Public ownership of stadium shields bonds for the project from federal income tax
By Tim Carpenter
TOPEKA — The Kansas House introduced legislation Friday authorizing creation of a state sports authority to allow construction of a publicly owned stadium spectacular enough to convince the Kansas City Chiefs to move from Missouri to Kansas.
Public ownership of the $3 billion stadium was viewed as a necessity because private ownership of the complex would prevent the $1.8 billion in state bonds issued for the project to be subjected to federal income taxes.
Attorney Korb Maxwell told state lawmakers in January that failure to form a sports authority to allow stadium ownership by the state would likely kill the proposed project.
Terms of the sports authority legislation involving the state of Kansas and owners of the Chiefs were outlined in an 11-page bill scheduled to be discussed Tuesday during a joint session of the House and Senate commerce committees. The bill would need to be fast-tracked with two or three weeks remaining in the 2026 session of the Legislature.
Under House Bill 2793, the nine voting members of the sports authority would have to be appointed by Aug. 31. Members of the board would must be Kansas residents and would be chosen by the governor and leaders of the House and Senate. The group would include a representative of the Chiefs and the secretary of the Kansas Department of Commerce.
The bill would allow the sports authority to take possession of facilities other than the domed stadium constructed for the Chiefs. The authority would be authorized to sell real or personal property and would be exempt from property tax levied under state law for property acquired by the authority. In addition, the authority would be exempt from city, county and state sales taxes.
Purchases by the sports authority for contractual services, construction, repairs, supplies, equipment or furniture “shall not be subject to the competitive bidding requirements” of state law, the bill said.
The deal would enable the Chiefs to engage in a lease agreement giving the franchise exclusive use of the stadium at agreed upon times and the right to retain some or all revenues from ticket sales, suite licenses, personalized seat licenses, concessions, advertising, naming rights, broadcast deals and other revenue tied to the stadium.
The sports authority would be responsible for submitted annual reports to the Legislative Coordinating Council and the commerce committees of the House and Senate.
The Legislature would take up the House bill at a time when some lawmakers have expressed opposition to the incentive package for construction of a stadium and practice facility for the Chiefs.
Sen. Cindy Holscher, an Overland Park Democrat seeking the party’s nomination for governor, said the stadium plan was a “raw deal for Kansans.”
“At a time when our leaders should be laser focused on lowering costs for Kansans, instead they are delivering a massive giveaway to billionaires and asking us to foot the bill,” Holscher said. “The stadium deal makes big promises of nebulous economic growth, but risks blowing open our state budget.”
The bill doesn’t outline boundaries of the STAR bond district in Johnson and Wyandotte counties that would be relied upon to generate sales tax revenue to pay for construction projects serving the Chiefs.
