From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com:
The latest Pawtucket Red Sox stadium financing proposal supposes that, among other things, Pawtucket would get enough income (to pay off construction bonds) from stadium-related income, including from stores and restaurants that would purportedly go up around the stadium. Given the current fragile state of much retail in the Age of Amazon, that expectation – or hope – may be excessive. And how popular will minor league baseball be over the next few decades? And, lest we forget, Pawtucket already has a big municipal debt burden.
Then there’s the assertion that the state wouldn't be on the hook if Pawtucket couldn’t pay the interest on the bonds that it sells to help fund the stadium. The trouble is that the cold, hard bond market closely connects the fortunes of municipalities and the states they're in. To maintain its bond rating, Rhode Island might have to come in to rescue the city if the PawSox promoters’ projections turn out to be wrong.
Consider that back in 1991, then-Gov. Bruce Sundlun decided that the state had to step after a private insurer of deposits in credit unions and small banks went bust. So far as the bond market was concerned that state had to come to the rescue. After all, it was called the Rhode Island Share and Deposit Indemnity Corporation….And Pawtucket is part of Rhode Island.
I hope that the PawSox stay – I know they don’t want to move to Worcester! -- but the latest deal has some big risks for taxpayers. I wonder if they can find plausible additional stadium users besides a baseball team. Soccer? Horse shows? Croquet?
