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March 28, 2016 Editorial

Let Hartford keep admissions tax revenues

A proposal has resurfaced at the General Assembly that would divert to the city of Hartford state admissions tax revenues generated by Dunkin' Donuts Park.

The city would use those funds to help pay down the debt incurred for building the minor-league baseball stadium, which is set to debut May 31.

Opposition to the proposal, which was pitched last year but failed to gain traction, has come from residents around the state, Republican legislators and others. We understand how the diversion of any state revenues to support athletic teams/stadiums might be offensive to the public, particularly as funding for many state programs is likely to be axed in the weeks ahead.

However, we support this proposal and think Hartford should receive the revenues generated by its own development.

While we've been opposed to, or skeptical of, many state subsidies to private enterprises, this measure doesn't quite fit that bill. The admissions tax revenues — spawned by a 10 percent tax on tickets — will be generated by the stadium itself; the city is simply asking to keep that money instead of sending it to the state.

Last year it was estimated Hartford could receive around $426,000 annually from the admissions tax to offset the cost of constructing the stadium, which will force the city to make millions of dollars in annual debt-service payments. Those extra funds will help shield Hartford taxpayers, particularly businesses, which already shoulder the highest tax burden in Connecticut and could face even higher costs as the city deals with its own structural budget deficits.

Additionally, the XL Center and Webster Arena in Bridgeport are already exempt from the state admissions tax, so there is precedent in creating some leeway. There is no sound logic behind the current inequity in the law; all sports venues should be treated the same.

Therefore, we also think the city of New Britain should be allowed to keep admissions tax revenues from its minor-league stadium, which will be hosting the New Britain Bees this summer.

Frankly, a better model would be for the state to eliminate the admissions tax altogether and give municipalities the ability to levy it, particularly if the state didn't help fund the venue's development. It would be an easier way for cities in particular to get more revenue without having to increase property taxes.

In written testimony, Republican Sen. Minority Leader Len Fasano opposed the bill, arguing promises were made that the state wouldn't help pay for the Hartford baseball stadium. He said diverting the admissions tax revenue would break that promise. But that's not entirely true.

Hartford is not asking for the state for a bond allocation to help underwrite the stadium's construction costs. Indeed, even when the project went over budget by $10 million, Mayor Luke Bronin agreed to have city taxpayers — not the state — shoulder about a third of that cost overrun. The team and stadium developer shouldered the rest of the burden, and rightfully so.

Opening Day is around the corner and there is still as much uncertainty and angst surrounding the stadium as there was a year ago. The Yard Goats' (formerly the New Britain Rock Cats) move to Hartford from the Hardware City was controversial and rubbed many people the wrong way.

The fact that the team's stadium will likely add to the city's deficit for at least the next few years is unconscionable in many ways.

But the stadium is here to stay, and will add a new sense of vibrancy to downtown. We should all hope it succeeds because if it doesn't, admissions tax revenues will be the least of Hartford's concerns.

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