Forbes columnist Mike Ozanian, who writes about the intersection of money and sports, has been giving a national audience a close look at Minnesota’s stadium debate.
He says today that the big proposed public subsidy probably won’t provide the big boost to the economy that supporters claim.
He notes that Gov. Mark Dayton and NFL Commissioner Roger Goodell have been pushing hard for a deal that calls for taxpayers to pay 54 percent of the cost of the nearly $1 billion stadium, a public percentage that’s far higher than all but three of the last 10 NFL stadiums.
But he pooh-poohs the claims that a new stadium will generate extra tax revenue and extra spending by fans:
But those touting the positive economics of the new stadium appear to be looking at history through rose colored glasses and seem to be ignoring the impact past stadiums have had on businesses and taxpayers.
The upshot from UBS: “Independent academic research studies consistently conclude that new stadiums and arenas have no measurable effect on the level of real income or employment in the metropolitan areas in which they are located. Feasibility studies for professional sports facilities often fail to account for the substitution effect. Individuals generally maintain a consistent level of entertainment spending so money spent on sporting events typically comes at the expense of cash spent in restaurants, on travel, and at movie theaters.”
His bottom line:
The new stadium will definitely make team owner Zygi Wilf a lot richer. But it is doubtful it will do much for the pocketbooks of the folks who will be asked to pay for most of it.
What’s the effect of non-Vikings uses?
What’s the effect of the non-NFL uses of the stadium? That’s a massive thing to leave out. The proposed stadium will be taking on the functions of the Dome, which is in use almost every day there isn’t a Vikings game. It’s used by the state high school leagues and colleges, including hosting something like 300 baseball games AFTER the Twins got their own stadium. If you don’t figure in the other uses, the calculation doesn’t mean much.
They don’t need a new stadium for any of those things
They can still host all of those events with the current Metrodome. There is no additional economic value to replacing the Metrodome with a new stadium for non-NFL events.
There would only be a handful of events that the Metrodome would be considered “too outdated” to handle. NFL Pre-post-regular season games, one Superbowl, maybe a Big Ten Championship game and some NCAA basketball tourney weekends. Those events do not bring in enough money for the city of Minneapolis to seriously consider spending $600 million+. Keep the dome, if the Vikings want to get serious and actually put a fair share toward the stadium I will listen. As the plan is constructed now it is a complete joke for Minneapolis residents.
Gopher Baseball
The Gopher Baseball team has been playing its spring games at the Dome, including 38 games this spring. I don’t believe the Viking stadium will be able to accommodate baseball.
*Sigh*
C’mon, even Forbes realizes we the people are getting screwed.
Buttering the Bread of a Billionaire…
…at the expense of taxpayers is the main thrust of the proposed legislation.
I wonder why this column is not at the headline level here on Minnpost, since it goes straight to the heart of the false or exaggerated claims of sycophantic supporters? Shouldn’t this be a top-line story?
One more point – virtually all columns and articles written about this boondoggle PRETEND that its true costs are known. This is utterly misleading.
The true final costs are NOT known by anyone. It will be the taxpayer, the last party to be considered, who will FIND OUT the cost over the years if this atrocious handout actually becomes law.
The alleged $150 million cost to Minneapolis taxpayers and the alleged $400 million cost of bonding by the state is only one level of deception.
Here’s what the proponents like to leave out:
– operating costs of $189 million (Mpls)
– inflation and interest – according to Mpls CFO, raises $150 million to as much as $675 million (Mpls)
– tax escalator – more taxes means more payments; could raise costs to $890 million (Mpls)
– interest costs (state bonding) estimated as high as $722 million
– cost overruns (Mpls and maybe the state)
– loss of property taxes – Vikings get an exemption and will pay none
– an NFL-inserted requirement that the stadium be maintained to be comparable to other NFL stadiums; this amazing wild card obligation is beyond anyone’s comprehension – I guess the NFL is free to “make it up” as they go and the taxpayer must cough up whatever they demand
– a shortfall in taxes on rosy gambling revenue predictions will have to be made up with public monies
I repeat: the true final costs are NOT KNOWN by ANYONE.
So any and all representations you’ve read in print about the costs are false to the extent they have left out these expenses.
How on earth can a responsible Legislator vote for this?