Publicly funded stadiums have become as American as apple pie. Every few months a new deal seems to be struck which has a new football, basketball, soccer or another behemoth of sporting entertainment being built with public coffers. As a soccer supporter what caught my eye this past week was new expansion club, Atlanta United FC, and their glittery new stadium that will be shared with the NFL’s Atlanta Falcons. The stadium is still being built at an eye-popping price tag of $1.4 billion. I figured that given the scope and cost it would likely be at least partially funded by the public.
The numbers were not surprising. 70-80% of the cost will be covered privately while the remaining cost will be publicly funded via an already existing hotel-motel tax. Cost overruns and operating risks will also be covered by private funds. On the surface, this does appear to be a “model example of a public-private partnership.” The vast majority is covered by private funds, including the overruns. The public portion utilizes an existing tax and does not add any new taxes. So what exactly is wrong with this project?
What if I told you the stadium being replaced by this glistening new edifice, the Georgia Dome, only opened in 1992 and is scheduled to be demolished after the Mercedes-Benz Stadium is opened? What if I told you the owner of the Falcons and Atlanta United, Arthur Blank, is worth $2.6 billion? What if I told you Atlanta public schools have cut music and art programs as recently as last summer? Do you still think these hotel-motel funds are best served funding a $1 billion+ stadium that is currently selling seats with $1,250 personal seat licenses?
The Mercedes-Benz Stadium is just one fairly mild example of how misguided publicly funded stadiums are. There are many others. Detroit has cockroaches and black mold in its schools. Teachers have had sick-outs to draw attention to this travesty and are blamed for not “caring about the children.” Somehow though the city has $250 million in taxpayer-funded bonds for the new Detroit Red Wings arena. Yes, Detroit is still bankrupt and going from crisis to crisis but remember kids, professional sports come first!
For an example from the world of soccer look no further than the Philadelphia Union’s stadium in Chester, PA. Chester is in bad shape as are Philadelphia’s schools. Nonetheless, tens in millions of state funds went toward building their new soccer-specific stadium. It is indeed beautiful today but Chester remains an economic wasteland that fans leave as quickly as they come in for games.
These stadiums are sold as economic powerhouses that will lift everyone. However, in a world with the internet, study after study after study, refute this line of thought. But, when owners are rebuffed, the threat of moving usually gets the locals in line with whatever tax benefits are requested. Look at the Milwaukee Bucks arena deal. Or the recent move of the St. Louis Rams to Los Angeles, abandoning a stadium that has not even been paid off yet.
I am a sports fan. I would love my team, the New England Revolution, to have a soccer-specific stadium tomorrow. But these deals show misplaced judgment, priorities, and simply put, amount to a massive giveaway to Americans who need it least. If you are a billionaire in this country, you are better suited to take a risk than anyone else on the planet. When running a professional sports team, especially for the biggest leagues, there are a myriad number of revenue streams available to pay off your latest investment that does not involve fleecing the public. American cities need to start calling the owners bluff. Some cities may lose their teams, but what will not be lost is the proper perspective on these matters. Sports are fun, exciting and worthwhile, but they are not as important as everything else that makes a community. The public needs to start making that message clear to the owners and leagues in this country.
Main Photo: Raymond Boyd, Getty Images
