The City of El Paso could end subsidies for debt payments on Southwest University Park by 2021, according to a report presented to the City Council on Monday.
Home to the El Paso Chihuahuas (Class AAA; Pacific Coast League), Southwest University Park generates revenue through a variety of sources, including hotel and sales taxes, along with the team’s annual rent and parking revenues. Thus far, those revenues have not been enough to cover annual debt payments on the ballpark, meaning that the city has used general fund subsidies to offset the cost. This is not an unexpected cost for the city: the plan was to pay down debt early and then draw on a surplus down the road. It looks like that’s exactly what’s happening.
While $2.2 million in subsidies have been used over the past four years, officials expect that the revenue will rise enough that the city will no longer have to dip into its general fund by 2021. More from KVIA:
The ballpark is generating money through hotel and sales taxes, ticket revenues, rent charged to Mountain Star Sports Group and parking at the convention center during games. But it’s not enough to completely cover the debt payments. At least not yet.
“Yes, we knew that all along. Early years of the program we knew that there was going to be some subsidy needed. But highlighting overall, it’s actually going to be a great benefit to not only the downtown and the whole redevelopment, but we are going to have about $18 million of surplus at the end of 30 years that can go back into maintaining the ballpark and taking care of it,” Robert Cortinas, interim director of municipal finance operations for the city, said.
Cortinas presented the numbers to the council and mayor.
“Between the refinancing, the performance of the hotel occupancy tax, there are a lot more dollars now so, taxpayers are not going to pay for it. We are going to get reimbursed for anything we spent early on. And we are actually going to have a lot more money now to actually take care of the ball park,” Cortinas said.
Back in 2012, voters signed off on a two-percent increase in the city’s hotel occupancy tax in order to help finance the ballpark’s construction. Southwest University Park opened for the Chihuahuas in 2014.