7 Colorado counties will get a cut of the Denver Broncos’ sale

The $4.65 billion sale of the Denver Broncos results in $41 million being refunded to cities and counties that help pay for the stadium.

DENVER — The $4.65 billion dollar sale of the Denver Broncos has resulted in a $41 million refund to cities and counties in the metro area.

A provision of the lease and management agreement between PDB Sports, LTD and the stadium district called for owner Pat Bowlen to share some of the profits should the franchise be sold.

The contract called for 2% of the net profit to be shared with the district. That total amount is $41,037,951.

Mile High Stadium (Empower Field) is owned by the Metropolitan Football Stadium District. That district is made up of seven metro area counties: Adams, Arapahoe, Broomfield, Boulder, Denver, Douglas and Jefferson.

Taxpayers in those counties, as well as cities and municipalities in those counties, funded 75% of the stadium cost ($270 million) through a one-tenth of one-percent sales tax. That tax of one penny on every $10 went away at the end of 2011.

As part of the sale, the stadium district will receive $41 million that will be disbursed proportionally to the municipalities, cities and counties that paid into the stadium district tax.

The stadium district will receive an accounting of the stadium district tax from the Colorado Department of Revenue.

The amount each municipality, city and county will receive will be based on the breakdown of how much of the district tax was collected from each locale.

The lease agreement called for the money to be spent on “youth activity programs.”

When the district gives the money to the local governments, it will be up to those governments how to spend the money and what “youth activity programs” mean to them.

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The Broncos sold for $4.65 billion.

Based on the lease and management agreement, the “sharing amount” with the stadium district equals “2% of the net profit realized by PDB… Net profit means the gross proceeds of the sale less capital contributions to the franchise (or capital contributions of the person’s selling interests, plus six percent imputed annual return on such capital contributions and less franchise debt if such debt is not assumed or paid by the purchasing entity.”

Here is the breakdown provided by the Metropolitan Football Stadium District Board:

Sales Price (gross proceeds from sale): $4,650,000,000

Franchise Debt: -$247,076,305

Capital Contributions (with 6% imputed annual return): -$2,351,026,144

Net Profit: $2,051,897,551

Sharing Amount: $41,037,951

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