Contractors on clock for new football stadium
ST. LOUIS • On an unseasonably warm day this winter, 10 members of a relatively unknown public board unanimously voted to begin hiring contractors for a new riverfront football stadium.
It was Jan. 29. The meeting lasted nine minutes. Gov. Jay Nixon’s two-man stadium task force had said, for the prior month, that planning work had largely been done pro bono.
The resolution signed that day authorized the chairman and executive director of the St. Louis Regional Convention and Sports Complex Authority, the agency that owns and operates the Edward Jones Dome, to begin paying for work planning the new arena.
But contractors were already on the clock.
Account statements, invoices and contracts obtained by the Post-Dispatch show that the Authority’s general counsel, Blitz, Bardgett and Deutsch, had billed the board $27,982.50 for work on the new stadium — in December. Architecture firm HOK had charged the Authority $50,495.44 on Dec. 30.
Even the Authority’s contract with its first official hire, stadium construction manager John Loyd, was dated Jan. 22, though it wasn’t signed until after the board meeting a week later.
Since then, dome Authority Executive Director Brian McMurtry and board Chairman Jim Shrewsbury, a Nixon appointee, have authorized the hiring of or payments to more than a dozen firms.
They’ve signed architects, engineers, surveyors, planners, contract attorneys, tax attorneys and bond attorneys to contracts totaling at least $40 million. Contractors have already invoiced the Authority for about $800,000, all toward the development of a stadium that may never be built.
“The thing I worry about the most is that we’re spending money now, and we may not get a favorable decision,” board chairman Shrewsbury told the Post-Dispatch at the end of March. “Then we’ll have to make up those funds to continue to pay off the bonds. That is my major concern.”
He reiterated that worry on Wednesday. “This is a gamble,” he said. “It's not a reckless gamble. But it is a gamble.”
Last week, Nixon’s task force — Jones Dome counsel Bob Blitz and former Anheuser-Busch executive Dave Peacock, plus Loyd and an HOK design chief — traveled to NFL headquarters in New York City
to pitch their proposal for a $985 million open-air stadium on the Mississippi riverfrontnorth of downtown. It was the first time they presented their proposal in person to a key NFL owners' group, the Committee on Los Angeles Opportunities, which will recommend which team or teams might move to L.A.
Stan Kroenke, owner of the St. Louis Rams, is a frontrunner in the race.
'THAT ALL COSTS MONEY'
The new-stadium spending is not yet a serious problem, Shrewsbury said. “There’s a difference,” he said, “between maxing out your credit card and mortgaging your house.”
But Shrewsbury and other leaders at the Jones Dome have long warned of dire finances to come.
McMurtry told public officials last summer that the Dome authority would burn through its $16 million savings in just six years. And if spending continued at that pace, he added, in 15 years the Dome will be nearly $62 million in the hole.
He suggested then — well before the authority began spending money on development of a new stadium — that a $40 million bond issue might be necessary.
Authority bank accounts are holding relatively level so far; they now stand at about $17 million. But there’s still more than $100 million in debt to pay down on the Dome.
McMurtry did not return phone calls seeking comment.
Blitz, the Authority’s general counsel, argues that the region needs a new NFL arena, that the planning has required some spending, and that the dome Authority has plenty of money, at least in the short term, to cover it.
Yes, he said, at first, some contractors worked for free.
“But once we had to start meeting with the NFL, and meeting their requirements — they didn’t just want to see a pretty picture. They want to see schematic drawings. They want to see details,” Blitz said earlier this week. “They want to know that you have the right team to build an NFL stadium. And that all costs money.”
DIGGING TUNNELS, MOVING TOWERS
More than half of the money invoiced so far — about $380,000 — is to pay architects HOK. If the stadium is built, that contract is worth $39 million.
The other invoices amount to less — $171,000 to Blitz’s firm, $100,000 to Loyd, $73,000 to Thompson Coburn, for instance.
But they do more than count dollars. The invoices and contracts shed light on the complicated tasks in front of the stadium task force.
Invoices sent by the state’s municipal finance advisors, Columbia Capital, show the company started analyzing financing options on Jan. 6, three days before the task force announced plans to build a riverfront stadium. Four employees at the Kansas City firm, which sends its bills to the state, not the dome Authority, have now worked 48 days altogether, logged more than 90 hours and billed about $14,000 on the project.
The contract with Ameren Missouri shows that the dome Authority has set aside $325,000 to move the company’s
gigantic transmission towers, which bear the power lines traversing the Mississippi River into Illinois.
The St. Louis environmental engineering firm, Geotechnology, is analyzing the soil and rock under the stadium site, in preparation for such heavy tasks as building parking garages, relocating the transmission towers, constructing a stadium next to a flood wall, and digging a tunnel through which a railroad will be rerouted. The contract is worth $26,800.
And the Pennsylvania venue management firm SMG will get about $200,000 to analyze the St. Louis market, compare the market to other NFL cities, develop a five-year stadium operating plan, project Rams net operating income and expenses, identify other stadium revenue sources, provide a 30-year capital improvement schedule, and develop an NFL negotiations strategy, among other things.
One contract is still free: The public relations firm FleishmanHillard is donating up to $75,000 in fees, and hasn't yet billed the Authority. In addition, Peacock and Blitz say they are working for free.
Blitz said he knew of just one contract that was competitively bid — the one announced last week, hiring the local construction conglomerate, HCKL, for a still unannounced cost.
He and Peacock have both said they are keeping a close eye on expenses. “We have been as cost-conscious and contract-conscious as we can be,” Blitz said. Peacock said he's spent $15,000 of his own money on the project.
The Authority gets $24 million a year, in total, from St. Louis, St. Louis County and the state. Of that, $4 million a year is set aside for dome upkeep. “So we’ve got plenty of money to maintain the Dome,” Blitz said.
Moreover, he said, the Authority can terminate the contracts at will. “Tomorrow, if the NFL says, ‘Guess what, St. Louis, you don’t have a team,’ we don’t even have to go through the end of schematic design,” he said.
Shrewsbury, however, noted that, no matter what, at some point, someone will have to back-fill the Authority's bank accounts and make up for the current spending.
A few board members at the dome Authority have also promised to watch it all carefully.
After the January meeting, board member Jerry Wallach approached Peacock. “I would just like to see where the money’s going,” he said.
“That’s a reasonable request,” Peacock replied. “We’ve got to be transparent.”
“Absolutely,” Wallach replied. “And we are.”
“No one should expect an authority to give up their authority,” Peacock said. “That’s what they’re there for.”
