February 5, 2012
As Super Bowl Shows, Build Stadiums for Love and Not Money: View
As you watch the Super Bowl Feb. 5, spare a thought for the taxpayers in the host city of Indianapolis. The stadium in which the game will be played has been financed largely at their expense and, like so many sports venues built with public money, the cost just keeps growing.
Lucas Oil Stadium, where the Colts play eight regular season games per year, has every amenity: a retractable roof, state-of-the-art turf, seven locker rooms, 137 luxury suites, 1,000 flat-screen televisions. And well it should: It cost $720 million to build.
Of this, the Colts paid only $100 million. To cover the rest, local officials raised taxes on hotels, restaurants and rental cars, and issued bonds that soon led to ballooning financing costs.
Although the economic rationale for publicly financing stadiums is poor, an important fact remains: People really, really like sports. And they will often be willing to pay a high price to keep their favorite teams or lure new ones. Sports are part of what makes a city a city -- what would Boston be without the Red Sox, or Chicago without the Bears?
But this calculus is an ethereal one. What price could a city government place on its citizens’ love for their sports teams?
The answer is that public funding for new sports stadiums should be up to voters to decide. Cities should make sure the public has access to independent evaluations of the costs and benefits of building a stadium -- not just the inflated “economic-impact studies” done at the behest of team owners and publicized in the media. It should also be made clear exactly what other subsidies the sports teams will be getting: from cheap loans to cheap rent to cheap land.
Atlantic Yards Report, Bloomberg (well, his media company) calls for public vote on funding for sports facilities
Now the Brooklyn arena, as well as the two new baseball stadiums, have relatively less direct subsidy than many other deals.
But they didn't need it. They get indirect subsidies, access to sponsors in the nation's biggest media market, and other revenue opportunities.
The city government--hello, Mr. Bloomberg--produced and embraced cost-benefit analyses for the arena that differed significantly from that produced by the NYC Independent Budget Office.
And there was never a vote.
Posted by steve at February 5, 2012 1:01 PM