When the owner of the fledgling minor-league soccer team Indy Eleven said that a new $87 million publicly financed stadium could pay for itself by generating $5.1 million a year in ticket taxes, I did a little math: Even if the team jumped to the major-league level, I estimated, it couldn’t expect to generate much more than $8 million a year in ticket sales, which would mean $800,000 a year in ticket taxes, which would mean a whopping big budget hole for the state.
That analysis took me about two minutes. Now somebody with actual time to do some real research has conducted a more in-depth projection, and it is so much worse than even I had predicted:
An analysis by the Legislative Services Agency, an independent body advising the legislature, estimated this week the soccer team would generate just $2 million to $4 million a year in ticket sales, significantly less than the team’s estimate of $51 million.
Yeah, by a little bit. The LSA study was based on average ticket sales in the NASL (the minor league that Indy Eleven currently plays in), not the MLS, which is one reason its numbers are lower than mine. But no matter how you slice it, it’s inconceivable that Indy Eleven would get within shouting distance of generating enough ticket tax to pay off the public stadiums bonds — as the Indianapolis Business Journal notes, to reach the $5.1 million target for ticket-tax revenue, the soccer stadium “would have to sell in tickets alone more than four times the total revenue of the [minor-league baseball] Indianapolis Indians. The well-established Indians reported a record $11.8 million in revenue in 2013, including tickets and concessions.” (They also play 72 home games a year compared to 17 in MLS, one reason the Indians sold more total tickets than all but one MLS team in 2013.) The IBJ also reports that team owner Ersal Odzemir “did not immediately respond to an IBJ request for a breakdown of how much of his estimated revenue would come from non-soccer events.”
As a reminder, if the ticket-tax money falls short, as now seems inevitable, the next revenue stream would be income and sales taxes paid by the team, most of which would be cannibalized from existing tax revenues. (Unless people in Indianapolis are suddenly going to find a giant pile of new spending money as soon as they have soccer tickets to buy.) So this is really the difference between a project that could pay for itself and an $87 million gift to a team that hasn’t even played its first game, and has gotten no indication that it will even be allowed to apply for a jump to the majors. The soccer plan has only just begun to move through the legislature — a bill to increase by $2 million a yeae the amount of sales and income taxes that can be diverted to Marion County’s Professional Sports Development Area has passed the state house, but that money doesn’t have to be used for a soccer stadium — so hopefully legislators will actually look at the numbers before rubber-stamping the plan. Even if this is Indiana.