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September 02, 2011

Emanuel to back $200m in Wrigley Field subsidies?

Catching up on this late, but apparently Rahm Emanuel, the Obama hatchet man turned mayor of Chicago, is willing to put up as much as $200 million in city money towards a renovation of the Cubs' privately owned Wrigley Field. Or so say the "sources" cited by Crain's Chicago Business:

According to insiders, the team has pitched a range of public-funding options, from allowing the team to use amusement-tax revenues to pay for renovations to a sales or property-tax subsidy, a state credit for rebuilding an historic structure and bonds that would be issued by the Illinois Sports Facilities Authority, which owns the field where the White Sox play.
Some of those ideas already have been shot down. For instance, a source close to Mr. Emanuel said there is no chance the mayor would back an expanded tax on restaurant meals in the Lakeview area to pay for stadium work.
But a state historic tax credit in the range of $40 million is said to be potentially doable, and the team argues that it ought to be a subsidy from new taxes that its renovation would create, in the same manner that scores of local projects have received tax-increment financing subsidies.

TIFs, of course, have a somewhat problematic history in Chicago, having been handed out so vigorously to developers by Emanuel's predecessor, Richard Daley, that the city's property tax base has been left with more holes than the Cubs' starting rotation. And as the Chicago Reader notes:

There are no real community economic development benefits to be gained by pumping $200 million into Wrigley Field. The surrounding Wrigleyville area is already booming—as wild on weekends as the French Quarter in New Orleans.
There are certainly other areas in town—like most of the west and south sides—far more deserving of public subsidies. And, as we all know, the schools and city are deep in the red.
All in all, it's really not a good time to essentially take money that could go to public school students—among other worthy recipients—and turn it over to a baseball team.
Especially one that's as wretched as the Cubs. Sorry, easy target.

The Reader goes on to note that Cubs owner Tom Ricketts is rich enough to afford to pay for renovations himself — which, while true enough, is sort of beside the point, since it's unlikely that $400 million worth of renovations is going to produce $400 million worth of new revenues. Which does raise the question of why a major renovation is desirable in the first place, but then, we know what the response to that is.

In all, given the lack of details (the Crain's article just alludes to possible kickbacks of property taxes or amusement taxes, the latter being a rehash of the Cubs' previous plan), the unnamed sources, and the fact that it dropped in mid-August, this feels more like a trial balloon than anything. Still, it's probably a sign that the Wrigley subsidy debates are likely to heat up again, once everyone has had time to forget about the Cubs' season.


Neil, while the Crain's Chicago Business article on this potential debacle led to a flurry of posted comments on the story (well over 98% of posted comments being AGAINST any public financing for the Rickett's/Wrigley), the public outrage has yet to really foment in Chicago media (save for Crain's & the Reader).

I fear that as your book & website have outlined again and again, the people with the money (Rickett's) and the power (Mayor Emmanuel) will get their way, and once again, the Chicago & possibly Illinois taxpayers will once again get screwed.

Posted by Daniel M on September 2, 2011 03:39 PM

"since it's unlikely that $400 million worth of renovations is going to produce $400 million worth of new revenues."

This is all that needs to be said about 90% of these projects...

Posted by Joshua Northey on September 2, 2011 05:06 PM

I don't know enough about Chicago politics let alone it's neighborhoods but I'm curious if he were to find some viable alternative to playing elsewhere than Wrigley (somewhere in Chicago has to also want the Cubs) whether the loss of the Cubs would be good or bad for that neighborhood?

I'm assuming that freeing up an entire city block in a bustling, kitschy neighborhood isn't the worse thing that could happen to a city. Yet losing an anchor tenant isn't the best thing either.

Regardless it would be a phenomenal social experiment for the likes of FoS and other economists and social activist groups if a team moved out of an established neighborhood teaming with consumers and shoppers and the team was worse for it and the neighborhood was better. That would be something.

Posted by Andrew T on September 3, 2011 03:22 PM

Andrew T -
I live in Chicago and can tell you that businesses/ merchants in the Lakeview (neighborhood Wrigley Field resides in) area would fight tooth & nail to retain the Cubs.
That said, there are areas within Chicago that could support the construction of a "new" Cubs stadium, as well as a huge new revenue stream, which would be paid Parking owned and operated by the Cubs (there is scant parking in neighborhood, little there is is owned & operated by businesses that are NOT the Cubs.).
The southern lakefront would work (and might mirror San Francisco's AT&T park but on Lake Michigan).
But in all likelihood, Wrigley will remain where it is, with somewhat modest changes, and we taxpayers will end up paying for it...

Posted by Daniel M on September 4, 2011 05:58 PM

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