September 25, 2007
Does a rising Dome lift all boats?
Headline on an AP story in today's Kansas City Star:
A year after reopening, Superdome driving city's recovery
Needless to say, I had to click on this when it popped up on Google News - I've spent the last ten years challenging anybody to bring in evidence that stadiums can provide significant economic boosts to their cities, so if this was true, I wanted to see it.
The headline turned out to be based on just two statements, both by parties with an interest in promoting the idea of a New Orleans "rebirth" via dome. First, the AP cited figures, apparently provided by the local tourist board, that "a typical sold-out game puts 2,500 people to work" and that the dome's reopening following a $200 million facelift "provided a needed boost in business to area hotels, restaurants and clubs." Then there was a quote from Doug Thornton, VP of the dome's management company: "Out of this disaster came opportunity, and in hindsight, many would agree it was absolutely the right decision at the right time ... not only for the symbolism, but the economic benefit."
Let's give both these statements the benefit of the doubt, though, and assume that the dome's reopening did provide a boost to local businesses. There's an unstated question here, though, and it's vitally important: compared to what? New Orleans, in case it's slipped your attention, is still a disaster area, with affordable housing an especially dire need after many low-income neighborhoods were virtually wiped off the map by Hurricane Katrina. There are lots of ways the state could have spent $200 million, but the AP story makes no attempt to measure whether these would have generated greater economic benefits than just for a few downtown "hotels, restaurants and clubs."
We can, however, measure the one piece of data provided: those 2,500 game-day jobs. Assuming a generous schedule of 20 events (eight Saints home games, a few college bowl games, and, I dunno, monster trucks?), that translates into about 200 full-time equivalent jobs - meaning that for its $200 million investment, the state is getting about one new job for every $1 million spent. That's a worse ratio than some of the most egregious corporate subsidy deals of our time. Where's the headline trumpeting that?
The Saints will not stay in New Orleans. Doesnt "Los Angeles" mean "City of Angels"???
Los Angeles 2nd largest market in the states. Hmmmmm. Dont Angels & Saints have a connection? Hmmmmm. You read it here first. You will soon see The Los Angeles Saints of the NFL.
You're three years too late to be first with that prediction:
http://www.fieldofschemes.com/news/archives/2004/05/nfl_to_la_in_08.html
Posted by Neil on September 25, 2007 05:41 PM
I may be way off here, but I seem to recall reading from the late Will McDonough that because the NFL was awarded a special anti-trust exemption back in 1967 for the NFL-AFL merger, Congressional approval was obtained with a lot of help from Lousiana Congressman Hale Boggs with the proviso that the Saints could never be moved from New Orleans.
Not sure how much of that is true or not, but could be something to make note of.
http://en.wikipedia.org/wiki/New_Orleans_Saints#Early_history
Posted by Jonathan on September 26, 2007 10:25 AM
There were pledges not to move teams, minimum stadium size and such when the anti-trust exception was granted, but they were not written into law, just pledges by the commissioner at the time. This became apparent when teams started to move from place to place in the early 80's. The anti-trust exception was only in effect for the merger so unlike baseball, teams are free to move at will no method for the league to stop them.
Posted by James on September 28, 2007 03:39 AM
I'm usually 100% on-board with your economic analysis but I think New Orleans is unique among American cities. It's in the Super Bowl rotation, the Final Four, and it's a tourism heavy economy. You need some kind of anchor stadium to host those mega events.
I'm not saying that the benefits of the stadium are distributed equally or that spending $200M to refurbish a stadium is the best investment of public money but the Superdome absolutely had to be refurbished to keep the tourism economy of NOLA and it's relatively unscathed French Quarter rolling.
Posted by joejoejoe on September 30, 2007 05:38 AM
I know this article is a few years old but to say the superdome is used only for only 20 events proves clearly this writer is pulling this story out of his ass.
Unlike most cities who built stadiums in the 70s, the superdome is not out in the boonies, it sits in the heart of downtown. That means 166,000 sq footage of convention space is within walking distance of the french quarter and 20,000 hotel rooms. Being that it is an air conditioned dome with art. turf, it is a versatile facilty that can host more then a few football games and monster truck rallies.
In terms of annual, regularly attended events:
8 saints regular season home games +
2 pre-season +
at min. 6 tulane football games a year +
2 bowls (sugar and new orleans bowl) +
Bayou Classic +
the 2 days of the high school football championships (5 games)=
20 "events", 21 days of just regularly scheduled football alone each year. This doesn't include saints play-offs, occasion regular season high school games, the BCS national championship game every 4 years, and superbowl every 10 years or so.
Add in a monster truck rally every year + 3 days Essence fest + the 4 days of the home and garden show + 4 days of the NO boat show. At minimum, 33 days of the year the Superdome is occupied. As a concert venue, it can, and has seated over 75000. It has hosted 3 final fours, with one on the way, the Republican national conention, and mass by the Pope. It's used for boxing, wrestling, figure skating, gymnastics, as a movie theater, and has multiple times served as a shelter of last resort from hurricanes. The Superdome is more then just another football stadium, next time he should do a little research.