Utah Government Willing To Pony Up $1 Billion To Attract MLB Team

Utah's state government is reportedly willing to invest $1 billion to attract a Major League Baseball team to Salt Lake City.  The funds would help build a top-tier stadium and multiblock fan zone featuring mixed-use developments, restaurants and new businesses. Although it may look like another giveaway to a Major League Baseball (MLB) club owned by a billionaire, the project could also create thousands of new jobs.

Salt Lake City is already home to two major sports franchises, the NBA's Utah Jazz and Real Salt Lake of Major League Soccer (MLS), both of which also play in the downtown area. Adding a top-tier professional baseball stadium and fan zone would make Salt Lake City an almost year-round destination for sports fans, and the baseball stadium could host other large events.

It's important to note that Utah's government would not be acting alone in offering financial support to build a new baseball stadium. Utah Jazz owner Larry Miller is reportedly planning to invest $3.5 billion in the proposed stadium, and he already has a 100-acre site selected for its construction. It will be in a prime location, within easy distance of Salt Lake City International Airport, the state fairgrounds and light-rail stops.

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While the Utah government is willing to put up $1 billion in partnership with Miller, it's important to note that most of that money would not come out of the pockets of Utah taxpayers. The initial funds would be paid for in bond measures that would be paid back by raising the state's hotel tax, which is how the state raised $35 million to help fund the construction of Real Salt Lake's soccer stadium.

Miller and the Utah state government view the proposed stadium as the centerpiece of a redevelopment area that would be called the Fairpark Entertainment District and feature a large network of hotels, bars and restaurants. This multipurpose fan zone experience is one of the hottest new sectors in real estate development and has seen tremendous success revitalizing cities like Inglewood, California, with SoFi Stadium or Titletown in Green Bay, Wisconsin.

These developments are popular with both team owners and governments. It starts with team owners buying more land than the stadium will require because doing so allows them to get both stadium revenue and profits from the redevelopment of the adjacent real estate. They don't have to share the revenue generated by selling new condominiums and long-term leases on hundreds of thousands of square feet of prime real estate with other team owners.

Local governments get a tremendous boost from increased property taxes on the appreciated land value at both the stadium site and the surrounding real estate. State governments see their coffers filled by tax revenue from new jobs, which include construction jobs to build the development and staffing of the new businesses. It has the potential to be a win-win for everyone involved.

It's one thing to build a stadium but quite another to attract a Major League Baseball team. As it stands, the league has 32 teams, and many of them have already completed versions of Utah's proposed Fairpark Entertainment District or are playing in relatively new stadiums. At any given moment, only one or two major league teams want to move, and they need league approval to do it.

So, Utah is trying to thread a narrow needle. Right now, the MLB team most likely to move is the Oakland Athletics, but they already have a deal in place to move to Las Vegas. The Tampa Rays, who have been playing alternate home games in Montreal, are also a long-shot possibility.

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Outside of that, the proposed stadium in Utah would need to host an expansion team. In the meantime, it appears as if Utah is going full steam ahead with its stadium plans. Miller is a billionaire, and billionaires usually get what they want. Miller and Utah's government will go forward together under the old premise that "if you build it, they will come."

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