A September 2008 analysis of the ballpark options in Richmond failed to consider the economics of a renovated Diamond and concludes a new Shockoe Bottom ballpark could work if surrounding counties continue to help paying for baseball in the area — and given statements from elected officials throughout the region, that’s a mighty big if. No wonder many in Richmond are arguing the deck is stacked for a new Shockoe Bottom facility. But don’t take our word for it — you can read the study yourself, as we’ve obtained a copy.
A September 2008 analysis of the ballpark options in Richmond says a new downtown Shockoe Bottom ballpark could work if surrounding counties continue to help paying for baseball in the area — and given statements from elected officials throughout the region, that’s a mighty big if.
In addition, the firms failed to analyze the finances of a renovated Diamond as part of a redevelopment of the Boulevard area.
In 2008 then-Mayor Douglas Wilder commissioned Davenport & Co. of Richmond, Chmura Economics and Analytics of Richmond, and Economic Research Associates of Washington to study the economic impact of baseball in the city. The firms looked at three scenarios: constructing a new ballpark at the Diamond site with no associated development, tearing down the Diamond and using the land for new development, building a new ballpark in the downtown Shockoe Bottom area, and renovating the Diamond sans any redevelopment in the greater Boulevard area. Left unaddressed: renovating The Diamond as part of a larger redevelopment in the greater Boulevard area.
Since a renovated ballpark with no development would generate no additional income for the city, it was not studied further. And there was no explanation of why a combination of Diamond renovation and Boulevard redevelopment was not considered, even though that option was pitched by developers to the city.
So the real decision, according to the researchers, was to tear down the Diamond and use the land for redevelopment, or build a new downtown Shockoe Bottom ballpark and use tax proceeds from Shockoe Bottom and Boulevard redevelopment, a move favored by Wilder and other Richmond politicians.
The Diamond, the former home of the Richmond Braves (Class AAA; International League), is on a larger site dubbed the Boulevard. There’s the potential of 59 acres of additional development near the ballpark. A smaller parcel exists in the downtown Shockoe Bottom neighborhood. Both have been pegged for redevelopment by Highland Properties.
A Richmond group is buying the Connecticut Defenders (Class AA; Eastern League) and will be seeking a move to Richmond. The issue is where the team will play — an issue that’s been plaguing city officials for years.
In determining whether a Shockoe Bottom ballpark is feasible, the group assumed "maximal" tax revenues generated both by the larger Shockoe Bottom development and a redevelopment of the Diamond property. In this scenario, debt service on the new ballpark would total $7.5 million annually. But the increased tax revenues generated by both development projects would not cover this debt payment, even when using the "maximal" tax revenues. To make the numbers work, the assumption is that a new ballpark would continue to receive financial assistance from surrounding counties — and that’s a mighty big assumption. Currently Chesterfield County ($750,00 annually), Henrico County ($750,000) and Hanover County ($225,000) contribute annually to The Diamond. The report contemplates the loss of this money and concludes some magical, unnamed private-sector partner would make up the lost $1,725,000 — but without this money the tax revenues generated by the two development projects would fail to cover debt service on the ballpark.
And even with the study stacked in favor of the new ballpark, the firms could not make a clear-cut economic argument it was the better idea. A new ballpark at the Diamond site would pay for itself and indirectly bring an additional $100,000 into city coffers. A new Shockoe Bottom facility could create more jobs and indirectly bring an additional $200,000 annually into city coffers — assuming the maximal development of both the Boulevard and Shockoe Bottom areas. And really, the only way the numbers work is when you assume additional tax revenues generated by a $363-million construction project, not by additional tax revenues generated by the projects.
A copy of the report — a 100-page PDF — is attached to this article.
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