Rutgers, The State University of New Jersey
39 Biel Road
New Brunswick, NJ 08901
March 6, 2012
Mayor R.T. Rybak
350 South 5th St.
Minneapolis, MN 55415
Re: Stop public funding for construction of stadiums for professional sports teams Dear Mayor Rybak:
Recently it was announced that the city of Minneapolis agreed to a deal with the Minnesota Vikings, a franchise in the National Football League, to help fund the construction of a new stadium for the team to play in. While this will be deemed as great news by local fans of the team, I believe that using public tax revenues to fund the construction of this new stadium is a misuse of public funds and a poor demonstration of governmental policy. Research has shown that the use of public funds to finance new sporting facilities does not generate any revenue for the city appropriating the money and that the opportunity cost of not spending that money on other public programs or buildings can be detrimental to the financial stability of the communities and cities involved. (Lazere, pg.1) This research is also supported by esteemed civic finance scholar Robert Baade, who recently stated, “Findings indicate that public funding of sports, including funding of stadiums and sports arenas, is not a sound civic investment. Stadium subsidies and other sports subsidies benefit not the community as a whole, but rather team owners and professional athletes.” Due to the overwhelming wealth of evidence that shows the negative effects of public funding for sports facilities, I have developed a plan to force professional sports outlets to raise money through privatized funds so that money otherwise being pumped into building new sports facilities can instead be spent on projects that will provide a greater economic boost to the local economy and support more efficient governmental policy. As the main controller of the city budget, I hope you will support my conclusion on this topic and give your fiscal support by withdrawing your monetary contribution to the building of the new football stadium and funding other public projects. The Problem
One of the fastest growing industries in the United States is the sports business, as the Hambrecht and Co. Sports Finance Group found that profits from the industry have risen almost 40% in the past 20 years to about $22.4 billion in 2011. To accommodate this rapidly increasing public interest, owners of these sports franchises have demanded that newer and modernized stadiums be built that can seat more fans, include more venues and vendors to boost profits, and maintain public interest. Part of their demands have been to receive public funding from the cities and states their teams play in, arguing that having their teams play in the local area will generate revenues for other local businesses and provide jobs for local citizens in the facilities where games take place. And by threatening to move their franchises to cities willing to provide more funding, owners are able to use the fear of public backlash from relocation to strong-arm their team’s host cities and states into providing financial aid for the construction of new stadiums. (Owen, Polley) As a result, these stadiums have largely been built on the back of public financing through subsidies and tax dollars. However, the measureable benefits of having a professional sports team in a local city or community do not justify the vast amount of governmental financial aid required to construct a stadium. Professional sports franchises should be forced to use privatized funds to renovate or build stadiums so that public funds and tax revenues can be allocated to areas of more pressing need.
While owners have argued for decades that new stadiums provide an economic boost to the cities and nearby retail stores and restaurants that host these facilities, there is actually little data to support this claim. For example, according to...