Getting taxpayers to finance a new stadium is extremely beneficial to the billionaire owners of sports teams, as well as the players whose salaries are driven by league and team revenue. It makes very little sense for taxpayers as the economic impact to the local economy does not begin to pay back the amount taxpayers have to invest.
One study even shows that stadiums might have a negative impact on the local economy because the hundreds of millions (or billions) of dollars spent on a stadium could be better spent in areas that have a long term benefit like education and roads. If municipalities want to fund a stadium and not lose money, they clearly should receive some type of equity participation in the team’s increase in valuation after the stadium is built.
The leagues know this which is why they have passed rules against any governmental ownership or equity in teams.
In Los Angeles, the new SoFi Stadium was privately financed by the team’s owner Stan Kroenke and banks. Kroenke was smart enough to know that L.A. taxpayers were not about to pay to build him a stadium, so he didn’t even bother asking.
It would be quite fascinating to see some other NFL, MLB, or NBA team try to seek out taxpayer financing of a new stadium in 2020. When these referendums pass, it is typically a narrow victory of something like 51% of the people in favor. It seems like if a taxpayers stadium financing scheme were on the ballot today, it would be more like 90% against it.
Think about all the forces that would be against it:
1. Libertarians that don’t think taxpayers have any business financing a private stadium.
2. Local Neighbors that live near the proposed stadium site that don’t want the traffic jams and drunk people that stadiums attract.
3. People that Don’t Find Sports Entertaining and instead go to movies, opera, plays, meet-ups, bars, gyms, national parks, etc. for their in-person entertainment.
4. People that Don’t Find Sports that Entertaining Anymore, after coronavirus put them on hold for 4 months. Many of these people found other things they enjoyed just as much or better.
5. Public Health Prioritizers who think everything else in society should be locked down and put on hold until a widely-distributed vaccine for the coronavirus has wiped it off the face of the earth.
6. Deficit Hawks that cannot stand the idea of a city every running an unbalanced budget that requires bond financing.
7. Die Hard Sports Fans That Love Their Team, But Hate Their Team’s Owner, and don’t feel that the team is deserving of a new stadium until the owner sells the teams. (e.g. Washington Football Team – Snyder, Phoenix Suns – Sarver)
8. The “Everything Will Be Different Post-Coronavirus” crowd, that thinks the days of people wanting to be crammed together in a stadium is over. They now view stadiums as super-spreaders of infectious diseases. At a minimum, they feel the seating capacity should be greatly reduced and changed to allow social distancing — the opposite of what is going on with new stadiums.
9. People that Love College Sports but Aren’t that in to Pro Sports. They don’t understand why quasi-professional football teams like the University of Alabama can privately fund their stadium, and yet real professional sports teams cannot.
10. People that Think the Current Stadium is Good Enough. The crappy 60’s/70’s stadiums are all gone (other than the Oakland A’s baseball stadium) and the ones that were built after that are all at least decent.
11. Public School Teachers, some of whom have gone on strike in various states the last 2 years over inadequate pay, and others who are mad that government officials are making them teach in person classes at the risk of getting the coronavirus. They will want the stadium money for themselves, not for a sports team.
12. Income Inequality people that don’t think a backup forward should be making $15 million a year, nor that billionaire owners should even exist, in a world where some people only make $7.25 per hour.
13. People That Are Terrified of Big City Riots in places like Portland, Chicago, and Minneapolis. They don’t plan on ever leaving the suburbs or rural areas and risk getting beaten by Antifa in order to attend a sporting event in a major city.
14. America Haters that think America is rotten at its core and its sports teams should be hated not loved.
15. Mascot Haters that presently hate teams with Native American names like Chiefs, Braves, Indians, etc. and might find a reason to hate additional human-centric team names like Padres, Royals, Rangers, Brewers, Patriots, Texans or White Sox for various reasons in the future.
16. Eurocentric Soccer Enthusiasts who are mad at the major American sports which are a big deal, when soccer is not.
17. Anti-Concussion people that think football and possibly other sports should be banned because of the unavoidable head trauma and permanent brain damage they may cause.
18. Patriots that are outraged by professional athletes kneeling for the national anthem.
19. Police Officers that see athletes as police haters that are promoting the idea that Black Lives Matter but never Blue Lives Matter.
20. The All Lives Matter crowd.
21. The People that Agree Black Lives Matter, but Can’t Stand the Black Lives Matter “What We Believe” Page that promotes socialism and getting rid of the nuclear family.
22. The People that Think No Lives Matter; it’s all stupid and what is the point of any of this.
23. Blue Collar people that have to go to work no matter what, feeling it is unjustified for athletes to skip games for political purposes.
24. Hotels and Car Rental Companies. Typically the stadiums are funded by excessive taxes on hotels and car rentals as they are perceived to hit out-of-towners harder than locals. With these industries already decimated by the coronavirus, it would be unlikely that would bite their lip and not fight back.
25. Urban Hipsters who watch shows like Last Week Tonight with John Oliver or The Daily Show with Trevor Noah, which use snarky humor to tear apart any argument in favor of public stadium financing.
I think any professional sports team would have a real uphill battle trying to get taxpayers to build them a stadium right now.