Comment 84000

By Mal (anonymous) | Posted December 16, 2012 at 10:47:58

LET'S ELIMINATE SPORTS WELFARE
http://www.sportsonearth.com/article/40595178/

Perhaps you’ve heard the news: America is barreling toward a self-induced “fiscal cliff” of federal tax hikes and spending cuts, largely because Democrats and Republicans can’t agree on how to make the nation’s budget moderately less unbalanced. On one side, President Obama wants to raise money by increasing taxes on the wealthiest Americans; on the other, House Speaker John Boehner wants to reduce costs by slashing social welfare programs. Both men and their respective parties seem stuck at an ideological impasse -- think who’s better, Barry Sanders or Emmitt Smith? only with the world economy at stake -- and yet each camp is ignoring an obvious way out.

Well, maybe not a way out. But definitely a way forward. An easy, overdue fix to the nation’s fiscal woes. A course of action rock-ribbed liberals and hardcore conservatives can agree on. A policy shift that would not only save cash, but also act as a trust-building, goodwill-generating building block toward larger, harder and more essential partisan compromise.

Ready? Here goes.

Eliminate Sports Welfare.

.....

Consider stadium subsidies. When Kubla Khan built his stately pleasure dome above a sunless sea, he did not strong-arm the Xanadu County Board of Directors into funding the project by threatening to move to Los Angeles. His mistake. He wouldn’t last five minutes as an American sports owner. According to Harvard professor Judith Grant Long and economist Andrew Zimbalist, the average public contribution to the total capital and operating cost per sports stadium from 2000 to 2006 was between $249 and $280 million. A fantastic interactive map at Deadspin estimates that the total cost to the public of the 78 pro stadiums built or renovated between 1991 and 2004 was nearly $16 billion. That’s enough to build three Nimitz-class nuclear-powered aircraft carriers. Or fund, in today’s dollars, 15 Saturn V moon rocket launches -- three more than the number of launches in the entire Apollo/Skylab program. It’s also more than what Chrysler received in the Great Recession-triggered auto industry bailout ($10.5 billion), and bigger than the 2010 GDP of 84 different nations. How does this happen? Simple. Team owners ask for public handouts and threaten to move elsewhere unless they get them, pitting cities against in each other in corporate welfare bidding wars -- wars rooted in the various publicly granted antitrust exemptions that effectively allow sports leagues to control and maintain a limited supply of teams to be leveraged against widespread demand.

“It’s like this magic alchemy where we take all this public money and it morphs into private profit,” says Dave Zirin, author of “Bad Sports: How Owners are Ruining the Games We Love.” “The most egregious example of this is the Seattle Sonics going from the 14th biggest [media] market in the country to Oklahoma City, a market that is No. 45. Why did that move make sense? One place offered corporate welfare and another didn’t. The NBA punished a city for not giving them hundreds of millions of dollars.”

Of course, you probably know this already. You probably know that of the reported $100 million Indianapolis Colts owner Jim Irsay deigned to spend on Lucas Oil Stadium -- opened in 2008 for a cool $720 million, with the public picking up the bulk of the tab -- nearly half came from taxpayers buying out the team’s lease on the old RCA Dome. (When it comes to double moves, Reggie Wayne has nothing on The Mad Tweeter.) You probably know that Minnesota Vikings owner Ziggy Wilf -- a man personally worth more than $1 billion -- just negotiated ransomed his way into $498 million in state and city funding for a new stadium. You probably know that Miami-Dade county ponied up roughly $500 million for the Miami Marlins’ new stadium -- including $2.5 million for an animatronic outfield fish statue -- by issuing bonds that eventually will cost the public $2.4 billion, a deal so resoundingly popular and transparently above board that, a) the Securities and Exchange Commission launched an investigation, and b) Miami mayor and stadium advocate Carlos Alvarez subsequently lost in the largest recall of a local politician in United States history. Heck, you probably know that as of two years ago, the good people of Houston, Seattle, Indianapolis and New Jersey were still paying off dark caves and holes in the ground -- that is, NFL stadiums that already had been decommissioned or demolished.

What you don’t know is that the actual costs of stadium construction -- like the estimated $500 million to $4 billion in public subsidies that went into new stadiums for the New York Yankees and Mets, two supposedly private projects -- are even higher than typically reported.

In her book “Public/Private Partnerships for Major League Sports Facilities,” Long calculates that the average public subsidy for the 121 sports facilitiies in use in 2010 is actually $89 million higher than the $170 million figure commonly reported by the sports industry and the media. How so? Think land giveaways. Infrastructure freebies. Tax breaks. Government subsidies enough to make an ethanol-producing Iowa corn farmer feel, well, hosed. The Colts don’t pay rent. The Vikings’ new stadium reportedly will be property tax-free. In the late 1990s, the city of San Diego was buying unsold San Diego Chargers tickets as part of a sweetheart lease deal -- does your landlord make up the difference when you don’t hit your sales targets at work? -- while from 2002 to 2010, the state of Louisiana gave New Orleans Saints owner Tom Benson $186.5 million in straight cash, homey, just for keeping the team around.

“Rather than pay for a new stadium, it was, ‘let’s just give you cash every year,’” says Brian Frederick, executive director of the Washington-based fan advocacy group Sports Fans Coalition. “He took that, and took money to get the Superdome renovated, and then when Hurricane Katrina hit he got more renovations. Then he turns around and buys the [New Orleans] Hornets. Well, guess where he got the money?”

Then there’s Paul Brown Stadium, both the newish home of the Cincinnati Bengals and quite possibly the single greatest boondoggle in the history of public-stadium financing. Completed in 2000, the building was supposed to cost $280 million. The Bengals estimate that it cost $350 million. Hamilton County, which assumed more than $1 billion in debt to pay for the stadium, puts the price at $454 million. Long, on the other hand, estimated in the Wall Street Journal that the actual cost to the public was roughly $555 million, once parking garages and other expenses were factored in. Moreover, local residents are on the hook for Paul Brown Stadium’s security costs, as well as most current and future operating and capital improvement expenses -- including, and this is not a misprint, a potential future “holographic replay machine.” Perhaps unsurprisingly, a voter-approved stadium-subsidizing Hamilton County half-percent sales tax increase remains in effect, while once-promised additional public school funding and a property tax cut do not. Oh, and the Wall Street Journal also reported that Hamilton County’s annual stadium debt payment two years ago was $34.6 million -- nearly 17 percent of the county’s total budget, and a big reason local lawmakers had to slash spending on schools, police and a program that helped troubled adolescents.

Meanwhile, the Bengals collect parking revenue from the stadium.

Still, at least the county gets to enjoy the job-creating, local business-boosting gold mine of 10 NFL games a year, right? Wrong. Numerous studies have shown that the local economic impact of stadium construction is nil. Dennis Coates, an economics professor at the University of Maryland, Baltimore County, calculates that “the professional sports environment” -- that is, having stadiums and teams in a particular area -- may actually reduce local incomes. “Our model shows that average income is a little bit lower, about 40 dollars a year for a family of four,” Coates says. “Now, why might that be? There are a number of possible explanations. One of them -- and I think this is the most plausible -- is that a large amount of the money spent inside a stadium simply leaves the community. Think about the revenues generated. Fifty percent is player salaries. In most leagues, players don’t live where they play. So they take an enormous amount of money generated in the community and take it to south Florida or southern California and spend it. If that same money was spent on a movie, dinner, bowling, the theater, a locally owned bar, tips for bartenders and waitresses, all of that money predominantly stays within that community.”

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