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No Jones Tax
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06/10/04
A MODEST PROPOSAL
While the Dallas County Commissioners
authorize a study to evaluate the benefit to the public of using county wide
hotel occupancy and car rental taxes to help finance a new Dallas Cowboys
Stadium, in the face of important deadlines, we believe it is fair to ask:
Why are the Commissioners still involved in the stadium issue at this juncture?
After all, the Cowboys have announced their preference for locating their new
stadium in Fair Park, a City of Dallas owned park facility, which obviously will
require the active, direct participation of City of Dallas officials in the
negotiations that necessarily will occur, and in the design and construction of
the stadium. |
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James Northrup:
An inspired approach.
Richard was the last of the great
Dallas city managers.
Darrell Jordan is
the greatest mayor we never had. (Thus far.)
If Jones cannot get a major city to
support him, a countywide hotel tax fails.
Ft.Worth ain't that dumb. |
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Would it not be preferable and much more efficient to eliminate this extra layer
of bureaucracy if the stadium could be built without it?
We believe it can be, thus eliminating the need for a county wide referendum,
and perhaps eliminating the need for a referendum in the City of Dallas.
How would we propose the funds be raised for the
public component of the stadium?s cost?
Simply, the same way the City of Irving built Texas Stadium, using seat options
and revenue bonds, essentially having the stadium financed by those who intend
to use it.
The Cowboys have said the stadium will cost approximately $650,000,000 and they
expect the public to come up with around $425,000,000 of that amount. To keep
the math simple, assume in a 75,000 seat stadium that 25 year options for the
best 40,000 seats, entitling the owner to purchase a Cowboy ticket and perhaps a
ticket for other events such as the Cotton Bowl Classic, for the seat covered by
the option, could be sold for an average price of $10,000. That would yield
$400,000,000.
Revenue bonds attached to the seat options, which the option purchaser would be
required to purchase, issued on terms favorable to the City of Dallas in the
average principal amount of $625 would yield the remaining $25,000,000. The
options could be detached from the bonds, allowing someone who wanted to sell
his option the opportunity to do so.
The Cowboys would pay rent to the City of Dallas in an amount sufficient to pay
off the $25,000,000 bond debt in 40 years. The duration and price of the seat
options and the face amount of the bonds we have used could vary due to market
conditions, of course.
Since the City of Dallas? tax rate would not increase or otherwise be affected,
no referendum would be required. No hotel occupancy or car rental taxes would
be needed. Those two important industries would not oppose the stadium project
and would probably enthusiastically support it.
We believe this plan offers a practical and fair way to finance and construct
the very best all-weather, multi-use stadium in the world for the Dallas Cowboys
and the citizens of Dallas.
We urge the Mayor and City Council of Dallas to seize the initiative and
negotiate directly with the Cowboys, to the end that a City of Dallas / Dallas
Cowboys partnership to build this stadium will become a reality in time for the
Cotton Bowl Athletic Association to submit its application to join the Bowl
Championship Series this December, and so that Dallas can get in line for
future Super Bowls, Final Four Tournaments and other special events at its
magnificent new facility.
Darrell Jordan
Richard Knight
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