Wednesday, September 12, 2012

Taxpayers lose $4 billion on sports venues

One of many links someone shared with me last week during the DNC, when I was too busy hopping from event to event to sit reading links, is this from Bloomberg.com, which adds up some VERY BIG sums of what U.S. taxpayers really pay to subsidize sports stadiums and arenas: "In Stadium Building spree, U.S. Taxpayers Lose $4 Billion."

With groundbreaking Friday for the Charlotte Knights ballpark in uptown Charlotte, it's particularly timely reading. Bloomberg reporters looked primarily at tax-exempt muni-bonds issued for places including Charlotte's Time Warner Cable Arena, where the NBA Bobcats play.

The reporters write: "During the past decade, studies by Grant Long; Robert Baade of Lake Forest College near Chicago; Victor Matheson, an economist at College of the Holy Cross in Worcester, Massachusetts; and others have found that stadiums are poor municipal investments. Nonetheless, political leaders are still willing to offer taxpayer-funded aid to team owners including muni-bond financing to lure or avoid losing a franchise and the civic pride and event-related jobs that go with it."

The link takes you to a 2006 article in Growth and Change: A Journal of Urban and Regional Policy, where the article abstract says: "The evidence presented here is that the presence of a new or renovated stadium has an uncertain impact on the levels of personal income and possibly a negative impact on local development relative to the region."

Note: The Knights ballpark is getting direct subsidies from Mecklenburg County worth some $20 million (depending on how one values 8.6 acres uptown for $1 a year), $8 million over 20 years from Mecklenburg County, and $7.25 million from the City of Charlotte. I'm fairly sure tax-free municipal bonds aren't being used. If someone knows different, please alert me.

Many people say the money is worth it: Bringing baseball to uptown Charlotte will enliven the city and spur development, they say.

And if you were uptown during the Democratic National Convention you saw an event that would not have happened if George Shinn had not taken his Charlotte Hornets elsewhere, and the city decided it really did need a new uptown arena.

But isn't it better to have those debates when you know the full cost of things? Are sports arenas the best use of $4 billion in U.S. treasury funds or should there be other priorities? Depends, I suppose, on how much you love pro football, basketball and baseball.

1 comments:

Knowledge Fire said...

Sure that bringing baseball to uptown Charlotte will enliven the city and spur development. Still $20 million is huge. Hope they just don't turn into corporate event venues.

Post a Comment

Note: Only a member of this blog may post a comment.