Under the law, Porter County would have to approve a one-percent food and beverage tax to have representation on the stadium authority. The governor said if it doesn’t get approved, the biggest impact would be on Porter County itself.
“If they choose not to put any skin in the game, they’re not going to have any say-so for what happens from all the economic benefits we’re going to get from it,” Braun said.
The whole Porter County kerfuffle points up one of the weirder things about the Indiana Bears stadium deal: Though it was passed by the legislature back in February, it didn’t precisely spell out who would be spending what on a stadium, or even where exactly it would be. A newly created sports authority will be able to offer the Bears owners money from a whole bunch of taxes, only some of which actually exist yet:
All new property tax, income tax, and sales tax for the next 35 years from an omni-TIF district encompassing the stadium and an undetermined number of square miles around it. This could certainly amount to billions of dollars, much of it potentially cannibalized from spending that has nothing to do with the Bears, but just as we saw in Kansas, it’s impossible to say exactly how much without knowing the size of the district.
A doubling of the Lake County hotel tax from 5% to 10%, which would provide at least $90 million.
Those 1% food and beverage tax surcharges in Lake and Porter counties, which would be worth about $250 million each, if approved.
A 12% ticket tax, which would be worth about another $200 million, though as established ticket taxes are unlike other taxes in that they tend to come out of team owners’ revenues.
The best guess at the total public cost is “easily past $4 billion,” but that could go up or down depending on what gets approved in terms of that tax diversion district plus the new taxes. And a quarter-billion dollars from Porter County seems like a significant amount of money, though I suppose Braun is right in that if county leaders balk at that, the state could always compensate by running the omni-TIF district all the way to the Ohio border.
All this makes Indiana’s bid for the Bears a bit of a moving target in the state’s bidding war with Illinois, which is no doubt very much to Bears owner George McCaskey’s liking. (“You’re willing to give us $1.5 billion in property tax breaks and infrastructure money, you say? Well, what if I told you Indiana was offering a TIF district the size of the entire Local Group?”) Right now you have a three-way — or more, given the various Illinois factions — game of chicken going on, and nobody’s showing each other their cards, and … okay, maybe it’s too early in the day for me to be writing extended metaphors. If anyone says they know how much money Bears execs could get out of either Indiana or Illinois, they’re lying, that’s the upshot here.
First off, a special note of thanks to all the FoS supporters who get daily posts by email for your patience while I’ve spent the last week or two figuring out how to make the formatting more readable on mobile devices. (The actual code took just a few minutes to write; figuring out where to insert it in the convoluted system that sends out notices as soon as posts are published was a much longer saga.) I hope this reduces your eyestrain, even at the risk of easier access to stadium news raising your blood pressure.
And speaking of stoking ire, here’s the rest of this week’s news items that didn’t make the daily cut:
New Orleans Pelicans owner Gayle Benson is reportedly working on a lease extension with the state of Louisiana to be signed by the end of this year, which could be a 10-year deal with additional five-year options like Benson’s Saints got. No one’s saying a word about the important stuff — how much the state would kick in for arena renovations as part of the deal, and whether Benson would pay any added rent or revenue sharing to help repay the state’s costs — but given that the Pelicans owner has previously said she wants more luxury suites with crushed velour furniture in order to boost the team’s profits, which are currently only about $77 million a year, don’t hold your breath on this “public-private partnership” including a ton of private.
A Kansas City labor organization has succeeded in getting enough signatures to put a vote on the November ballot on whether to use city money to fund a new Royals stadium. Mayor Quinton Lucas has declared “the train’s already left the station” and threatened to get the deal signed off on before November, to preclude the public from having a say; the group Missouri Workers Power has threatened to sue to block Lucas from doing so, citing legal precedents where courts struck down legislative actions taken on issues where voter initiatives were pending.
North Carolina house speaker Destin Hall is not so crazy about the idea of setting aside a pile of state money to build a Raleigh-area baseball stadium for a proposed MLB expansion team, saying, “Private companies should pay for their own facilities instead of relying on the General Assembly. However, if someone presents a proposal showing that North Carolina taxpayers would get a strong return on the investment, I am willing to consider it.” State senate leader Phil Berger, who lost his primary by 23 votes in March, has been the main advocate of a stadium funding bill; both Hall and Berger are Republicans, while Democratic Gov. Josh Stein said this week, “We’re eager for this opportunity to be considered, and we’ll do all we can to support it.”
Some Illinois state legislators don’t seem inclined to revisit tax subsidies for a Chicago Bears stadium no matter what Gov. JB Pritzker says: Comments this week (all from Pritzker’s fellow Democrats) included, “What the Bears wanted was a blank check We not only said no but, excuse my language, hell no,” “If you come to the table in Springfield and you are a liar, it doesn’t bode well for you,” and “The big issue that came about was, Are we going to give billionaires more taxpayer dollars?”
Neighborhood leaders around the Chicago Fire‘s proposed stadium at the The 78 site say if the city is going to devote tax money to parking garages for the stadium, it should also kick in for a community benefits agreement to provide funding for transit access, affordable housing, anti-displacement protections, public infrastructure, and support for local businesses. Whether to view this as a vital instrument of democracy to ensure that regular citizens can get dealt into public spending priorities or just a way for developers to buy off local community leaders by cutting them in on the deal is, as always, a reasonable question.
Most of the news coverage of the economic impact of the World Cup has disappeared as coverage of the games themselves has taken over, but Seattle’s KUOW did check in on local businesses this week and found that food outlets near the stadium that sell drinks or quick grab-and-go food items are doing great while businesses farther away or those that sell things fans may not crave before or after a soccer match (Vietnamese cookies, vintage clothing) are having a miserable time of it. Yup, checks out!
Crain’s Chicago has another article quoting Illinois Gov. JB Pritzker as saying the ball is in the Chicago Bears owners’ court as far as coming up with a demand for an Illinois stadium bill, just like Pritzker already said last week. The governor went a bit further this time in saying that Bears execs are actually working on cobbling together a new bill — “I think they’re looking at both of the bills that passed — the one in the House, the one in the Senate — hoping to put the provisions of each of those together in a form that they think will pass” — and reiterated that he’s willing to call a special session of the legislature as soon as team officials have all their votes in a row.
That’s all old news, so instead I’d like to take the time to focus in on this paragraph from the Crain’s piece:
Even though the bill didn’t provide any public money for the stadium, many Illinois legislators were cool to the idea of providing property tax breaks to a privately owned football team at a time when constituents are worried about the higher cost of living and struggling with their own taxes.
Look, I get it. There are only so many minutes in the day to report and speed-type reports like these, though at least Crain’s writer John Pletz appears to have a more reasonable one-article-a-day workload. And journalism shorthand is an established thing, so wanting to say “public money” when you mean “direct cash subsidies” is sort of understandable.
Still: Saying the rejected megaprojects bill “didn’t provide any public money for the stadium” but did “provide property tax breaks” is just nonsense, and doesn’t belong in any self-respecting news outlet. Tax breaks are very much public money — they’re calculated as such in an annual “tax expenditure” report by the state comptroller, for one thing — and are equally valuable to team owners’ bottom line, as saving $700 million on your property tax bills is no different from getting $700 million worth of government checks. So while the turn of phrase may seem innocuous, it ends up misleading those readers who are worried about the higher cost of living and struggling with their own taxes. And that’s before even considering that one of the bills previously considered would take sales and hotel taxes collected in a stadium district and use them to pay off stadium bonds, which isn’t a tax break at all, it’s just a government check.
As for where an Illinois stadium would go, the Bears-owned site in Arlington Heights is still the most likely target, though that isn’t stopping other communities from trying to get in on the bidding: In addition to the industrial suburb of McCook, state rep Curtis Tarver has proposed a site at 85th and Lake Shore Drive on the far South Side near the Indiana border, saying that he told Bears CEO about the idea and “he certainly did not tell me that’s the worst idea I’ve seen in my life.” Hope springs eternal, and summers eternal too, at least when a special session is on the table.
I will take this notion of the Bears in Indiana slightly seriously when I hear Colts ownership demanding that ‘whatever Indiana does for the Bears, they must do for us- err, again, err….”
Experts say the Colts and the city [of Indianapolis] are undoubtedly watching the Bears’ negotiations to gauge the state’s appetite for incentives and partnerships that could expand the team’s local impact and its own revenue. … Pete Ward, chief operating officer for the Colts, said the team is interested in growing its revenue from inside and around the stadium, potentially with a stadium district. He also confirmed the team is considering a new training facility and headquarters downtown.
That’s not quite “We need whatever the Bears get,” but it’s certainly Colts owners the Irsay family beginning to jockey for position to be next in line for whatever they think they can arm-twist Indiana government officials into dishing out out. The Irsays’ lease allows them to choose in 2032 whether to extend their stay beyond 2038 or opt out in 2035, and as we have seen time and again, lease opt-outs are a recipe for fresh subsidy demands. And Ward, if nothing else, is preparing an obsolescence claim about his team’s 18-year-old stadium by talking up how it’s already less shiny than some other teams’ homes:
“It feels like it’s brand new, but where it’s lacking is in amenities and diversity of revenue streams,” he said. “We would love to see some things happen down there, but we’re not asking the city to do that. We’re not asking them right now, and we’re not saying it’s their responsibility. We’ll have to see how things evolve.”
Does that translate as “We’re not planning on asking the city for money, we’re planning to ask the state”? Or “We’re not asking the city for money yet, give us a few years?” And does “amenities and diversity of revenue streams” mostly mean team execs are eyeing a stadium district — something Indiana house speaker Todd Huston called a “huge opportunity to do some really cool stuff” — or more wine bars in their current stadium, or what? Too many variables this time for a single bet, maybe a parlay is the best move.
The Chicago Bears‘ search for the city that will lavish it with the most public stadium dollars has officially re-entered the throwing-stuff-at-the-wall stage, with fresh suburbs entering the fray. Last week, McCook, Illinois Mayor Terrance Carr and four of his top officials hand-delivered a letter to Bears execs spelling out a stadium proposal in his village west of Chicago. And while Carr wouldn’t say what was in it — no spoilers for Bears execs before they’ve read it! — he did provide some hints:
The proposed site is at the southeast corner of 55th Street and East Avenue, filled in quarry land. … [Carr’s] proposal: The Bears or the village would buy the land. Then the Bears would build a domed, 80,000-seat stadium, which the team would give to the village. In return, Carr would charge the team $1 a year in rent. As a publicly owned stadium, it would be exempt from property taxes.
That would provide the “property tax certainty” that Bears officials say they want — at a cost of hundreds of millions of dollars to the McCook treasury, plus the cost of buying the land from its current owners for around $160 million. (Estimates of the cost of a tax break on a similar Arlington Heights stadium came to $700 million, and there the team would still be paying current property tax levels, while in McCook it would pay nothing.) “It’s not a waste of money for me to do this,” said Carr, while also saying, “This is prime real estate. If we don’t get the Bears, I’ll get some development there.” Wouldn’t that seem to indicate it would be a waste of money, if the mayor thinks he could get development without putting up $800-million-plus in subsidies? Unless Carr just means “somebody is eventually sure to snap up my get-out-of-property-taxes-free card,” in which case he’s only leaving out whether a football stadium operating ten days a year would be the best bang for $800 million in public bucks.
Random suburban officials delivering secretive manila envelopes to NFL teams wouldn’t normally be much of a news story, but all the other potential Bears stadium plans remain up in the air: Illinois officials are still in “tell us what we have to put in a tax break bill for you to commit to our state” mode, while officials in Porter County, Indiana continue to balk at a 1% restaurant tax surcharge to help pay for a stadium in Hammond, which is not actually in Porter County.
“I think there’s actually a negligible percentile of Porter County residents that support creating a food-and-beverage tax in our county and putting that money in an envelope and sending it off to Hammond,” [Porter County Commissioner Jim] Biggs told the Indiana Capital Chronicle. “We have our own issues here that need to be addressed.”
Outgoing Porter County Council president Andy Vasquez, who lost his primary for reelection this spring after supporting the Bears stadium tax, added, “Evidently people don’t want it because I’m no longer going to be here after December 31st. I’m not going to be here, so we’ll leave it to the next group.” It sounds increasingly like nothing is going to get decided until next spring, when Indiana’s bill to provide a somewhat hazy amount of money for a Bears stadium expires — if you were ever inclined to take sports team execs’ pronounced deadlines seriously, this might be a good reminder to quit.
Before we get to this week’s news roundup, some old business from last week: I shamefully forgot to give a shoutout to John Mozena for his outstanding liveblog of the stadium-related papers at University of Maryland-Baltimore County’s annual sports economics conference after I was unable to attend. Please check out John’s work at the Center for Economic Accountability and throw some coin his way if you like, or at the very least get some of his free “Pay For Your Own Damn Stadium” stickers.
Back in the present, you’re stuck with me, and I’m stuck with this week’s avalanche of news items:
The North Carolina legislature is debating whether to set aside unspecified hundreds of millions of dollars in its final budget for a stadium for a potential future MLB expansion team “in or near Wake County,” which would mean the Raleigh-Durham-Chapel Hill “Triangle” area, as distinct from the Greensboro-Winston-Salem-High Point “Triad” area that voted down paying for a stadium to lure the Minnesota Twins back in 1998. The state has a $700 million Economic Development Project Reserve that it can designate for “high-yield” development projects, and while sports stadiums are nobody’s idea of high-yield in terms of actual measurable impact, there’s got to be somebody somewhere willing to write a consulting report claiming otherwise.
Former Pittsburgh Steelers quarterback Charlie Batch says team ownership is ready to get back on line for a new or renovated stadium now that their current home is 25 whole years old: “Thirty years is the expiration date. Guess what Acrisure Stadium is? Twenty-five years. So I promise you, conversations are happening behind the scenes to figure out kind of what the next move is as the Rooneys are looking for an upgrade in their stadium.” The next move, apparently, is to send your former-players-turned-YouTube-creators out to talk up how stadiums just straight-up become obsolete after 30 years and somebody has to build you a new one and see if that flies.
Illinois’ efforts to retain the Chicago Bears in the wake of team execs’ announcement that they’re absolutely, definitely (maybe) moving to Indiana remain very much undead, with Gov. JB Pritzker saying his state is ready to act but first needs “the Bears to focus on what they want,” adding, “they have not been clear about what is the bill that they need, and how do they need to look, and then, can they get the votes necessary to get it done in the House and the Senate.” State house stadium bill sponsor Kam Buckner noted that both that body and the state senate have passed competing bills — there’s also now a third one, filed by State Rep. Martin McLaughlin despite the legislature not even being in session, that would raise the size thresholds on a “megaprojects” bill to where it would only apply to an Arlington Heights stadium — and “the Bears have to decide what makes most sense for them, which one of those bills is the bill they can get behind and wrap their arms around that can help them remain here in the state of Illinois,” adding, “We cannot have a special session until we have a deal. You don’t call a special session to draw up a flight plan. You call a special session to land the plane.” The hope here seems to be that if Bears officials pick a favorite tax break bill and declare that it’ll be enough to get them to stay in Illinois, that’ll get legislators in both houses to vote for it, which is absolutely the kind of bootstrapping your own momentum thing that you try to do when you’re pushing legislation that just got nowhere.
Building a stadium district in Denver’s Burnham Yard railyards may be easier said than done for Broncos ownership, given little details like the land is mostly zoned only for industrial use. This is Broncos owner Greg Penner’s problem, of course, except that, as the lengthy Denver Post article on this only reveals down in its 28th paragraph, Penner could end up asking for TIF property tax breaks to pay for his larger development. “The track record for delivering on these promises by teams in development,” noted University of Colorado Denver economist Geoffrey Propheter, “is shaky. And that’s being super generous.” (Credit where credit is due to the Post: “The naked man, in retrospect, was the least of Sean Herman’s worries” is an excellent teaser lede, though still not quite up there with “The freighter captain, the cop, the guy from the private security firm, the Swiss Army major, and the reporter never saw the pirates coming.”)
Athletics owner John Fisher now says his mistake in announcing a stadium plan in Las Vegas was not talking to the media himself enough about it: “Not hearing from me, I think, led to frustration from, frankly, the media. Like, who is this guy? Is he hiding? Who’s the real John Fisher?” He then went on to tell The Athletic absolutely nothing about how he plans to make a $2 billion stadium (with $600 million in public subsidies) in what would be MLB’s smallest market work out, especially when his development partner Bally’s may bail on its part and leave Fisher to fund such additional amenities as a $100 million parking structure. Hearing from John Fisher, it turns out, also leads to frustration, who’da thunk it?
San Antonio Mayor Gina Ortiz Jones would like Spurs minority owner Michael Dell (net worth: $246 billion) to pay for some or all of her city’s $489 million share of a downtown arena. Dell hasn’t responded to her request, and Stanford University Roger Noll says that’s likely because the multibillionaire knows spending your own money on new sports venues is a dumb idea — “the incremental benefits of having a new arena are not as big as the cost” — which is why it’s only worth it if you can stick taxpayers with the bill.
The first of the Buffalo Bills‘ family of stainless steel buffalo statues has arrived, and fans are excitedly pointing out that bisons don’t really look like that! They’re not even usually made of steel!
It’s okay, though, says Mayor Lucas, because he has his reasons:
“This is not an absence of engagement,” said Lucas, who said stadium construction would need to begin this year. “I think it’s instead — how does everybody make sure that they’re in a real cohesive approach to how the deal is delivered?”
Okay, so city and state (and team?) officials are engaged, they just aren’t cohesive — that’s another way of saying they haven’t been able to come to an agreement, right? “We look forward to the continued partnership with the State and the Kansas City Royals,” added spokesperson Lane Johnson in a statement to the Kansas City Star, which is very much the sort of thing one says when one is still at the negotiating table with no idea if talks will end up going anywhere.
According to the Star, qualifying for the Show-Me money shouldn’t be hard: The Royals deal is a sports project that will seat at least 30,000 people and will cost at least $500 million, the state is being asked for less than 50% of the total cost, and the city will be putting in money. How much the city can ask for could be an issue, though — the state will have to estimate exactly how much in sales, income, and other taxes Royals employees paid last year, and that’s likely only around $15-17 million, which would only be enough to cover about $250 million, less than Lucas is asking Missouri to kick in.
Once all the financial details are worked out, the whole deal still needs to go back to the city council for final signoff. And it could require a vote of the public as well, if the labor activist group the Missouri Workers Center has its way: An affiliate of the group submitted more than 4,500 petition signatures on Friday to force a public ballot on the Royals plan. Lucas pooh-poohed any notion of resorting to democracy, saying, “the deal is likely to be done before you would actually have a public vote on the deal itself,” which would either be in November or April of next year. Lucas says he hopes to have all the stadium paperwork signed off by the end of the summer — he may have to, if he wants to avoid giving voters a say in how their tax money is spent.
I unfortunately had to cancel my trip to this year’s sports economics conference at University of Maryland-Baltimore County starting today, but friend of Field of Schemes John Mozena of the Center for Economic Accountability generously offered to liveblog from there instead. Take it away, John, I will be following eagerly along with other readers! —Neil deMause
8:30 a.m.
Good morning, everyone. I’m deeply honored to be trusted with the virtual keys to Field of Schemes, which is a daily read for me and an invaluable resource for anyone who wants to make sports team owners pay for their own stadiums. I feel a bit like a Wish.com or Temu “No honey, we have Neil deMause at home” but I’ll do my best.
(Also, I’m fully aware that I’m the dumbest and least qualified person in this lecture hall and it ain’t even close. Last night, I was embarrassed to suddenly realize that I was debating the economics of promotion and relegation in American soccer at the bar with someone who literally wrote the book on the economics of soccer.)
8:45 a.m.
The first two papers are on non-stadium-related topics, but I’ll try to summarize them regardless.
The first paper is “Whistle Politics: Nationality Bias and Own-Nationality Favoritism in a Multinational Basketball Officiating Setting,” by Georgy Shukaylo* and Veronika Dolar of the David and Nicole Tepper Department of Sport and Entertainment Management at the University of South Carolina. Their question was whether American players are refereed differently in the AdmiralBet ABA League, the top-tier professional league for teams from the six former Yugoslav republics.
(Editorializing for a moment: The irony of a “Department of Sport and Entertainment Management” being named after someone who has been responsible for the 2019 and 2024 recipients of my organization’s “Worst Economic Development Deal of the Year Award” is left as an exercise for the reader.)
Shukaylo and Dolar hypothesized a few different ways that refereeing bias toward American players might present itself in Balkan basketball: Did Americans get whistled more by local referees because of lingering animus over America’s role in the first and second Yugoslav wars? Or because of resentment over America’s basketball dominance? Or did they get fewer calls because the league wanted to keep higher-profile American players in the game to keep fans happy?
It turns out that the data suggests that final option: U.S. players got a slightly lower whistle rate, roughly half a foul less per 40 minutes than comparable players. The authors determined that this was the result of ‘passive leniency’ by referees calling fewer incidental “touch” fouls on Americans, not more fouls on local or other international players.
* Georgy recently completed his Ph.D at the University of Michigan, where he had the good fortune to celebrate national championships in football and men’s basketball during his time in Ann Arbor. Go Blue.
9:25 a.m.
Petr Parshakov presents a paper by himself, Dennis Coates, Dmitry Dagaev and Sofia Paklina on “Compatriot Bias in Evaluation of Football Players,” looking at the role that national and racial bias play in people’s assessment of soccer players, using the crowdsourced rankings from the EA Sports FIFA/EA FC video game as a starting point. The results are more complex than I’m competent to summarize, but broadly come down to “Yeah, people do have some bias towards people who are different but there’s a lot of other issues at play including rooting interests and player popularity.”
9:55 a.m.
On to stadiums and economic impact, which will be the focus of the rest of the day!
From UMBC colleagues Mike Andrews and Dennis Coates, we have early-stage work on “Estimating Local Effects of Stadiums Using a Runner-Up Design.”
Andrews describes the question as “How does a new stadium affect the local economy,” which he admits is a question that’s been asked a lot by economists in the room (and elsewhere), but that they are trying to use some different tools to answer the question “What would have happened if the stadium had not been built?” and then compare that to real-world post-stadium outcomes.
The interesting thing they’ve done is to look at winning and runner-up NFL stadium sites according to local decision-makers, figuring that sites that would be appropriate for stadiums should have had relatively similar trajectories if not for the stadium being built on one of them, so comparing the differences in outcomes should let you identify the stadium’s impact.
The first result is that they found no significant economic differences between the immediate areas around stadiums versus the immediate areas around runner-up sites, which is consistent with *gestures around at everything everyone in this room has been publishing for years*.
More interestingly, they then went on to look at what happened to growth in areas further away from the stadium and runner-up sites – two, four, six, eight and ten-mile rings. While the data is very preliminary and has issues with small sample size, there seem to be signs that growth in the immediate neighborhood of a stadium comes at the expense of areas a few miles away from the stadium in a way that doesn’t take place at non-stadium sites.
10:10 a.m.
Brief note while we prep for the next paper: As a non-academic, one of the most fascinating things about this kind of environment is the way that the post-presentation Q&A sessions are a combination of politely brutal critiques and collaborative suggestions for how to improve or follow up on research. I’ve heard some people argue that the research consensus on stadiums’ economic impact is an effect of “Oh, they all just agree with each other,” but once you hear economists holding each other’s feet to the fire on things like whether they should have accounted for a city’s grid design in their use of a circular radius for stadium impact it becomes pretty obvious that in this room, getting the answer right is more important than being polite.
Sample question: “I totally want you to be right, let me be clear on that, but…” followed by a sharp observation that the researcher had to admit was a potential issue with their conclusion.
10:20 a.m.
From UMBC master’s candidate in economic policy Bradlee Kilgore, we have “Impact of Stadium Projects on Nearby Home Prices.”
Using Zillow home price data in the areas around 67 stadiums and arenas across the country, Kilgore did a bunch of complex statistical work that flies several thousand feet over my head to find that on average, home prices around stadiums are 8% lower than similarly situated homes further away from the stadium, with arenas (as opposed to open-air or domed stadiums) having an outsized effect on that negative outcome. Kilgore finds the worst effects from NBA arenas, second-worse from shared NBA/NHL arenas, followed by NFL stadiums, with very slightly positive effects from NHL and MLB stadiums.
Basically, what this tells us is that the hassles of living near a stadium – crime, traffic, noise, parking pressure, etc. – outweigh the benefits for enough people that it drives down housing prices in the area.
11:25 a.m.
Next up are Jeffrey Carr, Jessica Morschakov and Mark S. Rosentraub from the University of Michigan (Go Blue!), with “Legacy Central Cities and Fragmented Governments: Which Principles Shape Policies To Change the Spatial Distribution of Regional Economic Activity?”
(In the past, Neil has described Rosentraub as a “sports subsidy apologist.” I am not informed enough about his body of work to agree or disagree.)
Rosentraub and his colleagues are promoting a concept they call “Municipal Capitalism,” which (as I understand their definition) encourage elected officials to make investments in stadiums that generate more in tax revenues and other tangible benefits than they cost to finance. ‘Each community has to look at their own assets and needs, we know what the sports owner cartel wants to achieve, how can cities design stadium deals using market-based criteria to get a tangible return on taxpayers’ investment?’
They use the Las Vegas Raiders’ Allegiant Stadium project as their test case.
They claim $58.5 million in new tax revenues as a result of Allegiant Stadium, with most of that going to Nevada state government, generating $15-20 million more in tax revenues than are necessary to fund bond obligations.
Their conclusion was that it was a Municipal Capitalism success, arguing that its fiscal benefits exceeded the fiscal costs, that elected officials “faithfully executed their obligations to voters” by making a capital investment in the stadium that created a new revenue stream, and that the project provided intangible “big-league city” benefits to local residents.
They reference a Las Vegas Convention and Visitors Authority claim that 61.8% of visitors at Allegiant Stadium were out-of-town visitors who identified the event as the primary reason for their trip to Las Vegas, which does not pass my personal sniff test.
They admit that Las Vegas is an unusual market, and there are some hard questions on whether anything learned from Allegiant Stadium has any real value to stadium projects in all the other cities that are not entirely driven by the tourism industry.
“Are you asking me to think of this as simply a description of how municipalities work…or are you claiming that this is a normative framework and that the world is better off if municipalities behave in this regard. Because if so, I’m not going with you,” asks their University of Michigan colleague Stefan Szymanski, pointing to negative externalities that the Municipal Capitalism model doesn’t seem to capture in its ROI calculations.
Rosentraub responds that it’s a hybrid, to which Szymanski says it can’t be, that it’s either normative or positive. Rosentraub’s ultimate response is that it’s largely normative, but “We’re not saying that there aren’t bad deals made, but let’s learn what we can from the good deals to improve future deals.”
10:35 a.m.
Quick note: The running joke this morning is “That was sarcasm” after something sarcastic is said, referencing a Q&A during an early presentation on whether an automated assessment of how soccer players are discussed on the Internet had correctly captured the potential that Internet users might, occasionally, be sarcastic about something.
11:55 a.m.
Next up is University of Colorado Denver’s Geoffrey Propheter, who has done useful work on the intersection of the real estate industry, property taxes and sports.
Propheter is presenting some of an upcoming “labor of love” book on the Oakland Coliseum, discussing his efforts to assess the facility’s total lifetime cost to taxpayers from 1963 to 2024.
He points out that many now-standard government finance mechanisms were first launched in California.
“TIFs were invented in California. You’re welcome!”
Propheter looked back at the at-the-time promises in 1963 of stadium boosters promising that (among other things) the subsidy from the city/county would go from $1.5 million/year to $536,000 by 1970, that it would be self-sustaining within 22 years and that it would be profitable by Year 30.
While the stadium subsidy did drop, mostly, to the promised levels five years late, and it most certainly never got self-sustaining or profitable.
12:05 p.m.
I studied philosophy and political science. When I see a slide like this, I get a loud vacuum cleaner noise in my skull.
But seriously, it just drives home how much hard work, expertise and care goes into answering a question as simple as “Do hotels do more business when a world-class sports superstar is playing in town?”
(More on that question in a moment)
12:25 p.m.
So, superstars and hotels.
Chan Hyeon Hur at Florida International University is presenting his work with Badr Badraoui of FIU and Timothy Webb of the University of Delaware: “Do Sports Superstars Generate Local Tourism Gains? Evidence from Hotel Markets after Messi’s MLS Arrival.”
Lionel Messi, they say, created “an uncommon natural experiment” in coming to Inter Miami FC, and that the demand to watch him either at home or away created a “rare, high-intensity league-wide demand shock” for MLS tickets that would not have existed without him. (Shohei Ohtani is the other current example of a superstar with this kind of drawing power.)
The research question they asked was whether the demand to see Messi play in Miami had any measurable impact on local-market hotel revenues.
Using a lot of math like the slide I shared above, they found a “transient novelty premium” generating a short-term spike immediately after Messi’s arrival, but no evidence of any long-term structural growth in hotel stays. They suggest this should be relevant for local government officials using projected growth in hotel revenues to justify dedicating hotel taxes to stadium projects.
(One criticism from the crowd is that the authors did not capture AirBnB and other similar non-hotel lodging services, which they said is something they are hoping to do in a followup paper.)
12:30 p.m.
Lunch!
I have asked presenters to check out this blog and let me know if I missed or misconstrued any of their work. If I get asked for edits, I’ll note them in the interest of transparency.
2:00 p.m.
A break from stadium stuff, with Dave Berri of Southern Utah University and Stacey Brook of the University of Central Florida presenting their paper “Does it Matters Who Swings the Bat? Player Exploitation in College Softball and College Baseball.”
Berri, who has been involved in a number of legal cases by athletes against universities and/or the NCAA: “The NCAA receives more than $1 billion per year from media rights for college basketball. It spends more than $60 million of this on legal fees defending its arbitrary rules.”
He argues that saying “college sports are not profitable” is meaningless, as colleges and universities are nonprofit institutions and departments within those schools – academic or athletic – will spend “as much money as they’re allowed to.” He also pointed out that college sports are tiny, from a budgetary perspective, using the example that the University of Maryland has a $2.98 billion budget, and its athletic department had $124 million in revenue in 2025.
Berri presented some evidence that the NCAA is doing a terrible job at maximizing revenues for ‘non-revenue’ sports – which he points out is a terrible name, since they do bring in revenues – thanks to its focus on maximizing its basketball and football media revenues. He presented a model to measure the value of NCAA baseball players and other similar players to university athletic revenues, and to use that to develop a structure to get an appropriate percentage that money to players, whom he argues are being badly under-compensated compared to the value they generate for their schools.
2:30 p.m.
University of Michigan doctoral candidate Jeff Carr returns with “Changes to Franchise Supply and the Effects on Teams in the Same Market: Niche Markets or Limits on Discretionary Spending?”
He’s attempting to measure the “substitution effect” for sport within a market, looking at what teams arriving or leaving did to incumbent teams’ attendance. If an MLB team shows up, what does that do to the local NFL or NHL team’s attendance? (He used the example of the Orioles’ attendance when the Ravens came to Baltimore.) If an NFL team leaves for someplace else, do jilted fans console themselves with tickets to the local MLB or NBA team?
There are a lot more pro sports teams out there than there used to be.
Cities have more pro sports teams than they used to.
His finding is that the arrival or departure of teams doesn’t tend to change the attendance of existing teams by a meaningful amount. The one meaningful outlier is WNBA teams, which Carr posits is a function of that league having a fanbase that is more likely not to be fans of other sports.
2:55 p.m.
Because of a scheduling issue, conference organizer Dennis Coates is filling in to present a previously published study from himself, Sabina Kosimova and Gleb Vasiliev titled “Performance Under Pressure in Elite Curling.”
Their findings generally confirm sports consensus that players make better shots when they’re either way ahead or way behind and there’s no immediate pressure, but perform worse in late, close games. They found a small amount of evidence that women (at least in curling) may do slightly worse than men in general, but better than men on common (as opposed to unusual or highly technical) shots.
I will admit that I did not expect a curling-specific paper today. (The Q&A has become an opportunity for those in the audience who actually understand curling to politely flex on their fellow attendees.)
3:30 p.m.
Pete Groothuis from Appalachian State University *pause for instinctive shudder from Michigan football fan* asks what he describes as “a philosophical question” about the ways that applied microeconomics papers use and define their population data, how they check their work to determine whether the results they’re seeing are truly statistically significant…and what “statistically significant” means in the first place.
Groothuis himself describes the issue as a “highly theoretical” exercise in econometrics, so your humble correspondent was deeply out of his depth around the third slide – and the first two slides were a title card and a photo of a mountain.
Leaving the details of the question to those more competent to explain it, I will say that yet again I’m struck by the way that the researchers in this room and their colleagues across the country are putting brain-meltingly intense intellectual effort into trying to get as close as humanly possible to the capital-T ‘Truth’ of what’s actually happening in the real world with their research.
As someone who’s a consumer of this work and relies upon it to form the foundation of advocacy for good public policy, it’s incredibly heartening to see this rigor in action.
4:15 p.m.
Clay Collins from the University of Georgia presents “Family Violence and Football at 15: A Review and Re-Evaluation of Card & Dahl.” It’s a revisiting of a famous paper from 2011 finding connections between domestic violence (now more commonly known as intimate partner violence) and NFL games, where “seemingly irrelevant events” such as an NFL team’s upset loss drives someone to violently lash out at a partner.
(Conference organizer Dennis Coates: “I would consider this an ‘economic impact’ topic.”)
Collins is using modern, more-comprehensive datasets to update the 2011 paper, which (among other things) used crime data that only covered roughly a fifth of the U.S. population.
“I run this, and I’m not getting any significant results,” Collins says. “So what’s going on here?”
His first take is not that Card & Dahl were wrong — “they don’t give out Nobel Prizes for nothing” — but that something else must be in play. Maybe the prevalence of gambling and fantasy sports is changing the emotional for NFL fans, so the “your team blows a game” trigger is less…triggering? There’s some research out there that suggests this is playing a role. Maybe people are venting on social media rather than via violence? In the Q&A, attendees are suggesting potential answers, data sets, statistical tools, etc.
4:50 p.m.
Doctoral candidate Aiden Powell of West Virginia University presents a very interesting investigation into sports externalities: “Professional Sporting Events and Emergency Medical Service Response Times: Evidence from San Francisco.”
Researchers (including some in this room) have documented increased police response times near stadiums during events, but Powell has focused on EMS response, specifically for people having “cardiovascular events” where delayed treatment can result in death or other adverse outcomes.
Powell’s research uses data from San Francisco Giants games in 2024 and 2025.
He finds that in the hour before a game, EMS response within a quarter-mile of the ballpark is delayed 4.7 minutes on average, a 51.6% delay. He estimates an additional seven seconds of additional EMS delay for each 1,000 attendees at the game.
After the game, it’s delayed 2.6 minutes; a 28.4% delay, with three seconds per 1,000 fans.
5:15 p.m.
Victor Matheson of College of the Holy Cross presents “The Impact of Mega-Events on Gambling Revenues – Evidence from the Las Vegas F1 Race.” The economic impact question he’s asking is deceptively simple: What did the creation of a Las Vegas Formula 1 Grand Prix in 2023 do to gaming revenues in Las Vegas casinos?
(As a supporter of Detroit City FC in the USL, I need to shout out the deeply esoteric Hartford Athletic USL jersey that Matheson is wearing. So he’s the person who bought one.)
The up-front $500 million cost of the race’s permanent infrastructure was largely private, but there are per-race costs for infrastructure, police, etc. to Las Vegas, plus negative externalities headlined by a 10-week closure of The Strip.
Matheson puts up a slide where F1’s CEO predicted $1.7 billion in economic impact in the first year alone, asks “How many years have we been doing this?” as the room chuckles wryly.
Gambling revenues on the Strip are way up, $66.8 million. That’s almost entirely from high-stakes table games. However, revenues from slot machines and other lower-tier gaming are significantly down, as are gaming revenues overall in non-Strip casinos and casinos elsewhere in the state.
Matheson’s take is that the Las Vegas Grand Prix is “remarkably successful” for the large casinos on The Strip, that booked an extra $70 million in gross gaming revenue. However, that boom for the big, fancy casinos has come at the expense of a bust for the non-Strip casinos and casinos elsewhere in the state, which have gaming revenues down almost the same proportional amount.
“It might be up a bit in total,” said Matheson, “But it’s certainly not up enough to reach that billion-dollar economic impact figure.” He also noted that excitement over the race seems to be waning, with that bump in gaming revenues shrinking each successive year.
5:45 p.m.
Doctoral candidate Murad Latifov of Texas Tech University presents a paper on a fascinating question I’ve never seen asked, “The Impact of Professional Sports Franchise Movements on Crime Rates in Urban Areas.”
He’s not looking just at crime on gamedays, but in general at long-term baseline crime rates. Do new stadiums and/or teams make cities more or less law-abiding? Does it change if it’s the fourth or fifth team in a city, versus the first or second?
It’s especially interesting because stadium subsidy supporters often point to “uncaptured benefits” that sports teams bring to a city, including things like civic pride and a more robust civil society, which could, maybe, be seen in crime rates. (The crimes he’s looking at in the FBI data are rape, robbery, aggravated assault, burglary, larceny-theft, and motor vehicle theft.)
This theory considers sports teams to be “Civic Anchors” around which a society organizes itself in a virtuous, upright manner that discourages crime. The counter-argument is that stadiums “concentrate motivated offenders and suitable targets” in a way that promotes crime.
It turns out that the latter seems to be true. Latifov’s work unearthed some meaningful, statistically significant results: “A city’s first franchise significantly raises violent and short-run property crime. The loss of a city’s last franchise lowers crime, especially for rape.”
Gaining a second, third, etc. team doesn’t seem to have any impact, and losing a team doesn’t seem to change things until a city loses its last team.
One relevant question that was asked and that Latifov had not investigated was whether this effect exists for cities that had major college sports teams before they had professional teams, such as Columbus, Ohio before the arrival of the NHL Blue Jackets.
5:50 p.m.
The last presentation of the day is an early-stage exploration by Shirin Mollah, Josh Davila and Jonathan A. Jensen of Texas A&M into “Why are stadium lifetimes getting shorter? Findings from a semi-parametric hazards model.”
One unusual finding is that a growing economy keeps older stadiums around, rather than pushing replacement. A 1% growth in GDP in a market reduces the probability that a stadium will be replaced by up to 14%.
The larger the city, the less public funding they offer — every 1 million in population decreases subsidies by $8 million.
The more expensive the stadium, the longer they’ll get kept around. Every $10 million spent on a stadium lessens the chance of it dying by 3.96%.
6:30 p.m.
And that’s it! Thank you again to Dennis Coates and the entire team at UMBC for gathering together such an excellent group of presenters, and for being wonderful hosts.
Thank you to the presenters, and I apologize for any errors or omissions I made in describing your work.
If you have any questions, comments or criticism, please feel free to email me directly.
I didn’t make it to this week’s annual sports economics conference in Maryland that starts this morning, but a special guest blogger has offered to report back on the stadium papers presented there, so please tune back in later today for that. (UPDATE: now underway!) In the meantime, I’ve taken on the task of figuring out exactly what the Plano city council approved yesterday for a new $1 billion Dallas Stars arena development in the north Dallas suburb. Piecing it together from various news reports, mostly a useful explainer from the Dallas Morning News:
The council unanimously approved creating a tax increment financing district that would siphon off all new property tax revenue from the arena and surrounding development — described as “other sports and entertainment venues, retail, restaurants, residential development, public spaces and related infrastructure improvements” — for 41 years, with this TIF providing an estimated $700 million that would be used to pay off bonds for the Stars’ arena.
The city would own the site and the arena, while Stars owner Tom Gaglardi would lease it for terms that “are to be negotiated.” Gaglardi and partner developers Levin Holdings and Cawley Partners would co-own the rest of the development in the TIF district, with their property taxes kicked back to Gaglardi to help pay for the arena.
The council approved an upcoming public vote to create a “venue tax” to provide additional funding for the arena — but while that normally means a ticket tax, in this case, the Morning News reports, “the city could ask voters to consider a combination of several kinds of taxes, aimed at visitors, on things like car rentals, hotel occupancy, event parking, event admissions and facility use per game and player.” Unlike a ticket tax, which mostly ends up coming out of team owners’ pockets, much of that would money that would actually drain the public treasury.
Hockey Reddit, meanwhile, is already LOLing at the prospect of the Stars trying to better their finances by leaving downtown for a less easily accessible location for many residents, though the money from the real estate play should help defer some of those concerns. (Best comment so far: The team should be renamed “The Slightly Farther North Stars.”)
None of this is set in stone, as Gaglardi has as yet only issued a nonbinding letter of intent, plus that lease agreement needs to be negotiated and any new taxes voted on. All we can say for sure is that the city would be out at least $700 million in tax breaks — money that normally would go to paying for public services to support a new development — plus potentially hundreds of millions more in new “venue” taxes plus possibly additional tax exemptions on the city-owned arena, all of which could easily push the public cost to more than $1 billion.
In exchange, Plano would ensure the presence of the Stars for 30 years, at least assuming the eventual lease doesn’t contain an out clause allowing them to leave or demand new upgrades later, hard to say since it isn’t written yet! But here’s Stars president Brad Alberts talking about how committed his organization is to this agreement:
“There’s the wedding. We’re planning for the wedding,” he said. “That’s a good way to think about it. Can we walk away from the wedding? Sure. Are we intending to? No.”
Now that’s what you like to hear from your fiancé! We’ll likely hear more in coming months in the run-up to that arena vote, though it’s always possible we won’t find out for sure until the last minute.
You probably noticed, but it’s Friday! Which brings us, with no further ado, to the rest of the week’s news:
MLB commissioner Rob Manfred has said that he’s “hopeful” that a Tampa Bay Rays stadium in Tampa will win final approval, given that “we think the polling runs about 60-40 in favor of the stadium.” Actual polling shows that residents would like a new stadium in the abstract by a 58-29% margin, but oppose the Rays’ funding scheme by 59-34%; congrats to Manfred, I guess, on figuring out how to dispense with the actual asking-people-questions business and pioneer vibe polling.
Meanwhile, the Tampa Sports Authority has issued a letter saying the Buccaneers should get first dibs over the Rays on any available public stadium money, which isn’t going to make any easier the already difficult road to approval of the couple billion dollars in stadium subsidies Rays owner Patrick Zalupski is seeking from the city, county, and state.
People in Wyandotte County is worried that the state of Kansas may try to bigfoot it into expanding its STAR district to redirect more county sales taxes to a Chiefs stadium; in other news, Wyandotte County included a poison pill in the STAR district legislation that if the state tries to expand it, the county automatically rescinds it. It looks like at the very least the county would have to go back and revote on a larger tax district, at which point hopefully residents would re-up their concerns like whether siphoning off more county sales taxes could force the county to, say, raise property taxes to make up for any resulting budget gap.
The province of Quebec is already spending $870 million (Canadian) to put a new roof on Montreal’s Olympic Stadium because it’s too big to tear down, but MLS commissioner Don Garber wants even more public money to make it a “best-in-class experience” for CF Montréal. The MLS team mostly doesn’t play at the Big O — it occupies the 18-year-old open-air Stade Saputo for all but big matches like the home opener and playoff games — but may need to more once MLS switches to a fall-to-spring schedule next year, plus Garber says the smaller stadium is “an MLS 1.0 stadium” and the team needs “an MLS 3.0 stadium.” Why any of this is Quebec’s problem to solve, Garber didn’t say, beyond insisting that CF Montréal’s owners are committed to staying in town but need to “have a best-in-class facility to be able to drive revenue,” hint hint.
Records obtained by Crain’s Chicago Business show that Bears attorneys called or met six times with their city counterparts in April, even as team officials insisted that remaining in Chicago was off the table by then. The team says these calls were all about their current lease at Soldier Field; a city source told Crain’s their lawyers wouldn’t have taken six calls on that. This all matters because Chicago Mayor Brandon Johnson is still holding out hope for keeping the Bears in Chicago while team execs insist they won’t consider it — if nothing else, it’s going to make for an even more complicated decision by team owner George McCaskey in coming weeks about whether to pull the trigger on a move to Indiana or keep pushing for public funding for a stadium somewhere in Illinois.
“Portland’s own study said the Moda Center needed $500M in repairs — so why are the Trail Blazers asking for more?” asks the Oregonian, and the answer appears to be that the $500 million figure was just to “maintain the building in its current configuration in good working order,” while $600 million is to conduct a “transformative renovation” that can “support the power, technology, and production demands of tomorrow’s largest concerts and events.” In exchange for which, Blazers owner Tom Dundon has agreed to extend his lease on the newly transformed arena by … oh, he hasn’t said how long, or agreed to a new lease yet at all? Welp.
And if even after all those bullet points you still want more stadium content for your weekend, I was interviewed this week by Heartland Labor Forum’s podcast about the Kansas City Royals stadium plans, check it out here.
