In all the talk of a proposed downtown Buffalo Bills stadium this week, there wasn’t enough attention paid to the fact professional sports have little impact on local economies. When you’re talking about investing huge amounts of taxpayer dollars – whether it’s $200 million to renovate Ralph Wilson Stadium or $400 million to build a new stadium – it’s important to realize there’s not a huge return.
The evidence suggests that attracting a professional sports franchise to a city and uilding that franchise a new stadium or arena will have no effect on the growth rate of real per capita income and may reduce the level of real per capita income in that city. Yet government decisionmakers and politicians continue to try to attract professional sports
franchises to cities, or use public funds to construct elaborate new facilities in order to keep existing franchises from moving…
…one thing is clear from the evidence on professional sports franchises: owners are reaping substantial benefits in the value of their teams because they are so skilled at the stadium gambit.
Studies have found when sports are not around, people spend their money on other entertainment. When stadiums host big events, like the Super Bowl, visitors are displacing others who would have visited. Construction jobs are typically overstated. Development around stadiums is not guaranteed. Stadiums can drain local coffers to the point vital services have to cut. Recent stadium deals have been structured to allow team owners to escape hefty taxes, while the rest of us are footing the bill for their shiny new homes.
Finally, team owners threatening to move away are often not serious, according to a magnificent NPR story on stadium economics:
“Politicians continue to believe that it would be political disaster to lose a team on their watch,” Baade says.
Actually losing a team, though, is extremely rare. Most team owners prefer to keep plugging for new stadiums in their hometowns even after their bluff has been called…
…after successfully using relocation threats to get the city of Pittsburgh to help fund a new hockey arena, Penguins owner and NHL legend Mario Lemieux admitted, “Our goal was to remain here in Pittsburgh all the way. Those trips to Kansas City and Vegas and other cities was just to go, and have a nice dinner and come back…. That was just a way for us to put more pressure, and we knew it would work at the end of the day.” (It’s also worth noting that even in those few cities where teams have moved, no local elected official has yet been voted out of office as a result…)
There’s no question professional sports teams add to the quality of life of a city. But when you’re talking about billion-dollar behemoths funded by taxpayers, that argument only goes so far.
Links of the Day:
- A Pittsford resident is quoted in the Democrat and Chronicle saying an apartment complex filled with renters could drag down the school district. Never mind these will be high-end units not filled with dreaded poor people.
- This was sadly predictable. Wegmans learned you can’t extend a school day without extra cash. Both the executives and the school district are to blame for incredibly poor planning.
- More Monroe County businesses are offering high-deductible insurance plans. This is a huge issue for employees, as one serious illness or surgery can cause severe problems for families living paycheck to paycheck or with meager savings.
- CNN has banned the term “Frankenstorm” because it makes light of a storm that’s already killed people.