Friday, June 12, 2015

On Stadium Subsidies, are Mayors Driven by Peer Pressure?

Neil deMause writes on more and more cities are starting to push back against the seemingly unstoppable march of pro teams toward bigger and bigger stadium subsidies:
(Calgary) Mayor (Naheed) Nenshi, however, appears ready to buck the trend of democracy being the first casualty in stadium deals. More remarkably, he's one of several mayors—most newly elected to office—who seem eager to tell sports team owners to take their subsidy demands for a long walk off a short pier.

In Anahiem, Mayor Tom Tait shot down his own council's plans to give Los Angeles Angels owner Arte Moreno $245 million worth of parking-lot land for the low, low price of $1. In Oakland, Mayor Libby Schaaf told the Raiders she won't give them a dime of public money that she can otherwise "spend on police, parks or libraries." In Minneapolis, Mayor Betsy Hodges has declared she'll oppose $50 million in tax breaks for a new MLS soccer stadium, calling the demand "extraordinary" and calling out Minnesota United's owners for pretending that tax breaks aren't a public subsidy.

Nenshi not only wants to air arena proposals in public, but also insists that there be a net public benefit from any public expense. Friends, can we call it a movement?

"As a social scientist, I'm not quite ready to pull the trigger and say it's a trend," says Villanova sociologist Rick Eckstein, co-author of Public Dollars, Private Stadiums, the definitive book on why mayors so often bend over backwards to meet local team owners' subsidy demands.

Still, Eckstein calls it heartening that even a handful of elected officials are acknowledging two oft-ignored truths:

a)As innumerable economists have yammered about for decades, stadium subsidies rarely pay off;

b)As keepers of rare and valuable sports business commodities—namely, places to play sports, and large, ticket-buying and television-watching populations—cities and municipalities have the leverage to just say no.

"It's refreshing that after 20 years of yelling about this stuff, five or six people are starting to listen," Eckstien says.
It's a little bit of a different situation in St. Petersburg, where Mayor Rick Kriseman has struck a deal with the Rays that some critics call a "short sell" on its existing contract.  Kriseman says he expects St. Pete to be able to put up a competitive new deal that could keep the Rays long-term...but that, of course, would mean new tax dollars going to the team.

But deMause continues with an interesting concept:
Having other mayors on his side "helps tremendously," Tait says. "In Anaheim, I was absolutely alone, and the pressure was tremendous. You do question, gosh, by relying on math and stuff, am I crazy?"

The notion of elected officials being driven by peer pressure, like so many overgrown high-schoolers, may sound crazy to anyone who thinks of people in power as, well, powerful. Only mayors are people, too. Eckstein recalls a conversation he had with then-Dallas mayor Laura Miller during her battles with Jerry Jones over subsidies for a new Cowboys stadium. (Jones ended up building it in nearby Arlington, in exchange for $325 million in city sales tax receipts.)

"I talked to the mayor of Dallas a few years ago, she said basically she was alone and she would call other mayors to see if they would also oppose stadium plans in their cities," says Eckstein. "And they were really reluctant to, because no one wanted to be the first."
Rightly so, deMause has great skepticism the momentum can last...after all, mayors love stadiums.  So do governors.  And Congress.
There's still a long way to go—at this month's national mayors' gathering, Tait expects, any panel on sports stadiums will still be about how great they are for economic development, not how to cut a deal that's worth it for your city and its taxpayers. 

Shadow of the Stadium on Twitter
FOLLOW: Shadow of the Stadium on Facebook


  1. Regarding:
    "In Anahiem, Mayor Tom Tait shot down his own council's plans to give Los Angeles Angels owner Arte Moreno $245 million worth of parking-lot land for the low, low price of $1."
    Is it just a coincidence that Moreno owes Albert Pujols $165 million for the years 2016-2021 and still has to pay Josh Hamilton $70 million even though he is now with the Texas Rangers, and that adds up to $235 million - just $10 million shy of the $245 million handout he is looking for. If Arte does not agree to 'stupid' contracts then he does not 'need' to ask the city of Anaheim for handouts.

    Well done Mayor Tait!

    1. Yes, it is a coincidence.

  2. Is the Tampa Bay Times more correct in its current analysis of the economic benefit of Trop redevelopment than it was in its analysis of the economic benefit of bringing baseball here in the first place? That's a dramatic way to have struck out, but I suppose they will keep swinging. Imagine trying to promote the construction of a new stadium somewhere regionally, while at the same time arguing in favor of something "better" at the place where the current stadium sits. There's irony all over the place. These journalists are such flexible pretzels, but their inconsistent arguments leave a taste that is just too salty.