Top lawmaker says Sox must say how they hope to finance South Loop ballpark

Pretty pictures and rosy financial forecasts have piqued interest in building a new White Sox ballpark in the South Loop, but it’s time to put some meat on the bone and talk about how to pay for it.

That was the bottom line Thursday from Illinois House Speaker Emanuel “Chris” Welch, a key player in determining if the dazzling renderings released by developer Related Midwest turn into reality or remain a pipe dream.

“I would love to know how they’re planning to pay for it. I look forward to hearing that from the developers. I imagine they’re taking it step-by-step. They want to make sure there is an appetite for it,” Welch told the Sun-Times.

“They did come with a lot of pretty pictures,” Welch said. “They got people excited. Now, they’re going to have to answer the question of how they’re going to pay for it. I would imagine they’re going to have a menu of options they put out there because they know how this process works.”

The Legislature adjourns May 24, so “if they’re trying to do something in this legislative session, they need to start educating and informing people relatively soon, but I haven’t seen that yet.”

Welch clearly was impressed by the vision for the vacant South Loop parcel known as “The 78.”

Related Midwest/Provided

He likes the way the new stadium at Roosevelt and Clark would be used as a catalyst for a $9 billion development, with plans for 5,000 residential units — 1,000 of them affordable — and a revived riverwalk. It is hoped the project would breathe new life into downtown.

“It’s a great economic opportunity for the city of Chicago. Lots of community benefits. … I like the location. I like the use of the river. I like the fact that there’s a lot of green space that can be used by the community. I like how the ballpark would showcase the beautiful city of Chicago,” Welch said.

Last summer’s rain-drenched NASCAR race in Grant Park used the city as a TV backdrop, and in its presentation, Related Midwest took the same approach with the ballpark, Welch said, calling it “a really impressive use of the space and allows so many multi-purposes. It would be a huge economic boon” to the city and state.

Although there has been no “specific ask,” as Welch put it, the Sox and Related Midwest are laying the groundwork for what they hope will be approval of their massive financing package during the spring session.

With a $1.2 billion to $1.5 billion price tag on the Sox stadium alone — to say nothing of the developer’s plan to shrink Guaranteed Rate Field to 20,000 seats and turn the current home of the Sox into a soccer stadium for the Chicago Fire — the package is expected to draw on several funding sources backed by bonds issued by the Illinois Sports Facilities Authority.

Bonds used to renovate Soldier Field were issued by the authority and backed by a 2% hotel tax. But those bonds will not be retired until 2032. In all, $589.1 million remains to be paid off, including $375 million in principal and $214 million in interest. Whenever hotel tax revenue fails to grow at an annual rate of 5.5%, Chicago taxpayers must make up the difference. That’s happened three times, and twice in the last three years. The biggest deficit was $27.3 million in 2022.

AFP/Getty Images

Those Soldier Field bonds also have balloon payments at the end, under a backloaded schedule that salvaged the deal after the terrorist attacks of Sept. 11, 2001. The payments will go from $56.7 million this year to $90.5 million in 2032, when the Soldier Field bonds will be paid off.

Another $50 million in outstanding stadium authority bonds were used to fund a renovation of Guaranteed Rate Field and won’t be retired until 2029, when the Sox lease there expires.

Given all that, Welch was asked how the stadium authority, whose bonding power is capped at $150 million for Guaranteed Rate Field, could possibly bankroll a new $1.2 billion stadium without raising a Chicago hotel tax that’s already the highest in the nation.

“Right now, they’re trying to find out if there’s even an appetite for having a money conversation, and learning what the appetite would be,” Welch said.

“We have a number of budget pressures and we have to take care of working families across this state. ... We’re gonna continue to pass budgets that are responsible. Paying for sports stadiums for billionaires? Is that a part of that? I don’t think so.”

Related Midwest/Provided

The 78 is surrounded by a tax increment financing district created to bankroll infrastructure improvements needed to develop the site. That would be one source of revenue, assuming Mayor Brandon Johnson, who campaigned on a promise to rein in TIF subsidies to developers, can be persuaded.

Many new U.S. stadiums also take advantage of sales tax revenues generated by the project and the surrounding area. Such a tax also could be part of the mix here.

Tricia Van Horn, vice president of marketing for Related Midwest, declined to comment on the potential financing plan.

Yet another potential complication is the Chicago Bears’ quest for a new stadium.

Under Bears President Kevin Warren’s leadership, the Bears have recently turned their attention to the possibility of building a new domed stadium on the surface parking lot south of Soldier Field where movie mogul George Lucas once hoped to build an interactive museum.

Lucas gave up — and took his prized project to Los Angeles — after Friends of the Parks filed a lawsuit claiming that the Lakefront Protection Ordinance prohibits new construction east of Lake Shore Drive.

The Bears also have spent $197.2 million to purchase the site of the Arlington International Racecourse, but are embroiled in a property tax fight with suburban school districts. So if the team does stay in Chicago, it surely would be eyeing that same 2% hotel tax and the same stadium authority bonding power.

Tyler Pasciak LaRiviere/Sun-Times (file)

Welch was asked how the General Assembly would reconcile the stadium desires of the Bears and the Sox and which team would win if there’s only enough money and bonding authority for one new stadium.

“I don’t think we’re gonna have to make that choice. I think everybody can win. ... But in order for everyone to win, we need to have everybody at the table,” he said.

The Bears and Sox have been “important parts of the Chicago story” for decades, Welch said. He hopes that story continues, but “I would like to hear more from the White Sox and Related Midwest. ... I have not heard anything from the Bears about the proposal ... to build a stadium on the same location as the George Lucas museum that was proposed a few years ago and, if so, how they would pay for it.”

If it comes down to a competition between the Sox and Bears, Marc Ganis, a veteran Chicago-based stadium consultant, said he would “never bet against Jerry Reinsdorf,” the baseball team’s 88-year-old chairman.

“Jerry is extremely experienced at these things. He has a very strong track record, and he has deep ties in the city and state politically. Those are very strong attributes,” Ganis said.

“I look at what Jerry has done. He’s been brilliant about these kinds of things. I look at that and say, I can’t imagine he comes away empty-handed.”

Related Midwest/Provided