Let’s see, what else happened this week? Massive governmental incompetence and death in India, that has nothing to do with stadiums, let’s stay focused here, people:
- The NFL Draft was last night, and let’s not let the occasion pass without noting that this is yet another dumb mega-event that sports leagues get cities to pay for the privilege of hosting: Cleveland put up $5.5 million in public and privately raised funds to land this year’s draft. Bloomberg Tax goes on to report that this all started about a decade ago when Butch Spyridon, CEO of Nashville’s convention authority, approached NFL commissioner Roger Goodell at a party and “pointed at the [Nashville] mayor and said, ‘You should consider moving the draft. He’ll give you free police and free venues.’” Mayors and shiny objects, man.
- San Jose Mercury News columnist Daniel Borenstein has called Oakland A’s owner John Fisher’s demand for a massive public subsidy a “massive public subsidy,” and also “egregious” and and attempt to “mooch off taxpayers.” He also notes that A’s stadium czar Dave Kaval fudged the numbers on his claims of economic benefits, comparing $855 million in up-front public infrastructure costs with $1.4 billion in projected public benefits without noting that the benefits would be stretched out over 45 years, making them worth way less than $855 million. Borenstein calls this an “inflation adjustment” when it’s actually also the discount rate, which is a slightly different thing, but either way major props for actually doing math instead of just repeating whatever was in the team press release.
- Baltimore is seeking bids from developers to renovate its downtown arena because, let’s see, something about the Washington Capitals maybe occasionally playing games there if it were renovated? Anyway, Baltimore’s development agency is refusing to release any details of the bids because “proprietary information,” so we’ll just have to wait to see how much Baltimore taxpayers are being asked to spend for the privilege of watching live hockey a couple of times a year.
- Depressed about the Tennessee legislature nearly unanimously approving $22 million in sales-tax kickbacks as part of a $50-million-plus subsidy for a new Tennessee Smokies stadium? Well, at least one Tennessee legislator has a line in the sand he won’t cross: state Rep. Jerry Sexton said he was voting against public funding for upgrades to the Titans‘ stadium because he’s upset that some NFL players sometimes take a knee for the national anthem as a protest against systemic racism. That’ll show ’em.
- The Regina Red Sox are asking for $15-20 million in public funds for a $20-25 million baseball stadium, and … oh, sorry, are you not familiar with the Regina Red Sox of the Western Canadian Baseball League, a summer wood-bat league for college players that operates exclusively in Saskatchewan and Alberta? Well, their owners want a new stadium built with public money for their unpaid players to play in, because, let’s see, scroll scroll scroll, here we go, “Currie [Field]’s old infrastructure severely limits our options for food and beverage, seating, parking and our ability to attract corporate sponsors.” Also “a dump built on a dump,” according to team president Alan Simpson, now that’s the way to get fans to turn out for ballgames! Anyway, here’s a YouTube video of renderings of what they want to build:, and though it doesn’t feature any fireworks or magic basketballs (Canadians are so boring, amirite?), it does include this guy who wore sandals to the game and is drinking some kind of beverage while leaning back against thin air, so don’t knock it entirely:
Re: Oakland A’s.
Old Accounting axiom. Figures lie and liars figure (looking at you Dave Kaval).
Sorry but for a city like Cleveland that’s not only mid-sized but also has an image problem having mega-events is important to changing the reputation of the city. Its more advertising than anything: https://www.cleveland.com/business/2021/04/i-didnt-know-you-had-a-beach-and-other-observations-about-cleveland-from-meeting-planners-in-town-for-the-nfl-draft.html?utm_source=facebook&utm_medium=social&utm_campaign=clevelanddotcom_sf&fbclid=IwAR0A55iBCSsOpdAgPGTOZpAqBAEQ4rgO8Vm0bE-DdYjcgj6Io2jn3kWuwFU
And research has shown time and time again that the PR value of big events for cities is near zero. It sounds good anecdotally, but it doesn’t show up in the economic data.
How do you quantify how positive perceptions of a city show up in economic stats? For example, if people watch the draft on TV and decide “Cleveland looks kind of cool lets go and check out the Rock Hall” or if the people who attend the draft who otherwise might not have visited decide they like Cleveland and visit more often in the future. We see all the time when companies relocate or decide where to put a HQ its largely based on where the executives like hanging out. How is that quantified?
You quantify that based on increased tax revenue or hotel stays following an event. If the trend line remains the same, then the event had little impact.
But cities typically only see long term benefits when they host a unique experience for several years— long enough for investors to build actual pertinent infrastructure.
Disneyworld vs. Ringling Circus
Except the more traditional traveling circuses had to pay their own bills, unlike the NFL.
In Cleveland’s case this is a relatively new thing as they just built their convention center and several hotels downtown in the past few years (I believe the convention center opened in 2013ish) so its a test case. However, you look at a place like Vegas that started off as just a place for tourism and now has grown to the point where non-entertainment companies are relocating there. I use my own example, I visited Cleveland for a football game and as a result took a liking to the area and eventually wound up living there for 13 years. Prior to that first visit I never heard anything good about the place. Even now I go back for games annually. Now yes I am a unique case but getting people/companies to move to your city requires having a positive perception of the city and when you start where they are they need events like this.
In the last 6 years, Santa Clara and San Jose have hosted a Super Bowl, an NHL All Star Game, and a Stanley Cup Playoff and Championship. They also already had two convention centers, a theme park and several hotels.
Neither of those marquis events spurred any renewal to these bland step-sister to SF cities or fueled any long term revenue or interest.
Nobody, and I mean literally nobody, is saying to their spouse: “Hey, let’s go to San Jose for a long weekend.”
You proved my point, Sam’s point above and John B’s point below when you mentioned the Cleveland HOF and Vegas. Have or build a series of long term, iconic attractions, vibe, soul etc and that may be a ticket out of obscurity. A one-time event ain’t gonna do it.
But the Bay Area is already an area that has a positive reputation. They don’t need these sort of things. Heck if the Giants had moved to Tampa in the 90s the area would still be doing well. Cleveland isn’t San Fran (as much as I am fond of the area).
I am pretty sure the Regina Red Sox fan is not leaning back, but rather he is in the process of falling backwards and passing out due to the # of beers he’s consumed at the game.
I thought he might be about to make a, um, comment on the lack of restrooms right there on the concourse floor in front of ‘everybody’ (which is likely less than 1,000 fans on average).
To be fair, Royal Farms Arena is older than every single current NHL and NBA building; if it lasts ten more years it’ll have been open longer than the Boston Garden was. Provided the taxpayers don’t get stuck with the bill, I have no problem with a new building. Maybe they’ll even scrape up a semi-pro sports team to play there.
I care less about the age of a stadium than when physical things are lacking when deciding to spend money on an upgrade/repair/replacement.
The problem with an “event” like the NFL draft being subsidized to promote the host city is that it effectively shows none of the city.
Sure, you might have a couple of lead in/lead out shots of city landmarks or bars or something approaching nightlife when it’s time for commercials, but as far as the event itself goes you see nothing of the city. The arena/convention hall could literally be anywhere (including the inside of a soundstage at television city in LA) for all the public knows.
Drafts and indoor events in general are less useful as promotion devices for that reason (I’m not saying showing the Detroit or Pittsburgh skyline from inside a baseball stadium is a huge tourism impact, but at least you can see the city. You can’t from inside an arena or the former TransWorld Dome, for example.)
And when only a few fans can attend these things due to pandemic restrictions, you get even less bang for your PR and marketing bucks.
If you want to show the sights and attractions of your city during the NFL draft, you’d be money ahead to spend $1m buying actual tourism commercials during the broadcast rather than hosting it and hoping people stay glued to the TV during the LI/LO segments and notice your city…. for $5m +.
The question really isn’t whether hosting this event is worth “anything” to the city’s tourism industry. It’s whether it is worth more than you could have generated by spending the same amount of money on other tourism promotion methods.
NDM,
Curious: let’s assume the Oakland City Council becomes foolish and, even during dire economic times, approves the $800+ million in public funding for the A’s ballpark development. Can the A’s use that funding for actual ballpark construction, under the guize of “infrastructure” funding? 45 YEARS to see the entire $1.4 BILLION in “public benefits”?!! LOL!!!
Oakland’s current City Councilpersons.
https://www.oaklandca.gov/departments/oakland-city-council
Along with Oakland Mayor Libby Schaaf, NdM’s original “gang of four,” I’m thinking “good luck with that one.”
Oakland elected officials could never be confused with those of Knoxville.
Neil,
Another thing that was brought up this week Manfred without anyone asking said some blub about an expansion team being $2 Billion and mentioned expansion would obviously reduce the revenue pool by dividing 32 teams instead of 30 teams. Why do I think this is interesting. Its a change of tune of how he talked about the subject 3 years ago. My take: you mayor and govs better step up on the A’s and Rays because all I’ve been hearing is crickets in Charlotte, etc, etc