RALEIGH – To all you readers outside the Triangle, I’ll apologize ahead of time for what is to follow. It may look like a purely local issue, but bear with me. It has implications for similar debates in other North Carolina communities – and it may even involve state tax money on down the line.
Newly reelected Raleigh Mayor Charles Meeker has long talked in general about his desire to build a major sports complex in or near downtown Raleigh. His problem is that the RBC Center, the 10-year-old home of the N.C. State Wolfpack and the Carolina Hurricanes, is located next to the university campus and its Carter-Finley Stadium on the west side of town.
Meeker sees this as a problem of timing, not a problem of need. In the latest edition of Triangle Business Journal, the mayor indicated that he wants the current funding arrangement for the RBC Center to end in 2019 so as to free up tax money to build a new downtown arena.
I was never a fan of the original financing of the RBC Center. When originally conceived, it was to be funded one-third from N.C. State, one-third from local government, and one-third from private sources. Two-thirds of the original cost, in other words, was supposed to come from taxpayers. That was bad enough, but then the project ran over budget, the fundraising didn’t quite make it, and taxpayers ended up shouldering the vast majority of the bill.
The primary (though not only) sources of public funds for the project were local taxes on meals and hotel stays. Proponents argued that these taxes would fall on visitors rather than local residents, a notion that would surely come as a surprise to local diners and local businesses and residents with many out-of-town guests.
By 2019, the construction bonds for the RBC Center will be paid off. Supporters of the existing arena want local officials to keep funneling the hotel and meals tax revenue to them for maintaining and improving the facility. Meeker and others would rather reroute the money to new facilities, such as Meeker’s downtown arena idea.
Truthfully, I’d rather see the tax go away as soon as possible. The next best thing, however, would be to maintain the asset taxpayers have already been compelled to finance, the RBC Center. The worst possible option is the one Meeker seeks. One need look no further than the experience of Charlotte, where taxpayers were compelled to build a coliseum on the west side of town for the Charlotte Hornets, and then two decades later were compelled to finance an uptown arena for the Charlotte Bobcats – with the previous coliseum being demolished.
The mayor of Raleigh apparently sees this as a success story to be emulated, rather than as a debacle that continues to embarrass and anger Charlotte taxpayers.
If anything, Meeker’s idea has even less merit. Who would play in a new downtown Raleigh arena? N.C. State, not surprisingly, strongly prefers the current location next to campus. Hurricanes Vice President Jason Karmanos told TBJ that his team doesn’t want to move, either. The current location is relatively easy to get to from all over the Triangle market, including Durham and Chapel Hill. A downtown Raleigh location would be less accessible.
Now, here’s why this isn’t just a Raleigh story. First, there are politicians like Meeker across the state who lack common sense and love to dream big with other people’s money. Beware of them.
Second, don’t be surprised several years down the road if there’s a push to secure regional or state funding for a downtown Raleigh arena, should the project move forward. State taxpayers ended up funding part of the RBC Center, though many probably never knew it. Beware of that.
Basically, wariness is always warranted where “progressive” politicians are involved.
Hood is president of the John Locke Foundation