Publicly funded stadiums a bad bet

Who benefits from tax-supported facilities? Owners, players, politicians


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OTTAWA -- Forking over public money to support professional sports franchises is apparently a difficult habit to break.

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Hey there, time traveller!
This article was published 19/02/2011 (4481 days ago), so information in it may no longer be current.

OTTAWA — Forking over public money to support professional sports franchises is apparently a difficult habit to break.

Even as a handful of American municipalities declare bankruptcy and other cities are still paying for stadiums that have long since been torn down, sports teams in the U.S. continue to look to taxpayers to help them build new state-of-the-art facilities, and even to absorb property taxes on those buildings.

The flagging U.S. economy means it is taking longer for teams to convince various levels of government to support them, says Brooklyn-based journalist Neil deMause, co-author of Field of Schemes: How the Great Stadium Swindle Turns Public Money into Private Profit, but they are still getting funding.

“People are starting to say no and have been saying no for a while, but teams can come back and come back,” he says. “They only have to win one time.”

The culture of public money for sports teams is so deeply ingrained in the U.S., he says, that it is “a basic part of the sports-league business model that you get the buildings more or less for free.”

But that is the U.S. There has never been quite the same appetite for throwing public money at professional sports in this country.

In fact, in 2000, the Liberal government in Ottawa did a quick about-face on a plan to subsidize NHL teams to keep them in Canada after an angry public outcry against what was dubbed “millions for millionaires.”

And Ottawa residents will recall that Rod Bryden had to pay for his own overpass off Highway 417 when the Palladium (now Scotiabank Place) was built in 1996. He did, however, receive a $4-million grant from the federal government and a $26.8-million loan from the Ontario government to build that off-ramp.

But, with the ball rolling on a publicly funded NHL-ready hockey arena in Quebec City (the province and city have said they would split the $400-million cost) and similar demands across the country, things could be changing.

DeMause, who writes a blog on the politics of public funding for sports franchises (, has lately turned his attention to the Quebec arena (being built in an effort to lure back an NHL team). He calls it a potential “game-changer for Canada,” especially since the federal government hasn’t entirely ruled out getting involved. There have been suggestions that a portion of the gas tax fund, which is intended to be used for municipal infrastructure, could be diverted to help pay for an arena. The feds are not committed — and plenty of pundits have pointed out that giving money to Quebec for its arena of dreams would make it impossible to turn down requests from other Canadian cities. “It will be fascinating to see what happens with Quebec,” he says.

With any luck, Quebec City will not turn out to be a game-changer for this country in terms of public attitudes toward taxpayers’ dollars subsidizing major sports franchises.

Generally, public dollars have gone to build sports facilities for non-professional events such as the Olympics, but some money has gone to buildings used by professional teams. According to an Edmonton Journal article, 24 out of 30 NHL arenas were built with some public money, substantial amounts in some cases. The average cost of an arena was $165 million and the public paid about 43 per cent of the cost. In seven cities, the majority American, the public paid 100 per cent of costs.

And that is just hockey. The jockeying and lobbying for public money for basketball, baseball and football facilities — including cities luring teams away from other cities, on the public dime — in the U.S. is legendary.

“It’s difficult to find a major U.S. city that hasn’t been cajoled, threatened or blackmailed into building a new sports palace,” write deMause and his co-author, Joanna Cagan, in Field of Schemes.

At a time when cities across North America are facing tough times, when there is not enough money to upgrade antiquated sewage systems or to build modern transit, why does putting money into wealthy sports franchises still tempt so many?

Supporters repeatedly argue sports franchises revitalize cities and boost their economies. It’s a refrain Toronto Mayor Rob Ford gave voice to, saying a National Football League team would not only boost the economy and tourism but make Toronto, in his brother Doug’s words, a “world-class” city.

Even if you agree that football and not, say, the Toronto International Film Festival, would put Toronto on the map, Ford’s premise is false. Studies, including one published by the Brookings Institution, conclude arenas are a poor investment of tax dollars. They create few jobs, at a high cost, and, rather than boosting the economy, simply move money around cities. Who benefits? Owners, players and, sometimes, politicians — but only if voters let them get away with it.

Elizabeth Payne is a member of the

editorial board of the Ottawa Citizen.

— Postmedia News

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