ATLANTA (March 7, 2013) – After several weeks of negotiations and community inclusion, Mayor Kasim Reed and the Atlanta Falcons have reached an agreement on key city terms for the construction of a new stadium in downtown Atlanta, subject to approval by the Georgia World Congress Center Authority (GWCCA) board, the Atlanta City Council and Invest Atlanta.
The agreements negotiated between Mayor Reed and the Atlanta Falcons include several major elements based on input from the Atlanta City Council, Atlanta residents, neighborhood groups and business owners concerned about job creation, minority and woman owned business participation in the construction, infrastructure improvements and economic development in the neighborhoods surrounding the proposed stadium. These agreements build on the framework that had been negotiated by the GWCCA and the Atlanta Falcons for a new stadium on the GWCCA campus.
The deal terms include more than $30 million in direct investment for the English Avenue, Vine City and Castleberry Hill neighborhoods, and a $50 million investment in infrastructure improvements in the area adjacent to the proposed new stadium. Specifically:
- The Atlanta Falcons would assume responsibility for $50 million in infrastructure costs related to stadium construction.
- The Arthur M. Blank Family Foundation would commit to investing $15 million in private funds in the English Avenue, Vine City, Castleberry Hill and other neighborhoods contiguous to the new stadium to address overall needs as part of a cohesive plan; accelerate quality-of-life improvements; improve health, education and welfare of current residents; address equity and social justice issues associated with new residential and commercial development; and attract new investment, new jobs and new residents.
- Invest Atlanta, the city’s economic development agency, would also commit $15 million in tax allocation district dollars for economic development projects that would leverage private sector and philanthropic investment in the English Avenue, Vine City and Castleberry Hill communities, pending approval by its board.
- To promote full and equal business opportunities in connection with the design and construction of the new stadium, the Atlanta Falcons and the GWCCA have agreed to develop an Equal Business Opportunity Plan that will ensure at least 31 percent participation by women and minority business enterprises. The construction of the stadium is expected to create more than 1,400 full-time equivalent jobs in Atlanta and more than 4,500 full-time equivalent jobs across Georgia over a three-year period, according to a study completed by Georgia State University Associate Professor Dr. Bruce Seaman.
- The public contribution for stadium construction is capped at $200 million, which would come from the hotel-motel tax collected by the city of Atlanta almost exclusively (more than 85 percent) from visitors and tourists, not residents of the City of Atlanta. Invest Atlanta would be asked to issue the bonds using the hotel-motel tax that currently supports the Georgia Dome. The existing hotel-motel tax revenue stream is the sole public funding source for the stadium construction and any risk associated with repayment is carried by the bond holders, not the City of Atlanta.
- No property taxes or new taxes of any kind would be paid by or levied on City of Atlanta residents or businesses to fund construction of the new stadium. The City of Atlanta will not serve as a backstop for any debt associated with the construction of a new stadium and this agreement will not affect the city’s bond capacity or credit capacity.
“I am pleased that we reached an agreement that will ensure the Atlanta Falcons remain in the heart of our city for many years to come and will lead to revitalization of some of the city’s most historic neighborhoods,” said Mayor Reed. “Equally important, a new stadium will lead to the creation of well-paying jobs during its construction at a time when many of our friends and neighbors are seeking employment. This new stadium will also keep the city of Atlanta at the forefront of the hospitality industry in America as we pursue our goal of attracting 40 million visitors annually. It will strengthen the viability of the more than 200,000 jobs that support our tourism and convention business every single day.”
Atlanta attracts more than 39.7 million visitors annually, according to the latest data from the Atlanta Convention and Visitors Bureau. In 2011, tourism generated $12 billion in visitor spending. The hospitality industry is responsible for more than 229,000 jobs for Atlanta residents. In addition, 12 million visitors traveled to metropolitan Atlanta for business purposes in 2011 and spent an estimated $5 billion.
“We appreciate the Mayor and his staff’s diligence in moving the agreements for a new stadium toward completion,” said Atlanta Falcons Owner & Chairman Arthur Blank. “We are grateful to the members of the Atlanta City Council who have given us the opportunity to address their questions or concerns, and we will continue to work with the Mayor, City Council, Invest Atlanta and our partners at the Georgia World Congress Center in reaching final agreements.”
The Atlanta City Council would vote on the extension of the hotel-motel tax to 2050 and other key agreements among the City of Atlanta, GWCCA and the Atlanta Falcons. The memorandum of understanding for the development, construction and operation of the new stadium would require GWCCA Board approval. Invest Atlanta would need to approve resolutions to issue the bonds necessary to move forward with stadium construction.
Mayor Reed, who has supported the Atlanta Falcons in the team’s effort to build a stadium and remain Atlanta’s hometown football team, became directly engaged in the negotiations in January. The Atlanta City Council also has played a vital role in this process. With the full support of the Reed administration, council members have engaged their constituents and other stakeholders through several public meetings, some of which lasted for more than five hours and included detailed presentations from Rich McKay, President and CEO of the Atlanta Falcons; Frank Poe, Executive Director of the GWCCA; Duriya Farooqui, Chief Operating Officer of the City of Atlanta; and Brian McGowan, President and CEO of Invest Atlanta As the process continues, Invest Atlanta will lead community engagement with the English Avenue, Vine City and Castleberry Hill neighborhoods.
The new stadium is estimated to cost approximately $1 billion. About $800 million for the cost of construction of the new stadium will come from investments contributed by the Atlanta Falcons and other private sources. The $200 million public contribution from hotel-motel tax revenue has been specifically dedicated by the Georgia General Assembly for the Georgia Dome or a successor stadium on the Georgia World Congress Center campus and cannot be used for other purposes, such as for Atlanta Public Schools, infrastructure needs or transportation improvements.
As previously agreed, the GWCCA and Atlanta Falcons would endeavor to minimize negative effects on businesses, traffic and neighboring properties and businesses surrounding the new stadium site during construction, development and operation of the new stadium, and will further seek to identify reasonable opportunities to enhance the area surrounding the new stadium.
A new stadium would allow the City of Atlanta to remain nationally competitive for major events which are currently held at the Georgia Dome and have a significant annual economic impact on the city, including the SEC Championship ($29 million-$32 million); Chick-fil-A Bowl ($24 million-$35 million); Chick-fil-A Kickoff ($25 million-$36 million) and the Bank of America Classic ($21 million-$30 million). The total annual economic impact of these four events is between $100 million and $133 million, according to data reviewed by Dr. Seaman.
A new stadium also would greatly enhance the city’s ability to attract new marquee events that would have a positive economic impact on the city as well as create and retain jobs in the city. Dr. Seaman estimates the potential citywide economic impact of a Super Bowl at between $125 million and $203 million; FIFA World Cup at $100 million-$200 million; a new BCS Championship at $110 million-$185 million; and a Major League Soccer franchise at $25 million-$36 million annually.
In the next two years, more than $1.5 billion in development will open in Atlanta, including the Atlanta Streetcar, Porsche North American headquarters, the National Center for Civil and Human Rights, the College Football Hall of Fame, Buckhead Atlanta and Ponce City Market.
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