The NFL Playoffs: Brought to you by Washington State taxpayers

Seahawks_stadiumAt 3:30 today, the Seattle Seahawks will face the Carolina Panthers for the right to play in Super Bowl XL. (Get ready for lots of "Extra Large" commercials.)

At the Tacoma News-Tribune, columnist Peter Callaghan is reminding us to thank the taxpayers who footed the stadium construction bill, boosted the team's profits, and are subsidizing the Seahawks payroll.

But while the fans are loud and proud – now that the team is winning – there is another group that has far more to do with the success of the team; more than the fans, more than the players, even more than reclusive owner Paul Allen. Call them the 13th Man – the voters and taxpayers who provided the money that provided the stadium that provided the profits that provided the payroll that provided a 13-3 season. ...

Take a look: By the time stadium bonds are paid off in 2021, the public will have put up $592 million in principal and interest. That doesn’t include the $125 million that is going to pay off the debt on the Kingdome, which was demolished to make way for Struggling Telecom Company Field. ... Allen’s share? After state voters narrowly approved the stadium legislation in 1997, he put down $194 million to buy the team. ...

Allen got a great deal and the fans got a team that finally fulfills a promise of excellence. But someone ought to at least give a tip of the helmet to the people across Washington who – often reluctantly – made it all possible. Let’s hear it for the 13th Man.

Read the rest. Discuss.

(Hat tip to Ridenbaugh Press.)

  • (Show?)

    While its true that taxpayers have subsidized the Seahawks new stadium and payroll..the Seahawks are drawing huge crowds. The surrounding businesses are benefitting by that (especially bars and restaurants) seeing increased sales.

    These increased sales are often dramatic on game days (this includes the Mariners to a lesser degree) and shifts a lot of sales tax dollars into the state coffers.

    While it might not enough to offset the entire taxpayer bill in the short term, it likely goes a long ways. And when all is said and done the region will probably benefit more from the revenue generation created by the Seahawks and the Mariners.

  • Bob (unverified)

    I'll admit I was long skeptical of the Seahawks new stadium economic impact, until I went to a game this year. They do have a positive economic impact on some industries. For example, the hotel I was staying in had at least two to three hundred football fans staying there specifically because of the game.

    However, this is not to say that I buy that argument in Portland for a baseball team. Part of why the economic development in Seattle worked is two reasons:

    1. Its in a preexisting neighborhood. Pioneer Square has other business on game days.

    2. Seattle is more than double the size of Portland and therefore its easier to sell out games.

    That being said, NHL to PDX! Oh and GO LUMBERJAX!

  • Bruce (unverified)

    My question for you, Carla and Bob, is what if you don't work in a nearby service industry (like a hotel, bar, or restaurant)? Say I work in a Seattle grocery store, how do I benefit from the stadium?

  • Richard Rider (unverified)

    This talk of the stadium paying for itself is ludicrous. There are 8 regular season NFL games, two exhibition games and hopefully a playoff game from time to time. Let's be generous and say 12 games a year.

    I don't care how much booze and food the restaurants and bars sell to fans on those 12 days, it ain't gonna come close to providing any meaningful tax receipts to pay for the stadium. And no restaurant is going to survive if game income is its major source of profit.

    First, consider how much of this "revenue" would have come in anyhow with the old stadium. Sure, there's more fans attending now, but how many more -- 30%? Probably not even that.

    Actually, even this meager revenue is an illusion. 90% of the money spent on game days is from local and Washington state fans. This is recreation money that, if the patrons didn't spend it in these bars, would have been spent elsewhere in Washington -- generating the exact same amount of revenue. Economists call this the "substitution effect," where no new income is generated.

    Hotel rooms? The extra people from out of state on game day in hotel rooms is a drop in the financial bucket.

    Pro sports spinmeisters have conned and bribed politicians to buy into this scam. We citizens may love our pro sports teams, but we should be outraged at this huge taxpayer subsidy for millionaire players and billionaire team owners.

  • (Show?)

    Boy do I want to echo Richard's comments. Every proponent of government subsidy for professional sports uses the tax income received on spending by fans as new income and not as a shift from the bar across town. Academic studies that consider that factor show that tax payers lose. I am proud of Portland for rejecting subsidies for major league sports.

  • Chris Snethen (unverified)

    If you want to see what impact a new sports venue has on an area, just wander down to the Rose Quarter. They have over 200 events there a year and not one restaurant found success from those patrons. There are a handful of bars and taverns around the stadium district which see increased traffic from game day. As does Pioneer Square, which was around long before Struggling Telecom Stadium and Leaving Lake Oswego Insurance Field were conceived and will be around long after they're both replaced. New stadiums around the country do not sustain economic growth. Phoenix and Baltimore are but two examples I've seen firsthand. Restaurants at both locations close up soon after games and see barely a trickle of traffic during the day or in the off-season. Whether they're built for 8 games, 40 games, or 81 games, stadiums and arenas only serve one interest, that of the billionaire owner. If they were such good deals financially, the owners would build stadiums and arenas themselves.

  • NSGN (unverified)

    I was living in Seattle at the time that this legislation was rammed through. In fact, in my (albeit hazy) recollection, the stadium bill came on the ballot not once, but twice, and it was not passed the first time, but through some sort of a legal loophole, it got on the ballot a second time and, with a spin job from Paul Allen, Paul Schell (that sad excuse for a mayor who ended up partying with Bill Gates during the WTO riots) and company and was passed. By and large, the people of Washington state did not want this stadium and, between that, the never-ending light rail saga and Don McIntyre, it seemed that Washington State had their priorities in the wrong places. On the other hand, they pay no state income tax, which must be nice...

  • Jerry (unverified)

    It is interesting that in this commentary, the true costs (and actually, still not all the costs, but it is attempting to do so) are being considered that includes at least the financing costs of the Seahawk Stadium. And it is even discussing the cost of tearing down the 20 year old dome it replaced. Now, why can't Commissioner Adams, PDC, City Council do this kind of real accounting on the life-cycle costing for the Tram? The North Macadam URAC committee in Dec. asked for such but no reply from PDC, PATI, City Council.

  • askquestions1st (unverified)

    I won't go into details here, but from the time the Seahawks stadium opened I had daily personal exposure to the economic effects of the Seahawks business on Pioneer Square and downtown Seattle.

    NSGN is correct about the history, except he or she probably forgot one detail: Paul Allen literally paid the state's expenses for the special election. Unfortunately, it only goes to prove my other thesis on a recent thread here, the voters have no one but themselves to blame since in the face of the obvious and utter debasement of democracy that election represented, they did approve the stadium in the end. And there is little reason right now to believe the same wouldn't happen in Oregon with a baseball stadium if the same came to pass.

    The fact is that at the bottom line, as the statistics cited demonstrated, the Seahawks are a losing deal for Seattle and the rest of the State's taxpayers.

    It is a separate issue whether some local business in the hospitality interest individually experienced some net positive benefits.

    In macro-economic terms, the Seahawks represent a transfer payment of taxpayer wealth to a select subset of individuals. This includes both a direct transfer of tax dollars and an indirect transfer in the form of externalized costs. And baseball in Portland will be no different.

    It is always interesting to me how the pro-business types, and particularly the small business types who are the most rabid anti-government, anti-tax types (check out the political contribution habits of the restaurant industry, and sole-proprieterships of all stripes, sometime), are all for socialistic transfers of taxpayer wealth to themselves, but not to anyone else.

  • Ross Williams (unverified)

    I am not a big advocate of public stadiums and the claims for direct financial benefit are overblown. But there is another benefit which is the extent to which having sports teams makes a community a more attractive place to live. If you accept the argument that economic success in the future is going to depend on the ability of communities to attract talented people, then an investment in a sports stadium may pay for itself.

    The problem with the entertainment dollars sports generate are two-fold. First, much of that money would have been spent somewhere else. Second, Chris points out, sports events alone can't sustain entertainment businesses. The huge capacity needed to take advantage of the sports crowds does not create inviting spaces for people the rest of the time. So you really don't get the same development boost in the immediate vicinity that you do from other urban amenities.

    The other issue with baseball stadiums is that they attract very large crowds even compared to the Rose Quarter. I don't know how the Portland transit system can handle that and I think downtown would have to be transformed for the worse in order to handle that much additional traffic and parking at game time.

    Portland is probably better off investing in expanding its rail transit system or reclaiming the east bank of the Willamette. But it is not clear that adding a baseball team would not pay for itself by making Portland more attractive to the high tech and biotech businesses it hopes to attract. Its a mistake to ignore that broader impact.

  • (Show?)

    There is one argument that proponents raise that I'd like to hear folks weigh in on...

    The idea that major league sports teams "put the city on the map" - that "major league cities" have "major league sports".

    And, of course, if a city is perceived as a "big city" (with everything that that implies in terms of financial capital, entertainment options, population base, etc.), it's more likely to attract corporate headquarters, startup businesses, media attention, etc.

    I haven't decided how I feel about this argument, but I find it interesting that as I travel around the country, Portland is always perceived as a podunk little backwater. But of course, the Portland metro area is larger than the metro areas of Cincinnati, Kansas City, Orlando, San Antonio, Las Vegas, Salt Lake City, Austin, Nashville, Memphis.... all places that most Americans would rank above Portland in size.

    FYI, census numbers are here.

  • NSGN (unverified)

    Actually, one correction to my earlier blog. The Safeco Field, which opened in 1999, was built with taxpayer money despite the fact that WA state voters rejected the tax in 1995 (the erosion of democracy in WA state to support special interests)... The Qwest Field, whose special election was sponsored by Paul Allen was narrowly approved in 1997 and opened in 2002. The taxes include hotel, restaurant and sales tax increases.

  • (Show?)

    My question for you, Carla and Bob, is what if you don't work in a nearby service industry (like a hotel, bar, or restaurant)? Say I work in a Seattle grocery store, how do I benefit from the stadium?

    The businesses around the stadium get revenue from those attending games. Those who work at those businesses get money in their pockets. That money is then used to purchase groceries, clothing, food and other items from other businesses in the Seattle area...thereby generating more revenue for businesses away from the stadiums.

    Honestly, I don't know that the revenue generation from the surrounding businesses is enough to offset the costs of tearing down the Kingdome and rebuilding the new stadiums. But it certainly has a ripple effect in terms of the "rising tide lifts all boats" scenario in play with the throngs attending Seahawks games.

    I'm not in favor of forcing taxpayers to build new stadiums against their it seems (at least in part) was done in Seattle. But I don't think the benefits can be discounted.

  • (Show?)

    While I agree that the Seahawks are on the dole from the taxpayers, as is every other professional sports team in the country, I'm bemused that after thirty years in the Wilderness as a fan, the talk on Blue Oregon is about corporate welfare.

    Yeah, it's a legitimate topic, but why weren't all of the posters in a high dudgeon over college football programs nefarious ways when Kari's beloved Trojans were playing in a bowl game.


    The Hawks, which are in my mind, as in touch with the self-deprecating Northwest Ethos as a pro sports team could be, at least deserve a couple of attaboys.

    At the start of this season they dumped every prima donna an "bad boy" player that they had and hired team players to replace them.

    They play clan and don't talk trash (so far), and I've by god waited 30 years for the only team in the only sport I follow to make it to the top game.

    GO SEAHAWKS!!!!!!

  • (Show?)

    At the start of this season they dumped every prima donna an "bad boy" player that they had and hired team players to replace them.

    One can only hope that Paul Allen has learned from this experience and will apply the same lessons to the Blazers.

  • Eddie in Eastmoreland (unverified)

    Most of the arguments for pro sports seem to always center around the additional business it brings to a city. That's a small side benefit.

    I've been on three corproate relocation search teams over the past 17 years. When a major corporation decides to either move it's headquarters or establish a new regional office they cut the list of prospective cities down to 2 or 3 by some pretty standard criteria. The number of major league sports franchises, established cultural organizations (symphony, opera, museums, etc), major universities nearby, and the city's reputation in working with corporations make up the bulk of these criteria. Having an NFL or Major league baseball team in a city carry a HUGE weight in that city making the "short list" for corporate siting. Once on that 2 0r 3 city short list then other criteria (tax structure, available land, etc) become the final keys to who wins.

    Think not? Compare Portland to Seattle. While Seattle has been larger than Portland for the past 50 1985 Portland had 11 fortune 500 companies to Seattle's 21. Seattle kept growing, enticed the NFL and MLB into town and now has 37 fortune 500 companies headquartered in the area. Boise (YES Boise of all places) has 4.

    Over the past 15 years Portland's political leaders chose to emphasize it's little Beirut image, went out of their way to become anti-business, and stonewall most discussions about stadium funding....AND NOW (drum roll please).....we have one fortune 500 company remaining in the area.

    People actually "pretend" to wonder why we trail other major cities economicaly and have major school and human services budget problems? The same activists who beat the drums for more taxes for schools and social programs angrily denounce any funding to woo prospective corporations and become enraged at even the mention of building a new stadium. So who do they intend to tax? The work force within Portland is making 11% less on average than workers in Seattle. Taxing Portland citizens pay checks just doesn't go as far as it once did.

    Can this philosophy really be labeled "Progressive" politics? I don't see the progress.

  • Ross Williams (unverified)

    Boise (YES Boise of all places) has 4.

    And, pointing out the obvious, not a single major league sports team.

    in 1985 Portland had 11 fortune 500 companies to Seattle's 21. Seattle kept growing, enticed the NFL and MLB into town and now has 37 fortune 500 companies

    The Mariners had their first season in 1977 and Seahawks had their first season in 1976.

    we have one fortune 500 company remaining in the area.

    Which ones moved? I don't remember even one, instead some local companies didn't stay competitive (Techtronix) and others merged (US Bank). I don't think the lack of sports teams had much to do with it.

    I think the argument that a baseball or football team would help Portland attract people and businesses has some truth. But its not at all clear that a stadium would attract a baseball team or a football team or that a region with one fortune 500 company can support such a team if they did move to Portland.

  • Richard Rider (unverified)

    In San Diego, the home of the infamous Charger ticket seat guarantee (the taxpayers paid for the empty seats, giving San Diego 7 years without a single winning season prior to its demise of the deal), the NFL football franchise has brought "America's Finest City" (now better known as Enron-by-the-Sea) practically NO major corporate relocations. But a number of such local companies have left SD, gone BK or downsized.

    With about 65 expensive skyboxes, the SD stadium has over 30 vacant boxes, as there are too few big companies around to waste their money on this perk. So naturally the Chargers' owners want to build even MORE sky boxes and charge far more for them (not to mention a half billion dollar stadium), but ONLY if the taxpayers pay for the construction. The team owners certainly wouldn't waste THEIR money on such a dumb investment.

  • BlueNote (unverified)

    This post is an excellent example of why so many people don't like Democrats and their progressive cousins. Give it a rest!

  • Lee (unverified)

    Eddie in Eastmoreland: You goofed up. Boise having four Fortune 500 corps disproves you theory; or your participation on those search teams may have a criteria problem.

  • Eddie still in Eastmoreland (unverified)

    Tis true Boise has no pro sports franchises....they have 4 "home grown" fortune 500 companies who haven't moved....because of a very favorable corporate tax structure.

    Georgia Pacific, Louisiana Pacific, Willamette industries, Evans Products, PacificCorp, Columbia Sportswear.....just a few off the top of my head that are no longer in Portland. In addition to those corporate headquarters Portland has lost (driven away) several significant regional offices of major companies over the past 20 years....KPMG, IBM, Boise Cascade, NHA, Oracle.....the list goes on.

    Oh well....we can ride bikes in a bike friendly town and wander our greenspaces until our sneakers wear out (but not after dark if you value your life), and drink better beer than you can find in most major cities....although it's only a matter of time before our most treasured micro-brews go big time, relocate their corproate headquarters to another city (probably Seattle) and market their products nationally.

    <h2>It's still cool to live here though, as long as you don't have to earn a living that will allow you a nice vacation home and a couple decent vacations a year to far off places, and a membership at a middle of the road country club. For those essentials of life you have to base your career well outside my beloved Blue Oregon.</h2>
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