It looks like the MLB owners’ vote on the Oakland A’s move to Las Vegas is going to wait until Thursday, but during the lull the Wisconsin legislature approved their own nine-figure stadium subsidy, for the Milwaukee Brewers. Members of the state senate, which voted 19-14 to join the assembly in supporting the bill, had previously indicated that they wouldn’t sign on unless Brewers owner Mark Attanasio had to cough up a bigger share of the cost, so let’s see what they got:
An amendment approved Tuesday requires a $2 fee for events like concerts — with the amount rising to $8 for a ticket that allows access to “a stadium luxury box or suite.” The amendment increases the surcharge on non-Brewers events to $3 starting in 2033 and to $4 starting in 2042. The fee for box or suite tickets will increase to $9 starting in 2033 and to $10 starting in 2042.
Okay then! The $2 non-sports ticket tax and the $8 luxury suite ticket tax were already part of the previous version of the bill that couldn’t win passage last week, so the only difference is an extra dollar per ticket starting ten years from now and another dollar ten years after that. It’s a little hard to determine exactly how much that’ll be worth to Wisconsin taxpayers without knowing how many tickets will be sold, but given that the two tax surcharges together were only originally supposed to be worth about $8 million in present value, plus the way that time works, we’re likely talking about less than $5 million in additional new taxes. At best, then, the senate’s haggling brought the total public cost down from $440 million to perhaps $435 million.
And there was much rejoicing:
“We’re investing long-term in a state asset and ensuring that state taxpayers are coming out ahead,” [Senate Minority Leader Melissa] Agard said on the Senate floor ahead of Tuesday’s vote. “We’re working across the aisle — with partners inside and outside of the Capitol, with local governments — to ensure that a foundational, iconic part of Wisconsin remains in Milwaukee.”
Looked at another way, the senate just helped set the price for how much governments are willing to give up in tax kickbacks to keep a team from even thinking about leaving town, and it’s $435 million for a 20-year lease extension. That may not be the worst deal in recent memory — Maryland, let’s not forget, is plunking down at least $750 million to guarantee 30 more years of the Baltimore Orioles — but it’s still a ton of money for a stadium that is only 22 years old and only cost $400 million to begin with. The business model for running a sports team, don’t ever forget, isn’t just to use your cartel power to extract money to get a new stadium; it’s to use that power to keep getting more money, again and again, until the sun burns out. Stadiums are 100% the grift that keeps on giving, and nobody’s going to stop taking advantage of it until somebody makes them stop. It would be nice if elected officials would read the room and see that these public subsidies tend to be massively unpopular, but if lobbyists have their ear more than constituents, flaming torches and pitchforks are always an option.
“…public subsidies tend to be massively unpopular…”
Not on election day, which is the only day that counts. Not one of the people involved in this giveaway will lose an election, or even a night’s sleep worrying about it.
Way more elected officials have lost their jobs for approving stadium payouts than for opposing them. (Including Wisconsin’s George Petak, who was recalled after being the deciding vote in the original Brewers stadium deal.) But you’re correct that voters seldom make election-day decisions based on individual subsidy deals.
Didn’t the Cobb County guys get voted out?
Tim Lee did, yeah. As did the Miami-Dade mayor, a few others.
“without knowing how many tickets will be sold”
Do the government agencies actually audit these teams and stadium operations to make sure they are paying what they are supposed to?
This is a well-timed question, as I just received the response to my open records request about the Orioles’ rent calculations. I’m still going through the documents, should have a report back here by Monday.
Well done Wisconsin Senate! You have really held the Brewers hedge fund owner’s feet to the fire on this one!
NO! We aren’t giving you $440m. NO!
Ok, we’ll give you $435m, which could rise at some point if we find out that you don’t spend the money – a net $22m per year – on the team and just pocket it instead, and fans stay away… then our ticket tax won’t raise us as much money. Or maybe any more than we are getting now. But hey, no-one can predict the future…
But it’s wonderful, this deal. It ensures that… something…may happen. Oh yes, that’s right, that a hedge fund billionaire (*oops, pardon me: a global alternative investment firm focused on below investment grade credit markets with primary strategies that include funds that invest in leveraged loans, high-yield bonds, mezzanine debt, special situations, and distressed securities.) will get his second $400m+ subsidy in the last 20 years.
Because who are we as a society if we can’t funnel $800Bn to a guy who paid $233m for the team (to Bud Selig, naturally), and who used to work along side Michael Milken at Drexel Burnham Lambert before that whole unfortunate junk bond thing became public?
Well done Wisconsin!