No, Nashville Wasn't Awarded An MLS Team, But There Is A Stadium Financing Plan

NASHVILLE, TN — A half hour or so before Monday's special session of the Metro Council during which Mayor Megan Barry and investors seeking an MLS expansion franchise for Nashville released the funding plan for a stadium, a heretofore little-known soccer reporter caused a hubbub that made the meeting seem a bit of a foregone conclusion.

Jeff Rueter, a freelancer who has written about the MLS for ESPN and other outlets, tweeted that Nashville had already been awarded the franchise and would begin play in the 2019. The problem with the since-deleted tweet is that Nashville doesn't have the soccer-specific stadium required by the league and the MLS Board of Governors hasn't voted on expansion teams, both key milestones in the pursuit of top-flight pro soccer for the Music City.

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Rueter's assertion was quickly refuted by everyone from Barry to MLS2Nashville top man John Ingram to Alexi Lalas, of all people, and he walked it back.

That bit of news is no real shock. Nashville has been seen as one of the front-runners for one of the four expansion teams for months, pending the stadium deal, which, to coin a phrase, was the real news Monday.

Under the plan announced by Barry and Ingram — which Barry asked the council to vote on by November, before that aforementioned league meeting — Metro would issue up to $225 million in bonds through the sports authority and the team's owners would pony up $25 million on the front end.

The plan calls for the Metro Board of Fair Commissioners to approve a ground lease at the fairgrounds for the 27,500-seat stadium — that's a bit lower than the original 30,000-seat design — to the Metropolitan Sports Authority. The authority would then issue revenue bonds with debt service of approximately $13 million per year.

Though Barry and Ingram touted that the team itself would pay that debt service, it actuality it will be paid off through a combination of private investment, lease payments and taxes from revenues generated at the stadium. Indeed the plan calls for sales taxes generated at the stadium site go to retire the debt, along with a $1.75 ticket tax. In addition, if the combination of sales and ticket taxes are below $4 million in the first five years of operation or below $3 million in years six through 10, Metro itself will service the debt through "non-tax revenue."

In addition, Metro's chief operating officer Rich Riebeling said that if the team were go under before the 30-year term expires, Metro would be on the hook for the debt service payments alone.

The plan also proposes allowing the ownership group to lease approximately 10 acres at the Fairgrounds to support mixed-use, mixed income development which will include affordable and workforce housing.

At Monday's meeting Ingram announced that the Turner family, founders of mega-chain Dollar General, was part of the team's ownership group. The Ingram family's net worth is estimated at more than $4 billion. Cal Turner Jr.'s is estimated at roughly $1.5 billion.

A crucial difference between the soccer stadium deal and the city's most recent foray into sports facility financing with the Nashville Sounds' First Tennessee Park is that the team, not Metro, would be on the hook for cost overruns. Metro had to foot the bill when the baseball stadium's cost ended up $10 million more than estimated.

Because of a charter amendment, a 27-vote majority of the 40 member council is required before any buildings at the fairgrounds are demolished or relocated. This is in addition to the votes of the sports authority and the council needed to issue the bonds.

Image via HOK/Nashville Soccer Club Holdings