Lots of bad news for the Stadium Boondoggle in the strib:
A nice little profile on the Pohlads:
http://www.startribune.com/stories/509/5463825.html
Pohlad will laugh all the way to the bank letting Hennepin County Taxpayers
hold the bag:
http://www.startribune.com/stories/562/5462895.html
Oped - Jay Wiener: Economics of Stadiums Look Dicey:
http://www.startribune.com/stories/562/5462895.html
As the legislative special session stalls, Minnesota's stadiums process is
stuck in the mud once more.
It seemed as if the University of Minnesota's $235 million football
stadium, mostly paid for by private donors, was on track for passage.
It looked as if the Twins ballpark, with Hennepin County footing most of
its $478 million bill, was a done deal.
Now, it's dicey again. Insiders are saying the "U" on-campus stadium still
stands a chance. But if there's no movement on the larger issues at the
Capitol this week, the Twins' prospects could run out of time.
Too bad.
But, maybe, not so bad.
Despite 12 years of debate on public funding for sports facilities, two
fundamental questions remain unanswered.
Why has the state ducked on participating in Twins (and Vikings) stadium
policy when any economic benefits from teams accrue to the state's coffers?
And if we build three stadiums -- the Vikings are on the horizon with new
owner Zygi Wilf -- can we support them?
Antitax politics and mantras about billionaire owners and millionaire
athletes have shrouded stadium arguments. But when we cross the
public-funding Rubicon -- which we have in every case -- we must be
rational, not convenient.
Why should Hennepin County taxpayers fund a stadium that's used by the
"Minnesota" Twins? How can politicians call local pro teams "statewide
assets" and then turn their backs on projects designed to retain the teams?
Why do Greater Minnesotans scream about wanting retractable roofs and then
say, "But I won't pay for it"?
EY: Good questions all, read the whole thing:
http://www.startribune.com/stories/562/5462895.html
The Twins are dropping the economic argument for the stadium.
http://www.startribune.com/stories/535/5463027.html
"I don't think the economic argument turns it one way or another, so why go
there?" said Bell, president of Twins Sports Inc. "If there are side
benefits, great. If not, so what?
"You get into an economic argument, and the bottom line is, 'Do you want to
build it or not?' " he said.
EY: The Twins obviously want the stadium built, but they want the
taxpayers to be the chumps.
The article continues:
In dropping the stadiums-as-economy-boosters argument, the Twins are
acknowledging what economists long have argued: Stadiums built for pro
sports fail to deliver measurable financial returns for their communities.
"At some global level, they're obviously correct," Bell said.
The histories of the Xcel Center, Target Center and Metrodome -- all
acquired chiefly with public money -- show that stadiums usually fall short
of promises that they will provide monetary benefits to the public.
Consider the Metrodome: Opened in 1982 at a total cost of $68 million, its
boosters predicted that the stadium would be a magnet for new construction
in a part of downtown that hadn't seen new private investment for years.
Instead, the building boom of the 1980s and 1990s in downtown Minneapolis
bypassed the Metrodome neighborhood.
"We put a stadium in the middle of nowhere and nothing developed around
it," economist Art Rolnick said of the Metrodome. "If these things are
magnets for economic development, what happened?"
The outcome should be no surprise, said Rolnick, director of research at
the Federal Reserve Bank of Minneapolis.
"Most of the year, there's nobody in them," he said. "It doesn't pay for
most businesses to be near these facilities."
The Target Center, acquired by the city of Minneapolis from private
developers at a cost of $74 million in 1990, now sits next to the Block E
entertainment center, but Block E was built only through $40 million in
public subsidies.
The Xcel Center, opened at a total cost of $130 million in 2000, became
something of a laboratory this past winter for measuring whether the
presence -- or lack -- of professional team sports hurts a city's economy,
when the NHL lost its entire season because of a labor dispute between
players and owners.
From November through April, sales tax receipts in St. Paul totaled $7
million, up $181,000, or 2.6 percent, from the same period a year earlier,
when fans were regularly filling the Xcel for Minnesota Wild games,
according to the St. Paul Office of Financial Services.
"If [fans] don't go to NHL games, they don't stop spending money," said
Robert Baade, economist at Lake Forest University near Chicago. "They spend
money on other things."
Even ripple effects from marquee events -- a Super Bowl or World Series --
can be hard to discern in the numbers.
EY: I thought the whole point of the public investment in the stadium is
that this would create jobs. I happened to oppose the corporate welfare in
the Northwest Airlines bailout years ago - but that at least had a better
economic develop justification - creation of high wage jobs (which have not
been delivered) in a depressed area.
The article continues:
Tom Stinson, Minnesota state economist, made a careful study of sales tax
receipts after a Super Bowl game in the Metrodome in the early 1990s.
Boosters had predicted that the game would pump tens of millions of dollars
into the Twin Cities economy as thousands of out-of-towners descended on
the city.
"We had been told that there would be a great deal of economic activity,"
Stinson said. "We were looking for it in the sales tax receipts data, and
we couldn't find it."
EY: Well if Stadiums in Minnesota area haven't generated increased sales
tax receipts in the past, then why should they bring this benefit to the
state in the future.
The article continues:
Other cities, such as Baltimore or Cleveland, can point to stadiums as
having spurred new life for certain areas. But as a group nationwide,
stadiums are more an economic drag than a boost on the cities that
subsidize them, economists agree.
"There's a lot of research that's been done that suggests that the benefits
are not great enough to justify the costs," said Patrick Rishe, economist
at Webster University in St. Louis and a longtime student of sports subsidies.
"The general outcome of every objective economic analysis I've seen is that
stadiums are consumption, they're not investment," said Paul Anton, chief
economist of Wilder Research, a St. Paul nonprofit think tank.
EY: Politicians should listen to these economists. RT Rybak has a hard
time justifying his support for increasing the sales taxes on Hennepin
County residents to pay for a stadium. Peter McLaughlin and the other
county commissioners voting for this boondoggle should also be asked for
comment. They can't say that any of this was a surprise to them.
The article continues:
Some politicians concede that stadiums alone don't provide a financial
boost to a city or even a neighborhood, in and of themselves.
"When the Metrodome and Xcel were built, there was a false assumption that
a ballpark alone would create a huge new urban village," said Minneapolis
Mayor R.T. Rybak, who nevertheless favors spending public money on a new
Twins stadium.
A Twins stadium in the Warehouse District would add to the customer traffic
at nearby bars and restaurants, but it can't lift their prospects all by
itself.
"You can't make it in the bar and restaurant business by being jammed on
game nights and empty on other nights," Rybak said.
One reason Rybak said he favors a Twins stadium is that crowds of tens of
thousands near the end of the light-rail line could add momentum to city
plans for a transit hub in the neighborhood, linking buses, light rail and
a proposed intrastate North Star rail line.
"I agree that people should go into this with tempered expectations," he
said. "It cannot, in and of itself, create a huge boom."
EY: There's plenty to sell this transit hub without a stadium
boondoggle. Governor Pawlenty has ignored the advice of his base on the
Northstar corridor. Several "we don't want no choo choo trains"
legislators lost partly due to their idiological opposition to light rail.
Eva Young
Near North
Minneapolis
[EMAIL PROTECTED]
http://lloydletta.blogspot.com
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