Spokane arena doesn’t make money, but it does make … smiles, I guess?

Hey look, it’s two happy-ending sports venue stories in one day! Or happyish endings, anyway: The Spokane Spokesman-Review reports that the Spokane Arena, built in 1995 at a cost to the city of $62.2 million, is profitable, draws concerts that otherwise wouldn’t be likely to stop by eastern Washington (Cher! Three times!), and is home to minor-league hockey and arena football.All of which is great, until you read the fine print:

  • The arena “reported an average operating profit of $962,000” from 2004-2012, but that’s just an operating profit. If you count construction debt, the arena is losing a few million dollars a year.
  • Some of those concerts would likely play in Spokane regardless: “Being the biggest city between Minneapolis and Seattle means the arena hosts some acts that can’t afford not to play along the way, said Kevin Twohig, the Public Facilities District’s chief executive officer.”
  • The PFD and the teams that play at the arena already want a new one in the next decade or so, because, as Twohig says, “You’d have a hard time finding a 30-year-old arena in a major market right now in the U.S.” All the other kids are doing it!

There are some bright spots here: Spokane’s arena was fairly cheap compared to a major-league facility. And as economist Geoffrey Propheter (you remember Geoffrey Propheter) points out, there are intangible benefits to an arena as well:

The intangible benefits of the Arena are by definition difficult to measure, but they include public use of the facility for events such as graduations or the Washington State B basketball tournaments it hosts each year. If arenas are built with public money and those aims in mind, Propheter said, the goal is more focused on the intangible benefits than the tangible ones.

“The policy objective is not to increase the amount of cash in someone’s pocketbook or jobs,” he said. “Instead the goal is to give the community a place to engage in certain activities, and that makes people happy. That happiness is difficult to quantify, but it is a real sense of happiness for the community.”

That’s absolutely a consideration: If getting to host some NCAA tournament games every few years and having arena football and minor-league hockey and all that comes with the new arena (Cher! Three times!) when you’re practically on the Idaho border is worth the $62 million price tag, then far be it from me to argue. Spokaners might want to be prepared to put a price on happiness before the next arena bill is presented in a few years, though, just in case.

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7 comments on “Spokane arena doesn’t make money, but it does make … smiles, I guess?

  1. I guess if your name is Propheter, your only career options are economist and phone astrologist.

  2. Unless the vote to build it was unanimous, I’m guessin’ that a lot of people in that community are getting shortchanged in their happiness account.

  3. Key Arena is 54 years old and is hosting the same acts that play in Spokane….but Cher has been going to Everett.

  4. I’m actually okay with arena projects that lose money, IF the backers are willing to say, “This is going to remove blight, improve this area, reduce crime, bring in business, and COST YOU MONEY, which is why we’re only going to do this with voter approval.”

    It’s when they hide behind bad studies and then say, “We know what we’re doing, so we don’t need a vote” that I get mad.

    Yes, I’m still talking about Sacramento, which conducted a very poor study to get an arena. That’s going to bankrupt us.

  5. MikeM-

    I agree completely. If they were selling the Vikings Stadium as a project to focus spending within a certain area in the metro, a sop to the construction unions, a community pride project, et cetera, and debating it on those merits I would have no problem with it.

    The problem is that they know those arguments won’t fly when you are talking about a half billion or billion dollar subsidy. So they break out all these ridiculous economic impact figures that are little more than lies and wishful thinking.

    I will never forget the fancy Aquarium Duluth Minnesota built with a bunch of City debt under the premise it was going to have as many visitors as the Shedd in Chicago and average $10/head.

    The figures were hilarious before it even came up for vote. But the mayor and the conservative wing of the city council were in bed with the construction industry, and the liberal side of the council loved the public spending on an “educational” amenity and construction jobs, and so no one cared when people raised objections.

    Then over course over the next several years as it hemorrhages money like an ebola victim hemorrhages fluids and the city needs to keep paying 90% of the operating costs and debt service of this supposedly self-sustaining project everyone is like “I was never for that!”, or “how could we have known 10,000 people a day wouldn’t turn up in January in northern Minnesota?”.


  6. Just a point of information: Spokane is home to a Major Junior hockey team, not a minor league hockey team. Minor leaguers get paid, Juniors don’t (or they lose their eligibility). Plus minor leaguers can use their own ID if they want to buy a beer…Juniors aren’t old enough. FWIW.

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