Should professesional franchises pay for their own (new) stadiums or should the city in which they reside pay with tax levees? If the team is required to pay, the outcome seems to be to be less frivolous spending and more local business input (endorsments). If the local citizens pay, the result seems to be cost over-runs and a “hostage” situation (pay or we leave). The team should be allowed to play where ever it wants, but it in the long run it is a business.
Had to check your profile, Vinny. I thought you just might be from Flint (where I live). This issue is a big one here right now. Isaiah Thomas wants to bring a CBA team here, and there’s talk of a minor league baseball team, the Lansing Lugnuts (or something like that) moving here as well.
The trouble is, we need a new stadium. And I’m going to have to pay for it.
I have no objection to a basketball team here. People in Flint really do love basketball, and I think it would do quite well. But Thomas is not only asking for a new stadium, he wants 3500 season tickets sold. The Flint Generals, our hockey team (I forget which league right now) is very popular, but they don’t even sell half that in season tickets.
I wouldn’t mind a small tax increase to fund a stadium. Truth is, I honestly believe that building a new stadium and bringing a basketball team here would do nothing but good for this community. But if my tax dollars go to this stadium, and Thomas bails on us because he didn’t get his 3500 season tickets, I will be furious.
Who should pay for the stadium is trickier. Teams can’t just play wherever they want. The town has to want them, too. I’m not a math or business genius, but if there was some way to split the cost, between the franchise and the city, that would be fine. That way, both parties would have some vested interest in the success of the team.
Changing my sig, because Wally said to, and I really like Wally, and I’ll do anything he says, anytime he says to.
If you ask this question about professional sports, you need to ask it about almost every industry. Most cities offer tax breaks to attract new business, and many also have tax-exempt zones, usually in economically slow part of the city where the jobs are needed.
I can’t speak for every city and arena deal, but in Dallas the cost of a new arena is being split between the Stars, Mavs and the city. Any cost over-runs are split by the 2 teams, the city has capped its cost. Also, it not quite a hostage situation as you put it. There are many cities that are willing to spend their tax money to lure a pro sports team(i.e. Baltimore), so the pay or leave threat is not hollow (i.e. Cleveland).
Many cities look at situation as a quality of life discussion. Pro sports teams add something to a city that no other industry can.
“If you ask this question about professional sports, you need to ask it about almost every
industry. Most cities offer tax breaks to attract new business, and many also have
tax-exempt zones, usually in economically slow part of the city where the jobs are needed.”
But there is a difference. If a local government offers businesses a tax break to encourage them to locate there, it’s just passing up on a PORTION of the additional tax revenue that the break generates by attracting new business.
Let’s say a city assesses a 5% income tax. If the city gives a 50% tax break to attract a business that makes $1 million in pre-tax profit annually, it’s getting 2.5% of the NEW $1 million, or $25,000 more than it had before. If the city doesn’t offer the break, and the business doesn’t locate there, the city gets 5% – of $0!
Also, the tax break theoretically has no risk for the city. If the city offers the break but business doesn’t locate there, it has no additional revenue. If it didn’t offer the break, it would also have no additional revenue.
On the other hand, when the local government actually builds a stadium or arena for a sports team, it’s spending the (tax) money and it’s taking on the risk of the venture. The tax money spent in construction MAY get paid back in the team’s rent IF the team moves in. But if the team jumps town for a better offer, the city - the taxpayers - are stuck with a multimillion dollar white elephant.
One simple word: Yes
Before you sports fans get on my case, I am an AVID Broncos fan, love my Colorado Avalanche, and occasionally go to a Colorado Rockies baseball game.
But is it up to someone who HATES sports to subsidize the arenas? No. Does it bring in extra money to further the economy, yes.
But why single out football, hockey, basketball and baseball, why not fund sites for bowling, auto racing (I love auto racing), etc, etc?
It should be funded via user fees, not taxes.
“Major League Losers” is the book (can’t remember author’s name, but can have it by Monday) that pretty clearly shows that pro sports’ economic benefits to a region tend to be about equal to
ZERO.
No net increase in employment, tax base, spending tourism, etc. When all the costs are figured in, areas tend to lose money.
And teams that suck (the Twins) will just add a pissed-off feeling to the quality of life.
Let’s see: no economic benefit, increase in crime around new stadia, environmental degradation around new stadia, cost over-runs that tend to double or triple costs of building…
seems pretty clear to me.
Bucky
Oh, well. We can always make more killbots.
I am on record her on the SDMB as opposing city/county subsidies to professional sports franchises. I believe in free enterprise; some believe in socialis; but what we have today is the worst possible combination of capitalism and socialism! We have a system in which taxpayers put up the funds to build stadiums and private enterprise gets the profits.
However… in fairness to owners, even the guys who are NOT pure greedheads are in a bind these days. If I owned a baseball team playing in an old, dilapidated stadium with no luxury boxes, and I saw that nearly ALL of my competitors were playing in brand-new stadiums (with a thousand luxury boxes that they can lease to big corporations), paid for by their local city governments, I would be INSANE not to want the same thing for myself. I mean, what’s the alternative? To sit back and watch my best players abandon me to play for rich teams that HAVE big new stadiums?
The first cities to shell out big bucks for stadiums started a dangerous spiral that’s all but impossible to end at this point.
In Canada, everytime a team wants more tax breaks or aid they threaten to move to USA if they don’t get it. It’s usually portrayed that the American cities are standing on the border with cash-bucket in hand waiting to snap up our teams. Interesting to read that many of you are struggling with the same issues.
Many Canadians are getting fed up with these threats as the link below shows.
[http://www.thestar.com/back_issues/ED20000122/news/20000122NEW01_NA-NHL22.html](http://www.thestar.com/back_issues/ED20000122/news/20000122NEW01_NA-NHL22.html)
pweetman
Canadian anger was misplaced in this case. The federal government was offering a tax break, not a cash handout. Of course nobody mentions how the government wastes more than a billion dollars on completly useless crap.
If the Sens or Oilers or Flames leave Canada, the Liberal Party will never win another election. Sure, not “giving” money to sports teams was popular for about one week, but they may go down as the government that killed the NHL in Canada.
If I was discussing Lucy Lawless but I wrote Lucy Topless, would that be a Freudian typo?
adam yax wrote
Yeah, but when the public helps to fund stadiums and other infrastructure I think they should be able to recoup at least some of their money through the taxation of the teams that are benefiting from them. We are investing in these facilities and deserve a return on this.
From that point of view a tax break is a handout.
pweetman
Lets see you have teams owned by billionaires paying millionaires to play for them. And you want my tax $ to pay for your stadium?
Does anyone see anything strange here?
Need more money:
Raise ticket prices? Sure
Get more TV money? Ok
Use Tax dollars? Never
I don’t know how common this, but apparently my city’s baseball team has a guaranteed minimum ticket sale number. Every ticket less than the minimum that they don’t sell is bought by the city. [sarcasm]It’s nice to know that my city is spending money on useful projects, instead of throwing it away at such things as schools, libraries, and roads[/sarcasm].
When Chicago was building a new stadium for the White Sox, I recall reading a report that claimed the economic to the city (in terms of employment, tax revnue, etc.) was about the same as a decent-sized grocery store.
“The dawn of a new era is felt and not measured.” Walter Lord
My personal attitude is this, if Tax money helped pay for the stadium, then it should be a public stadium…open to the public for general use free of charge when not in use by the teams for a home game. Thus, if a new football stadium is built, the local High Schools should be allowed to use it for their games at night, and during the day or when not used by the HS’s, its a public park.
And the teams would still have to pay for the maint.
>>Being Chaotic Evil means never having to say your sorry…unless the other guy is bigger than you.<<
—The dragon observes
I thought I should throw in an update. I found out yesterday that the cost of the the stadium is going to be $45 million more than expected. That does not include the $2 million/ pre-session and $4 million/ regular session that are played in “old” stadium (construction is way behind schedule). Needless to say there are a lot of people here who whish they could take back their vote for tax increase.
“When I build something for somebody, I always add $50 million or $60 million onto the price. My guys come in, they say it’s going to cost $75 million. I say it’s going to cost $125 million, and I build it for $100 million. Basically I did a lousy job. But they think I did a great job.”
Donald J. Trump
(to a 1984 meeting of US Football League owners)
Originally posted by The Ryan:
Ryan, if you live in San Diego (your profile says California), the ticket guarantee is for the football team, not the baseball team.
This past season the city took a major bath on this guarantee and had to dip into the reserve fund halfway through the season. They - meaning the city, not the team - ended up buying up the general admission seats to guarantee sellouts and distributing them to city schools as freebies.
In spite of the freebies, demand was lackluster.
The only positive is that this deal with the Chargers may end up killing the political career of the mayor who heavily promoted it.
And they continue to tell everybody that the baseball stadium is going to be a great investment for the city.
pweetman wrote:
It doesn’t matter what you think should happen or what you deserve. You get what you’re able to negotiate. It just so happens that citizens place some value on having a local sports team, and allow their political leaders to pay for the privelege. Blame it on the “invisible hand”, but if people place a value on it, then the market will make sure that money is exchanged for that value. It’s neither good nor evil, it’s just the way it is. You can argue about whether it’s right or wrong, just as you can argue that it would be more convenient for the day to be longer, but it’s just as pointless. As long as citizens want a local sports team, they will pay for it.
I disagree with the “free of use” clause; the city’s gotta make up it’s investment somehow. Every so often in Chicago they float the idea of a new football stadium, usually a dome attached to McCormic Place, our big convention center. For once, this makes absolute sence as a publicly financed venture, because it would be used by the city for convention business. The city would put out the inital cash, and would make it up by renting the facility to football games, the Chicago Auto Show, the Republican Convention, etc. No single use sport facility makes financial sence.
“The large print givith, and the small print taketh away.”
Tom Waites, “Step Right Up”
PTVronman, I disagree. Cities spend money on building parks, and then don’t charge for their usage. I feel that the stadiums should be handled as parks with a when can be used clause is all. You will note that I stated that the teams still had to pay for upkeep, so once bought the stadium would not require as much infusion from the city as a normal park either.
>>Being Chaotic Evil means never having to say your sorry…unless the other guy is bigger than you.<<
—The dragon observes