It’s been another nutty week in stadiumland, but let’s give thanks for the small things — in this case, for the WP Dark Mode plugin, which has been updated so that it again gives FoS readers the option to avoid eyestrain while still navigating the site as you’re meant to. If you haven’t clicked the little crescent moon in the corner of the screen, give it a try, it’s fun!
Or you can read about the news of the week, which is less guaranteed to be fun, but is still … interesting? Informative? One of those:
- Fox 13 in Salt Lake City claims that both the proposed MLB stadium and NHL arena would create entertainment districts where sales taxes would be kicked back to pay for the projects. We knew this for the baseball stadium, but for the arena the legislation says “authorizes a qualifying local government to levy a sales and use tax within the local government’s boundaries and for use within the project area” and caps the amount at 0.5%, so it looks like this would actually be a citywide sales tax hike? Either way, it’s a lot of money, and still more money would be required to pay the full $1.4 billion combined cost — including, notes University of Colorado economist Geoffrey Propheter, $1 million a year in kicked-back “possessory interest taxes,” more than half of which would come out of school budgets — but it sure would be nice to see some clarity on this before the legislature wraps up its session … wait, today? Well, that’s suboptimal.
- NBC Chicago obtained emails showing that Mayor Brandon Johnson and Chicago White Sox owner Jerry Reinsdorf had their comms departments work together to concoct a press statement about the team’s stadium plans in January, and while it’s sort of understandable given that it was about a meeting between the two, it’s also maybe not the best sign of a mayor being interested in driving a hard bargain for his constituents that when the White Sox asked the mayor’s office to vet their press release, the response was “Could we do a joint statement?” Especially when the resulting statement referred to a meeting “to discuss the historic partnership between the team and Chicago and the team’s ideas for remaining competitive in Chicago in perpetuity” and didn’t mention anything about the $2 billion public price tag.
- Chicago political consultant David Axelrod tweeted that the White Sox stadium plan would be “a game-changer for the city” and immediately got piled on for “peddling disinformation” (The Athletic’s Keith Law), told “You’re not an economist, so how about trust the economists who are” (economist J.C. Bradbury) and “Claiming stadiums catalyze economic development is like arguing vaccines cause autism” (Bradbury again), among many, many others.
- Comcast Spectacor, the owners of the Philadelphia Flyers, are talking about doing a $2.5 billion redevelopment of the parking lots around their arena, to include “hotels, residences, restaurants, shops and a 5,500-seat performance stage.” Funding for the first phase would come from Comcast and its development partners, while the second phase would be paid for by “yet to be determined,” according to the Philadelphia Inquirer, which isn’t a red flag at all.
- The U.S. House of Representatives passed a bill handing over the RFK Stadium site to Washington, D.C. for redevelopment which will likely mean a proposal to build a new Commanders stadium there. Every representative from Maryland but one voted against it, as did four of 11 members from Virginia; “It’s most certainly not a level playing field when one interested jurisdiction receives a free transfer of federal government subsidized land,” said Rep. Glenn Ivey of Maryland. We’re still a long way from actual stadium plans or price tags, and the D.C. council may yet vote to use the site for something other than a stadium, but it definitely adds one more potential competitor to what’s been a mostly quiet of late three-way bidding war.
- MLB commissioner Rob Manfred called the Oakland A’s Las Vegas relocation plans “solid” and immediately got piled on for damning it with faint praise. Manfred also acknowledged that “to most effectively build the [2025] schedule, we need to know at some point in the spring exactly where they’re going to be,” which isn’t exactly giving A’s owner John Fisher a deadline, the commissioner knows who signs his checks. Fisher is apparently hoping that if he agrees to sell his share of the Oakland Coliseum site to the local group that wants to develop it, the city of Oakland will grant him a lease extension to play there through 2027, which isn’t the deal the Oakland mayor’s office has been talking about at all, so we’ll see what the reaction there is.
- Tennessee’s tourism department has asked the state legislature for the right to deny public access to public records about how much it offers the NFL for the right to host the Super Bowl at the new Titans stadium under construction. “The Super Bowl deal is often embarrassing for the NFL because of the demands they make and for the politicians that agree to give the league things like free high-end hotel rooms and police escorts,” notes College of Holy Cross economist Victor Matheson.
- Toronto is now expecting to spend $380 million on hosting six 2026 World Cup matches, which is, let’s see, $63 million per match. It says it expects an economic boost of $392 million in GDP and tax revenues of $119 million, which seem both optimistic and mismatched unless Toronto has a 30% sales tax rate, but since World Cup impact numbers are generally garbage anyway — Matheson once called them “so outlandish as to defy common sense” — we can safely ignore them entirely.
Over 600 million left to pay off for the Chicago stadiums???? No new stadiums until you pay off your last one.
I opened that article about Toronto’s World Cup expenses expecting to read $300 million was just the cost of the kickbacks to FIFA for getting to host some games. Ouch.
Would spending $2B on new stadiums actually be better if the state of Illinois allocated a giant lump sum to pay off the old ones first? Discuss.
Is there any reason why governments can’t just keep creating new TIF districts to help pay for stadiums (and their demolition costs) that haven’t been around for decades?
I mean, think of the tremendous spin off benefits the stadium demolition industry creates. Not only do you get free steel to recycle, you create work for countless window washers and water truck owners, excavator/shear owners & operators, temporary construction fence rental companies, sign makers… and all this before you pay someone under the table to let you dump the residual concrete and associated toxic compounds in a field/swamp/playground somewhere.
Instead of studying all the economic benefits new stadia do not bring, I wish someone in the field would focus on the benefits demolishing them creates.
It won’t happen, and this would obviously be terrible for the fanbase, but I would love to see every city tell the A’s to go play in the street just to see what happens. They might end up being the Osaka Athletics or something like that for a few years
To answer your question about the sales tax for the Utah ballpark, my understanding is that it would be a city-wide sales tax increase with no exemptions. (Fun fact: Utah is one of about a dozen states that still has a sales tax on groceries).
Like I said before, my guess is the arena deal goes through for sure. Their funding scheme is more cut and dry, and the useless mayors of both Salt Lake City and SL County are on board with it. I think the ballpark bill will also be signed to allow for up to $900 million to borrow, but they’ll punt on the funding portion of it. That’ll keep the Miller family (billionaire wannabe owners for the MLB team) and Rocky Mountain Power (the state’s largest utility who owns the land earmarked for the ballpark) happy and shows MLB that the state is “serious” or some nonsense. But with MLB expansion still a ways off, it’ll buy Utah legislators time to figure out a funding scheme that won’t piss off so many politically connected constituencies.
The challenge Utah faces is that the state doesn’t allow for gambling and already has really high “vice” taxes (not to mention controls the hell out of access to those things), so the usual fundraising schemes can’t work here. I really don’t know where they can find $900 million that a) can be spun as “no new taxes on residents” b) would only apply to the Wasatch Front region and c) keeps the biggest lobbyists happy. I’m sure they’ll find a way, but it’s not readily clear how they’ll screw over Utahns with this one.
You called it!
https://utahnewsdispatch.com/2024/03/01/legislature-approves-tax-increase-plan-nhl-stadium-slc/
Surely I’m not the only one who doesn’t know what “possessory interest taxes” means, or whether the existence of that phrase also means that there is such a thing as ‘non-possessory interest taxes’, or ‘possessory interest-free taxes’…
They say ignorance is bliss, but I’m not feeling it on this one…
I’m just going to assume this is a generic term that covers both Jerry Reinsdorf and the Disney corporation reaching into my pocket without me ever knowing it has happened.
I *think* that it’s taxes on real property that sits on public land, but I need to go back and consult Geoff’s book to say for sure.
To get to $392 million in economic impact, it would require the World Cup to bring in 270,000 people from outside of Toronto and spend on $1450 during their stay on stuff. That seems quite high. I guess there might be some sickos who stay for three weeks and run up a bill, but not enough to cover for the day-trippers. Still, the projection for the tax revenue is just an admirable lie.
Unless there was a plan to turn RFK into National Park, I suppose it’s good that it will be given to the city. Now, hopefully the city will use it for something it really needs and not give it to a billionaire.
Brandon Johnson is probably the best thing that happened to Lori Lightfoot.
Here’s the key quote on the Toronto thing:
“The economic benefit is the real piece here,” Toronto Budget Chief Shelley Carroll said Monday. “There’s a sort of unquantifiable benefit to putting on one of these events. and putting the city on the world stage.”
( a ) Money isn’t quantifiable? Don’t we literally count money?
( b ) Do people outside Toronto not know about Toronto? If you watch a game from Toronto, do you see much of Toronto? How did Johannesburg benefit from being “on the world stage?”
At some point, maybe people will just stop listening to these clods and their promises of unquantifiable benefits.