We should welcome the Carolina Panthers’ offer to build a training and office complex in the Rock Hill area. It’s a good way for the Palmetto State to become a bigger part of the Carolinas’ NFL team, a concept the Panthers have promoted since their inception 25 years ago.
While lawmakers appear starry-eyed over the intriguing proposal, any incentive package offered by the governor and economic development officials must come with a “claw back” guarantee if the team is sold, moves or otherwise can’t or won’t fulfill the terms of the deal.
After all, South Carolina negotiators are playing in the big leagues. And Panthers owner David Tepper, a billionaire former hedge fund manager who bought the team less than a year ago for a record $2.3 billion, surely has other options.
The Panthers could invest about $150 million in York or Lancaster counties over the next four years, and its payroll in South Carolina could be about $190 million annually for about 150 employees, according to initial reports.
South Carolina would reap the tax revenue benefits mainly from related development but, according to published reports, a good portion of player and executive payroll taxes still would be paid in North Carolina. The Panthers and the city of Charlotte might also benefit by the Panthers freeing up office space in Bank of America Stadium and about 7 acres of downtown real estate now used as practice fields.
Mr. Tepper has talked about building a headquarters and training complex similar in concept to the gleaming facility the Dallas Cowboys built about 30 miles outside of Dallas. With such a development in South Carolina could come a hotel, bars and restaurants, even a naming rights deal. In other words, there is a lot of potential.
But Gov. Henry McMaster and his negotiators need to focus on concrete aspects of the deal and be careful about offering incentives, such as cheap land or property tax breaks, that would tilt any deal in favor of the Panthers without having a contractual guarantee that South Carolina would at least break even, perhaps after four years.
Note that North Carolina officials aren’t falling over themselves to offer the team a better deal so far, and the Panthers just started the construction of a protective “bubble” over a practice field in Charlotte.
Though North Carolina refused money for upgrading the stadium and a practice field in 2013, the city of Charlotte eventually did come through with an incentive package valued at $87.5 million.
At a news conference announcing the negotiations, Gov. Master said he wasn’t worried about competing with North Carolina. And he shouldn’t be. He should worry about competing with the Panthers for a fair deal.
Rightly, he said, “We’re thinking about South Carolina.” But perhaps unwisely, he quipped, “We know we can outrun anybody on the field.” That shouldn’t be the goal.
The Charlotte Observer was blunt in an editorial headlined: “Is Charlotte being played by the Panthers? Of course.” Charlotte Mayor Vi Lyles played it cool in a prepared statement: “The Panthers are an integral part of the Carolinas and the Charlotte region’s economy,” she said. “We support their ‘Two States, One Team’ orientation.”
South Carolina lawmakers are already rushing through bills to enable the Panthers to qualify for tax credits and for its players to qualify as full-time Palmetto State employees.
South Carolina should be courtly but cautious. The governor and his economic development team have a fiduciary duty to taxpayers when negotiating public benefits for a privately owned NFL team or any corporate entity. Negotiators must not be swayed by potential benefits. The benefits to South Carolinians must be concrete and guaranteed.