Taxpayers are about to subsidize a lot more sports stadiums

Open a map of the United States. Select a big city at random. Chances are, it has recently approved or is on the verge of approving a lavish, taxpayer-funded stadium project for one or more of its local sports teams. This is true in Las Vegas, where the team currently known as the Oakland Athletics will soon be playing in a new ballpark up the street from the home of the NFL’s Raiders, also formerly of Oakland. Combined, the two stadiums will end up receiving more than $1.1 billion in public funding, not counting tax breaks. Something similar is happening in Chicago, where Jerry Reinsdorf, owner of the White Sox, wants roughly $1 billion in public funding for a new stadium in the South Loop, while the Halas-McCaskey family, which owns the Bears, is requesting $2.4 billion for a new football stadium on the lakefront. Likewise in Cleveland, which has one of the nation’s highest childhood poverty rates, as well as in Phoenix, Philadelphia, and St. Louis. In Buffalo, the Bills recently received $850 million for new digs, and in Nashville, politicians approved a record $1.26 billion subsidy for the Titans.

Economic research is unequivocal: These subsidies are a boondoggle for taxpayers, who have spent nearly $30 billion on stadiums over the past 34 years, not counting property-tax exemptions or federal revenues lost to tax-exempt municipal bonds. Stadiums do not come close to generating enough economic activity to pay back the public investment involved in building them—especially when they’re coupled with lease agreements that funnel revenue back to owners or allow teams to play in the stadiums rent-free. Even as an investment in your city’s stores of community spirit, stadium subsidies at this price are hard to justify. As the economist J. C. Bradbury told the Associated Press, “When you ask economists if we should fund sports stadiums, they can’t say ‘no’ fast enough.” You would think that three decades’ worth of evidence would be enough to put an end to the practice of subsidizing sports stadiums. Unfortunately, you would be wrong. America finds itself on the brink of the biggest, most expensive publicly-funded-stadium boom ever, and the results will not be any better this time around. Until the 1980s, super-rich sports franchise owners generally did not seek or receive extravagant public subsidies. Three events changed that. First, in 1982, Al Davis, the Raiders’ owner, left Oakland for Los Angeles because officials refused to fund renovations to the Oakland Coliseum, which the city had built in the ’60s. (They would later cave on this; the Raiders returned to Oakland in 1995, lured by public funds.) Second, in 1984, Robert Irsay, the owner of the Baltimore Colts, moved the team to Indiana after being offered a sweetheart deal at the publicly funded Hoosier Dome. Finally, a few years later, Maryland approved hundreds of millions of dollars in public funding—along with a historically lopsided lease agreement—for a new stadium for the Orioles, who were now Baltimore’s only remaining team. (The Ravens wouldn’t exist until 1996.) “If you want to save the Orioles,” Maryland House Speaker R. Clayton Mitchell said at the time, “you have to give them this kind of lease.”