We spend a lot of time here looking at ways wealthy sports team owners lobby for public spending on new stadiums and arenas to make themselves richer, or at least give them fancier places to entertain their friends and make their competitors jealous, as one does. But then there are the cases where the sports-industrial complex takes on a mind of its own and demands subsidies for buildings that no team in particular stands to benefit from, on the general principle that all the other kids are doing it, so it must make sense.
One can usually depend on local chambers of commerce to lead the charge for public money to be used for this kind of thing, and sure enough, that’s who’s pushing for Cincinnati to spend around half a billion dollars on a new arena:
“What became clear through our work is that our region is an epicenter of cultural vibrancy, music, art, and sports in the Midwest,” said Brendon Cull, President & CEO of the Cincinnati Regional Chamber. ” In terms of assets, we are missing one key component: a modern arena. Our study makes clear that the opportunity before us is more concerts, more sporting events, more family entertainment, and more comedians that contribute to growth in population, the economy, and cultural vibrancy in our region.”…
“The results of this study mark a significant advancement in the ongoing conversation about the necessity for a state-of-the-art modern arena for Greater Cincinnati,” said Bill Baker, Vice President & Managing Partner of MSA Sport. “By being located in Cincinnati’s vibrant urban core, a new arena will attract more visitors and events, spur additional investment in the city, and further enhance our great region.”
Okay, there’s not no self-interest at work here: MSA Sport would be in line to design and build a new arena, so clearly they have their own reasons to want to drum up business. Other names on the study are the Machete Group, Turner Construction, and Populous, all big names in the sports construction world. (They say they consulted with the owners of the Cincinnati Cyclones minor-league hockey team, who have “expressed a willingness” to partner on the project if the city brings its checkbook; FC Cincinnati owner Jeff Berding has been hot for a new arena for years now as well, though it’s not clear if he thinks he could get operating rights to one or what.) The report’s authors argue that if the city puts up 70% of the money toward a $675 million–$800 million arena project, it could reap $829,000 a year in new tax revenues, which would only amount to a $30 million a year or so annual loss — hey, nobody said they were big names in math.
The study also includes a list of musical acts that toured nearby in recent years but skipped Cincinnati, with the clear implication that it’s because their arena is a dump:
Build a new arena, and Elton John will come! Or, well, maybe not, but somebody will, and who can put a price on that? Sure, pointy-headed economists probably, but who wants to listen to them when there are arena contractors with such nice clear plastic binders?
We know that all realistic studies show the municipality/taxpayers do not get a return on stadium investments, but do we know if there is data on whether or not such projects “ contribute to growth in population, the economy, and cultural vibrancy (however the HELL you would measure that)?”
Populations of places increase for all sorts of reasons. Do they increase because (or in part because) of new stadiums? Does an area’s overall economy benefit, or does the substitution effect rule?
People with agendas keep SAYING these things, but is there any reason to believe these particular claims?
KT, as I discovered when I was on the Tiger Stadium Fan Club’s executive committee, when you press proponents of this sort of thing and you can corner them into admitting that actual figures and rational projections don’t add up, they come up with this sort of thing…”cultural vibrancy,” civic pride, and so forth. A word the proponents of getting rid of the stadium often used was “synergy.”
Basically, when they come up with this, “synergy” is a synonym for “pixie dust.”
By the way, Neil, is there any disinterested study that shows that pouring public money into a stadium or arena owned by private interests is at all a good deal for the taxpayers?
I don’t mean a study that you find properly laid or with which you disagree, I mean any such study?
Define “study.” There are lots of people claiming it’s so without showing their methodology.
There are studies of per-capita income, tax receipts, job creation, all of which show no measurable impact from the presence or absence of sports teams or new venues. Not sure about population growth — dig around in the big meta-study and it might say:
https://t.co/dwkxjzrlca
Occam’s Razor is the best measure for these types of “feel good/Yay! (insert host city’s name here)/Up With People! claims/projects…
Which is to say that if there was/were any kind of net positive return on projects like this, they would be privately financed, allowing the business interest which created them to reap the rewards of their efforts.
In very rare cases, they ARE privately financed and do turn a profit. This should be an example to others, but tends to be turned into a “oh well we aren’t LA or NY so we can’t possibly… so we need the taxpayers to help fund this and then we will be just like LA!”
Council Bluffs/Tuscaloosa Live! vs LA Live! Discuss amongst yourselves…
If the owner or main beneficiary of the arena really feels that there will be some benefit to major employers in having a shiny new plaything for a few years, s/he is welcome to go visit those employers tin cup in hand asking for capital contributions to the great cause.
After all, if ‘everyone’ benefits, surely the major employers in any area will want to be part of the solution.
Chase center in San Francisco was privately financed and seems to be doing quite well. Both nba arenas in Los Angeles were privately financed (crypto.com arena and the intuit dome). T Mobile arena in Las Vegas was also privately financed. Supposedly a new NBA arena in Las Vegas would be privately financed to if it ever gets off the ground. Those are just the places I can think of off the top of my head. There are probably others. So privately financed arena can definitely work
Neil was Madison square garden privately financed?
MSG was privately financed, but has been getting huge annual tax breaks since the 1980s to cover upgrades.
Arenas that are in major cities and can be programmed 200+ days a year can pay for themselves. It’s extremely unlikely that a new arena in Cincinnati would get enough Blink-182 concerts to repay $40-50 million a year in construction debt, whether it’s the public or private investors taking it on.
So easy to refute these arguments, but the politicians rarely do. “Sporting events” won’t pay jack toward new arena debt, or generate significant ancillary revenue in town, unless there is an NBA team or NHL team or both using the building as their home arena. If concert revenue is so vital to the city coffers, then someone should build a grade-A concert venue instead of a sports arena.
Exactly. Thus you have The Sphere in Las Vegas which is built such the it is great for shows but can not accommodate basketball or hockey
The Forum in Inglewood was completely refurbished (by MSG) and is concerts only and seems to be constantly booked as well. * I know it was originally built for the Lakers.
No. Clearly, the most “cultural vibrancy, music, art” coming from Ohio is horror bands:
https://www.fiftygrande.com/he-horror-bands-of-ohio/
This stuff makes Ohio seem cool. The teams? Their costumes aren’t as fun.