TO spend public funds on pro sports facilities or not to spend public funds on pro sports facilities -- that is the question.
The answer, according to the latest Playing in the Big Leagues report from the Conference Board of Canada, is murky, one that ultimately needs to be decided by communities on a case-by-case basis. In Who Should Pay for New Pro Sports Facilities? the right economic conditions can exist for major Canadian markets like Toronto, Montreal, and Vancouver to build and maintain privately funded sports facilities, but those same conditions may not be present for smaller urban centres.
"In an ideal world, pro sports franchises and their playing facilities would be privately-financed," the board's chief economist, Glen Hodgson said in a release Monday. "From a purely economic perspective, there is not a compelling case for public investment in professional sports facilities, but other considerations have to be assessed."
Those "other considerations" are where the grey area begins.
The report, written by Hodgson and Mario Lefebvre, explains how there is no direct documentation suggesting publicly-funded stadiums and arenas will spin off into any financial success for those communities, and how government needs to measure the possible economic positives (taxes, employment opportunities) against the negatives (larger debt, funding concerns for other projects) before venturing into such commitments.
Ultimately the document, the seventh and final in the series on the economic impact delivered by pro sports in Canada, recommends fiscal responsibility and common sense when considering public funds for facilities.
What the report doesn't address, says Ian Hudson, an associate professor in the Department of Economics at the University of Manitoba, is a distinction between the stadium and the viability of the team playing in it.
The facility itself won't stimulate major urban growth, Hudson says, it only redistributes those dollars from a different area of the market in question. Any development next to a new stadium or arena -- say like dining or shopping options -- tends to be because of the success of the anchor tenant, not because of the building.
"The usual spinoff deals are all team-dependent," Hudson said. "No one comes to see a stadium -- at least not long term. People come to see a new stadium the first year, and then that's over. The honeymoon period is done."
Winnipeg already has a newer arena (MTS Centre; 2004) and is constructing a new football stadium at the University of Manitoba, so any warnings or concerns in the study won't have much impact on the local sporting landscape in the coming decades.
The downtown arena, which houses the Winnipeg Jets, was largely funded with private money. Construction costs on the $190-million football stadium project -- the future home of the Blue Bombers -- is on the public tab, with the Winnipeg Football Club to repay the province over a long-term arrangement.