KANSAS CITY, Mo. — A leaked Jackson County memo that purports to prove a new Kansas City Royals stadium would actually cost taxpayers substantially more than the team claims created a stir two months ago.
The Royals have proposed a $2 billion development for a new stadium and surrounding ballpark district, but the memo erroneously claimed that it would actually cost between $4.37 billion and $6.42 billion.
For starters, a math error on the spreadsheet wildly overestimated the higher-end projection, which actually should have been a little more than $5.13 billion.
Nonetheless, it’s an eye-popping number that might understandably give taxpayers pause, but the issues with the county’s leaked numbers go deeper than sloppy bookkeeping, which double counted the revenue a 3/8-cent sales tax extension would generate.
The bigger issue — and far bigger number actually — is what appears to be a massively inflated assumption baked into the leaked “data” related to property insurance premiums at the new stadium.
Currently, Jackson County pays the premiums at the Truman Sports Complex, which also includes GEHA Field at Arrowhead Stadium, as part of its insurance package for county-owned buildings.
Those estimated premiums for both stadiums have climbed from $495,482 in FY 2016-17 to nearly $2.17 million, but the leaked spreadsheet assumes that the county will be on the hook for $4.5 million for a new Royals stadium alone in 2028, when the team hopes to move into new digs.
Former Jackson County Legislator Dan Tarwater, who works in the insurance industry, was skeptical of those figures.
He didn’t believe property insurance would be that high on a new building and suggested that the assumption premiums would increase a staggering 10% annually compounded over a projected 40-year lease was laughable.
By the county’s estimate, insurance premiums alone would top $100 million per year for the last decade of the projected lease agreement, topping out at $271 million by 2071.
That means, of the projected $4.37 billion to $5.13 billion price tag the county would be on the hook for, according to the leaked memo, nearly $3 billion is for insurance premiums at a new baseball stadium alone.
Jackson County Administrator Troy Schulte acknowledged in an email to legislators accompanying the spreadsheet that the “staggering” insurance costs “will need to be adjusted to actual value when a new stadium is opened.”
Schulte indicated that “our property insurance broker, Lockton,” provided the numbers.
According to information obtained by KSHB 41, such figures don’t square with reality.
KSHB 41 reached out to stadium authorities that oversee professional sports venues that have opened in the last decade to get an idea of the going rate for property insurance rates at new stadiums.
Property insurance rates at U.S. Bank Stadium in Minneapolis, which opened in 2016, have increased substantially in the last five years but remain well below the projections in the leaked Jackson County memo, according to information obtained by KSHB 41.
The cost to insure the Minnesota Vikings’ home field has jumped from $614,092.69 in 2019 to more than $1.6 million in 2023.
Still, that’s well below the projected $4.5 million price tag for property insurance premiums in the first year of a new stadium in the Jackson County memo.
It’s a similar story for Levi’s Stadium in Santa Clara, California, where the city’s stadium authority splits costs with its tenants.
Insurance premiums there — which cover property insurance, general liability insurance and worker’s compensation, among other costs — have risen from $2,870,047 in FY 2018-19 to $3,327,000 in FY 2023-24.
The Levi’s Stadium, which began hosting San Francisco 49ers games in 2014, lease agreement includes a budgeted annual 3% increase.
The Texas Rangers referred all questions about their property insurance payments to Major League Baseball, while the Atlanta Braves, who opened Truist Park in 2017, and the Georgia World Congress Center, which operates Mercedes-Benz Stadium — home of the Falcons and Atlanta United of MLS since 2017 — did not respond to repeated inquiries from KSHB 41.
The Royals have yet to decide if they will pursue a downtown ballpark and remain in Jackson County, where they’ve always been since their 1969 founding, or move to Clay County at a site north of the river in North Kansas City.
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