpy County consultant announced an agreement between the suburban Omaha municipality and the Omaha Royals (Class AAA; Pacific Coast League), we were provided the details of the agreement.

First, what’s being considered and budgeted for is a $26-million ballpark project, with the actual ballpark construction budgeted at $20.33 million. The 6,000-seat ballpark, which will be ready by March 15, 2011, will contain 15 suites, a wraparound concourse and berm seating for around 2,000 more. The O-Royals would commit to a 25-year lease and retain an option to buy the ballpark at its fair-market price at the end of the lease. There had been talk of the O-Royals management possibly seeking a Low Class A Midwest League team for the market, but the proposed lease calls specifically for a Triple-A team.

The O-Royals will cover about half of the cost of the project, paying $2.35 million up front (including $350,000 in area development funds) and committing to $450,000 annually in rent — a number that could change when adjusted for inflation. The O-Royals will manage the facility and control all events in addition to baseball games; the county will have the right to hold five events there but pay a fee and costs to the O-Royals. The O-Royals will receive parking revenues; the county will pay for capital maintenance. The O-Royals would be responsible for any cost overruns.

Basically, all revenue from the ballpark will reside with the O-Royals, including suite sales and all signage. The O-Royals will also retain naming rights to the facility, keeping the first $300,000 and then equally sharing the rest with Sarpy County.

The agreement also commits Sarpy County to sell bonds to finance the project, but does not specify how these loans will be backed. County officials have asked the Nebraska Legislature for three separate funding methods, two based on tax-increment financing. The agreement does not preclude the use of a ticket surcharge to pay for the ballpark, and Sarpy County officials have been tossing around the idea of a hotel/motel tax as well.

What surprises us is the proposal for a $20.33-million ballpark. It will surely be a bare-boned facility; at a time when a Triple-A ballpark easily costs more than $50 million — the new Gwinnett Braves (Class AAA: International League) ballpark will cost at least $64 million, while the new Portland Beavers (Class AAA: Pacific Coast League) ballpark is budgeted at $55.1 million, with no land costs involved — it will be interesting to see what the Omaha Royals will get for the money.

RELATED STORIES: Agreement reached on new O-Royals ballpark; O-Royals, Sarpy County on verge of signing ballpark deal

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