Aw, man! I was afraid that Portland Timbers plan to spend $50 million of their owners’ own money to expand their stadium, asking for no public money at all, was too good to be true — and turns out it is, as the team’s owners want a ten-year exemption from ticket taxes on the new seats, just because:
Commissioner Nick Fish, Wheeler and Golub all noted that the proposal asks the city to waive taxes on tickets that would not otherwise exist without the Timbers spending $50 million on an expansion.
“It seems reasonable to ask for an exemption on taxes that would not already be generated,” Fish said.
Yeah, no, that’s not a reasonable thing to ask for at all: It’d be like me buying a new car and asking to be exempted from gas taxes for any additional miles I drove as a result, or me getting an advanced degree and asking to be exempted from income taxes for any additional salary I earned. Investing in property is a perfectly normal business practice, and paying taxes on the increased revenue you get is a part of doing business, and something you have to factor into your revenue calculations — asking to have taxes kicked back to you is a subsidy, pure and simple, regardless of whether you dress it up in “these are taxes we wouldn’t be paying if only we weren’t earning more money.”
To make matters worse, the Oregonian reports that the city pays for maintenance and insurance on the building, and those costs will go up some once there’s a bigger building to maintain and insure. “We will see an increase in our costs,” Portland spectator facilities and development manager Susan Hartnett told the paper. “Obviously, with the expansion, it will go up. As will the repair costs, with more square footage.”
It’s still not a huge subsidy — about $2 million over the course of the decade for the tax break, plus whatever the increased maintenance and insurance costs tack on — so the deal still looks pretty good for Portland, assuming Portland taxpayers have any interest in the Timbers having a bigger stadium. (Better access to tickets for otherwise sold-out games, I guess?) But it’s an important reminder that sports team owners — and development tycoons in general — see themselves as very different from you and me: Whereas our taxes are the price we pay for having the benefits of a democratic government, their taxes are a gift they’re giving to the public, and which they can ask to have rescinded at any time if they want to use the money for something else. Nice work if you can get it.