Friday, November 30, 2012

Cities are getting smart about getting scammed

The Economist has a commentary about how the Atlanta Falcons are looking for a taxpayer subsidy in the neighborhood of $300 million to build a new stadium.

Now, that $300 million won't pay for the entire stadium. Just 30 percent, as plans are to spend $1 billion to build the new stadium.

I don't begrudge NFL team owners for trying to get money from their local area for new stadiums or renovations of their current stadiums. It's never a bad idea in business to get someone else to pay you for something you want.

But local cities are starting to catch on. It used to be, that teams would threaten to relocate if they didn't get a new stadium paid in part by the local governments. But economists are also putting out reports about the lack of economic benefit that new stadiums bring to cities, considering the large amount of funds governments put into the stadiums.

That threat of relocation is still there, as teams such as St. Louis, San Diego and to a lesser extent, Jacksonville, are threatening to  move if they don't get their ways. But the problem, is that there are view viable markets for the team to move.

Los Angeles is really the only place a team could move to - with a new stadium. San Antonio has a dome that is waiting for a team, but it likely will need well over $100 million in renovations to make a new owner happy.

So where does that leave Atlanta? I don't think they go anywhere. I don't think they get a new stadium with any public money, especially with their stadium being just 20 years old. If Arthur Blank wants a new stadium, he is going to just have to scrounge around in his pockets for more money to cover the costs himself.

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