By Cindi Andrews and John Byczkowski
Enquirer staff writers

Reds fan Martha Cook loves Great American Ball Park, and she'll catch a half-dozen games there this year.

But the changing shopping habits of Cook and others like her will make it harder to pay off the stadium's debt.

Cook, a retired banker, used to shop at Tri-County Mall and Kenwood Towne Centre, two of Hamilton County's biggest shopping centers.

But now, she's more likely to make the short trip from her West Chester condo to the Streets of West Chester, which opened recently with Barnes & Noble, Chico's and other stores and eateries.

"It's upscale but has a neighborhood feel," Cook says.

"I like new growth."

New suburban shopping centers seem to be popping up everywhere - luring new shoppers in the process.

But that trend suggests big trouble for the county's efforts to pay back the $647 million it borrowed to build Great American, Paul Brown Stadium and riverfront parking.

The reason: Every time someone buys a book, a sweater or a refrigerator in Hamilton County, a half-cent of the sales tax is earmarked to help pay off the stadiums. Buy the same product outside the county, and not a penny goes toward the stadium debt.

The extra half-cent added up to $60.4 million in 2003 - $2.7 million less than projected and, more important, the fourth straight year of sub-par growth.

Officials have blamed the economy for the shortfall, but an Enquirer analysis of the region's taxable retail sales indicates the revenue trend might be difficult to reverse.

Between 1997 and 2003, sales in the four Southwest Ohio counties (Hamilton, Butler, Warren, Clermont) and three Northern Kentucky counties (Campbell, Kenton, Boone) grew 26 percent.

But sales in Hamilton County grew just 14 percent, or an average of less than 2.2 percent a year.

"If trends continue, it's obviously going to be very difficult" for the county to pay its debts, says George Vredeveld, director of the University of Cincinnati's Economics Center for Education and Research. "I'm not sure we should think in terms of crisis, but we should think in terms of a situation that needs some serious attention."

Mortgage payments due

The county took out $647 million worth of loans - bonds - in 1998 and 2000.

Figuring the proceeds from the stadium sales tax would grow at a rate of 3 percent a year, the payments were structured to start low and rise gradually.

The payments totaled $35.6 million in 2003. They will peak at $57 million in 2027 before ending in 2032.

The sales tax is also being used for stadium operating costs, which totaled $11.9 million last year and are expected to rise over time, to an estimated $35.5 million by 2032. The deal to build the stadium also committed 30 percent of the sales tax to pay for a 2.5 percent rollback of homeowners' property taxes, and about $8.5 million a year for Cincinnati Public Schools.

The sales tax has covered all those costs so far, but after four years of virtually flat collections, county commissioners are facing the likelihood that to keep paying the bills, they'll need to inject millions of dollars into the stadium fund starting in 2006 or 2007.

Over the long haul, the county now needs 4 percent annual increases to break even, while the worst-case scenario - 1 percent annual increases in retail sales - would cost the county an additional $286 million during the next 28 years, Assistant County Administrator Eric Stuckey estimates.

Frederick Church, Ohio's deputy tax commissioner, says he doesn't expect statewide retail sales - which grew at twice Hamilton County's pace the past five years - to post gains above 4 percent to 4.5 percent for the next several years.

Looking for answers

Commissioners Phil Heimlich and Todd Portune say the numbers are alarming.

"I think we need to wake up and smell the coffee," Heimlich said. "I think there's been a kind of complacency. ... What these numbers tell me is blaming the national economy and the recession was just an excuse."

They have a few options if the county starts going into the red, including restructuring the debt - similar to refinancing a house - and cutting county services. Ending the property-tax rollback is not an option, they say.

Heimlich wants to tighten county spending and more than triple the $25 million "rainy-day" reserve fund to provide a cushion in case retail sales don't rebound.

He and Portune also support two longer-term approaches to improving the county's economy and its stadium fund:

• They have embraced several recommendations from a team of economic-development experts about how Hamilton County can stem population and job losses. The team urged the commissioners to create a strategic plan to attract and keep businesses. Portune is proposing a county economic summit.

• The commissioners are also seeking to take over a federal antitrust lawsuit that alleges the Bengals and the National Football League improperly used their monopoly power to get the new stadium and favorable lease terms. They hope to rework the deal and save money. The Bengals and the NFL deny the charges.

"The public has paid quite enough money, and it is time that the parties that got the county into this mess begin to contribute toward getting county taxpayers out of it," Portune says.

Worst-case scenario

Vredeveld thinks a 3 percent annual sales-growth estimate was sound when the county calculated the size of the stadium fund years ago. For the two decades before the stadium tax was approved, the county averaged 5 percent growth.

"I did not expect population loss in Hamilton County to reach the levels that it has," Vredeveld says. "You usually don't assume, when you're forecasting, the worst-case scenario. We've come very close ... to the worst-case scenario."

Hamilton County's population peaked at 925,944 in the 1970 Census. Population losses accelerated in the 1990s, costing the county 2.4 percent of its population between 1990 and 2000. The biggest gainers were Warren County, which grew 39 percent, and Boone County, with 49 percent growth.

The patterns have continued in the new millennium, with Hamilton County losing an additional 2.6 percent between 2000 and 2003, according to Census estimates.

Former Kennedy Heights resident Samantha Hunter was part of the exodus. She and husband Richard moved to West Chester last year to give their three teenage grandchildren a better environment. Hunter was delighted when the Streets of West Chester opened, saving her the trip to Kenwood Towne Centre.

"It's so beautiful," Hunter says. "We love it."

Retailers are following the moving vans. Barnes & Noble bookstore left Springdale's Tri-County area for West Chester. Wal-Mart is leaving Symmes Township to build a SuperCenter near the Shoppes of Deerfield in Warren County.

Nonetheless, Hamilton County is still the region's Goliath. It accounted for 44 percent of the seven-county area's population and at least half of its taxable retail sales in 2003. Those sales grew about $1.5 billion between 1997 and 2003, to $12.2 billion last year, based on receipts reported by the Ohio Department of Taxation. Those comprise the region's biggest dollar amounts, despite being the lowest percentage increases.

And more stores are coming to Hamilton County, Stuckey points out, with Anderson Township rebuilding the former Beechmont Mall, and a new shopping center planned in Oakley.

Still, J.R. Anderson, development director for Anderson Real Estate, sees more trouble ahead for the county, partly because undeveloped land is so much more plentiful in the suburbs.

Anderson Real Estate is trying to expand its successful Rookwood shopping complex in Norwood, but it's also building the Shoppes of Deerfield.

"There's only so many retail dollars to go around, so all you're doing is slicing the pie differently," Anderson says.

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E-mail candrews@enquirer.com and johnb@enquirer.com