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The bill to tax payers for bond-funded stadiums? $4 billion

Sep 6, 2012, 4:36 PM EST

Image (1) yankee%20stadium.jpg for post 4012

Whenever the subject of publicly-financed ballparks and stadiums comes up someone always makes the distinction that so-and-so’s ballpark wasn’t paid for with taxpayer dollars but, rather, was paid for with municipal bonds.

Muni bonds, however, are not free.  As Bloomberg notes, just because the money doesn’t come from a city or state’s general fund doesn’t mean taxpayers aren’t footing the bill. They are, because the interest paid to investors on such bonds are not taxable. The result:

Tax exemptions on interest paid by muni bonds that were issued for sports structures cost the U.S. Treasury $146 million a year, based on data compiled by Bloomberg on 2,700 securities. Over the life of the $17 billion of exempt debt issued to build stadiums since 1986, the last of which matures in 2047, taxpayer subsidies to bondholders will total $4 billion, the data show.

Stadiums which directly enrich millionaire and billionaire sports owners and their allied businesses.

  1. mybrunoblog - Sep 6, 2012 at 4:40 PM

    Yeah president Obama could sure use that money to put a dent into the $16 trillion debt he created.

    • Tim OShenko - Sep 6, 2012 at 5:07 PM

      Right, because Obama started two wars, and relinquished billions in tax revenues by giving massive tax cuts to the wealthy for the past decade. Good thing those tax cuts bolstered growth in the private sector, though, otherwise our economy would really be in the hole.

      • Ben - Sep 6, 2012 at 5:22 PM

        Yep. It’s absolutely insane to blame President Obama for the national debt.

        http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/08/28/republican-national-convention-the-one-graph-you-need-to-see-before-watching/

      • paperlions - Sep 6, 2012 at 6:10 PM

        It actually kind of is (http://zfacts.com/sites/all/files/image/debt/US-national-debt-GDP.png)….if you want to look at the history of debt accumulation, it has accumulated far faster during Republican administrations than during democratic ones until now. At some point, when the country isn’t making any money thanks to a stagnant economy resulting from too many jobs being shipped overseas and monster tax cuts and bail outs for that that already have far too much wealth…there is no where for the debt to go but up because you can’t even pay the interest, much less “make” enough money to pay it down.

        At this point, it doesn’t really matter who is in power, or what promises they make, the government doesn’t take in enough money (or spend it wisely enough) to pay down the debt or to even control it.

      • Ben - Sep 6, 2012 at 6:43 PM

        Unfortunately it appears conservatives aren’t really worried about things like facts anymore. Conservatives seem to be particularly susceptible to the backfire effect,, “When your deepest convictions are challenged by contradictory evidence, your beliefs get stronger.”

        http://youarenotsosmart.com/2011/06/10/the-backfire-effect/

  2. danaking - Sep 6, 2012 at 4:50 PM

    I’m also curious to know where the money to pay the interest and the principle comes from. Governments pay that, too, don’t they? Not federal, but state and local. The money has to come from somewhere.

  3. ireportyoudecide - Sep 6, 2012 at 4:55 PM

    Well I would rather they spend my tax dollars on a new stadium then a new art museum.

    • alang3131982 - Sep 6, 2012 at 5:00 PM

      What if that new art museum could charge admission and that revenue would then go to the state? I imagine most museums are probably run at near deficits and it’s not like people are paying for running a Yankee stadium…but you’d like the locality to have a chance on breaking even on these deals….

    • 18thstreet - Sep 7, 2012 at 9:52 AM

      I think this is the most interesting comment here, because of the response to it.

      EVEN ON A SPORT BOARD people don’t want to spend money on a new sports stadium. It’s amazing these things keep getting built anyway. It’s amazing how the politicians (of both parties) always seem to find the money to make these things happen, despite the fact that voters don’t want them. It never fails to amaze me.

  4. chc4 - Sep 6, 2012 at 5:45 PM

    Craig — your partisan tone is baffling. Almost every major city has a democratic mayor and they are very influential in getting stadium deals done. Then you have governors, senators and others that could belong to either party. I would argue the mayors and dems push these boondoggles through to give their union cronies years of work. Either way the American taxpayer loses. I certainly don’t blame these “millionaire/billionaire” owners for asking. I do blame politicians for caving… and that’s not a partisan issue.

    • Craig Calcaterra - Sep 6, 2012 at 5:49 PM

      How on earth are you reading a partisan tone into what I wrote? Where did I mention anything partisan at all?

      • chc4 - Sep 6, 2012 at 6:06 PM

        “Millionaire/billionaire” owners bilking taxpayers? You sound just like Obummer. The evil rich people screwing over the man. Doesn’t hurt that you so often take shots at Bush, Romney, etc.

        I live in Atlanta and our esteemed mayor (Kasim Reed) has come out and said taxpayers will pay in large part for the Falcons new stadium. It blows my mind. 70% of ATL residents are against any sort of public funding yet it’s going to happen.

      • Craig Calcaterra - Sep 6, 2012 at 7:23 PM

        So a position that I have long taken — that it is stupid to waste public money — is now a liberal position?

      • Kevin S. - Sep 6, 2012 at 9:59 PM

        Craig, didn’t you know that all money given to millionaires and billionaires creates jobs? It’s in the bible, dummy.

    • Sign Ahead - Sep 6, 2012 at 5:54 PM

      Doesn’t a partisan article have to at least mention a political party?

      • chc4 - Sep 6, 2012 at 6:07 PM

        Um no, not if you pay any attention to current events.

      • lazlosother - Sep 6, 2012 at 6:16 PM

        Well, it certainly helps if you can project your own political leanings into an otherwise nonpartisan post. Then you can project your idiocy onto the blogger, as chc4 has done.

        It’s simple, like chc4. And the best part is that you can then assume a tone of indignation that anyone would do what actually wasn’t done.

    • Marty - Sep 7, 2012 at 12:44 AM

      Not an overtly partisn post. But still, Craig is a openly partisan schlang choker.

      It’s a park. Parks cost money. Sometimes it works out so city janitors get paid 80k
      for picking up trash and the higher ups from the city admin offices earn multi million $ pensions for showing up until they’re 55. Sometimes rich people make money. Developers who bribed the city council. MLB
      Owners. The list is endless when it comes to who profits off your tax deductions.

      And be sure that if any publicly financed city park provides a lick of attraction, the city is going to charge you $15-20 to get in.

      So the fact that Craig would bemoan this travesty over all other ass poundings tax and fee payers are
      subjected to at the hand of Johnny Gov reveals the concept I iterated in the second sentence to this comment is as true as when you first read it.

      • 18thstreet - Sep 7, 2012 at 7:43 AM

        You couldn’t pay me $80,000 to be a janitor.

  5. chill1184 - Sep 6, 2012 at 6:18 PM

    Welcome to the wonderful world of Sports Welfare/Crony Capitalism.

  6. weaselpuppy - Sep 6, 2012 at 7:20 PM

    Protesting the subsidizing of people that don’t need it isn’t partisan, it’s common sense. Not much of that in either Party nowadays…so it’s actually BI-partisan…..As a Tigers fan, I hope Mike Ilitch gets as rich as he can get, legally, morally, ethically and honestly. As a Tiger and Lions fan, I understand that the bonds are being paid off by a hotel and rental car tax, but given the inability of Wayne County and Detroit to manage their budgets (spending, I really mean), it wouldn’t surprise me to find that some of that is being skimmed…I get that the owners want the municipalities to have some skin in the game, but really, Messers Illitch and Ford didn’t need public money to build either place…..It’s too bad Bill Davidson passed the Palace/The Pistons (built without public money by a great businessman and financier/promoter/owner) to his dimbulb harpy daughter, who single handedly tanked the value of the franchise…..

  7. jaybow666 - Sep 6, 2012 at 7:32 PM

    LOOOOOLLLL all of anything that gets sold in those parks gets taxed in most states. LLOOOOOOOLLLLL players salaries in most states get taxed. LOOOOLLLLLL all income for the team itself, its employees, MLB, etc. is taxed in most states. LOOOOOOOLLLL all of the supplies used to build those stadiums get taxed in most states. LOOOOOLLLL all the hotels that people stay in, all the gas and public transportation used to get to those stadiums gets taxed in all states. And oh man the property taxes. But that crony capitalism! WHERE’S MY MONEY? Oh wait I have to actually make something to get a break from the government? Oh in the end the taxes on everything that goes into sports teams more than makes back the initial government outlays? BUT WAAAAHHHHHHHH!!! I WANT FREE MONEY!!! I env-….HATE people that have more money than me!

    • churchoftheperpetuallyoutraged - Sep 6, 2012 at 7:38 PM

      wtf are you talking about? You really think the taxes gained on all that stuff makes up for the tax breaks the owners get? Where did you learn how to do math?

      • 18thstreet - Sep 7, 2012 at 7:44 AM

        I applaud anyone who tried to divine meaning from this.

    • Sign Ahead - Sep 6, 2012 at 7:51 PM

      I’m pretty sure that the evidence doesn’t support your conclusion. Publicly funded pro sports facilities are a net loss for their communities (a huge net loss in many cases). All the text-message laughter, shallow generalizations and capital letters in the world aren’t going to change that.

      As a baseball fan and a politically active person, I would like to see the discussion shift from “Publicly funded sports ballparks are good because they make money for the community,” (a demonstrably false position that becomes harder to justify with every new facility) to “How much is our community willing to pay for professional baseball (or football…or basketball)?” Even though these businesses don’t deliver the kind of benefits they promise when it’s time to vote for a new bond issue or property tax waiver, they do bring some good things (like…you know…baseball) to their community. And it would be refreshing to see people discuss the real costs and benefits rather than a self-serving fairy tale.

  8. gmsalpha - Sep 6, 2012 at 8:11 PM

    And how many of these stadium deals were hashed out during Obama’s time in office?

    And how many were done during Junior’s? And Clinton’s? And Senior’s? And Reagan’s.

    I mean…come on now. Let’s break it down if we’re going to call out any particular government official. Sheesh.

    • 18thstreet - Sep 7, 2012 at 9:57 AM

      Oh, for Christ’s sake. We’re talking about state and local government here.

      I blame George W. Bush for A LOT of things (the war in Iraq, an unaffordable tax cut, an unfunded Medicare expansion), but the idea that he’s to blame/credit for Mayor Anthony Williams of DC building a new stadium for the Nationals is the stupidest thing I’ll read all day. And, yes, I assume Bozos4All will be posting something soon.

      I could have posted the same comment under the jerk who referred to the President as “Obummer.” There has not been a federal government takeover of local land use laws nor municipal bonds, you idiot.

  9. ireportyoudecide - Sep 6, 2012 at 11:32 PM

    I think you are missing the point as to why many cities have voted and approved the stadium deals. They feel the enjoyment they get from watching/attending the team is worth it. Put it this way, NY could sell of Central Park to real estate developers and make Billions of dollars, however the people of the city believe the park is worth the lost dollars in revenues and taxes to the city.

  10. Marty - Sep 7, 2012 at 12:27 AM

    If government is going to waste my money, it might as well be on baseball.

    Still, I propose that if taxpayers are footing more than 50% of the bill,
    Tv broadcasts should be free to local residents for the life of the stadium. If this means $16 beers and guys like Zito, Werth and Adrian Gonzalez(LOL) at $6 M/yr the so be it.

    • 18thstreet - Sep 7, 2012 at 11:26 AM

      The supply and demand curves are your friends, at least they long to be.

      There’s no connection between anything you mentioned other than money is involved.

  11. theptbnl - Sep 7, 2012 at 2:39 AM

    For all the flack the Giants receive regarding the A’s-San Jose thing I kind of hope they succeed so the city of San Jose won’t get screwed over by the stadium deal. It’s almost hard to believe that a team would actually build a stadium for themselves like the Giants did.

  12. tuftsb - Sep 7, 2012 at 12:19 PM

    The stadium gambit is totally bipartisan – and based on distorted statistics.

    The use of multiplier effects of estimated revenue assume that:

    1. All monies spent are new and not a mere reshuffling of existing local spending
    2. The funds stay in the community and are respent.

    Most consultants hired (by teams and the government) paint a rosy picture of the economic effects and ignore the fact that very little new funds are spent and the funds that are spent leak out into the economy beyond the local community and are not recycled ad infinitum.

    At the national level, it ends up resembling nuclear arms and nutually assured destruction. If one team gets a new park, everyone lese needs it to supposedly keep up. Once they all have a new park, we are back where we started.

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