Are Mayors Finally Getting Smart About Publicly Funded Stadiums?
For decades, politicians happily have handed over public money for sports stadiums. A new group of mayors is finally saying no.
You probably missed it if you're not keeping up with the daily news from Alberta, Canada—in which case, you're also missing all sorts of excitement over the provincial official who called his health minister "morbidly obese" on Facebook—but two Mondays ago, Calgary Mayor Naheed Nenshi made a somewhat startling pronouncement regarding talks with the NHL's Flames over a new arena.
Any proposal, Nenshi told Bloomberg News, won't "be a deal that gets presented to the public with a ribbon on it. We will actually engage the public in discussions about what they think is right."
This might not seem like much cause for an actually, except that consulting the public before spending the public's money is, historically, incredibly, actually rare in sports venue deals.
Just in the last few years, we've seen:
• Two Los Angeles-area cities get around public oversight rules by staging petition drives for referendums on stadium plans, then having their city councils vote to approve them before holding any public vote.
• Missouri's governor asserting that he can spend state money on a new St. Louis Rams stadium without asking the state legislature for permission.
• Cobb County's cloak-and-dagger deal for a new Atlanta Braves stadium, where legislators took turns standing in the hallway outside closed-door meetings to evade open meetings laws, while the county commission chair secretly hired a lawyer to plan out the deal without even telling his fellow commissioners.
Mayor Nenshi, however, appears ready to buck the trend of democracy being the first casualty in stadium deals. More remarkably, he's one of several mayors—most newly elected to office—who seem eager to tell sports team owners to take their subsidy demands for a long walk off a short pier.
In Anahiem, Mayor Tom Tait shot down his own council's plans to give Los Angeles Angels owner Arte Moreno $245 million worth of parking-lot land for the low, low price of $1. In Oakland, Mayor Libby Schaaf told the Raiders she won't give them a dime of public money that she can otherwise "spend on police, parks or libraries." In Minneapolis, Mayor Betsy Hodges has declared she'll oppose $50 million in tax breaks for a new MLS soccer stadium, calling the demand "extraordinary" and calling out Minnesota United's owners for pretending that tax breaks aren't a public subsidy.
"As a social scientist, I'm not quite ready to pull the trigger and say it's a trend," says Villanova sociologist Rick Eckstein, co-author of Public Dollars, Private Stadiums, the definitive book on why mayors so often bend over backwards to meet local team owners' subsidy demands.
Still, Eckstein calls it heartening that even a handful of elected officials are acknowledging two oft-ignored truths:
a)As innumerable economists have yammered about for decades, stadium subsidies rarely pay off;
b)As keepers of rare and valuable sports business commodities—namely, places to play sports, and large, ticket-buying and television-watching populations—cities and municipalities have the leverage to just say no.
"It's refreshing that after 20 years of yelling about this stuff, five or six people are starting to listen," Eckstien says.
Tait, the senior member of the mayoral Gang of Four—he was first elected to the part-time gig of Anaheim mayor way back in 2010, and started questioning the Angels' land-for-stadium-renovations swap proposal in 2013—says there has been some communication about sports subsidy politics between him and his comrades in arms. "I've spoken to them all, actually," he says, either via phone or in person at U.S. Conference of Mayors meetings. He notes he even had a bet with Calgary's Nenshi over the outcome of the Ducks-Flames playoff series—one that he'd no doubt be less quick to mention if it hadn't resulted in the Calgary mayor having to sing "Let It Go" from Frozen while dressed in a Ducks jersey after the Flames went down in, well, you know.
Having other mayors on his side "helps tremendously," Tait says. "In Anaheim, I was absolutely alone, and the pressure was tremendous. You do question, gosh, by relying on math and stuff, am I crazy?"
The notion of elected officials being driven by peer pressure, like so many overgrown high-schoolers, may sound crazy to anyone who thinks of people in power as, well, powerful. Only mayors are people, too. Eckstein recalls a conversation he had with then-Dallas mayor Laura Miller during her battles with Jerry Jones over subsidies for a new Cowboys stadium. (Jones ended up building it in nearby Arlington, in exchange for $325 million in city sales tax receipts.)
"I talked to the mayor of Dallas a few years ago, she said basically she was alone and she would call other mayors to see if they would also oppose stadium plans in their cities," says Eckstein. "And they were really reluctant to, because no one wanted to be the first."
That's makes this current flurry of mayoral outliers potentially different: Even if they're just a statistical blip, tipping points have emerged from stranger places. "I'm so proud of them being willing to stand up and if nothing else at least say let's look at this twice," says Seattle city council representative Nick Licata, who helped secure the passage in 2006 of Initiative 91, which required that any public funding of future sports facilities require a guaranteed return on investment greater than what the city would get from putting its money into treasury bills. (While it didn't work perfectly—there were endless squabbles over what exactly was meant by "investment" and "return," for starters—it did help sway would-be NBA team owner Chris Hansen into signing an arena proposal that by league standards was remarkably city-friendly).
Licata suggests that tighter city budgets and increased infrastructure needs may have something to do with mayors being less free with public cash. (Though that never stopped anyone before: Cleveland famously approved a new taxpayer-funded stadium for the Browns the same year that its school system went into receivership.) Like Tait, he also believes momentum plays a role, with mayors standing on the shoulders of those who've gone before—in fact, Nenshi's "public benefit" ultimatum with the Flames is a direct echo of I-91's language in Seattle.
Of course, there's plenty of skepticism that this will last, let alone grow into some sort of North America-wide mayoral movement. (The rest of the world doesn't need a movement because it doesn't have the same culture of private sports owners demanding public subsidies.) All of the reasons mayors tend to be stadium money pushovers remain in place: fear of owners taking their teams and leaving town; fear of local business leaders exacting retribution at campaign fundraising time; the "edifice complex" that has politicians believing that shiny new buildings win votes at election time, or at least are something to brag about at the next U.S. Conference of Mayors meeting. Moreover, the Gang of Four is still in the minority: in Milwaukee, for example, elected officials are putting the finishing touches on about $370 million in taxpayer largesse for a new Bucks arena—and getting ready to submit it to a state vote without even first making their plan publicly available, let alone giving the public a say in the matter.
Still, mayors are not entirely at the mercy of their local sports team owners, and can in fact thrive by taking a hard line with them. Despite widespread lore that "you don't want to be the mayor who let your team leave town," the number of elected officials in history who have been voted out of office for losing sports teams is holding steady at zero. Consider Tait's case. "I was up for election," he recalls, "and [the Angels] announced that might move to Tustin the week that the absentee ballots went out." A few weeks later, Tait was reelected by a 33-point margin. He thinks playing hardball with the Angels may have won him votes. "I've had more people come up to me in the grocery store saying, 'Thank you, mayor, for standing up for us,'" he says.
There's still a long way to go—at this month's national mayors' gathering, Tait expects, any panel on sports stadiums will still be about how great they are for economic development, not how to cut a deal that's worth it for your city and its taxpayers. But progress has a way of inching forward. When Tait demanded that the Angels pay fair market value for land in Anaheim, the city council in nearby Tustin— which Moreno was wooing as a move destination—decided that sounded like a great idea for them, too. "Who knows what it's going to take to really get the dialogue to shift so that maybe this becomes the norm rather than the exception?" Eckstein says. "I don't think we're near that. But imagine a world where you have to prove that these things are a good idea.
"Once you get even a small groundswell, maybe people start jumping on that bandwagon."