As Steve Chapman notes (Commentary, Jan. 17), “a shelf full of studies documents the dismal truth that sports facilities yield no significant windfall to their communities.”
Subsidized stadiums, sports teams and even convention centers suffocate communities rather than revitalize them, according to a new Heritage Foundation study, “Cities in Denial: The False Promise of Subsidized Tourist and Entertainment Complexes.” Heritage economist Ronald Utt states that “these projects drain local taxes and deter healthier economic growth. What cities need, instead, is a restoration of basic services such as good schools and safe streets.”
The study compares Washington, D.C. and Baltimore, two cities that have sunk millions into stadiums and other tourist-related infrastructure projects, and the suburbs of northern Virginia, which have focused on creating a business-friendly climate characterized by strong basic services and an emphasis on education. It found that despite its lack of public-subsidized stadiums and convention centers, northern Virginia has the strongest economy.
Virginia has an unemployment rate of only 3 percent compared to 4.7 percent in Maryland and 8.3 percent in the District of Columbia. Baltimore continues to lose roughly 1,000 residents a month to the suburbs with better schools and lower crime. Research shows Ravens Stadium will end up creating only 899, mostly low-paying, jobs, at a cost to taxpayers of $200,000 per job. Washington, D.C., is spending $800 million on a convention center expected to increase the city’s tourism by an astounding 1 percent. Local taxpayers will pay $340 in subsidies for every $140 spent by a conventioneer on a district hotel room.
Congress should and could end stadium blackmail by withholding federal support to cities and states that feel rich enough to subsidize wealthy owners. Sen. Daniel Patrick Moynihan (D-N.Y.) has introduced legislation that would classify professional sports facility financing as a “private activity,” thereby making such projects ineligible for tax-exempt privileges. Such corporate welfare schemes that redistribute wealth from fans and taxpayers to already wealthy owners must end, first because it is legalized theft and second because it is based on a myth.
End this corporate welfare.
