Even More on the Gwinnett Stadium Cost Increase

Last week, the Gwinnett Board of Commissioners approved a $19 million budget increase to fund the new Gwinnett Braves stadium. It turns out that though the Board didn’t mention a word of the cost increase until the Friday before Labor Day, and voted on it the following Tuesday without discussion, county officials were aware of the cost increase well before this time. From the AJC’s Jeremy Redmon:

The cost for Gwinnett County’s taxpayer-funded minor league Braves stadium started to exceed the county’s $40 million estimate as early as March — less than two months after the project was announced — and reached as high as $62.4 million at one point, according to internal budget documents obtained Friday under Georgia’s Open Records Act.

A small group of Gwinnett Convention and Visitors Bureau and county officials ultimately decided to make $19 million in changes and upgrades, much of which aren’t required for the Braves to play ball.

By March 31, the Triple-A ballpark had grown to 196,370 square feet, with a $45 million price tag, the records show. A month later, it grew by more than 14,000 square feet and its cost ballooned to $55.1 million.

Why didn’t the county disclose the cost increase until now?

“Anything we let out would have been a hypothetical number,” GCVB Chairman Richard Tucker said. “You wouldn’t call a press conference or issue a press release to say, ‘We have some preliminary bids in and it is tracking higher’ because all the time we were still looking at, ‘What can we eliminate that is in the design?’ And, in fact, all of the design had not even been done. It just doesn’t work that way.”

That is exactly what should have been said at a press conference. A degree of uncertainty about the exact increase is no excuse for withholding that the price tag would rise by a significant amount. As of March 31, the day before the Board voted to approve the stadium project, the stadium’s projected cost had increased by 12 percent to $45 million. One month later, the cost was nearly 40-percent higher at $55.1 million. There was ample opportunity to reveal that the price tag would rise significantly and that those funds would have to come from taxpayers. At the minimum, the anticipated cost increase should have been revealed before the July 15 primary and August 5 run-off elections.

A large chuck of the new expenditures are not necessary, and county officials concede that costs could go higher despite previously denying the potential for further cost increases last week.

But GCVB officials concede the stadium could be built without many of the additions, including the $7.5 million plan to build a concourse surrounding the stadium, erect canopies over some of the seating and the entrance and upgrade finishes. The GCVB is also considering spending more for a high-definition scoreboard, though that amount is not finalized, a convention and visitors bureau official said.

Commissioner Bert Nasuti claims to have been surprised by the cost increase, but feels the expenditures are worth it.

County Commissioner Bert Nasuti said he was “stunned” when he first learned of the additional $19 million cost from GCVB officials last month. Still, Nasuti, who also serves on the GCVB board, said he voted along with fellow Gwinnett commissioners last week to cover that amount with county reserve funds so the ballpark would be “first class.”

“We set a standard here of doing things correctly, doing things upscale, nice, family-friendly, user-friendly, good fan experience,” Nasuti said, adding county officials decided to “stick with that philosophy and build a first-class, state-of-the-art baseball stadium.”

Nasuti’s enthusiastic support is largely based on an economic impact study by the County’s economist. (per AJC’sMichael Pearson).

But Nasuti said the stadium is an economic development project that eventually will bring the county more in revenues than it costs to build.

“If you stop all economic development activity when there’s a downturn, then you’re going to punish yourself in the long term,” he said.

It’s unclear exactly how much money the stadium will bring into the county.

County economist Alife Meek has estimated that the 72 home games scheduled for the stadium will produce $14.6 million in new economic activity in the county, a small portion of which the county will capture in the form of tax collections.

This study has not been released to the public. Nasuti has not responded to my request to supply the study. Meek, though he has challenged my criticism of his study’s conclusions, has also not provided me with the study. Until I see the this document and I am convinced that it has been done properly, I’m going to have to side with the vast economic literature that finds no economic impacts from stadium projects. No one should take this number at face value, any more than you should take up smoking because a tobacco industry study shows smoking isn’t related to lung cancer incidence.

At least Nasuti and I agree on one thing.

“The business model in my mind is as sound as it ever was,” said Commissioner Bert Nasuti, who came up with the idea of bringing baseball to Gwinnett County.

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