Should Taxpayers Be Subsidizing the NFL?

Sep 24, 17 9:28

Post #1 of 20 (1461 views)

I'd say "no." And maybe the coming tax reform bill that's being kicked around in Congress can make it illegal to finance sports stadiums with tax-exempt municipal bonds. I'm actually in favor of removing the tax exemption for state and local bonds entirely, but fat chance of that ever happening.

The NFL benefits from a raft of sweetheart deals and exceptions to antitrust law and other regulatory measures that almost no other business, outside of major professional sports (MLB, NBA, NHL) is allowed to receive. There's some sort of database out there that shows arrests of NFL players for a wide variety of crimes, including domestic abuse, gun crime, and murder. Add in the emerging evidence that many NFL players, current and former, are suffering sometimes-horrific aftereffects from concussions, and I'm not sure why the NFL in particular is given such leeway to conduct its operations, including holding up many a municipality for millions (hundreds of millions in some cases) in money to build posh "public" stadiums that only its teams seem to derive benefit from.

Economically, such deals don't seem to make much sense for the cities playing host to an NFL franchise, though I suspect it's more about prestige and perks that such municipalities accrue. If you have an NFL team you've "made it" as a metro area, I think the common belief is. But have you really "made it" if the money you're spending could have been better spent on infrastructure and other improvements? Hardcore NFL fans would say the investment made by their cities to lure and keep an NFL team is well worth it. Many other folks, though, might not be so understanding, and that number seems to be growing larger by the year.

Economics Of Subsidizing Sports Stadiums | St. Louis Fed

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Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 9:34

Post #2 of 20 (1452 views)

Should they? IMO, no. But I also think it's ridiculous to say Congress should make it illegal. It's a local issue. If municipalities want to blow their bond opportunities in this manner, it's their right. Absolutely no reason for the feds to get involved.

Re: Should Taxpayers Be Subsidizing the NFL? [tigermilk] [ In reply to ]

Sep 24, 17 9:42

Post #3 of 20 (1443 views)

tigermilk wrote:

Should they? IMO, no. But I also think it's ridiculous to say Congress should make it illegal. It's a local issue. If municipalities want to blow their bond opportunities in this manner, it's their right. Absolutely no reason for the feds to get involved.

I think I agree with you. But let me play devil's advocate.

These sports leagues have incredible monopoly power courtesy of our same Federal Congress. Perhaps allowing these NFL billionaires to then prey upon local municipalities represents an unfair advantage. Most people you talk to think it's folly to be subsidizing these NFL stadiums for the financial benefit of the NFL owners, yet it keeps happening. In that line of reasoning the Feds would only be helping with this problem because they created it.

Last edited by: SH: Sep 24, 17 9:42

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 9:50

Post #4 of 20 (1431 views)

One of my pet peeves is when sports team hold cities hostage for subsidizing sports arenas. The teams tactic is always the same, they pull out statistics showing how they "lose money" and if they don't get a tax break they will leave the city. Then they talk about how many jobs they create and the cities (taxpayers) foot the bill.

The problem is that even if teams lose money operating (which they don't), they ignore the fact that the value of the franchise is going up. I would love to lose 5 million per year for 5 years in operations if the capital appreciation of the franchise went up 50 million in the same time but they conveniently forget to mention that.

The jobs they create are minimal and other than the construction of the arena, are very low paying jobs.

If I were in the City government, I'd be working on a deal that says we will subsidize the building of an arena but the City but every year, the value of the franchise is determined and if goes up, the City is repaid the costs. If the teams want taxpayer subsidies, it puts taxpayers at risk so they should be offered the chance to get the rewards. As it is, the owners pass the risks to the taxpayers but they are the only ones to get the rewards.

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 11:00

Post #5 of 20 (1376 views)

As an NFL own and a taxpayer, in my case, in my state, yes. For the rest of ya'll, do what you want ...

If there are no dogs in Heaven, then when I die I want to go where they went. - Will Rogers

Emery's Third Coast Triathlon | Tri Wisconsin Triathlon Team | Push Endurance | GLWR

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 12:05

Post #6 of 20 (1332 views)

I think a lot of people who complain about subsidizing stadiums are the same people complaining about teams leaving. You don't get it both ways. As long as other cities are willing to subsidize stadiums you run the risk of your team leaving if you don't.

I am curious how much tax revenue teams bring to their cities.

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 12:25

Post #7 of 20 (1308 views)

I'm confused about the conclusion in your link:

Building sports stadiums has an impact on local economies. For that reason, many people support the use of government subsidies to help pay for stadiums. However, economists generally oppose such subsidies. They often stress that estimations of the economic impact of sports stadiums are exaggerated because they fail to recognize opportunity costs. Consumers who spend money on sporting events would likely spend the money on other forms of entertainment, which has a similar economic impact. Rather than subsidizing sports stadiums, governments could finance other projects such as infrastructure or education that have the potential to increase productivity and promote economic growth.

Like what? I have Packer season tickets. They are expensive. If there were no Packers, I would not spend that money on other entertainment in Green Bay. I live in Milwaukee. At least half of all Packer season ticket holders live outside of Green Bay. Were it not for the Packers, those people would never spend money in Green Bay.

I think it is foolish to assume NFL fans (for example) would suddenly spend that money on the local orchestra if there was no football. I do not agree people set aside "entertainment funds" that are going to be spent on "entertainment" and if one form (i.e., NFL) is gone, they would spend it on another form.

Similarly, the conclusion says those stadium fund could be used on infrastructure or education. Ok. How does that create spending in the municipality that use to have the professional sports team?

If there are no dogs in Heaven, then when I die I want to go where they went. - Will Rogers

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Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 13:01

Post #8 of 20 (1282 views)

Sort of like asking why college football is such a big thing at academic institutions? Its a lot of revenue for the universities. Same thing with subsidizing stadiums. The small city near me lost its second tier hockey team (a farm team for the NHL) and thus a lot of revenue. So the city spent a pile of money and expanded the hockey arena and now has a new team. Its a win-win for the community in the final analysis..

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 24, 17 16:41

Post #9 of 20 (1179 views)

It is dumb for local taxes to go to stadiums. The economics are never there. The expense goes to the taxpayers and the profit goes to private entities.

It is even dumber to think Congress should do something to prevent local governments from deciding where their tax money goes. Apparently you think Washington bureaucrats have a better feel for what is right for these communites than the local government. I never realized you had such confidence in Washington.

I'm beginning to think that we are much more fucked than I thought.

Re: Should Taxpayers Be Subsidizing the NFL? [j p o] [ In reply to ]

Sep 24, 17 17:15

Post #10 of 20 (1159 views)

j p o wrote:

It is dumb for local taxes to go to stadiums. The economics are never there. The expense goes to the taxpayers and the profit goes to private entities.

Not in Green Bay.

If there are no dogs in Heaven, then when I die I want to go where they went. - Will Rogers

Emery's Third Coast Triathlon | Tri Wisconsin Triathlon Team | Push Endurance | GLWR

Re: Should Taxpayers Be Subsidizing the NFL? [cerveloguy] [ In reply to ]

Sep 24, 17 17:53

Post #11 of 20 (1125 views)

Sort of like asking why college football is such a big thing at academic institutions? Its a lot of revenue for the universities.
---

Except the niggling fact that an overwhelming majority of college football teams cost the university more money than they make.

Take a short break from ST and read my blog:
http://tri-banter.blogspot.com/

Re: Should Taxpayers Be Subsidizing the NFL? [JSA] [ In reply to ]

Sep 24, 17 17:56

Post #12 of 20 (1121 views)

JSA wrote:

As an NFL own and a taxpayer, in my case, in my state, yes. For the rest of ya'll, do what you want ...

Oh that's adorable. You think that "share" of the Packers that isn't allowed to appreciate, pays no dividends, isn't allowed to be resold, nor that gives you any voting rights or any other management power makes you an NFL "owner."

Anyone outside of Green Bay calls that a "non-refundable, not tax-deductible donation."

Last edited by: trail: Sep 24, 17 18:04

Re: Should Taxpayers Be Subsidizing the NFL? [trail] [ In reply to ]

Sep 24, 17 18:03

Post #13 of 20 (1115 views)

trail wrote:

JSA wrote:

As an NFL own and a taxpayer, in my case, in my state, yes. For the rest of ya'll, do what you want ...

Oh that's adorable. You think that "share" of the Packers that isn't allowed to appreciate, isn't allowed to be resold, nor that gives you any voting rights or any other management power makes you an NFL "owner."

Anyone outside of Green Bay calls that a "non-refundable, not tax-deductible donation."

You know I said that tongue-in-cheek. But, I am serious and factual when I dispute jpo's claim that the money goes from the taxpayer to a private entity. Not in Green Bay, it doesn't. There is no owner and no "real" shareholders to whom dividends are paid. All the money from the Packers goes back into the team to pay for improvements and upgrades, goes to pay all the OT incurred by law enforcement and first responders, goes into community projects like the Titletown District, and goes to charitable funds administered by a trustee. In addition, the Packers have paid for several improvements to roads and other public utilities around Lambeau Field.

If there are no dogs in Heaven, then when I die I want to go where they went. - Will Rogers

Emery's Third Coast Triathlon | Tri Wisconsin Triathlon Team | Push Endurance | GLWR

Re: Should Taxpayers Be Subsidizing the NFL? [JSA] [ In reply to ]

Sep 24, 17 18:26

Post #14 of 20 (1095 views)

JSA wrote:

trail wrote:

JSA wrote:

As an NFL own and a taxpayer, in my case, in my state, yes. For the rest of ya'll, do what you want ...

Oh that's adorable. You think that "share" of the Packers that isn't allowed to appreciate, isn't allowed to be resold, nor that gives you any voting rights or any other management power makes you an NFL "owner."

Anyone outside of Green Bay calls that a "non-refundable, not tax-deductible donation."

You know I said that tongue-in-cheek. But, I am serious and factual when I dispute jpo's claim that the money goes from the taxpayer to a private entity. Not in Green Bay, it doesn't. There is no owner and no "real" shareholders to whom dividends are paid. All the money from the Packers goes back into the team to pay for improvements and upgrades, goes to pay all the OT incurred by law enforcement and first responders, goes into community projects like the Titletown District, and goes to charitable funds administered by a trustee. In addition, the Packers have paid for several improvements to roads and other public utilities around Lambeau Field.

The exception proves the rule.

I'm beginning to think that we are much more fucked than I thought.

Re: Should Taxpayers Be Subsidizing the NFL? [j p o] [ In reply to ]

Sep 24, 17 18:27

Post #15 of 20 (1093 views)

j p o wrote:

JSA wrote:

trail wrote:

JSA wrote:

As an NFL own and a taxpayer, in my case, in my state, yes. For the rest of ya'll, do what you want ...

Oh that's adorable. You think that "share" of the Packers that isn't allowed to appreciate, isn't allowed to be resold, nor that gives you any voting rights or any other management power makes you an NFL "owner."

Anyone outside of Green Bay calls that a "non-refundable, not tax-deductible donation."

You know I said that tongue-in-cheek. But, I am serious and factual when I dispute jpo's claim that the money goes from the taxpayer to a private entity. Not in Green Bay, it doesn't. There is no owner and no "real" shareholders to whom dividends are paid. All the money from the Packers goes back into the team to pay for improvements and upgrades, goes to pay all the OT incurred by law enforcement and first responders, goes into community projects like the Titletown District, and goes to charitable funds administered by a trustee. In addition, the Packers have paid for several improvements to roads and other public utilities around Lambeau Field.

The exception proves the rule.

But those of us in God's Country are the exception.

If there are no dogs in Heaven, then when I die I want to go where they went. - Will Rogers

Emery's Third Coast Triathlon | Tri Wisconsin Triathlon Team | Push Endurance | GLWR

Re: Should Taxpayers Be Subsidizing the NFL? [cerveloguy] [ In reply to ]

Sep 25, 17 5:41

Post #16 of 20 (1009 views)

cerveloguy wrote:

Sort of like asking why college football is such a big thing at academic institutions? Its a lot of revenue for the universities.

By averages, or grand total, no, it's a loss for schools. In 2014, out of the 802 schools that play NCAA football at any level only 20 made a profit. From 2005-2009, only 7 were profitable every year.
10 of the 20 are in the SEC, 3 in the Big 10, the rest in the PAC-12, Big 12, and ACC.

Quote:

Same thing with subsidizing stadiums. The small city near me lost its second tier hockey team (a farm team for the NHL) and thus a lot of revenue. So the city spent a pile of money and expanded the hockey arena and now has a new team. Its a win-win for the community in the final analysis..

We lost an AHL (2nd tier) team 2 years ago. Nothing was done to the arena (1977 building, renovated in 09 and 12). We have an ECHL (3rd tier) team starting next month. New owner is pouring a lot of money into development. THAT's a win-win ;)
City loses some potential tax revenue (I think some of the development got breaks). People gain a team. A new municipal rink built on an old industrial brownfield site - IIRC there was a bit of remediation of let over toxic crap. New bar and residence (i.e. tax revenue) in an old, abandoned tack store - the building opened as a saddlery along a canal that was abandoned and filled in in the 1830s, the building was last a bar that closed 10 years ago.

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 25, 17 7:10

Post #17 of 20 (951 views)

Hell no.

My state and the local city recently helped fund half of the Vikings stadium. Vikings threatened to leave if the state didn't pay up. Most studies completely show that subsidizing stadiums do not pay back in the long run.

I would think the only exceptions would be a smaller city like Green Bay.

Go Packers.

Re: Should Taxpayers Be Subsidizing the NFL? [SH] [ In reply to ]

Sep 25, 17 7:39

Post #18 of 20 (938 views)

I always thought part of this problem with massive subsidies was the movement to having single-purpose stadiums. Back when MLB and NFL shared most stadiums there was some economic viability. A privately funded, single-purpose NFL stadium is just going to be a money sink for its owner without public support.

And the problem the NFL has is that the MLB doesn't need the NFL. A smaller, intimate MLB stadium that can double as a good concert and exhibition venue is pretty viable. It might be used half the days per year.

The NFL got a lot of leverage by threatening to move teams to LA. That threat is gone, and LA, so far, doesn't appear to be the NFL rainmaker the NFL promised it would be.

Now there is no leverage. What's the new threat: St. Louis? Ratings are down.

The NFL isn't going anywhere, but I bet it's going to have a harder time convincing politicians and taxpayers that it's a charity case.

Last edited by: trail: Sep 25, 17 7:40

Re: Should Taxpayers Be Subsidizing the NFL? [tigermilk] [ In reply to ]

Sep 25, 17 13:19

Post #19 of 20 (875 views)

tigermilk wrote:

Should they? IMO, no. But I also think it's ridiculous to say Congress should make it illegal. It's a local issue. If municipalities want to blow their bond opportunities in this manner, it's their right. Absolutely no reason for the feds to get involved.

It's a local issue for sure but the Feds absolutely have the right to say "you can't use tax-free municipal bonds for this purpose" because the exempted tax is federal income tax.

Re: Should Taxpayers Be Subsidizing the NFL? [big kahuna] [ In reply to ]

Sep 25, 17 13:36

Post #20 of 20 (870 views)

I don't think the NFL subsidies are any worse than defense, agriculture, oil, etc.

If anything, the NFL subsidies are more transparent. They don't sneak in through legislation. People usually get to vote on it.

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