OT: The Economics of Sports Stadiums and bye-bye to the Oakland A’s

[XXtwindad]

Interesting and relevant read in the NYT today:

https://www.nytimes.com/2023/04/24/s...-playoffs.html

"A year later I flew to Sacramento as the City Council convened for a tense vote on whether the city should pay roughly half the cost, $255 million, for construction of a new downtown arena now known as the Golden 1 Center.

Kings fans showed up in force, as they always do, despite the team having just skidded to its eighth consecutive losing season. They held aloft placards imploring the Council to say yes. Angry critics were also on hand, dead set against spending taxpayer funds on a sports team’s arena.

The Council voted to allocate the money. The Kings stayed put, with the new owner, Vivek Ranadive, promising fans that the team was in it for the long haul. “This is your team, and it is here to stay!” he said.

Nine years later, and after a league-record 16 seasons without being in the playoffs, Sacramento’s team is finally making waves in the N.B.A. postseason. Who knew it would take this long?"

I haven't lived in Sacramento in close to three decades. I have no idea how much of an economic impact the stadium has had on its immediate surroundings. Maybe someone who lives there can weigh in.

[benb]

Take 1/100th the amount of money and fund a local pro crit series.

Maybe there is an economic benefit. Lots of alcohol and food sales. A whole bunch of minimum wage-ish jobs and some business owners making bank.

Is it a better benefit than putting that same money into incentives for education, factory development, technology incubator centers, a new airport, lab space to attract biology companies, new public transit projects, etc, though? Likely not.

Even construction jobs are often better than serving hot dogs at the stadium or at a cart in the street, and also likely better than a restaurant job in the neighborhood.

[Mark McM]

Many seacoast towns in New England have town beaches, which are maintained by the town. Parking fees are charged to use the beach. When investment is need to for infrastructure improvements to the beach facilities, the funding comes from the town (and its tax payers). In return, the town residents get discounted parking fees.

When a city or town helps fund a new sports stadium, do the local taxpayers get discounted tickets? No? I didn't think so.

[benb]

Originally Posted by Mark McM

Many seacoast towns in New England have town beaches, which are maintained by the town. Parking fees are charged to use the beach. When investment is need to for infrastructure improvements to the beach facilities, the funding comes from the town (and its tax payers). In return, the town residents get discounted parking fees.

When a city or town helps fund a new sports stadium, do the local taxpayers get discounted tickets? No? I didn't think so.

Good similar example I ran into last week.

Horsehoe Bend is in National Recreation land and is Federal land and free to visit.

But the town of Page put the money into improving the parking lot and runs the bathrooms and such. So you have to pay if you bring a car, and National Parks passes are not accepted.

Also see Tin Mountain owning the road up Mt. Washington.

All these things are tiny amounts of money next to what pro sports costs and generates though.

[SteelCharlie]

Originally Posted by XXtwindad

Interesting and relevant read in the NYT today:

https://www.nytimes.com/2023/04/24/s...-playoffs.html

"A year later I flew to Sacramento as the City Council convened for a tense vote on whether the city should pay roughly half the cost, $255 million, for construction of a new downtown arena now known as the Golden 1 Center.

Kings fans showed up in force, as they always do, despite the team having just skidded to its eighth consecutive losing season. They held aloft placards imploring the Council to say yes. Angry critics were also on hand, dead set against spending taxpayer funds on a sports team’s arena.

The Council voted to allocate the money. The Kings stayed put, with the new owner, Vivek Ranadive, promising fans that the team was in it for the long haul. “This is your team, and it is here to stay!” he said.

Nine years later, and after a league-record 16 seasons without being in the playoffs, Sacramento’s team is finally making waves in the N.B.A. postseason. Who knew it would take this long?"

I haven't lived in Sacramento in close to three decades. I have no idea how much of an economic impact the stadium has had on its immediate surroundings. Maybe someone who lives there can weigh in.

I'm nearby and have never, as in Never, seen any financial discussions of any kind related to the Golden 1 Center. I'm guessing, don't ask don't tell at every level. Meanwhile, the homeless overrun the city.

[sevencyclist]

Very interesting to see arguments from both sides, with majority here not supporting public dollars for sports team. I am in the Bay Area and definitely feel like there were not enough consistent support from fans to have two baseball teams to keep the stadiums filled. There are three other cities with two baseball teams: NY, LA, and Chicago.

I wonder how does this concept apply to women sports, whether public dollars should be used to encourage development of professional women sports in soccer and basketball. Also wondering about public dollars to support cycling races. Should bike by cities charge "greedy entrepreneurs" race organizations to use roads for racing, since there will be security and usage hassle, and even more for starting and ending cities.

I don't have an answer, but just wondering whether answers change depending on sport, and the demographic of owners and the group of athletes.

[Elefantino]

As recently as 2014, the A's drew 2 million fans to the Coliseum, when talk began about a new stadium at the Coliseum site. If they'd had a new stadium, they'd likely be drawing more than 2 million every season. Of course, they'd have to not suck, too.

[many_styles]

Originally Posted by sevencyclist

Very interesting to see arguments from both sides, with majority here not supporting public dollars for sports team. I am in the Bay Area and definitely feel like there were not enough consistent support from fans to have two baseball teams to keep the stadiums filled. There are three other cities with two baseball teams: NY, LA, and Chicago.

I wonder how does this concept apply to women sports, whether public dollars should be used to encourage development of professional women sports in soccer and basketball. Also wondering about public dollars to support cycling races. Should bike by cities charge "greedy entrepreneurs" race organizations to use roads for racing, since there will be security and usage hassle, and even more for starting and ending cities.

I don't have an answer, but just wondering whether answers change depending on sport, and the demographic of owners and the group of athletes.

I also think that the location has to be more conducive to fair weather fans. Stadiums closer to downtown areas tend to spend money before and after the game and nearby restaurants and bars. In the Coliseums current state, only hard core fans attend games or when there are special matchups or a playoff run.

A lot of tix are sold for corporate events as well.

If the current state was going to be the perm location for the A’s investment to update it should have been on going and started 20+ yrs ago a la Dodger Stadium.

SF Bay Area is the 6th largest market for MLB, so I’m pretty sure the area can support 2 teams.


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[Mark McM]

Originally Posted by sevencyclist

I wonder how does this concept apply to women sports, whether public dollars should be used to encourage development of professional women sports in soccer and basketball.

It probably does not apply, as the usual problem here isn't that the stadiums aren't large enough, but that that there aren't anywhere near the number of fans to fill the current stadiums. New stadiums are not likely to cure that problem.

Originally Posted by sevencyclist

Also wondering about public dollars to support cycling races. Should bike by cities charge "greedy entrepreneurs" race organizations to use roads for racing, since there will be security and usage hassle, and even more for starting and ending cities.

Except for track cycling, most cycling events don't require the large investments in infrastructure required for stadium sports. I don't know about professional cycling, but for amateur events, the promotors usually end up paying the cities for services such as police, medical & ambulance, and any road modifications requires (such as temporarily removing speed bumps). The promotors usually sell the city the idea that a race will attract fans, who will then spend money on local businesses. If the businesses find that the hassle of closing the roads for a day costs them more business than any fans might make up for, they'll complain to the city, and the following year the city won't grant the promotor the necessary permits. So, if a race doesn't work out business-wise, it is a small one time hit.

[Heisenberg]

Originally Posted by XXtwindad

Civic pride (or “psychic” pride if you prefer) is another thing. Oakland is the birthplace/hometown of Bill Russell, Rickey Henderson, Marshawn Lynch, Dame Lillard, Gary Payton, and numerous other luminaries. It has a very rich athletic pedigree. It seems strange for the Town not to have a professional sports team.

Speaking of, this is a great listen for East Bay sport folks:

https://eastbayyesterday.com/episode...s-to-the-pros/

[verticaldoug]

I think the stadium funding is just another part of the huge sports washing boondoggle. When the value create is in this 'intangible' civic pride, you know it loses money outright.

It's not as bad as the grand daddy of them all- Hosting the Summer Olympic Games. They hail 2012 London a success when you look at the numbers- 5.2b in revenue for 18 billion in costs with 9billion value created in 'Civic Pride'.

Considering all the problems France has right now, I do not think spending money on 2024 Paris Summer Olympics should be their top priority.

[XXtwindad]

Originally Posted by Heisenberg

Speaking of, this is a great listen for East Bay sport folks:

https://eastbayyesterday.com/episode...s-to-the-pros/

That is totally cool. What a fantastic topic.

[72gmc]

Originally Posted by Elefantino

Of course, they'd have to not suck, too.

This made me laugh.

Do they have ownership that understands this? I'm sitting in the hometown of the Mariners as I type this ...

[donevwil]

Originally Posted by 72gmc

This made me laugh.

Do they have ownership that understands this? I'm sitting in the hometown of the Mariners as I type this ...

Worthy question and the answer is certainly "Yes". They argue that the cost of fielding a competitive team with an "acceptable" budget is not possible with their current revenue. They blame the lack of fans (need a new stadium) and, much more quietly, the ultimate loss of their MLB revenue sharing check. However, they have fielded competitive teams with low budgets, but the budget has gone even lower the last two years (certainly partially due to their losing the forementioned revenue sharing check soon, I believe next year, but also their decision to try to pull a "Major League" (movie) move). When they were competitive, and before they pulled an about face on their "Rooted in Oakland" propaganda, they drew fans. That became a problem in and of itself when their plan shifted and they wanted to be perceived as victims of circumstances and must relocate.

The part I don't understand is how Manfred is allowed to not only let this happen, but support it. He's a mouthpiece for all owners and one would think a majority of owners would not appreciate how Fisher is handling this. Granted Fisher and Bud Selig were buddies and Manfred was handpicked by Selig so the poisoning of MLB by Hall of Famer Bud Selig continues.

I'm still holding on to the theory that LV concludes they'd be better off with an expansion team with committed ownership rather than the A's and baby Gap.

[Hindmost]

Originally Posted by Heisenberg

Speaking of, this is a great listen for East Bay sport folks:

https://eastbayyesterday.com/episode...s-to-the-pros/

Thanks for the link. The site has a bunch of East Bay history stuff.