Following Oakland’s lead, Tampa officials are looking at putting together a ballpark deal based on foreign investments based on the federal EB-5 visa program — a long shot at best.
EB-5 is essentially a program that allowed a foreign citizen to “buy” U.S. citizenship by investing a million dollars into a U.S. corporation. It’s been used in raising money for smaller projects, like office buildings and business parks. It’s not exactly the most successful of programs — out of 3,805 applicants in 2011, only 1,403 were approved — and with many other municipalities seeking the same sort of business investments (in fact, the minimum investment is $500,000 for those putting money into economically disadvantaged areas with high unemployment), it’s an uneven method to raise money. Oakland already gave it a run while working on a Victory Square ballpark plan; it may be resurrected in the future in the Coliseum site is redeveloped.
Michael Sasso of the Tampa Tribune paints a very rosy picture of using this tool to help build a Tampa Bay Rays ballpark. But in the end it’s way too rosy and unlikely to succeed.
Let’s do that the math. Let’s say a deal is put together for a new Rays ballpark as part of a larger development (remember, the EB-5 program requires that a corporation with projected profits be the basis of the investment, and the ballpark itself won’t make money, requiring associated development to offset the losses), with $600 million going for a retractable-roof ballpark and $400 million for the associated development, bringing the total up to a billion dollars. Let’s also say the entire EB-5 visa program attracted $1.4 billion in 2011 (very iffy, as we’re guessing the $500,000 investment was mighty attractive to many foreign investors). Now put the two numbers in proportion: even to fund half of development — which cannot be funded by taxpayers — a new Tampa ballpark would need to draw a huge percentage of revenues generated nationally by the EB-5 program. So Tampa would need to put together a deal where a developer commits to a new ballpark, agrees to finance the billion, and then solicit foreign investment on the back end. When you’re talking about a billion-dollar development, million-dollar investors are really small game, and it’s hard to see a realistic economic model here. While foreign investment may play a part in ballpark development, it’s unlikely to play a major role in any financing plan.
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