Professional Sports Teams Can Use Their Own Money

Over the past 10 years there has been an enormous rise in professional athlete’s salaries and a rise in the number of new stadiums built to house these athletes. Stadiums being built today range from $150 million to $400 million. It is understandable that owners feel they need to have the top of the line stadium to attract the best athletes, improve their team, and increase their wins. That is what they are in business, to produce winning teams. But, why do so many owners feel it should be the city’s burden to shell out hundreds of millions of dollars to build these stadiums around the country and not their own?

Since 1997, 14 new stadiums have been built. Each costing at least $150 million, with the highest costing $534 million in Seattle. Subsidies were used to pay for at least half of the costs, if not all, of each stadium, except for three. Across the nation subsidies for professional sports stadiums cost taxpayers over $500 million annually. This is $500 million that could go to road improvements, more police on the streets, better equipment for firefighters, or improving schools. This $500 million could also go back into the pockets of taxpayers.
Why are cities willing to shell out so much money to build a place that millionaires can run around and play in, when many of them will never see the inside or will not be allowed to go where the millionaires go? One way owners push for new stadiums to be built is by threatening to leave a city and move somewhere else. By doing this they may put two or three cites into a bidding war with one another. Many cities want to be a "Major League City". They think by having a professional sports team that it will improve their cities economy. This is not the case.

One strong argument for the subsidizing of new sports facilities is the creation of new jobs. If a new stadium is constructed in a city in which the team already has a stadium, these jobs will simply be transferred. Only a small number of new jobs may be created. If a city outbids another city, and the team relocates, then jobs are simply moved from one city to another. In the case when one of the leagues’ offices grants a city an expansion franchise, new jobs would be created, although many of these jobs are only seasonal, which could be anywhere from 8 months to 6 months out of the year. A majority of the jobs created are not full-time positions. Many are only part time, because most positions are only needed when the team has a home game
By providing sports franchise with subsidies to build new stadiums, a deadweight loss to society occurs. If the construction of new stadiums are not funded by subsidies, they will be built by private developers. Owners would be forced to spend their own money, causing more time to be spent "in the planning, construction, and operating phases of such projects in order to achieve the economic returns necessary to attract and maintain the capital investment." There is no economic development when one stadium is abandoned and a new stadium is built down the road. When facilities are still functional and then deserted in order to build a new one, no societal value is gained. One economist remarked, "It is make-work: no different in principle from digging and re-filling ditches."

My question is why do citizens of cities continue to subsidize stadiums for professional teams, if there are no economic benefits for their city? Is the extra tax citizens’ pay worth the cost of living in a "Major League City", or is it something else?