CLEVELAND, Ohio — The same state money lawmakers tapped to help finance a new Cleveland Browns stadium may eventually help fund mounting repair costs at Progressive Field and Rocket Arena that their landlord, Gateway Economic Development Corp., cannot currently pay for on its own.
But as with the Browns’ deal, the money they’re seeking is currently tied up in court and far from guaranteed.
The Cleveland Cavaliers and Cleveland Guardians recently applied for a combined $105 million in assistance from the Ohio Sports Facility Performance Grant, a new state program that allows professional franchises to request up to 25% of a project’s estimated construction or renovation cost, capped at $250 million.
The Cavaliers’ requested $40 million in funding toward a total of $161 million in projects, according to Gateway attorney Scott Simpkins. Some of the dollars relate to projects referenced in the recent Facilities Conditions Assessment Report, which outlined $412 million in needed repairs between the two facilities through the remainder of their leases, he said, while others are meant to support upgrades to accommodate a future WNBA franchise.
A statement from Rock Entertainment Group, the umbrella organization for the Cleveland Cavaliers, Rocket Arena and other sports and entertainment properties, defended the spending as being for “the largest driver of economic activity in Cuyahoga County and host to nearly 200 ticketed events every year,” and “essential” to downtown Cleveland’s vibrancy and future.
“This investment will ensure the arena’s readiness to welcome the return of the WNBA to Cleveland in 2028, while serving as home to three professional franchises and supporting a full year-round sports and entertainment calendar,” the statement said.
The Guardians requested $65 million toward a total $259 million in projects, including some repairs identified in the FCA and some of the teams’ food and beverage costs that aren’t covered by Gateway, Simpkins said.
Team spokesman Curtis Danburg said Wednesday that the application “primarily focuses on pursuing supplemental support for the Progressive Field Preservation Project,” based on the FCA. It outlines projects he said are “necessary to preserve and modernize Progressive Field—Ohio’s oldest major professional sports facility—for the remaining 11 years of the approved lease.”
State officials have not provided a timeline for announcing grant recipients or releasing funds, and it remains unclear whether the dollars will be distributed at all.
They’re tied to the same account of unclaimed state funds lawmakers tapped to provide $600 million in financing for a new Browns stadium. That funding is currently blocked by a court injunction, stemming from a lawsuit that challenged the legality of using the money to fund sports and cultural projects.
How the money would work
Only the teams could submit applications for the funds. But Gateway officials say they still expect funds to flow through the board.
They envision entering into a cooperative agreement with the teams and the state so that Gateway would receive the money directly. That arrangement would also allow the teams to take advantage of Gateway’s sales tax exemptions on construction materials, Simpkins said.
Even if approved, though, the grants would not provide any cash upfront. The program is expected to operate on a reimbursement model, where Gateway would have to front the full cost of projects and submit documentation to get reimbursed.
That could still be a significant hurdle for a nonprofit predominately funded through sin tax revenues that no longer cover repair costs and have mostly been spent down. That left Gateway with no choice but to seek a $40 million bailout from the city and county two years ago, so that it could pay its bills.
Gateway has been limping along since, relying on money from deferred projects, reserves and IOUs to cover new repair expenses while it waits for officials to identify new funding streams to increase revenues.
On the Guardians’ side, for example, Gateway was able to defer more than half of an already approved $9 million project to free up dollars for more pressing expenses at Progressive Field. That includes:
$902,606 for capital repairs tied to concession-area alterations at Progressive Field. Most concession upgrades were funded by the Guardians, but this portion falls to Gateway under the lease.
$270,000 to replace four aging hot water tanks at the ballpark that were leaking and deemed at the end of their useful life.
An estimated $1.5 million to replace a freight elevator, which has deteriorated from weather and wear and must be upgraded to meet code requirements. The project has not yet been bid for the exact cost.
Gateway’s board signed off on those expenses Wednesday, leaving a $2.24 million cushion in reserves that it can use for other planned or emergency repair needs at the ballpark. There is no comparable buffer for the basketball arena, however.
“We have no cushion for the Cavs,” Simpkins said, “because as it is, we owe the Cavs money for the escalator project.”
He estimating Gateway currently owes the team about $4.5 million, but does not yet have a way to reimburse them.
Cuyahoga County Executive Chris Ronayne, in partnership with the city and the teams, have called to triple or quadruple the current tax rates on cigarettes and alcohol to raise more money for stadium repairs, but it would need permission from the state to put the question on the ballot and then voters would have to sign off on it. The state, so far, has only approved potentially doubling the rates.
Still, Ronayne has said that if the group’s lobbying is successful, the measure could go before voters in November’s General Election.
Another proposal to createa special financing district to help pay for repairs through fees on parking, dining and entertainment in the Gateway District also hasn’t gained traction.
Meanwhile, Gateway remains stuck. The state funding, however, could be a huge boon, relieving some of the pressure on the city and county to make up for sin tax shortfalls.
Gateway’s board submitted a letter of support for the teams’ grant requests, saying the funding would “ensure the long-term viability of these two tremendous public assets.” It wouldn’t just be the teams benefitting, it stressed, seemingly getting ahead of criticism of what could appear to be another tax-funding subsidy for billionaire team owners.
“Gateway, as the owner of Rocket Arena and Progressive Field...ultimately will be the beneficiary, along with Gateway’s public partners, the City of Cleveland and Cuyahoga County, of the capital improvement renovations when completed,” the letter said.