BROOK PARK, Ohio — Brook Park City Council signed off Tuesday night on a pre-development agreement with the Cleveland Browns, laying the groundwork for a broader deal to advance the team’s new suburban stadium.
Council unanimously approved legislation to ensure that contractors won’t have to pay sales taxes on purchases of construction materials for the $2.6 billion project, which ultimately will be owned by a public entity. If building materials account for 40% to 50% of the stadium’s total cost, that tax break could be worth $83 million to $104 million.
Brook Park also agreed to waive the city’s permitting fees on construction.
In exchange, team owner Haslam Sports Group will front $24.8 million to Brook Park over the next few years to help the city prepare to host NFL fans and visitors. Mayor Edward Orcutt has said the money will go toward “start-up costs,” from buying new police cars and ambulances to upgrading sidewalks, hiring staff and installing hundreds of traffic cameras.
Brook Park eventually will have to repay that money using city income-tax revenues, admissions-tax revenues and other tax revenues from the nearly 180-acre, mixed-use stadium district.
The city will get $1.8 million right away, according to the final version of the pre-development agreement. Then Haslam Sports Group will make monthly payments, starting at $250,000 in May; rising to $500,000 next year; climbing to $750,000 in 2028; and topping out at $1 million in 2029.
During council meetings and a recent interview with News 5, Orcutt said he could not predict the value of the waived permit fees. But it’s probably “in the lower millions of dollars,” he said.
He also couldn’t put a firm number on the size of the sales-tax break.
“Every dollar matters on this project to make it a reality,” he said in early April.
RELATED: What Brook Park is giving — and getting — so far in stadium talks with Haslam Sports Group
Site preparations got moving in October at Snow and Engle roads, on land where a Ford Motor Co. engine plant and casting plant once stood.
In early March, workers started mass excavation, digging an 80-foot-deep hole where the stadium will sit.
A groundbreaking ceremony is set for April 30 and will include remarks from NFL Commissioner Roger Goodell and Gov. Mike DeWine.
But Brook Park officials still have plenty of work to do.
The mayor and Haslam Sports Group are wrapping up negotiations over their ultimate development agreement — a binding contract spelling out the responsibilities and expectations for both parties. That agreement, which City Council could see by June, will also outline Brook Park’s plan for paying part of the stadium-construction bill.
Haslam Sports Group’s most recent financing proposal for the stadium calls for a $245 million contribution from Brook Park, using up-front cash from bonds tied to future city income-tax and admissions-tax revenues from the new sports and entertainment district.
The stadium eventually will be owned by a special governmental entity called a new community authority and leased to a Haslam Sports Group affiliate. The pre-development agreement says that the new community authority is expected to issue the stadium bonds.
Brook Park City Council will have to approve legislation to create the new community authority. That legislative process hasn’t started yet, but it could get moving in May or June.
Meanwhile, a $600 million state grant for the stadium is still tied up in court.
Ohioans sued after the General Assembly decided to tap unclaimed funds — missing money the state’s holding from people’s old bank accounts, utility deposits, last paychecks and other sources — to help pay for pro sports and cultural facilities.
Lawmakers say they’re on firm ground seizing money that’s been sitting for at least a decade. Lawyers for the plaintiffs disagree, calling the state’s approach an unconstitutional taking of private property for a questionable purpose, without adequate notice.
In December, a Franklin County Common Pleas Court judge imposed a temporary restraining order, preventing the state from moving $1.7 billion to $1.9 billion in unclaimed funds, including the money for the new Browns stadium.
Last month, a magistrate followed up by granting a preliminary injunction, barring state officials from reclassifying the money while the litigation plays out.
Now both sides are waiting to see if a judge upholds the magistrate’s decision.
Michelle Jarboe is the business growth and development reporter at News 5 Cleveland. Follow her on X @MJarboe or email her at Michelle.Jarboe@wews.com.
