Who hates the San Diego Chargers‘ $1.15 billion stadium-convention center public subsidy demand? Not only most San Diegans, it turns out, but the hotel industry that would have to shoulder increased room taxes in exchange for all the new tourists who would be expected to come to town as a result, but it turns out, wouldn’t really:
The Chargers’ plan for a downtown stadium-convention center will not generate enough meeting business to justify an increase in the hotel tax, concludes a new study funded by the tourism industry…
The proposed center, the study says, holds only limited appeal to meeting planners and would generate just $2.3 million more a year in additional hotel tax revenue, compared to what it estimates are the $67 million in annual public costs for both construction and operation of the project.
Okay, sure, economic impact studies, which can be made to say pretty much whatever you want them to. Still, $2.3 million a year in return on $67 million a year in new costs is pretty horrible even as a worst-case scenario. And the report correctly points out that other NFL-convention center joint projects have worked out pretty terribly as lures for new convention business, though as I’m sure Heywood Sanders would point out if he were awake at this hour, that’s true of lots of standalone convention center expansions as well.
Anyway, the upshot is that Chargers owner Dean Spanos’s uphill battle to convince two-thirds of San Diego voters to approve this thing in November just got even steeper. I’d never say never, especially before all the campaign spending is spent, but if you’re looking to place bets on how the stadium vote will go, take the under.
One of the examples of absolute hubris involved in the stadium extortion game is certainly hotel and rental car tax transfers. The self same owners who vehemently object to ticket taxes used as a funding mechanism will happily demand that alleged “visitor” taxes be kicked back to pay for their facilities (not limited to game day stadia, of course… practice facilities sometimes have tourist tax funding too).
At least with a ticket tax you know it’s only the people going into the stadium (or buying tickets, at any rate) that will pay it. Hotel and rental car taxes are a drag on all forms of tourism, not just sports related visiting.
Here’s a solution for the Spanos family: if they can’t get a workable stadium solution in San Diego, don’t move to Los Angeles (where support for the Chargers is not there), sell the franchise to someone who is committed to keeping the team in S.D.
I don’t know the dynamics at hand of Qualcomm Stadium, but would it be feasible to renovate the facility as Dolphins owner Stephen Ross did (and paid for at his own expense) in Miami after taxpayer funding for renovations failed to gain approval at the state level back in 2013?
I’m sure it really isn’t that hard. What would be great to know for the city, as a potential “business partner” of the Spanos family, is how much revenue the Chargers get from the Q, why it falls short, and how much they’d expect and how’d they’d gain it by a new stadium.
It really is fascinating that these figures–core information for any business plan–almost never feature in discussions of new public funded stadiums.