Monday, April 10, 2006

"Taxpayers shouldn't pay for stadiums" in Newsday, 4/10/6

Taxpayers shouldn't pay for stadiums

by Raymond J. Keating

April 10, 2006

It makes no difference whether they are winners or losers or have healthy attendance or empty seats, big payrolls or small - sports teams want new stadiums.

After all, upgraded facilities rake in big bucks, especially from luxury suites. And despite romanticism among some fans, the bottom line for professional sports teams is that they are businesses.

Objections arise when these businesses want taxpayers to fund new playgrounds. Other enterprises finance stores or factories privately. Sports teams shouldn't be any different. The only reason teams get taxpayer subsidies is due to the economic stupidity of politicians. Unfortunately, we have plenty of local examples.

The Yankees have won a record 26 World Series titles, including four in the past 10 seasons. They were No. 1 in attendance last year, topping 4 million, and this year they carry the highest payroll in Major League Baseball.

Last week, the New York City Council gave big thumbs-up for the team to proceed with its plan for a new Yankee Stadium, plopped down next door to the current Yankee Stadium, which was refurbished at taxpayer expense in the 1970s. The deal is presented as if the Yankees are paying for the $800 million-to-$900 million stadium, but city and state taxpayers are covering infrastructure, parking, transportation and parks costs that could easily reach or even exceed $400 million.

If that weren't bad enough, the city would float $866 million in tax-exempt bonds for the Yankees' portion, to be paid off by the team through payments in lieu of taxes to the city. So the team borrows at lower interest rates and pays no taxes, and money that would have gone for taxes is used to pay off the team's debt. Hey, I want the same deal on my property taxes and mortgage. In the end, federal, state and local taxpayers, one way or another, will pay for much of this new Yankee Stadium.

As for the Mets, although their record has been mixed over the years, their attendance last year exceeded an impressive 2.8 million fans, and the team has high hopes with the fifth largest payroll this year. Last week, the Mets unveiled their proposed $550-million ballpark, which resembles Ebbets Field and will rise next to Shea Stadium.

The Mets also will ride on the taxpayer dime, including some $165 million in infrastructure costs and $528 million in tax-exempt financing for the ballpark - also to be repaid through payments in lieu of taxes.

Finally, we have hockey's Islanders, who, as the NHL season winds down, have missed the playoffs. Last month, Nassau County Executive Tom Suozzi selected Islanders owner Charles Wang and Reckson Associates to renovate Nassau Coliseum and develop the surrounding 77 acres. The Wang group is to spend $320 million redoing the Coliseum and adding parking.

State taxpayers, however, could be checked for $77 million, as noted on the project's Web site, and the group will pursue tax-exempt financing, according to a county spokesman.

Such projects are spun differently depending on the audience. For fans, it's about transforming a loser into a winner or keeping a winner on track. But plenty of teams playing in new beautiful taxpayer-funded stadiums stink on the field. As a Cincinnati Reds fan, I have firsthand knowledge.

For taxpayers and voters, the spin is about economic revitalization and jobs.

But practically every independent analysis on stadiums shows no economic benefits. It's particularly obvious that building new stadiums next to old ones or renovating an existing arena will not drive local economic development. New sports venues also include shops and restaurants designed to keep dollars inside the facility, rather than spilling into the surrounding area.

So New York City and Long Island will see no economic gains for doling out sports welfare. The teams reap the benefits of new stadiums. They should pay the bill, not the taxpayers.


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