The Dolphins are the latest team to ask for a new stadium, promising a local windfall with only the tiniest bit of cost.
Two years ago my wife and I inherited a 2000 Chevrolet Blazer. It has four doors, a fold down seat and a back gate that won't stay open. It's greatest selling point, however, is that it is completely paid for, saving me a monthly payment on an asset that declines in value with each trip to Li'l Brown Jug.
But it is most certainly not free. Six months into owning the thing I spent $989 to fix the heater and another $1,454 on the fuel injector and associated parts. The gas bill is exactly what you would expect from an American SUV stamped out at the end of the roaring 90s.
Miami Dolphins owner Stephen Ross wants to buy South Florida its own SUV, this one in the form of a (mostly) free upgrade to Sun Life Stadium. The Dolphins, and the NFL's G4 loan program, would pay for roughy half of the costs, while soaking out of towners for the rest via a hotel tax.
Armando Salguero of the Miami Herald has the details:
The Dolphins will argue that none of these funds take money out of city or county coffers that are used to pay for teachers or schools or cops or firemen. Hotel bed tax money is slated exclusively for the improvement of local facilities such as the Miami Beach Convention Center and, yes, Sun Life Stadium among others.
Free, free, free!
Oh, there is one catch ...
Ross is prepared to pay for "substantially all" of the freight of this modernization as long as his government partners begin helping him with the cost of running the facility. This according to a source familiar with the Dolphins' thinking.
The argument goes that the upgraded facility pays for itself, bringing in more college football games and, eventually, the grand prize itself, the Super Bowl. Miami's public officials may need to find places to store all that fat cash rolling in from well-heeled visitors taking in all the special events, if the party line is to be believed.
Stadiums, the argument goes, end up paying for themselves while raining economic benefits on the community. Like a Dolphins trip to the playoffs, those benefits rarely materialize.
"The basic idea is that sports stadiums typically aren't a good tool for economic development," said Victor Matheson, an economist at Holy Cross who has studied the economic impact of stadium construction for decades. When cities cite studies (often produced by parties with an interest in building the stadium) touting the impact of such projects, there is a simple rule for determining the actual return on investment, Matheson said: "Take whatever number the sports promoter says, take it and move the decimal one place to the left. Divide it by ten, and that's a pretty good estimate of the actual economic impact."
Others agree. While "it is inarguable that within a few blocks you'll have an effect," the results are questionable for metro areas as a whole, Stefan Szymanski, a sports economist at the University of Michigan, said.
Most of the stadium visitors are locals. The impact of special events is overstated. NFL teams play 10 home games, including two preseason contests, with the occasional playoff game. Even factoring in the special events, stadiums are closed most of the year.
Stadium profits themselves go right back to the owners, leaving municipalities with whatever sales tax revenue comes in as a result.
In a deal like this, locals end up on the hook for stadium maintenance as well as a long list of lost tax revenue handed out to developers via subsidies. When the inevitable budget crunch does come, locals end up having to make budget cuts at the expense of cops and teachers because of the lost revenue and binding commitments to take care of stadiums and arenas.
Just ask the city of Oakland how that works. Last year, one of America's most crime-ridden cities slashed more than 200 police officers, while maintaining a $17 million payment for the upkeep of O.co Coliseum. A scathing Dec. 2012 report from Bloomberg examined the hidden costs of subsidizing Oakland's stadium.
Since 1986, Americans have kicked in some $18.6 billion to fund NFL stadiums, according to that same report from Bloomberg. The NFL, meanwhile, is set to pull in some $6 billion a year just from broadcasting contracts when a new round of television deals start in 2014.
There is no lease holding the Dolphins to their current stadium. If Ross' renovation demands follow the pattern that has played out most recently in Minnesota, residents will be hostage to threats of relocation. On the bright side, Salguero's article suggests a 30-year lease to keep the Dolphins in place may force some tiny measure of accountability on the team.
Cities, states and counties are free to do as they please when it comes to building NFL stadiums. They have a voice via their elected officials, if not directly at the ballot box in some cases. Miami isn't alone in looking at a stadium project either. Atlanta is looking for a new Georgia Dome. Representatives from the St. Louis Rams began the process of arbitration with city officials on Monday over a proposed upgrade to the Edward Jones Dome.
Football fans and anyone else in those places should demand some greater measure of accountability. Don't stop with a lease. Any NFL team seeking public dollars for a stadium should be required to open its books, giving residents a clearer picture of just what portion of a stadium those franchises can afford before forcing cities to make decisions that impact the local budget for a generation or more.
An informed decision lets everyone go to bed with a clearer conscious. Though it's a cliche, it's worth repeating: nothing is free, hand-me-down cars or coliseums.