Category: Misc

Bears stadium economic impact reports reveal that economic impact reports aren’t worth much

access_time personNeil deMause

Arlington Heights yesterday released not one but two economic impact reports on the village’s proposed Chicago Bears stadium: One commissioned by the team and carried out by consultants HR&A, and one commissioned by the village and carried out by consultants Hunden Partners. (There’s also a FAQ explaining the two reports.) Such reports do not have a glorious history, so how do these stack up?

HR&A’s Bears-commissioned report first:

  • “As part of this analysis, HR&A worked closely with CSL International, a feasibility, business planning, and consulting firm specializing in sports and entertainment, to estimate the impacts of a Super Bowl in Arlington Heights as well as understand the economic benefits realized from major non-recurring events that Chicagoland currently does not host.“ CSL’s brand isn’t exactly “understanding” things, so we’re off to a bad start already.
  • HR&A projects $10.9 billion in “one-time statewide economic impacts,” which just means that the project would involve building several billion dollars worth of stuff, plus a multiplier for when construction workers go and buy other stuff. Some of this spending would presumably involve things like steel that’s bought from out of state; HR&A doesn’t give any indication of how it calculated this number, though, so no way of knowing if this number is overblown or by how much.
  • After the initial construction outlay, HR&A projects “$1.3 billion in net annual statewide economic impact and close to 9,000 permanent jobs” from the ongoing operations of the stadium and its surrounding development, resulting in $69.1 million a year in net new tax revenues for the state, county, and city. “Net” implies that this is spending that wouldn’t take place without the project — but there’s no indication that HR&A subtracted out spending that would be shifted from elsewhere in the state to the Arlington Heights site. Unless Bears ownership plans on spontaneously generating new Illinoisans, at least some of the spending at the new project will inevitably be cannibalized from elsewhere in the state.
  • As for costs, “the Bears are seeking public funding for $855 million needed for district infrastructure,” notes HR&A, for such things as new highway ramps and moving a Metra commuter rail line. No funding source at all is given for this, but put next to those billions of dollars in projected revenues, $855 million is mere pocket change, right?
  • Hosting a Super Bowl, reports HR&A, “would generate an additional $570 million in statewide economic impact and support close to 3,800 permanent jobs” — that’s right, permanent jobs from a one-week, one-time event, sure would like a methodology footnote on that one, but sadly none is forthcoming.

That’s all pretty sad, but also pretty par for the course for what a consultant like HR&A will typically put together for a client like the Bears: Add up all the money that may change hands at a stadium project, slap on a multiplier, and print impressively large numbers in impressively large type. But what about the village’s hired hands, did they do any better?

  • Hunden’s report is just a three-page summary, so its findings are even more abbreviated than HR&A’s: The stadium project would “support” 5,400+ full-time equivalent jobs and $510.1 million in “net new tax impact” ($15.1m per year) over 40 years. Once again, there’s no indication of whether these numbers account for spending that would substitute for other spending that would take place without the stadium project — not to mention the opportunity cost of losing out on any spending that might take place if the old Arlington Park racetrack were redeveloped for something else.
  • Then there’s this amazing chart on projected uses for a stadium, which starts with the remarkable claim that an NFL stadium would host 370 “events” a year, then wayyyyy at the bottom specifies what most of those events would actually consist of:

The FAQ, meanwhile, adds even more caveats:

  • What about the added costs that would come with providing schools, police, fire, roads, and all the other stuff that a whole new mini-city would require? “Does this report include the impacts on Village services and infrastructure costs? No, it does not. Additional studies will consider the cost of Village services and infrastructure.”
  • Likewise, the reports don’t attempt to estimate the cost of “megaproject” property tax breaks that the Bears are demanding from a so-far-uninterested state legislature, but don’t worry, that isn’t real money: “A Megaproject Bill does not exempt large-scale developers from paying taxes, give State money to private business, nor cost the State government any money.” While all this is technically true — the Bears developers wouldn’t be completely exempt from paying taxes, they would just get a large break on their tax bill, and the public money provided would come out of the village’s and county’s treasuries, not the state’s — the implication that this would present no cost to taxpayers is false.

All of these funny numbers matter a whole lot, and not just for PR purposes: The FAQ specifies that “The Village has always stated that it will not approve the project unless there is a net fiscal benefit — meaning the Village’s new revenues must exceed new expenses,” so how the costs and benefits of the project are calculated is hugely important. Unfortunately, the two consulting reports are pretty much useless for that: Asked for comment after looking them over, sports economist J.C. Bradbury called them “an incomprehensible mess of motivated nonsense.” If it’s the kind of nonsense that will potentially land them more than a billion dollars in new transportation infrastructure and tax breaks, though, the Bears owners will no doubt consider it consulting fees well spent.

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Sabres extend lease five years in hopes Buffalo’s wallet will re-open by then

access_time personNeil deMause

Buffalo Sabres owners Terry and Kim Pegula had an expiring arena lease and no way to use it to extract arena upgrades from Erie County, which is too busy with helping build a new stadium for the Pegulas’ other team, the Bills. What to do? Why, just extend the old lease until the time is riper for arena subsidies, that’s what:

The Sabres will operate this season under the existing terms of their lease with Erie County and then for the four seasons after – or until a new, long-term agreement can be reached.

This comes as the Sabres negotiate with the county and other parties for a more modern lease than the current one first developed around three decades ago. It’s a process that will likely also involve the state, and possibly the city, and a request for public funding to pay for improvements and upgrades at the arena.

Expiring leases, it turns out, are only a ticking clock for public officials; for team owners, they can be moved at will. (The Sabres lease, like many sports leases, gave the Pegulas an option to extend their lease under the existing terms, which include free rent.) The Buffalo News reports that Erie County could be looking to get out of the arena business, which may mean dumping the Sabres’ home ice on the state, which would then presumably be on the hook for the bulk of upgrades, just like it was for the Bills stadium. That should make downstate taxpayers wary, since they’re already paying for a new stadium for a team hardly any of them ever watch, though “and possibly the city” should make Buffalo taxpayers wary as well.

Sabres COO Pete Guelli said he hoped the team could “be part of something that could help revitalize the City of Buffalo,” while Erie County executive Mark Poloncarz said he wants a revamped arena to be “part of a continued entertainment district that is key to the future of the city,” so everyone is on the same page here as far as being convinced that a glitzier hockey arena would boost the city’s economy. (SPOILER: It wouldn’t.) Looks like it’ll be a few more years before all this comes to a head, by which time everyone will be able to point to the visible impact of the new Bills stadium and, you know, are you sure you want to put this off, Pegulas?

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L.A. approves $2.6B convention center expansion, even as convention demand shrivels

access_time personHeywood Sanders

There are boondoggles, there are big boondoggles, and then there are public development disasters. Los Angeles has just embarked on a disaster.

Last week, the Los Angeles city council approved an expansion of the Los Angeles Convention Center with a price tag of $2.62 billion. The number itself is impressive. But what is even more impressive, or totally depressing, is how the city got to that figure.

Back in 2015, after a deal to combine a new football stadium with the convention center fizzled when Farmers Field ended up not being built, city tourism officials came up with a new scheme to expand and modernize the center with the aim of boosting the city’s competitive position. While acknowledging that other cities had built or expanded their centers on the “naïve assumption that, ‘if you build it, they will come,’” they asserted Los Angeles was “not a second-tier market or a desperate city trying to be more than it can realistically be.” The Convention, Sports and Leisure consulting firm promised that the center would see at least a 42% increase in convention attendees and hotel room nights after the expansion.

At that point, the cost estimate for the LACC expansion was $470 million. But year by year, as city staff tried to engineer a public-private partnership and design an updated and expanded venue, the price tag grew. By February 2020, the city council was warned that cost estimates had grown to $957 million. The figure from the city’s chief administrative officer in November 2023 came to $1.4 billion. What the city council accepted and supported last week was $2.62 billion — with every realistic likelihood of increasing more in the future.

So, what will the city get for $2.62 billion, which will be paid off via $193 million in annual debt service for the next 30 years? The chief administration officer says the project will create 2,153 new jobs each year after the expansion, the product of $150 million in new visitor spending each year. Local downtown interests and construction interests assert that it will be “transformative” for downtown, and by boosting the city’s convention center space will allow L.A. to compete for larger events against the likes of New York and Chicago.

The argument, set out by CSL in 2015, that more space means more convention business had been repeated by the CAO’s office in the years since. The 2023 report forecast that the hotel room nights generated each year by the center would grow from 288,045 to 490,758 — a 70% increase. Even now, the city continues to use those figures, as well as even more expansive estimates of increased tax revenue.

Yet the convention market has changed significantly in the last decade. When CSL delivered its forecast in 2015, Chicago’s McCormick Place had 937,600 convention and trade show attendees. Last year it saw 794,250. The total attendance of New York’s Javits Center in 2015 was 2.16 million. For 2024, its attendance came to 1.37 million. The Las Vegas Convention Center saw 1.3 million convention and trade show attendees in 2015. The comparable figure for 2024 was 1.1 million.

The 2015 white paper that made the case for the L.A. expansion cited examples of “large conventions that would choose Los Angeles if the LACC had adequate levels of properly designed and placed space offerings and program solutions.” The list included the annual meetings of the American Heart Association and the American Academy of Ophthalmology. That year, the AHA meeting in Orlando had 17,978 attendees. Last year, its attendance totaled 12,900. The 2015 ophthalmology meeting in Las Vegas had 28,355 attendees. The attendance for the 2024 meeting in Chicago was 16,543.

Even as Los Angeles commits to spending hundreds of millions of dollars in annual debt service — public dollars that could be used to employ police, firefighters, and other public servants — the likelihood of any significant increase in the city’s convention business is effectively nil. As L.A. has debated its convention center expansion, other cities have continued to add to heir own spaces, justified by the same arguments: downtown transformation, competitive demands, and optimistic consultant studies. And Los Angeles, which for years has had to offer its convention center space almost for free — token $1,000 rentals for space which should rent for $500,000, $710,000, or $1.1 million — will inevitably have to continue to give it away well into the future.

Built south of downtown in an area with effectively no nearby hotels or amenities, the L.A. center never offered the kind of environment typically sought by meeting planners and convention attendees. But it did offer a spacious home for the local auto show, other local public shows, and a large number of film shoots for major movies. Still, those did not bring out-of-town attendees to the city and do anything for the area’s economy. The answer was supposed to be the development of a great big hotel next door, together with restaurants and other attractions. Phil Anschutz’s AEG opened a 1,001-room JW Marriott/Ritz Carlton hotel together with the L.A. Live entertainment complex in 2007, using abundant public subsidies. Even that didn’t significantly reduce the deficit in nearby hotel rooms, or increase the center’s convention business.

In 1999, the LACC’s strongest year after a 1993 expansion, the center produced about 375,000 hotel room nights for the city. Things slid after that, as competing expansions in Las Vegas, San Diego, and other cities competed with L.A.  The center managed about 290,500 room nights in 2012, by offering free rent deals to event organizers. But the figure fell again, to about 245,000 in 2019.

In the end, L.A.’s $470 million convention center expansion has turned into a $2.6 billion one, in an overbuilt and declining market where Los Angeles and all of its competitors increasingly have to give their space away for next to nothing. Sounds like a great deal!

[Ed. Note: While L.A.’s convention center expansion began as a pairing with a never-built NFL stadium, it’s now being driven in part by a deadline to get the building ready for hosting events during the 2028 Olympics — even as L.A. has touted this as a “no-build” Games. Alissa Walker’s Torched newsletter has all the details.]

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Friday roundup: Browns stadium gets airport okay, San Antonio mayor seeks cut of Spurs’ arena revenues

access_time personNeil deMause

First things first: The Ohio Department of Transportation changed course yesterday and granted a building permit to the Cleveland Browns‘ proposed stadium in Brook Park, one month after declaring it would not do so because the stadium would “impact the airspace of the Cleveland Hopkins International Airport.” What changed? An outside consultant hired by the department reported that “the proposed stadium would have no adverse effect on the safety and efficient use of the aeronautical environment,” so ODOT gave the go-ahead.

This leaves the Browns stadium facing only two lawsuits over whether the team’s move from Cleveland to Brook Park violates the state’s Modell Law (the state attorney general says nuh-uh), plus additional suits over whether it’s illegal for the state to use unclaimed property to fund the deal and whether negotiating a move violated the team’s lease, plus $600 million in proposed city and county spending that hasn’t yet been finalized. Details!

In other news this week:

  • San Antonio Mayor Gina Ortiz Jones says she thinks if the city is putting up money for a new Spurs arena, taxpayers should get a cut of naming rights, concessions, and parking revenues as well. Which, sure, it worked for the Minneapolis Metrodome, so well that the public ended up recouping its entire $68 million contruction cost over time. Admittedly, the Twins and Vikings hated this deal so much that they immediately started lobbying for new stadiums where they would keep all the revenues and eventually got them, but it’s nice to see some elected officials learn the lesson that so many sports team owners live by: You can’t get if you don’t ask.
  • USL Championship expansion team Buffalo Pro Soccer is still looking for a place to build a stadium so it can actually become an expansion team. “I think we could make the decision today if we chose to,” said team president Peter Marlette, “but we want to make sure we’re getting everything right and that we are considering every possible factor and whatever site we end up going with.” The team owners have said the stadium will be privately funded, but we’ve heard that before in other cities, let’s see how things look after any hidden costs like land subsidies or tax breaks are accounted for.
  • The libertarian Mackinac Center for Public Policy is suing to repeal Michigan state funding for stadiums for the minor-league Lansing Lugnuts and the Utica Unicorns, Eastside Diamond Hoppers, Westside Woolly Mammoths, Birmingham Bloomfield Beavers of the United Shore Professional Baseball League (which all share a stadium in Utica), on the grounds that “private or local” projects require a two-thirds vote of the state legislature, and these only got a simple majority. State court of claims judge Brock Swartzle said he’ll make a ruling on an injunction by the end of the year.
  • The Philadelphia Phillies want hotel tax money from Pinellas County to upgrade their spring training facility in Clearwater, more specifics to come when they’re good and ready.
  • The Athletics‘ stay in Sacramento may not be drawing many fans, but it’s apparently drawing enough to cut into attendance at Sacramento River Cats minor-league games, especially now that resale prices on A’s tickets are cheaper in many cases than River Cats prices.
  • Sports economists Dennis Coates (who organizes the annual sports economics conference in Baltimore County) and Brad Humphreys have had a research award named in their honor, here’s a nice article about them and it, see how many of the economists in the photo at top you can identify!
  • Columbus Fury pro volleyball team seeks $1 million in cash from the city of Columbus and Franklin County to keep playing in town next season, now I have officially seen everything.
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DC passes final $6.6B Commanders stadium subsidy, there is much media rejoicing

access_time personNeil deMause

The Washington, D.C. city council cast its second and final vote yesterday on the Commanders stadium deal that will involve a record-shattering $6.6 billion (or more) in public subsidies, and as expected passed it again, this time by an 11-2 margin instead of last month’s 9-3. Let’s see how our news media, which are not at all influenced by their corporate leadership or by other political pressures, described the decision:

  • Washington Post: “Transformative $3.7 billion Commanders stadium deal passes D.C. Council”
  • USA Today: “The stadium is set to open in 2030, just in time to host big events like the 2031 FIFA Women’s World Cup and potentially the Super Bowl.”
  • WTOP: “The Washington Commanders are coming home.”

Not everyone was just feeling the excitement, admittedly: WUSA9 reported that the vote was “met with celebration by fans and concern by some neighbors in the surrounding community,” noting that local residents had asked for accommodations like guarantees of affordable housing, public transit, and preservation of green space. But proposed amendments on those and other matters — including the team having to repay the city if it failed to fully develop the stadium property as promised — were rejected after Commanders president Mark Clouse sent a letter to the council expressing his “deep concern” that any changes would make the project “unworkable and impractical,” at which point a councilmember who had vowed to vote no if the changes weren’t approved flipped his vote to yes anyway.

There was also some more critical coverage, including Greater Greater Washington‘s “Wednesday’s Council vote gets us a lousy RFK stadium deal,” which noted that D.C.’s CFO had declared the $6.6 billion in tax and land breaks to be “not financially necessary for the Team.” But that’s going to land far fewer eyeballs than Jeff Bezos’s WaPo calling the deal “transformative” — a word lifted from Commanders owner Josh Harris’s statement on the vote and not even dignified with quote marks in the paper’s headline (notably, it doesn’t appear in the accompanying article), something that could certainly never have been influenced by the fact that Bezos and Harris share both a socioeconomic status and a pal in the White House.

Very little of the news coverage bothered to describe the last-minute amendments (though almost all detailed Harris’s objection to them), and even less went into any detail about the $6.6 billion in stadium and garage construction payments, property tax breaks, and 26 years of free rent on 24 acres of prime city-owned property, all without even going through the motions of seeking competitive bids for the former RFK Stadium site. It all made for a shameful day for the media — okay, an even more shameful day — and prompted sports economist J.C. Bradbury to repost the Journalist’s Resource’s four tips for covering sports stadium deals, which include basic stuff like “interrogate economic impact statements or fiscal estimates from franchise owners” and “Understand how states and localities finance stadium construction.” Or, you know, you can just reprint team owner claims about all the Super Bowls this will bring. Journalists, think carefully: One may risk pissing off your publisher, while the other will get you done by lunchtime. It’s a knotty ethical conundrum!

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One person’s red tape is another’s oversight: a Denver Broncos stadium story

access_time personNeil deMause

The Denver Post ran a big Sunday explainer yesterday on what Broncos management still needs to do to get a stadium deal done: negotiate a community benefits agreement, get the land rezoned, seek tax breaks, clean up contaminated soil. None of it is super-interesting unless you’re fascinated by environmental report minutiae (“Groundwater contaminants included additional total petroleum hydrocarbons, volatile organic compounds, lead, cadmium and polychlorinated biphenyls”), but I want to zero in on the nut graf, which comes just two sentences in:

There will be community negotiations. There will be an environmental cleanup. There will be planning and design. And there will be a whole lot of bureaucracy.

“Bureaucracy” is an interesting word. It was coined in the 18th century by French economist Vincent de Gournay as “bureaucratie,” a portmanteau word combining French and Greek terms to mean literally “government by desk.” De Gournay created the term to describe the system of professional managers installed by King Louis XIV to oversee his sprawling empire, which the economist saw as tyrannical and overbearing. (De Gournay’s main objection was that government regulations served to hamstring businesses — a position he promulgated, ironically enough, as an appointed member of the French bureaucracy.)

From the start, then, “bureaucracy” was an epithet: It’s what you call the rules when you don’t like them. When you do like them, they get different names: “oversight,” “regulation,” “management.” It’s a political term, in other words, which isn’t to say it shouldn’t be used — it describes a very real and exasperating phenomenon, as anyone who’s tried to file an insurance claim can testify — but rather that it’s important to pay careful attention to how and when it’s deployed.

In the Post’s case, by describing the stadium as facing bureaucratic “hurdles,” the story is framed as a collision between a promised future good — “a state-of-the-art stadium as well as housing and an entertainment district that would draw events and people year-round” — and the sadly necessary steps needed to get the sausages made. It’s not a bad article: It provides a useful reference for anyone who wants a laundry list of items that the Broncos need to check off their list before breaking ground on (and potentially collecting tax money for) a new stadium development. (It’s certainly preferable to the Post’s editorial last week that argued for the stadium project as “an announcement that all of Colorado can celebrate” after only talking to three people: the Broncos CEO and the Denver mayor and Colorado governor who are pushing for the deal.) But it also establishes the public image of the essential conflict here as between well-meaning sports developers and desk-bound paper pushers, as if Broncos owners Greg and Carrie Penner are just another couple of regular Joes struggling to renew their driver’s licenses.

We see this kind of framing all over these days, of course, most notably with assaults on government “inefficiency” that turn out to involve stopping research on cancer treatment. While keeping bureaucrats from bogging everything down in red tape is a noble goal, sometimes paper pushers are the best defense against letting people pursue really bad ideas, too, so it’s important to cast them as slightly more nuanced than mere obstacles to progress.

What should be the real takeaway here: The Penners are trying to build a big, complicated project that will require all kinds of environmental remediation and possibly hundreds of millions of dollars worth of discounted land and tax breaks. And at this point, the only thing that can stand in their way is a whole bunch of spiritual descendants of Louis XIV’s desk-sitters. It’s not an optimal situation, for sure, but then, you know what Churchill never said about democracy.

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Friday roundup: Browns airport standoff continues, Spurs threaten voters with mascot appearance

access_time personNeil deMause

Before we get to the news, a quick note for any site supporters who are still waiting on swag: I haven’t forgotten you, I just have to restock on mailers and stamps, which I have penciled in for tomorrow morning. Thanks for your patience, and I assure you that your fridge magnets will still be timeless when they do arrive. (Because nothing ever changes in the world of stadium schemes, ha ha ha! Ha! Ha.)

But first, here’s the week’s remaining sports subsidy news to entertain and/or depress you:

  • The Ohio Department of Transportation has extended indefinitely its September 1 deadline for the Cleveland Browns owners to appeal their verdict that a new Brook Park stadium can’t be allowed as currently designed because it would infringe on airspace for a neighboring airport. Cleveland airport director Bryant Francis isn’t backing down on his insistence that the current design is a no-go, however, saying, “The FAA confirmed that the proposed height would intrude into protected airspace surfaces by 58 feet,” while adding, “We remain open to collaborating with all parties to find solutions that allow for growth while protecting the airport and the region it serves.” This is hardly the biggest problem with the Browns stadium project — that might just have to do with the at least $600 million in public money it would get from state checks that people haven’t cashed — but in America sometimes bad ideas get rejected because they’re bad, and sometimes they get snail dartered into submission.
  • The Browns’ proposed move is also now facing a second lawsuit charging that it would violate the Modell Law, with the law’s author, former mayor and state senator Dennis Kucinich, adding on to the lawsuit previously filed by the city. It’s actually the third lawsuit over the law, since the Browns owners are also suing the city to block the enforcement of the law, plus the state legislature moved to retroactively make the law not apply to in-state moves back in June, this is going to send a whole bunch of lawyers’ kids through college.
  • The San Antonio Spurs owners are holding a rally tomorrow in support of their campaign to be gifted around $750 million in city and county money for a new arena, and the key guest will be their mascot, who I’m just assuming will threaten to come to your house if you don’t vote for the subsidy.
  • Louisiana is planning to spend $7 million to bring a LIV golf event to New Orleans next summer. To put New Orleans on the tourist map. After spending tax money this year on a U.S. Bowling Congress Tournament, an Ultimate Fighting Championship event, the 2026 Southeastern Conference Gymnastics Championship, and the U.S. Gymnastics National Championships. “In a just world, politicians would have to come up with some reality-based justification for their desire to blow public money on what are effectively sports-adjacent parties,” notes Pat Garofalo in Boondoggle, almost wistfully.
  • The Athletics have submitted a development agreement for their under-construction (?) Las Vegas stadium while securing a permit to pour $87 million worth of concrete to support the lower seating bowl, tipping Schroedinger’s armadillo about 3% more into the “mostly not dead” category.
  • The Baltimore Ravens‘ $489 million stadium renovation, mostly funded by the first of a potentially bottomless pool of state tax money, is providing the team owners with more than a dozen event spaces that they can rent out for business meetings and the like. Will taxpayers get a cut of these new windfall profits, given that they’re paying for the bulk of the cost of building the event spaces? You must be new around here, kid, I’ve got some bad news about this timeline…
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Explaining the explainer on the San Antonio Spurs arena funding plan

access_time personNeil deMause

It’s fair to say that media coverage so far of San Antonio Spurs owner Peter Holt’s plans for a new arena district paid for partly by taxpayer money hasn’t been very good: The San Antonio Express-News has advocated against letting the public vote on how public money will be used, while News4SanAntonio had a reporter point to a chart showing how tax money would be used on the project and say “this doesn’t come from your tax money.” Meanwhile, local news outlets keep beating the drum to threaten that the Spurs could move without a new arena, even while acknowledging that Holt doesn’t have any great options to move to.

Against that backdrop, it’s nice to see a local news outlet, the nonprofit San Antonio Report, attempting an analysis of how the money would work for the Spurs deal. How’d they do? Let’s take a look:

Soon voters will be asked to weigh in on a portion of the NBA arena’s public funding, $311 million in county venue tax dollars, on the Nov. 4 ballot.

Another $489 million is expected to come from the city, which says it can spend the money without a public vote. And the remaining $500 million-plus would be paid for by the Spurs’ ownership.

That’s basically right, though it’s worth noting that the $311 million in county tax money would arrive over three decades, so it would only cover about half that in up-front arena expenses. Present value matters!

Unlike the city, which is using tax reinvestments, Bexar County’s taxing entities will enjoy the growth in taxable value from both the East Side developments and the new downtown sports and entertainment district — money that’s needed for a budget that relies heavily on new growth.

This is a mouthful, and it’s mostly wrong or at best misleading. So let’s unpack it bit by bit:

One part of those city “tax reinvestments” would actually come from a Project Finance Zone, a Texas-specific subsidy where state sales taxes are in and around a redevelopment area are siphoned off to help pay for the development itself. Since this is money that would otherwise go to the state treasury, one could see it as free money for the city — though, obviously, San Antonio residents are also Texas residents, so draining the state budget to help pay for a new Spurs arena isn’t exactly a free lunch.

Another part is from a Tax Increment Reinvestment Zone, which is just a TIF, redirecting any increase in city property taxes in the redeveloped area back to the developer. And as the Report reports, that’s not free money either: “New housing and development within the zone requires city resources, like police and fire, but the growth in property tax revenue is being directed toward special projects within the zone, instead of boosting the general fund for the entire city.” Translation: The new Project Marvel development that would include an arena would come with lots of new city costs, but the taxes that would normally pay for those added costs will instead go back to Holt to pay for building the arena.

The county money, meanwhile, would come from an existing car rental tax and an increase in hotel taxes, neither of which have much to do with a new arena — it’s unlikely Spurs fans will rent more hotel rooms or cars just because they’ve bought tickets to a sparklier home court — but which are revenue streams the county has available and if you squint they kind of have to do with “tourism,” so they’re getting thrown into the pot. Or will assuming that Bexar County voters approve them on election day in November, which no one appears to have done any polling on of late, but earlier this year support was deemed “tepid.”

And on top of all this, there’s the possibility of a city “infrastructure bond” — to be voted on separately, likely next spring — to provide $220-250 million toward new bridges and highway ramps to support the arena project. (The Report’s explainer doesn’t explain where the money to pay off the bonds would come from.)

So that’s more than $750 million worth of tax money going to the Spurs owner, in exchange for getting a big new downtown development and relief from any fears that Holt will move the team to Greensboro. Is that, like, a good deal? A bad deal? Better than a poke in the eye with a sharp stick?

Here’s the entire cast of characters quoted by the paper in its attempts to explain the situation:

  • Rena Oden, an “activist with the COPS/Metro group that opposes the program”
  • Bexar County Judge Peter Sakai, who wants to “do everything I can to keep the Spurs in town”
  • Pro-arena councilmember Marina Alderete Gavito
  • Houston Chronicle business columnist Chris Tomlinson, who is concerned the promised increased tax revenues may never arrive
  • San Antonio Mayor Gina Ortiz Jones, who wants an independent analysis of the project
  • City of San Antonio Chief Financial Officer Ben Gorzell, who says the arena plan is “predicated on not using existing city resources or funds”
  • John W. Diamond, a tax and finance expert at the Baker Institute for Public Policy, who fails to really explain the infrastructure bond beyond calling it “the whole process on steroids”
  • Councilmember Teri Castillo, who doesn’t want to see money diverted from the city’s general fund

That certainly checks all the boxes of citing both proponents and critics, though it’s worth noting that most of the quotes are recycled from past public statements, so the Report’s reporters didn’t spend much time picking up the phone for this one. And they absolutely didn’t call any of the people who would be the most useful: sports economists or local budget analysts who could discuss what return on investment, if any, San Antonio and Bexar County can expect to get from $750 million in Spurs arena subsidies. Bothsidesing may make your news outlet look “neutral,” but what readers need going into public ballots is information on what exactly they’ll be voting on and how it will affect what government money they’ll have available. Without that, it’s all too easy to see this as a simple referendum on whether the Spurs leave town — which it very much isn’t, but if Holt gets to play it that way without ever having to threaten to leave, it’ll be a win-win for the Caterpillar dealership magnate.

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Friday roundup: Browns still haggling over stadium permit, Fire stadium could include TIF-funded parking garage

access_time personNeil deMause

We’ve somehow ended up again at the last Friday in August, and if history is any guide, none of you are actually reading this, as you’re all headed out of town for the long weekend (as am I). So I could write about anything, really — maybe, okay, that’s too depressing. No, not that, either. How about we stay away from the current U.S. administration and … eeeagh! Fine, sports stadium news it is!

  • Cleveland Browns officials and representatives of the Ohio Department of Transportation are “in discussions” on the height of the Browns’ proposed stadium that ODOT ruled could interfere with flights into nearby Cleveland Hopkins International Airport, but “it remains unclear whether those talks could lead to a compromise,” reports Cleveland.com. The only wiggle room appears to be either digging the stadium lower into the ground (unlikely, since it’s already set to be 80 feet below ground level) or move it farther from the airport (maybe, though if you go too far you run into I-71). If they can’t negotiate an accommodation by Tuesday, the team’s owners can still file an appeal of ODOT’s ruling in state court.
  • Chicago Fire owner Joe Mansueto quietly removed a bunch of plans for a new park and transit and bike path improvements to accompany his proposed new soccer stadium, and advocates for parks, transit, and bike paths are steamed! The new plan also includes a parking garage that could potentially be funded by property taxes from the site (i.e., a TIF), which one steamed Chicagoan told Streetsblog Chicago may not be “even permissible under existing regulations.” Expect lots of shouting at the next Zoom meeting on the project’s transit plan, scheduled for September 9.
  • Wannabe Orlando MLB expansion team owner Jim Schnorf says he’s “confident we will be awarded a Major League franchise in the next decade,” citing the fact that Orlando is bigger than other prospective expansion markets (true) and that it has made more progress on stadium funding (not really so much true). Orlando is also very close to Tampa Bay, which already has the Rays (for now, at least), and MLB expansion looks to be on hold for now while the Rays and Athletics stadium situations get resolved so those team owners have lots of cities available to use as move threats, but “confidence” is nice!
  • Boston city councilor Julia Mejia and the Boston NAACP have proposed a scaled-back rebuild of White Stadium just for school sports that would cut the city’s costs to an estimated $64.6 million from the $100 million-$172 million it would cost for the city’s share of a stadium for the NWSL’s Boston Legacy F.C. That would leave Legacy without a stadium, which was originally the whole point of this exercise, but would also create possibly $100 million in savings that Mejia and the NAACP say should be put toward “unmet student needs” in public schools. Mejia tried to introduce this as a bill on Wednesday but the council ruled it out of order since it already voted for the NWSL stadium version; Mejia says she’ll find other ways to raise it.
  • Houston Astros owner Jim Crane is suing Harris County to keep being allowed to not pay property tax even though Harris County officials say they have no intention of trying to charge the Astros property tax. So long as nobody who owns a sports team has to pay property tax, that’s the important thing, no matter what those crazy judges in New Jersey think.
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Dumb reasons to build a stadium with public money just got even dumber

access_time personNeil deMause

Way back in the early days of this site, I used to do an annual “dumbest reasons of the year for building a stadium,” which I eventually stopped doing because they were all just variations on the same theme: the team will move without one, it will bring economic riches to your city, etc. But I may have to revive the tradition for 2025 if things keep going like they are this week, because hoo baby.

First up, we have this from Sports Illustrated, or at least from “Tennessee Titans on SI,” the rebranded FanNation network of blogs that aren’t really SI articles but look like them if you aren’t paying close attention:

The Tennessee Titans are opening a new and improved Nissan Stadium opening in 2027, which will feature a retractable roof.

The new stadium will help the city of Nashville’s chances at hosting a Super Bowl in the near future. … [Titans president and CEO Burke] Nihill believes hosting a Super Bowl will elevate the Titans as a franchise.

“Why not us? In terms of taking a place on the Mount Rushmore of NFL franchises and cities? I mean, you think about what our current reality has been up until now, which is an aging building built pretty basically, surrounded by parking lots, to that future where I think a lot of the energy of our city, especially for locals, will be right out our front door, and we’ll have a lot of ability to play into that,” Nihill said via Freeze.

“If the football team is sustainably great, which I believe it will be, and we do all of these things right? We’re a completely different organization than we are today.”

Like, what even? Yes, new stadiums get Super Bowls, sometimes, at least once before going back to the back of the line. The usual argument for wanting a Super Bowl is that it is a huge boon to the local economy, which is very much is not, but at least we’re used to hearing that.

But the idea that “taking a place on the Mount Rushmore of NFL franchises” — which would be a pretty damn big Mount Rushmore, with 17 cities on it — would make the Titans “a completely different organization” … that’s breaking new ground in stupid. The Nihill quote turns out to be from a longer interview by A to Z Sports, a company whose founding mission was essentially “talk radio, but made entirely of internet, that should go well,” and the Titans CEO wasn’t even talking about Super Bowls so much as how “we’re going to activate that thing like crazy with movie nights in the park and yoga and farmers markets and little concerts” — but honestly the word salad is so intense that I can see where the On SI writer could have gotten lost, though he might have wondered at what kind of sense it was supposed to make. (Ha ha, no, that’s not what he’s paid to do, if he’s paid at all.

Moving on to San Antonio, where the Express-News has been beating the drum for Spurs owner Peter Holt’s Project Marvel development project for a while now, and today the paper’s editorial board takes on the question of whether city residents should get to vote on spending $489 million in tax money on the arena project, and comes to a novel conclusion:

This would be a city election, likely in May 2026, on dedicating $489 million toward the $1.3 billion project.

It would follow a November election in which Bexar County voters will decide whether to increase the county’s hotel occupancy tax and maintain its car rental tax to dedicate $311 million toward the arena, which is proposed to be built on site of the Institute of Texan Cultures at Hemisfair.

To be clear, the city’s contribution is contingent on this vote. If voters reject the county funds, they are rejecting the entire project, city funds included. For this reason, we don’t see a need for a second vote on the same issue.

It’s far cleaner to simply have a vote and let the chips fall where they may. Let the voters decide and then let the world spin.

First off: No, the “entire project” doesn’t die if the $311 million in county funds (really more like $150 million in present value) is rejected; Holt could still take his $489 million in city funds and try to supplement it with some other funding source. But more to the point: Express-News editorial board, you do know that Bexar County (2.2 million people) and San Antonio (1.5 million people) are two distinct places, right? So just because voters in the county but outside the city vote for (or against) using county money on the arena project doesn’t mean that voters in the city will do the same with city money — it’s why they have separate elections for county and city positions, and don’t just let the county judge appoint the San Antonio mayor on the grounds that that’s “far cleaner.”

In both of these cases, the arguments being made are less reasons than pretexts — the Titans CEO wants a stadium so he can make more money on it, not to be on some “Mount Rushmore” of Super Bowl hosts, and the Express-News wants no arena vote because it really wants an arena for some damn reason, and waiting till next May and then letting voters have their say would be subjecting the Spurs owner’s desires to the whims of democracy, and we can’t have that. And hey look, there’s a headline in the San Antonio Business Journal about how San Antonio needs to build an arena for the Spurs because the Seattle Supersonics moved to Oklahoma City, though it’s paywalled and not available on either Wayback or archive.ph, so I can’t determine what exactly its case is. It’s going to be a competitive race this year for Dumbest Reason to Build a Stadium, so get your dumb reasons in now!

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Field of Schemes