Stadium politics annoy states vying for NFL teams
(The Hill) – Governors and lawmakers in several states are rushing to throw hundreds of millions of dollars in tax breaks, rebates and cash at some of the country’s wealthiest people, hoping to secure commitments from NFL franchises looking for huge new stadiums.
Three states are considering or offering incentive packages to keep teams already playing within their borders, while officials from two neighboring states are preparing their own offers to steal neighboring teams. Together, the deals represent some of the most expensive packages states have ever offered to private companies.
On Thursday, New York Governor Kathy Hochul (D) said she and legislative leaders had agreed to a $220 billion budget framework that would include $850 million in national taxpayers’ money and premises to finance the bulk of a new $1.4 billion stadium for the hometown team, the Buffalo Bills.
Virginia lawmakers are debating $350 million in bonds for a proposed economic development project that would be located in Prince William or Loudoun counties to host the Washington Commanders, who currently play across the Potomac River in Landover, Maryland.
Maryland lawmakers have proposed $400 million in economic development along the Blue Line corridor near the current Commanders Stadium, though none of that money will be used to fund the team’s wishes for a new home.
In the Kansas City metro area, lawmakers in Kansas and Missouri are in the early stages of defining incentive programs to woo the Chiefs. The team has a lease for Arrowhead Stadium on the Missouri side of the border until 2031. But general manager Clark Hunt said last week they had invested $500,000 to study whether to renovate , build a new stadium in Missouri or cross the border to Kansas.
The owners of all three teams regularly appear on lists of America’s ultra-rich. Terry and Kim Pegula, who own the Bills and Buffalo Sabers, are together worth $5.8 billion, according to Forbes. The Hunt family that owns the Chiefs has a net worth of $15.5 billion. Dan Snyder, who recently bought a $48 million estate that was once part of George Washington’s Mount Vernon, is worth $4 billion.
Lawmakers backing massive incentive programs for billionaire homeowners say the investments pay off in economic activity and civic pride.
“The Buffalo Bills are part of the fabric of our community in Western New York. Losing our team in another part of the country would be devastating to the psyche of our community and the fabric of who we are, not to mention the economy which has rebounded and grown,” the senator said. New York State. Tim Kennedy (D), who represents Buffalo. He pointed to stadiums that host the Yankees, Mets and Knicks, all of which received taxpayer funding. “The last thing we need is for an NFL team to shut down.”
Economists tell a very different story.
The stadiums of any professional sports team sit idle more often than they host games, and economic impact studies unanimously show that stadiums don’t deliver what teams promise to do.
“Economists don’t always agree on everything, but this is the one we’re pretty much aligned with,” said Paul Oyer, senior fellow at the Stanford Institute for Economic Policy Research and author of the book An Economist Goes to the Game. “They usually don’t bring other benefits to the area as they always say. There are usually a lot of promises and none of these benefits come outside the stadium. It’s not like they produce a lot of high quality full-time jobs.
The Bills’ new stadium will likely play a role as Hochul seeks a full term in November. Hochul’s two main challengers, Representatives Lee Zeldin (R) and Tom Suozzi (D), criticized the deal struck with taxpayers’ money.
“On behalf of the New York taxpayers, Kathy Hochul should have taken a stronger bargaining stance and tougher bargaining to successfully keep the Bills in Buffalo without their loyal fans and the rest of the state’s taxpayers. have to pay a public cost of $850 million,” Zeldin said in a statement.
In Virginia, the drive to woo commanders used stadium deals in Atlanta and Phoenix as models. Lawmakers have proposed floating bonds to build an economic development zone that would include a stadium and other facilities to attract visitors, such as The Battery in Atlanta, an entertainment district that hosts the Braves.
The bills under consideration, sponsored by State Sen. Richard Saslaw (D), the Majority Leader, and Delegate Barry Knight (R), who heads the House Appropriations Committee, would allow the team to recoup a portion of sales tax generated from a new stadium to help cover the estimated $1 billion construction cost, similar to a measure Arizona lawmakers approved to build a new stadium for the NFL Cardinals in Glendale.
Virginia and Maryland lawmakers are acutely aware of Snyder’s recent move from Maryland to Virginia. Some Maryland lawmakers say they don’t want to commit money to Snyder’s team, which dropped its racist name in 2020 and adopted the Commanders moniker earlier this year.
“Initially, they were a very good partner for the community. Then over the years they basically became MIA,” said state delegate Jazz Lewis (D), whose district includes the stadium, pointing to the investments late former owner Jack Kent Cooke has made in a major sports complex in Prince George’s County. “Frankly, there are a number of people who would be nice to see them go.”
Lewis said his $400 million proposal would build an entertainment district similar to the one being discussed in Virginia, though none of the money could be used to fund a stadium. Gov. Larry Hogan (right) said on Thursday he supported the proposal, which would make investments in the area even if the team leaves.
“It’s money that could entice them to stay because they know we’re making investments around them,” Lewis said of the commanders. He said the General Assembly was also considering funding upgrades to M&T Stadium, home of the Baltimore Ravens, and Camden Yards, home of the Orioles – two teams, he noted, that did not threaten to leave the state.
“Yes [the Commanders] leave, we can use the money to help level the stadium should that happen,” Lewis said. “I was very worried that, like RFK [Stadium in Washington] my constituents would have this towering structure that would reduce home values for years to come.
The fight against the Chiefs reignited the so-called Border War in the Kansas City metro area. For years, lawmakers on the Kansas side and the Missouri side have offered millions in grants and tax breaks to businesses that would cross state lines, moving as little as a few city blocks to move jobs within a state. or the other, at significant cost to taxpayers.
A truce established between the two cities three years ago now risks unraveling. After Hunt’s comments last week at the annual NFL owners meeting, Missouri Gov. Mike Parson (right) said his state wouldn’t let the Chiefs go without a fight.
“After my conversation with [Chiefs President] Mark Donovan, I assured him that Missouri would compete with any state trying to move Missouri chiefs,” Parson said in a statement. “My administration and I have a great working relationship with the Chiefs organization, and that won’t change.”
The NFL team fights come at a time when state budgets are suddenly overflowing with cash, infused with federal government assistance to manage the coronavirus pandemic and associated economic downturn and recovery as well as tax revenues surprisingly high.
But those good times won’t last forever, and economists warn that stadium deals rarely, if ever, deliver the promised returns. Oyer said a state would be wise to spend excess cash to pay off debts and pension obligations, which pays defined longer-term financial benefits.
“Football stadiums are particularly egregious because they are used on so few days a year,” Oyer said in an interview. “These stadiums cost billions of dollars, but the people who profit from them are a) already billionaires and b) running businesses that are already making billions of dollars.”
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