KJ commissions Sacramento soccer stadium report, shockingly gets answer he wants

Think Big Sacramento, the private nonprofit set up to push for new sports facilities by Mayor Kevin Johnson as part of his secret city government, has commissioned a report from consultants Capital Public Finance Group on the economic impact of a new Sacramento Republic FC soccer stadium, and come on, what do you think it said?

A new soccer stadium could generate $1.25 billion of economic impact over 30 years, according to the study commissioned by Think Big Sacramento.

We’ve been over the problems with using “economic impact” as a metric before (short answer: just because money is changing hands in your city limits doesn’t mean anyone in your city is benefiting), as well as the problems of hiring these consultants who just plug some numbers into a formula without trying to account for money that’s cannibalized from other local entertainment spending, or for economic losses from any public money that’s dedicated to the project instead of to other local needs. CPFG looks to be a local Sacramento group, so doesn’t have much of a track record, good or ill, in such matters, and it shows in the report, which is all of 19 pages long, 14 of which are taken up with overviews of Major League Soccer (attendance is up!) and the proposed downtown Sacramento site (“at the threshold of a new era”!). There’s no source given for any of CPFG’s numbers, and they don’t appear even to account for the fact that some people are already going to see Republic FC games, so counting the money those fans spend at a new stadium would be double-counting, and —

Sorry, this is way more attention than a quickly thrown-together PDF deserves, even if the Sacramento Bee thinks otherwise. Suffice to say that KJ bought himself some 19-page campaign brochures for his plan to get a new soccer stadium next to the Kings‘ new basketball arena. Wake me when somebody’s finalized how to pay for it. I know the Republic owners are saying “privately financed,” but we’ve heard that before.

6 comments on “KJ commissions Sacramento soccer stadium report, shockingly gets answer he wants

  1. Instead of “Just because money is changing hands in your city limits doesn’t mean anyone in your city is benefiting.” I think a better short answer would be “Just because money is changing hands in your city limits doesn’t mean THE CITY AS A WHOLE is benefiting.” Clearly money changing hands benefits some people, but obviously that shouldn’t be the basis for a decision like this.

  2. “Since the construction of the Golden1 Center began in 2014, Downtown Sacramento has seen an unprecedented amount of buildings purchased, with at least 15 properties sold. There is a new interest from non-local investors excited about investing in Downtown
    – this means that much of the rental revenue will go to out of region owners, decreasing the economic benefit locally.

    Furthermore, the revenue estimates are based on almost 100% attendance of all 22 MLS games, which is certainly not typical of MLS clubs. The area (within and outside of the county) also has a number of other indoor and outdoor venues which will certainly be cannibalized by this new stadium. Instead of analyzing similar markets, the primary comparison for existing MLS clubs is whether or not they transitioned from USL, but in includes the two teams with decades-long tradition (Portland and Seattle) and Canadian sides. Sacramento has a good fanbase, but this metric seems to be a little aspirational for a region with a track record of underperforming downtown entertainment options and relatively few businesses that purchase corporate seats.

    I’m excited that live soccer is popular in Sacramento (it’s a soccer town for sure), but the lack of true analysis in this report shows how much this will be shoehorned without a critical eye.

  3. Jeff: Yeah, that’s what I meant. Or rather, “any significant number of people.”

  4. Key word here s COULD.
    Stadium could bring in billions more over 30 years, BUT, within 18 years the stadium would probably be too old, and not up to par with other new (publicly financed) stadiums built for the weathly.

  5. I think I can shorten to two words: Substitution Effect.

    Sleep Train Arena is also in Sacramento. How quickly will businesses move away from there once the new arena has opened? All we’re doing so far is shuffling cards.

  6. I haven’t done the comparison, but I bet there was a lot of cut-and-paste with the 2011 report from the same consultants on the “economic impact” of a new publicly-funded professional basketball arena. Anybody want to check it out? https://www.scribd.com/fullscreen/125988072?access_key=key-slct7855425lxn4mrgl&allow_share=true