Pinellas County Commission requests Rays terminate new stadium deal by Dec. 1

The letter also illustrates that the county has not missed any deadlines thus far, despite the Rays “fallacious” claims.

The Pinellas County Commission’s leader, Chairperson Kathleen Peters, has responded to the letter issued by Rays co-Presidents Brian Auld and Matt Silverman with her own scathing response via a latter, with three important claims:

1. The county’s bonds are not late, as Rays have not met their prerequisites to receive the bond funds (which are due March 31, 2025).
2. The overall Agreement cannot be freely terminated by the city and/or county unless the stadium project is not completed by February 1, 2030.
3. Chairperson Peters calls the Rays letter dated November 19 “an inelegantly stated notice of termination” and requests a formal termination notice by Sunday, December 1.

Let’s evaluate all three of these items.

Claim 1: The county’s bonds are not late — True

This is not just a matter of conjecture, and also not as simple as there being no contractual obligation for the County to issue bonds.

Hours before the November 19 County Commission meeting to consider legislative action on the supplemental bond resolution, you both sent a letter to the County Commission stating that, “the county’s failure to finalize the bonds last month ended the ability for a 2028 delivery of the ballpark.” This statement is contrary to the terms of the Agreement that provide for no specific timeframe for the County’s action on the bonds, but allow for required actions of the Rays PRIOR to the County’s obligation to offer bonds for sale to be accomplished as late as March 31, 2025. (See Agreement section 3.6(a)(i)). The supplemental bond resolution is but one of many conditions precedent to the offering of the County bonds for sale that have not been met; many of which are the Rays’s responsibility under the Agreement. (See Agreement section 3.3(b) & (d)). These include but are not limited to providing to the County numerous documents acceptable to the County that have not been supplied to the County – much less determined to be acceptable by the County.

When the Rays negotiated for the County to support the new stadium with bonds, they agreed to meet several prerequisites before receiving any cash from those funds. To date, as Chairperson Peters points out, the Rays have not met any of those demands.

The process of approving, preparing, issuing, and receiving millions of dollars in funds takes months, as we’ve seen, so it’s a bit absurd for the Rays to claim a 30-day delay in one step of that process has killed a $1.3 billion stadium — particularly when they have not met their requirements to receive the funds.

Generally speaking, the city and county have very similar requirements for the bonds to be issued, per the Agreement. Those include:

• All Agreements Signed: Necessary project documents must be finalized, including a nearly ready “Construction Funds Trust Agreement” (a requirement from the City of St. Petersburg).
• Design Progress: The stadium’s design must be 50% complete.
• Pre-Construction Readiness: StadCo (the stadium company) must demonstrate readiness to start construction.
• Financial Plan: StadCo must show it can cover its financial commitment, including: Securing at least $100 million in loans from MLB; Providing a letter confirming available cash and financing commitments for the remaining amount; Paying $10 million in initial project costs.
• Various Approvals: The bonds must be authorized through resolutions, a Florida court must approve the bond issuance, a current project budget and schedule must be approved, and the city and county must confirm its intention with each other to proceed with its bond sale.

Claim 2: The local government cannot freely terminate the stadium agreement until 2030 — Half Truth

The Agreement negotiated by the Rays allows them to terminate at any time, but prevents the local government from terminating the agreement until 2030, which contradicts the Rays concerns about allowing the stadium to open a season late.

Another fallacious statement within your November 19 letter states that, “… we have made clear at every step of this process, a 2029 ballpark delivery would result in significantly higher costs that we are not able to absorb alone.” The Agreement not only requires that the Rays pay all cost overruns as noted above, but also includes a date (negotiated by the Rays) that the Agreement cannot be terminated by the city and county unless the stadium project is not completed by February 1, 2030. (See Agreement Section 16.6(b)(3)). This date is after the 2029 baseball season and can be extended for certain unforeseen events.

Termination revolves around the city and county concerns that the Rays may want to back out of building a stadium but keep the rights to redevelop the land. The local government has very few outs in the contract, and need the Rays to take action if they intend to leave without at least suing to keep the non-stadium elements of the redevelopment deal in tact.

Section 3.6 of the Agreement outlines the conditions under which it will automatically terminate and the actions required in such a scenario. These are:

• Missed Deadlines: StadCo fails to meet certain conditions for the City and County to start their bond sales by March 31, 2025.
• Project Abandonment: StadCo notifies the City or County that it is abandoning the project before bonds are issued.
• Unsecured Credit Facilities: StadCo fails to secure required credit agreements by October 1, 2025.
• Failure to Start Bond Sales: City or County does not commence their respective bond sales after conditions are met.
• Failure to Fund Contributions: City or County fails to deposit their contributions into the project accounts within 30 days after conditions are satisfied.
• Failure to Meet Funding Conditions: StadCo fails to meet all conditions for the release of project funds by October 1, 2025.

You’ll note here that two of the actions are responsibilities of the City or County, but triggering automatic termination is likely to create significant legal liability.

Outside these events, termination can only occur (re: without recourse for the local government) through the following far-off events:

• StadCo Payment Default: If StadCo fails to make payments as required under Section 3.2(a)(iv).
• Non-Relocation Default: If StadCo relocates the Rays to another location.
• Project Completion Failure: If StadCo’s Project Completion Date does not occur by February 1, 2030 — unless extended due to Force Majeure (events beyond control, like natural disasters).

The local government clearly does not want to be responsible for terminating the Agreement with the Rays, presumably to protect itself from future lawsuits. Accordingly...

Claim 3. The Rays “must” formally terminate the agreement by Sunday, December 1 — False

One open question, due to the (intentionally?) poor wording of the Rays letter to the County, has been whether the letter provided constitutes a termination as laid out by the Agreement between the local government and the Rays.

The November 19, 2024 letter approaches being an inelegantly stated notice of termination pursuant to Section 3.6(a)(ii) of the Agreement. The County is scheduled to move forward to consider legislatively adopting the supplemental bond resolution on December 17, 2024.

The County can be in a position to offer its bonds for sale pursuant to the Agreement weeks (and potentially months) before the Rays’ deadline to meet its conditions precedent to such offering.

As your November 19 letter makes several statements that are demonstrably false as reflected by the terms of the Agreement itself and as explained in this letter, and as President Auld made public comments in other settings that the Agreement is “dead”, that action by the Board on December 17 appears to be futile.

The Rays (StadCo.) must either indicate in writing that they intend to move forward under the Agreement as executed, or provide a clearer Notice of Termination pursuant to section 3.6(a)(ii) of the Agreement by no later than December 1, 2024.

Now, this “must” demand is probably unlikely to be met, as it’s not in the Agreement, but it does try to move the timeline up from the next county meeting on December 17, and it will be interesting to see if the Rays respond at all.

As things stand today, the Rays essentially want more money than the $750 million in funds and the steep discount they receive on the surrounding land if they’re going to stay in St. Petersburg, despite taking on the burden of all cost overruns.

Mayor Welch has stated there will be no additional funds heading to the Rays than what was already negotiated, setting up the current stalemate and blame game.