In a recent story from the Houston Chronicle, it was revealed Harris County has approved $35 million in upgrades to NRG including a new roof, and audio and video improvements. But that is just a small percentage of what is needed to bring the stadium up to the standards the Texans expect and the county agreed to in its initial deal with the team.
The PGAL study recommended investing an average of $20.6 million per year between 2019 and 2024 on capital projects and repairing or replacing infrastructure. The sports corporation’s entire operating budget is $14.9 million this year.
The county gets some money from the Harris-County-Houston Sports Authority, a completely separate entity from the Harris County Sports and Convention Corporation that services the three downtown stadiums, but it's not nearly enough. And the original agreement states that the county must keep the facility in "first class" condition, whatever that means. The county is on the hook for all of it. Let's dig into some history to figure out why.
We need to go back to the early 1990s when the Houston Oilers were still a thing. Owner Bud Adams, after taking a bunch of money from the county to add more seats he said he needed, suggested building a downtown retractible roof stadium for around $200 million, $87 million of which he would provide. The city practically laughed him out of town and the Oilers moved to Tennessee.
When football returned less than a decade later, the city had gone through a stadium spending spree, having gone through multiple referendums and a legislative session to get the money to build both a ballpark and basketball arena in downtown, one with a retractable roof even.
The city had lost the NFL and both the Astros and Rockets threatened at different times to move if they didn't get new facilities. And the region was in no mood to be a sports-less major city. It still took a lot of work to barely pass the referendums that would build the two new stadiums, but it got done. With the city's love of football, it became a no brainer that a football stadium would be next.
When Bob McNair managed to improbably score an NFL expansion franchise, it came with the promise of a new, fancy (yes, retractable roof) stadium. This time, it would be built solely on county property next door to the Astrodome (a story for another day). Unlike the other facilities, however, the team would not be on the hook for any of the costs.
In reality, not only is NRG the most expensive stadium of all the facilities in Houston, it was the only one where the team didn't contribute to building it. It also didn't require a very contentious public vote, something Enron Minute Maid Daikin and Toyota Center did — in the case of Toyota Center, two of them.
The total cost of NRG Stadium was $474 million (roughly double the ballpark and just under twice what the arena cost). Much of that was financed with so call HOT taxes, which taxed hotel rooms and rental cars. Additionally, fans would pay with a 10 percent tax on parking and a $1 per ticket surcharge.
There was some private funding — about $10 million per year from stadium naming rights — but the bill for the Texans and the rodeo, who would occupy the facility most of the time, was essentially zero. In the case of the Rockets and Astros, they share the maintenance costs. Both teams have sunk millions into their respective homes including a massive new video board at Toyota Center. At NRG, the county pays for everything.
Harris County is at the mercy of the Texans because they hurriedly put together a deal to bring the NFL back to Houston, a deal that did not require them to go before voters to get approval. NRG Stadium is the least used of all of the stadiums (Toyota Center's 250-plus events per year is exponentially greater) but cost the most and nearly all at taxpayer expense.
That includes the extensive upgrades that have now become necessary. It's a sweet deal for the team, but not so much for the county.