More Cities Foot Major-League Bill For Big Stadiums
In national politics, Social Security may be the proverbial 'third rail' - elected officials touch it at their peril. But when it comes to city politics, the subject to avoid is sports.
Just ask Willie Brown, arguably the most popular mayor San Francisco has ever had. While in Paris this winter, the sharp-tongued politician dismissed the quarterback of the San Francisco 49ers as "an embarrassment to humankind." The remarks stirred a storm of protest that sent local TV crews rushing to the banks of the Seine to question the mayor's choice of words.
Given this reminder that politics is only the second-most popular spectator sport in this football-crazy town, it's not surprising that Mr. Brown's door was wide open when the 49ers later came asking for a new stadium. The mayor has put his prestige on the line as he tries to persuade voters to pass a $100 million bond issue on June 3 to help finance a new home for the football franchise.
Indeed, city and state politicians all over are embracing major-league sports. Some $4 billion has been spent in the last six years to build 30 stadiums, much of it public money.
Some $7 billion worth of stadiums is in planning stages in cities such as Minneapolis, Milwaukee, Cincinnati, Nashville, Seattle, New York, and Chicago.
Public financing of sports stadiums, though not new, has become an increasingly costly, and controversial, proposition. Teams are eager to build new facilities, equipped with luxury boxes, that dramatically increase revenues and franchise value. The demand is driven in part by rising player salaries, say National Football League officials.
But teams practice their own version of free-agency, threatening to pack up and leave unless a city comes up with the dough. And city fathers have in many cases provided hundreds of millions of dollars of public money to keep, or to attract, a major-league sports franchise.
"The NFL has done a clever job of dividing the cities and conquering them," says former San Diego city councilman Bruce Henderson, who fought a losing battle against a $78 million publicly financed expansion of that city's stadium for its football team.
In every case, politicians and sports-franchise owners advertise these deals as an economic boon to the community, bringing new jobs, added tax revenue, and creating the lure to new investment of being a 'big league' town.
"Build the stadium, Create the jobs," reads the slogan for the campaign in favor of the new San Francisco stadium, promising to create 10,000 new jobs, mostly at a huge shopping mall that will be part of the sports complex.
But critics, citing recent studies, dismiss claims of economic benefit as groundless. In effect, the taxpayer is being asked to subsidize a lucrative private business, they argue.
"It's corporate welfare," says economist Raymond Keating, who advocates a 'free market' approach to stadium deals. "The only people benefiting from this in the end are the owners and the players."
A study of stadium economics carried out last year by the Congressional Research Service reached much the same conclusion. Boosters often overstate the benefits, failing to take into account that the money people spend at a stadium is usually taken away from some other activity, the study said.
Citing Baltimore's football-stadium project, the study calculated that each job created cost $127,000, compared with $6,250 for jobs created by the state's economic development program.
Local leaders cite the less tangible benefit of civic pride - the impact on a city's image of having a team.
Across the bay from San Francisco, city and county officials in Oakland had been trying for years to bring back the beloved Raiders, who left for Los Angeles in 1982. Two years ago they reached a deal to bring them back, motivated in part by the fear that they were also about to lose their major-league baseball and basketball franchises.
"We [have been] trying to revitalize the city for the last decade," says Oakland City Councilman Ignacio de la Fuente. "For us, it is more a do or die situation, to use this as an imperative for economic development."
Oakland Raiders owner Al Davis played on that desire, getting the city to pay all the $170 million cost of renovating the Oakland Coliseum.
Local officials floated a bond issue to pay for the new stadium, assuring the public that the sale of personal seat licenses and other gate receipts would pay for it.
But sales the last two years have fallen well short of projections, leaving a situation where tens of millions of dollars may have to come out of the general budget.
"We were bamboozled," says Alameda Country Supervisor Gail Steele, who describes hurried, pressured talks. "It was presented to us that this was the only way they would come."
San Francisco officials describe the 49ers deal as much better. The city will finance $100 million of the $325 million stadium, to be paid back from stadium revenues and taxes generated by a $200 million mall built next to the stadium.
"This particular deal is so lavish that it staggers me," says State Sen. Quentin Kopp, an Independent from San Francisco, pointing to the grant of 123 acres of prime public land to build the mall. By contrast, the Giants won approval last year to build a new, entirely privately-financed ballpark, he points out.
With the exception of Senator Kopp, every politician in sight is backing the stadium.
Even so - and despite the popularity of the 49ers - the bond issue is trailing in recent polls. This isn't unusual for San Francisco, whose prickly voters have rejected plans for publicly funded baseball stadiums. If the vote fails, the 49ers are said to be pondering a move to more hospitable quarters down the bay.