Chicago Bears have settled in their new home at Arlington Heights, but the city will be on the hook for a $9m gap in hotel tax next year in order to pay for Soldier Field Renovations. The future is not much better, as debt payments are increasing for these renovations.
Reports indicate that the Illinois Sports Facilities Authority wants to extend the payment of the debt by five years in order to reduce what would otherwise be an annual debt payment that was rapidly increasing under the current plan.
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These are the renovations that took place 20 years ago and transformed the stadium. The city’s tourism sector is still struggling to recover from COVID-19, and the hotel tax that was earmarked for the bond repayment has created a gap.
Shields reports that the ISFA has a $743 million debt, including interest. This debt must be paid by 2032. She reports that the debt service for this year is $53.5 million, and will rise to $56.8 millions next year. It will reach $60 million by 2025, $64 million by 2026 and then stay at $67.5 for three years. Then, it ramps up to $78.6 in 2030, $86.5 in 2031 and then $90.5 in 2032.
Shields explains that “advanced payments” on bonds are made using “upto 60% of a 5-percent statewide tax on hotels.” But the ISFA must pay back most of this advance by the end each fiscal year, using revenue from the hotel taxes as well as two $5 million subsidies received from the city and state of Chicago.
The deal was made by Richard M. Daley when he was mayor of Chicago. It allowed the state to cover any shortfall in the advance repayment with money from Chicago’s income tax share.
Miller notes that while Airbnb pays the tax, other similar businesses do not. Miller points out that while Airbnb pays tax, other businesses are not.
