The Kansas City Council has voted to provide a $600 million subsidy for a new Royals ballpark at Crown Center without key details about how to pay for it.

Those details will become clearer when a future ordinance outlines a stadium “impact” area where taxes will be redirected to pay off the debt.

The ballpark, totaling $1.9 billion, will be one of the most expensive major league ballparks of all time. In addition, the Royals are planning an entertainment district around the stadium to bring the total project cost up to $3 billion.

Kansas City will provide $600 million for the project, including $90 million in infrastructure work, and Missouri will provide $540 million. All told, taxpayers will cover about 60% of the costs for the stadium.

The deal has been advertised as a tax-increment financing plan, also known as a TIF. That’s a kind of tax incentive where increases in tax revenue that result from a development go back to help pay off the debt required to get it built.

Structured like this, supporters argue, the stadium is paying for itself.

But crucially, the city will be on the hook to guarantee repayment of that $600 million debt. And the money to repay the debt will come from tax revenue that flows into the city’s general fund, which pays for public services.

If the stadium and the surrounding entertainment district generate more than enough new tax revenue to cover the debt payments, the city will come out ahead. If not, the debt payments will come at the expense of city services for the next three decades.

That’s the calculation that leaders in Kansas City Hall were making ahead of the deal. And they believe that the stadium will kick off a chain reaction for new downtown development. 

“The Royals and Hallmark downtown will bring millions of people to our city core,” Mayor Quinton Lucas said in a press release, “build thousands of jobs in the heart of our region and will extend benefits to every corner of Kansas City and our area.”

But the evidence — at least from the public’s perspective — remains sparse. City Manager Mario Vasquez said the $600 million commitment is based on the city’s projections. But a third-party financial analysis will not be presented to the public until after the agreements are signed and the city has legally committed to that number.

Critics say the Royals deal prompts a sense of downtown development deja vu.

“This is Power & Light on steroids,” Councilmember Johnathan Duncan said after Vasquez presented the Royals deal at Tuesday’s meeting of the Finance, Governance and Public Safety Committee, referring to the city’s ongoing subsidy of the downtown nightlife district. 

Kansas City has been forced to pay out $167 million at the expense of city services over 16 years because the Power & Light District has not earned enough revenue on its own to pay back the debt.

Duncan represents the 6th District, covering southwestern Kansas City, and voted “no” Thursday on the ordinance to approve the deal. Councilmember Nathan Willett, representing the 1st District at the northern edge of the city, also voted “no.” The rest of the council voted “yes.”

“This body has not received a financial analysis of how we’re going to be paying (the $600 million Royals subsidy) back,” Duncan said on Tuesday. “To say that we’re going to sign off and allow the city manager to execute all these agreements without the financial analysis, I think, is reckless.”

Now that the City Council has officially committed to supporting a $600 million debt for the new Royals ballpark, here’s a deeper dive into how the money will flow, the financial costs of the political decisions and where the deal leaves Kansas City for the next 30 years.

Political math

From the beginning, Kansas City leaders have sought to avoid a public vote on the city’s incentive package for the Royals.

The idea was first pitched in August 2024, four months after Jackson County voters overwhelmingly shot down a sales tax extension to fund a ballpark in the Crossroads.

The Chiefs and the Royals spent $1 million each on the campaign, with paid door knockers and campaign ads on primetime television.

After Jackson County voters rejected the sales tax for the teams, the prospect of an incentive package without a public vote was appetizing. Indeed, the Chiefs ended up leaving for Kansas, taking a deal that also requires no public vote.

When The Kansas City Star reported that the city was evaluating Washington Square Park as a site for a ballpark, tax redirection tools were a key part of that conversation.

“Maybe the challenge the voters were issuing to us in Jackson County was to say, ‘Are there other taxes, redirection and other things that can facilitate a good stadium project?’” Lucas told The Star. “So the people paying for the stadium are the people who are going to the stadium.”

Fast forward two years, and the city’s contribution to the stadium — at least in raw financial terms — is remarkably similar.

The 3/8-cent sales tax in Jackson County, rejected in 2024, would have generated an estimated $1.1 billion over 30 years to help finance the stadium. Assuming a 5% interest rate, that sales tax would have brought in just enough money to pay off about $560 million in bonds.

That’s roughly the same amount of money that Kansas City ended up offering the Royals through its city incentives.

The key difference, however, is that the city incentives do not have a dedicated revenue source like a stadium sales tax. Instead, the city is agreeing to make an annual budget appropriation to pay off the debt by redirecting new tax revenue generated by the project.

The cost of skipping a public vote

That distinction matters to bondholders.

Bondholders are the investors who are effectively lending money to the government. When Kansas City “issues bonds,” that means it is borrowing money from those investors.

When Jackson County issued bonds for the Truman Sports Complex in 2006, the county paid an interest rate of 4.8% on that debt, which it later refinanced to 3.1%. 

No matter what, the bondholders knew that they were entitled to a cut of the dedicated 3/8-cent stadium sales tax, which made them more confident that they would get paid back. That meant a lower interest rate.

But Kansas City intends to issue these Royals bonds as “special obligation bonds,” as opposed to revenue bonds or general obligation bonds. That means that the city is essentially promising to pay back a certain amount of money every year. 

If the city doesn’t make the debt payments, the bondholders won’t get their money back. Moreover, Kansas City would tank its bond rating — basically the city’s credit score — and push its borrowing costs higher. 

If the city wanted to get a lower interest rate, it would have needed to take the stadium proposal to a public vote — either for a sales tax as Jackson County did or for general obligation bonds, using property taxes.

The distinction matters.

When the city issued general obligation bonds in April 2026, it got an interest rate of 4.25%. Those bonds are being used to pay for a variety of projects, including streets, sidewalks, bridges, flood control and public buildings. 

In contrast, special obligation bonds the city issued around the same time carried a 5.725% interest rate. Those bonds are being used to pay for construction for Barney Allis Plaza and Roy Blunt Luminary Park.

That difference, applied to the city’s support of a new Royals stadium, is worth about $7 million every year that could otherwise be spent on city services.

City officials argue that the more expensive financing option is tied more to political geography than to an effort to avoid a public vote.

“General obligation is, in essence, a property tax levy to the entire community,” Vasquez said. “So I don’t think a property tax levy would be fair because the benefit is so concentrated into the stadium.”

TIF with a twist

The city hopes that the money to repay its $600 million in bonds will be generated by the stadium and the surrounding entertainment district. 

But either way, the debt needs to be repaid, regardless of where in the budget the city can find the money.

Vasquez said that the city already has some data about what Crown Center and surrounding businesses could look like during a ballgame.

“We know that during Christmas, economic activity at Crown Center bumps up by about 15 percent,” Vasquez told The Beacon. “When we had the World Cup, we had six games, 28 days of activity in June, we had a bump. So we have an idea of what happens when the area is active.”

The city commissioned a third-party financial analysis in April, but the results have not been presented to the public yet.

Vasquez told The Beacon that the city arrived at the $600 million number by projecting some of that economic data onto a season of baseball.

Not all of the money spent in the ballpark district will be new to Kansas City. For example, some ballgame attendees might be going to a Crown Center restaurant instead of a Waldo restaurant that day. That shift in economic activity within Kansas City is a net neutral from a tax revenue perspective.

“We feel pretty good that we have calculated that number,” Vasquez said. “But to provide the public an additional level of comfort, we have a third-party revenue consultant looking at, ‘What are you guys building, how big, how much, how long?’ They’re going to provide those estimates, and what taxes they (generate).”

But with its vote Thursday, the City Council has already committed to a number. Regardless of what that financial analysis says, the city has committed to provide $600 million to the Royals.

The questions, instead, will be where the city can find the money to repay the $600 million debt and how big the city needs to draw the tax redirection area to make the numbers work.

For his part, Lucas believes that the economic benefit of the stadium and the entertainment district will surpass the tens of millions of dollars he and the other City Council members have committed the city to paying for the next three decades.

“Great cities address issues in a number of different ways,” Lucas said at the Tuesday committee meeting. “And it doesn’t mean that you are not addressing issues by also continuing to grow your city, to build jobs, to bring more people to your city, to bring more investment to the whole of your city.”