(The Center Square) – Lawmakers involved in North Carolina budget deliberations plan to extend a 1% tax on prepared food and drinks officials want to use to help renovate the Carolina Panthers’ Bank of America Stadium.
The added tax to restaurant meals and bar tabs in Mecklenburg County is set to expire in 2034. House members working to finalize a state budget with the upper chamber recently told the media they expect an extension to 2060 will be included.
The tax, which generated $44 million in fiscal year 2022 and $46.9 million through 11 months of fiscal year 2023, is considered a key source for potential taxpayer funding of $600 million in the renovation plans.
The Carolina Panthers, along with its stadium, were purchased by David Tepper for $2.2 billion in 2018. Forbes lists Tepper, worth $18.5 billion, as the 90th richest person in the world.
The food and beverage tax was initially created to pay off bonds on Charlotte’s convention center, and was previously used to pay for $75 million in renovations at the stadium.
The Charlotte City Council held closed meetings earlier this year to discuss splitting the cost of an estimated $1.2 billion in renovations at the stadium with the Panthers. The proposal to extend the tax is backed by the Greater Charlotte Hospitality and Tourism Alliance.
Continuing the tax to 2060 would give local officials a predictable funding source to leverage financing for the stadium renovations and other spending aimed at boosting tourism.
Mecklenburg Republican and House finance committee chairman Rep. John Bradford recently told the media the “non-controversial” tax extension to 2060 will be included in the final budget, while top House budget negotiator Rep. Jason Saine, R-Lincoln, confirmed the same.
The state budget was due at the start of the fiscal year on July 1, but remains unfinished as chamber leaders continue negotiations on potential accelerated tax cuts, further gambling legalization, and other elements of the financial package that are expected to stretch into August.
The potential public funding for the Panthers follows numerous other examples of taxpayers subsidizing renovations at professional sports stadiums across the country. Nashville in April approved $1.6 billion of public funding and a $3.1 billion estimated tax capture over 30 years for a new $2.1 billion Tennessee Titans stadium, while the Buffalo Bills are set to collect more than $1 billion from taxpayers.
The Maryland Sports Authority received $1.2 billion for renovations at both the Ravens’ M&T Bank Stadium and the Orioles’ Camden Yards.
While advocates argue restaurant taxes target tourists, economists believe all taxes impact taxpayers since, without the tax capture for the stadium and convention center, the revenue would otherwise go to city, state or county general funds.
“They represent funds coming largely from local residents and represent public funds that could be used for other more appropriate uses, whether that be other government projects or leaving the wealth in the hands of Charlotteans to spend how they see fit,” economist J.C. Bradbury, who has studied the public funding for stadiums, previously told The Center Square.
