Waste of the Day: Missouri Skating Rink Uses Taxpayer Money to Stay Afloat
Topline: An ice skating rink in Maryland Heights, Missouri recently received its fifth subsidy from the city to keep it from being seized by a bank, costing taxpayers more than $2 million and counting.
Key facts: The Centene Community Ice Center opened in late 2019 using $55.5 million in bonds issued by the city. It was leased to the nonprofit St. Louis Legacy Ice Foundation and projected to generate $20 million of revenue a year, leaving taxpayers with a net profit.
Instead, low visitor numbers and large day-to-day expenses forced the rink to default on its bond last September, risking foreclosure. The rink was scheduled to make a $138,000 payment but had just $18 in its bond account, according to the St. Louis Post-Dispatch.
That was the seventh time Centene missed a bond payment and the fourth time that Maryland Heights stepped in to help. On March 15, the city spent another $223,300 to bail out the rink and committed to spending another $625,000 if necessary.
The city also lost $1.5 million in potential revenue because the rink failed to charge sales tax for four years, the Post-Dispatch found. The rink’s chairman claims a city employee told him sales tax was unnecessary because the rink is publicly-owned.
Centene Ice Center includes a 4,500-seat concert venue and hosts practices for the St. Louis Blues hockey team.
The Blues have made $500,000 from sales commissions at the rink, the Post-Dispatch found through a public records request.
The late bond payments can partially be blamed on a contract that places private interests above taxpayers. The rink must pay Oak View Group and Live Nation — which manage day-to-day operations and book concerts at Centene, respectively — before bondholders and Maryland Heights.
Supporting quote: Maryland Heights City Administrator Tracey Anderson told the Post-Dispatch that low attendance has been the biggest issue.
"I don't think that anybody over-promised anything," she said. "I think that they did the best job that they could. There's been bumps along the way. And I would also tell you that COVID played a huge role ... Nobody anticipated that."
Summary: It’s rare that sports facilities are designed in a way that taxpayers will make a direct profit. Still, Centene and Maryland Heights dropped the ball and left taxpayers with a bill over $2 million.
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