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Friday, February 10, 2012
Metro Chamber: Arena report confirms economic benefits of a new facility
by Hal Silliman, published on January 7, 2010 at 10:22 AM
Storyline: Regional Prosperity
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An initial economic analysis of building a new entertainment and sports complex in Sacramento confirms the Sacramento Metro Chamber’s long-standing belief: A properly located arena will create thousands of jobs and millions of dollars in economic benefits for the entire region.
“The Metro Chamber has long-held that a new entertainment and sports facility will be a huge job generator for our region,” said Matt Mahood, Metro Chamber president & CEO. “The Sacramento First Task Force’s “Threshold” report shows how—at a time when unemployment is so high—building and running the complex will create 4,095 new jobs. I say let’s get it started!” The report was released Jan. 7.
Residents in similar sized cities across the county currently enjoy the benefits of successful entertainment and sports complexes, Mahood said. “Our study missions to Charlotte, Indianapolis and Denver found arenas can be located where they serve as catalytic economic development projects. They create not only thousands of jobs, but millions of dollars in economic benefits. And over time, additional investment and positive economic impact follows.”
“Closer to home, you only have to go as far as San Jose to see how the HP Pavilion, that opened 15years ago, was constructed on a site specifically selected to help boost the downtown area,” Mahood added. “The report shows that HP Pavilion annually provides the city of San Jose with direct fiscal benefits of $5.4 million and about 5,000 full-time equivalent jobs.” Mahood encourages the Sacramento First Task Force and others to visit San Jose to see for themselves how that area—a once blighted, neglected neighborhood—is now hustling and bustling each and every day.
“Sacramentans deserve and need an entertainment and sports complex. This kind of civic amenity also offers many unquantifiable benefits that contribute to and stimulate regional economic vitality. It will make our region an attractive business center, increase property values and generate money through tourism. What’s not to like about that?”
Mahood concluded, saying, “I think the report’s findings are significant and that it should make Sacramento residents more comfortable with supporting the construction of a new facility.”
Photo: San Jose's HP Pavilion cost $162.5 million ($132.5 million funded by the City of San Jose; $30 million funded by HP Pavilion at San Jose Management). The completion of the building was an important milestone in San Jose's emergence as a destination city.
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Notables:
"The report cites examples of where that has happened, but does not speculate how many jobs will be created if such revitalization happens."That's not the scope of the report," Mahood said. "It doesn't say, 'You build X and Y is going to come.' "
"Stanford University economist Roger Noll called the report "remarkably honest" but said it doesn't bolster the case for a new arena.
"Two hundred jobs is nothing," said Noll, referring to the permanent jobs the report estimates would be created. "You induce Macy's to open another store and you get that."
A critical issue, Noll said, is how the arena is financed. If taxpayers pay the bulk, that takes dollars out of their pockets, blunting at least some of the economic benefit. "How much are you willing to pay to get 200 jobs?" he asked."
Andrew Zimbalist was also interviewed.
Noll & Zimbalist's are research economists that delve into the big business of sports
Their research is ongoing and they coauthored a book in 1997
"Sports, Jobs & Taxes". available online for free
http://2020ok.com/books/58/sports-jobs-and-taxes-the-economic-impact-of-sports-teams-and-stadiums-9258.htm#ixzz0aXYOr4Tj
The primary conclusions are: first, sports teams and facilities are not a source of local economic growth and employment; second, the magnitude of the net subsidy exceeds the financial benefit of a new stadium to a team; and, third, the most plausible reasons that cities are willing to subsidize sports teams are the intense popularity of sports among a substantial proportion of voters and businesses and the leverage that teams enjoy from the monopoly position of professional sports leagues.
To paraphrase an American treasure- "And now you know" a little bit more of "the rest of the story"
Sports teams seem to serve interests outside the immediate community, especially gaming interests.
This town has so many other pressing problems that we owe deference to prior to sinking millions into especially at this time of enormous fiscal challenges.
As Rob Kerth once expressed, public amenities seldom benefit the community as a whole. It time we learned that lesson and avoided the costly boondoggle that is any arena proposal, for the mere entertainment and use of overpaid basketballers and irresponsible team owners.
In fact, before ANY such consideration of a NEW facility, or even a retrofit of ARCO, the Maloofs need to pony up however many millions it is now that were lent to them by the City in connection with their Kings franchise....Yet, they remain this city's largest deadbeat debtor...
Unfortunately, we as Californians are accustomed to getting little to nothing in return for our tax dollars, and for that reason many are unwilling to financially support a new arena; they demand the Maloofs to pay. In this case, we're not throwing good money after bad; in this case, a new arena would help stimulate a downtown business district in dire need of a premiere destination.
Downtown doesn't need a "premiere destination," it needs more places for people to live.