The Brookings Institution policy-research shop has weighed-in on the public financing-of-stadiums-for-billionaire-owners-debate to inform that not just local communities pay.
Ted Gayer, an economist at Brookings in Washington, D.C., is, in fact, a Washington Nationals baseball fan.
But he’s not a fan of national-tax subsidies for sports palaces.
Gayer and colleagues found in a recent Brookings study that federal taxpayers subsidized construction of sports stadiums built largely to attract or retain privately owned ball clubs to the tune of $3.7 billion since 2000. That includes a $79 million-so-far-and-counting federal subsidy for the new home of the Minnesota Twins, completed in 2010, and $32 million so far for the new Vikings stadium.
Usually pro sports critics focus on the hundreds of millions paid by local taxpayers to finance stadiums.
Gayer, director of economic studies at Brookings, said this is the first study that demonstrates how federal taxpayers subsidize these stadiums through the use of tax-exempt municipal bonds, which are supposed to only be used for projects with public benefits, such as transportation and sewer-and-water projects. Gayer, in a recent interview, called it a perversion of the 1986 Tax Reform Act.
“Even if one believes, contrary to the empirical evidence, that the spillover benefits to the local economy justify taxpayer support … there remains no economic justification for federal subsidies,” the study summarizes. “Residents of say, Wyoming, Maine or Alaska, gain nothing from the Washington-area football team’s decision to locate in Virginia, Maryland or the District of Columbia".
Building new stadiums benefits the owners because it hikes the value of the team through more revenue.
The Brookings study is called: ”Why the federal government should stop spending billions on private sports stadiums and can be found at www.brookings.edu/research.