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New Sports Stadiums and Taxpayer Abuse

 

 

Five Works Cited       There seems to be a domino effect through out the U.S., new stadiums are being built, teams are demanding that their city build them a new stadium to play in but it is not necessary to build these stadiums. The most obvious change in new stadiums is coming from baseball. In the last 10-15 years many new baseball stadiums have been built, but who is paying for these stadiums? The teams and the owners that are demanding the stadiums, or the taxpayers? The answer is that taxpayers are picking up a huge amount of the cost to build a new stadium.

 

Before the Depression stadiums were built by using private funds, some of these stadiums include: Wrigley Field, Tiger Stadium, Yankee Stadium, and Fenway Park ("Sports Pork", 3). All of these parks are very memorable for lots of reasons, mostly the players that played and or play there. Why when these stadiums were built were they a fraction of the cost that it is to build a stadium today? In the 1980's America was spending about 1.5 billion on new stadiums; in the 1990's it spent 11 billion ("Walls Come", 2). Furthermore, in 1967 the cost to build the Kingdome was 67 million, in 1999 the cost to build Safeco Field was 517.6 million. On top of the cost difference, not only was the Kingdome multi purpose but also it held more people. The capacity of the Kingdome for baseball seating was 59,166; the seating at the new Safeco Field is 46,621. Although the Kingdome was starting to fall apart, it was decades away from its useful life ("Walls Come", 2). In fact, in 1994 tiles fell from the ceiling and the cost to fix was 70 million, which was done. It is possible that one could argue that Seattle was in need of a new stadium. To build a stadium and have an estimated price is one thing, but having tons of extras added on that are going to have the cost overrun by 100 million dollars is a little ridiculous.

 

Many other cities are also either building new stadiums or contemplating it, 46 major league stadiums and arenas have been built or renovated for teams and 49 more are under construction or in the planning stages ("Debating", 1). Of the 10 highest valued Major League Baseball teams, 6 moved into new stadiums in the 1990's. The new stadiums are very nice and fun to go to, but where is the line supposed to be drawn as far as how much it should cost to build? Safeco Field is a very nice stadium but some of the finishing touches that were added could have been done without. Some of the things that accounted for the 100 million cost overrun were broken down as follows: 2.3 million for delays caused by bad weather, 4.2 million for extra finishing touches, 1.4million for concession improvements, 2.1 million to upgrade the sound and video system, 1.7 million to architect/engineer fees, 5.5 million for extra concrete needed for expansion and 2.1 million for contract settlements ("Stadium Costs Up", 1). All of these extra costs became a big issue in the city of Seattle. Although there were the overrun charges there are benefits to the stadium, for example, the stadiums retractable roof is was built to protect against Seattle's rain, it also provides something else; if the roof is open against the wind it cost approximately ten dollars to move it, but if the roof is open with the wind its motors act like generators and the motion actually creates seven dollars of electricity ("Giving Holiday", 1). The estimated cost of the stadium was originally 400 million, when the elected officials ignored the votes against a hike in sale tax and other things to pay for the overcharges; people were very upset ("Sports Pork", 9). The team itself stated in the beginning that they would pay any overrun charges, but when it came to a total of 100 million dollars the team fought the charges. As it turned out the taxpayers ended up paying the difference by such adjustments as raising hotel rates and taxes, mostly because a week a couple of weeks later the Mariners were in an exciting playoff series with the New York Yankees, which in turn made the public forget about the issues at hand and persuaded them to think all the costs were worth it. One of the classic signs of the new stadiums being built in the 1990's is that the fields are paid for mostly by the taxpayers but are named for the owners or corporations ("Sports Pork", 8). Seattle's Safeco Field is a perfect example of this. This is not what should be happening if the owners and or corporations are not going to step up to the plate and help out.

 

Taxpayers funding the new stadiums are very beneficial to the teams for many reasons. For one they are relieved of any financing cost, which can run anywhere from 10 to 20 million per year. Secondly, new expanded revenues are taken through luxury suites, club seats, stadium naming rights and other advertising. Thirdly, teams often don't have to pay property taxes on the new stadiums ("Sports Pork", 17). The players are getting out of cost left and right. Most people think it doesn't matter anyway, whatever the player makes in his salary per year, if it is not put back in building the stadium will be put back by things such as shopping or house taxes in that area. This is not true, the majority of players don't usually live in the city that they play for, they may have a house that they stay at for the season but the majority of their money is spent in another city where their family does their shopping and where they reside and do their shopping during the off season.

 

Ballparks are usually thought to be nostalgic in some sense. There is a feeling of getting back to the old days and remembering how to have fun and relax. These new stadiums are not only so high tech that it's hard to remember the old days but they are actually taking away from history. For example, the Kingdome (which no longer stands) had many historical moments such as the location of the first time a father and a son had taken the field as players on the same team, or Randy Johnson and Chris Bosio pitching no hitters. Now, 20 years down the road people will hear of these events happening and will no longer be able to get a visual s to where this took place because the building no longer stands. Possibly this is what America wants though; it just seems that it takes away a little bit the meaning of the sport itself when so many changes are made. The public seems to feel that they thrive on having a major league team in their city. Sports fans are usually very loyal to their teams and take much pride in the city they live in and the team that plays there. This gives people a sense of pride in their hometown, and therefore would make people want to build a new stadium to keep the team happy and also to be able to say that their town has the nicest or newest stadium.

 

Another issue that is brought up by the construction of these new stadiums is the job market as well as the cost to attend a game. It is almost impossible to take an average family of four to a ball game on a regular basis, the cost of the stadium's seats; food, parking, game programs and souvenirs are all too much. It seems that the ballparks are almost catering to the corporate elite ("Take Me Out", 2). For right now it does not seem like such a big deal because people can still attend occasionally and otherwise catch the games on T.V. but if the stadiums keep catering to the elite, in the long run they are going to lose fan base which in turn is going to redirect advertisers to promote entertainment such as wrestling of stock car racing (events that would be less expensive to watch and attend on a regular basis). If this were to occur advertisers and supporters would quit putting money into the stadium promotions and would lean more towards television promotion, which in turn would make the stadium generate less and less money. There would be less attendance and less promotion for the stadium. It makes it tough to root for a team that you never get to view personally and up close.

 

As for the job market the new stadiums are taking away from the income of other entertainment and not producing other jobs to take the place. In a given city there are many forms of entertainment: movies, bowling, concerts, bars etc. but what happens when you put another source of entertainment in there, so now instead of four major sources of entertainment you have five which means, in order to have the fifth source there it takes money away from the other four, there will be less money spent in those four places and less need for jobs and so on. A study done by Michel Walden, a North Carolina University economics professor, looked at the growth from 1990 to 1994 in 46 cities and found that cities with major league sports teams have grown more slowly in the 1990's ("Sports Pork", 20). For example, now that the Kingdome in Seattle is no longer standing the Seattle Seahawk's are forced to play in Husky Stadium, which has fewer concessions than the Kingdome did and therefore is another cut in job opportunities. On the other hand, it would create other little jobs around the area; the guy on the corner selling hats would get better business because of a new ballpark. However this does not outweigh the business lost at the other locations.

 

The question is: "What is the solution?" Do we allow the government to keep playing a role in having the public pay for the stadiums? If teams were publicly owned and not owned by the government or a corporation they would be less likely to threaten to leave ("Sports Pork", 22), and would therefore be more likely to stay and be content with what they have. Some of the solutions that have been brought up are as follows: Elect the right people, meaning elect the people to office who do not support handing money to sports teams and who will privatize sports venues currently owned by the public. Another option would be to employ direct democracy; make sure that the voters have the last say in whether a new stadium is built. Safeco field was voted down and was eventually built by the slip of a loophole anyway. Another option for ending the threat from teams to leave unless a new stadium is built would be to eliminate the federal tax exemption for public sports stadiums. This would raise the cost for cities and states and might in turn have an effect on the public as to if they are going to think a little harder to think about what is going to be beneficial for them and the city they live in. This seems it would be the more likely of all the options because to look at the tax break from an economic perspective it makes no sense to provide a tax exemption for a sports team that has no relation to the nation's economic well being ("Sports Pork", 24). Although contrary to all the facts, fans still buy tickets, merchandise, food and still cheer their team on. It is easy to be persuaded into thinking that a new stadium would be a wonderful idea with the image of a brand new stadium filled with fans and a winning team. Without the government pro sports would still exist and thrive, as they did in the past ("Sports Pork", 24). The owners and the players would have to adjust their financial expectations downward a bit.

 

The stadiums in most cases should not be built. It is the taxpayer money that is building the stadiums, which is unfair. The owners and the players do pay some of the cost but the bulk of the amount paid is done so by the taxpayer's money. Unfortunately this seems to be a domino effect throughout the cities of the U.S., once one new stadium is built the next city wants a stadium also, which makes it unlikely that the new stadiums will stop being proposed and built anytime soon. For now all the public can do is to think a little more carefully about all the effects of a new stadium being built in the city and make wise voting decisions.

 

 

Works Cited

 

Carter, David M. "Take Me Out to the Ball Game, James." Business Week. (2000) Issue 3672, pg. 142.

 

"Debating Stadium Costs and Benefits" New York Times 17 Oct. 1999, late ed., start pg. 30.

Keating, Raymond J. "Sports Pork. The costly Relationship between Major League Sports and Government" Policy Analysis (1999). No. 339.

 

Noll G., Roger and Zimbalist, Andrew. Sports, jobs, and taxes: the economic impact of sports teams and stadiums. Washington D.C.: Brookings Institution Press, c1997.

 

Rosner, Bob. "Giving Holiday Gifts At The Office Doesn't Have To Be A Nightmare" Seattle Post Intelligencer 6 Dec. 1999: D5.

"Stadium Costs Up By $19.3 Million." The News Tribune [Tacoma, Wa.] 6 Apr. 1999 sec. A14.

 

Thiel, Art. "New M's Concepts: Accountability, Pitching" Seattle Post Intelligencer 31 Mar. 2000: S2

 

"Walls Come Tumbling Down." Economist (2000) Vol. 354 Issue 8163, pg