Tuesday, April 13, 2004
Can Teams Afford to Pay for Their Own Stadiums?
Jay Weiner of the Minneapolis Star Tribune asks the question. Economists say Yes; club owners and local politicians say No.
Patrick Rische, a St. Louis sports economist, observes, "If there's a city that allows itself to end up paying 50 or 75 percent of a stadium with public money, then they're not being aware of recent events." In St. Louis, the Cardinals are paying 75% of the cost of their new stadium-plus-neighborhood-development. Mark Poitras of the University of Dayton adds, "Teams have been getting these subsidies, not because they need them, but because they can."
In response, Minnesota Vikings Executive Vice President Mike Kelly says the Minneapolis-St. Paul market has too much competition for the sports dollar to generate the revenue needed to make a privately funded stadium feasible. Governor Tim Pawlenty says that since the competitors of Minnesota teams have received huge public subsidies, the locals need similar treatment to be able to compete.
Twins financial consultant Mike Starkey says the club could expect "at least" $40 million more in local revenue from a new park. The club's president, Jerry Bell, warns that asking the Pohlads to invest more than $120 million could "create a potential 'Milwaukee' [Brewers] scenario where the debt burden could impair the club's ability to field a competitive team." He doesn't mention that the Brewers were so deeply in debt before their new park was built that the club couldn't pay the share of construction costs it had agreed to absorb.
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Jay Weiner of the Minneapolis Star Tribune asks the question. Economists say Yes; club owners and local politicians say No.
Patrick Rische, a St. Louis sports economist, observes, "If there's a city that allows itself to end up paying 50 or 75 percent of a stadium with public money, then they're not being aware of recent events." In St. Louis, the Cardinals are paying 75% of the cost of their new stadium-plus-neighborhood-development. Mark Poitras of the University of Dayton adds, "Teams have been getting these subsidies, not because they need them, but because they can."
In response, Minnesota Vikings Executive Vice President Mike Kelly says the Minneapolis-St. Paul market has too much competition for the sports dollar to generate the revenue needed to make a privately funded stadium feasible. Governor Tim Pawlenty says that since the competitors of Minnesota teams have received huge public subsidies, the locals need similar treatment to be able to compete.
Twins financial consultant Mike Starkey says the club could expect "at least" $40 million more in local revenue from a new park. The club's president, Jerry Bell, warns that asking the Pohlads to invest more than $120 million could "create a potential 'Milwaukee' [Brewers] scenario where the debt burden could impair the club's ability to field a competitive team." He doesn't mention that the Brewers were so deeply in debt before their new park was built that the club couldn't pay the share of construction costs it had agreed to absorb.
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