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On four [ [link removed] ] different [ [link removed] ] occasions [ [link removed] ] now [ [link removed] ], I’ve mentioned in passing that government subsidies for professional sports stadiums are a terrible use of taxpayer money.
But Missouri Governor Mike Kehoe doesn’t listen to me, and today he called back Missouri lawmakers for a special legislative session [ [link removed] ] to provide up to $1.5 billion [ [link removed] ] in subsidies for Kansas City stadiums [ [link removed] ]: a new stadium for the Royals, and renovations for the Chiefs.
Missouri should reject this effort. It wastes taxpayer money, provides few tangible benefits, and keeps money from being spent more effectively—which is a low bar, because just about anything would be a more effective use of money.
For those of you in Missouri: please forward this email to your friends and to your state legislators; they’re voting on this proposal [ [link removed] ] as we speak. Here’s where you can look up [ [link removed] ] who your state legislators are and how to reach them.
Representatives [ [link removed] ] use [email protected] and Senators [ [link removed] ] use [email protected] for their official email addresses.
Article summary:
Kansas Citians already voted down public stadium funding. The evidence is overwhelming that it’s a bad use of taxpayer money.
The jobs being created and supported by the Chiefs are, in reality, less than 10% of what the Missouri Governor’s Office is claiming.
This money could be used to address teacher shortages or provide health care for children for nearly a decade. We could use the money to functionally solve the budget crisis at rural hospitals. Instead, we risk wasting it on glitzy stadiums.
Missourians know that the money can be better spent
Let’s start with the baseline here: Kansas Citians were already asked to vote on a ballot measure that would increase their sales taxes to support stadium funding. And it was emphatically defeated, by a 58%-42% margin [ [link removed] ].
I know respecting the will of voters isn’t always [ [link removed] ] the forte [ [link removed] ] of the Missouri Legislature, but we should appreciate that they probably know what’s best for their city.
Now, the Governor is asking Missourians [ [link removed] ] to pay $1.5 billion in subsidies for new and improved stadiums. That’s a lot of money! For context, here are other options for how we could spend the money.
We could solve the state’s teacher shortage for eight years. We could make sure every child in the state has health insurance for 6.5 years. We could address nearly half of the state’s crumbling road and bridge infrastructure. We could keep money-losing rural hospitals open for more than two decades!
Or we could piss the money away and dump it into two glitzy stadiums. With all of the state’s issues, it’s an outrage that this is a serious proposal.
The Governor’s projected job data is complete nonsense
The Governor’s Office claims that the Kansas City Chiefs support over 4,500 jobs in Jackson County [ [link removed] ]. At best, this is actively misleading; at worst, it’s an outright lie.
Even if you include every player, coach, trainer, nutritionist, front-office employee, etc., you’re looking at about 310 full-time employees.
On game days, an NFL team might hire another 2,000 temp workers for about six hours of work [ [link removed] ]. But an NFL stadium gets used, at the very most, 20 times per year.
Yes, it’s great to hire 2,000 people. But:
Even if you generously assume that Arrowhead Stadium gets used 20 times per year, the staff there is only working 120 hours per year.
That’s about 115 FTEs [ [link removed] ], which is not worth $100s of million in subsidies.
So where on earth does 4,500 come from? If we want to be really generous, maybe they’re counting all of the short-term construction jobs and all of the very-part-time stadium jobs on game days.
But construction jobs only benefit workers who would’ve otherwise been unemployed [ [link removed] ]. Neither construction nor stadium funding create any lasting, per-capita income growth [ [link removed] ].
In reality, it’s more like 425 sustained FTEs—less than 10% of what the Governor is claiming. If we want to create jobs with taxpayer money, almost anything else would be more efficient.
Promises of incremental tax revenue don’t ever materialize
Roger Noll [ [link removed] ], a Stanford professor of economics who has written about public stadium funding, says it most clearly [ [link removed] ]: “NFL stadiums do not generate significant local economic growth, and the incremental tax revenue is not sufficient to cover any significant financial contribution by the city.”
The St. Louis Fed [ [link removed] ] has written about how little incremental tax revenue stadiums generate. This is especially damning:
Of the 30 metro areas where the stadium or arena was built or refurbished in the previous 10 years, only three areas showed a significant relationship between the presence of a stadium and real per-capita personal income growth. And in all three cases—St. Louis, San Francisco/Oakland and Washington, D.C.—the relationship was negative.
Even the National Council of State Legislators [ [link removed] ], at the front lines of stadium subsidies, is unambiguous: “Much of the research indicates that the economic impact stadiums have on cities is negligible.”
Other reasons why this is a terrible use of taxpayer money
To the extent that stadiums create jobs, they really just move them from one part of the metro area to another [ [link removed] ]. It’s robbing Peter to pay Paul.
Taxpayer-funded stadiums increase franchise value [ [link removed] ], which allows owners—who are by definition fabulously wealthy—to sell their teams at substantial profits [ [link removed] ]. The taxpayers pay, but the owners reap the (billions of dollars in) benefits.
Because of the way that stadiums are financed, cities—including St. Louis [ [link removed] ]—often end up paying for stadiums long after they close [ [link removed] ].
The Hunt family does not need our money
The Chiefs are owned by the Hunt family [ [link removed] ]. Their family net worth is about $25 billion [ [link removed] ]—they’re the 12th-wealthiest [ [link removed] ] in the U.S., and they’re willing to offer up less than half of their proposed [ [link removed] ] Arrowhead Stadium renovations.
Not for nothing, it’s not like the Hunts have ever acted like they really care that much about Missourians: they didn’t want the Rams moving to St. Louis [ [link removed] ] in 1994, and they voted for the Rams to leave Missouri [ [link removed] ] in 2016.
Clark Hunt [ [link removed] ] and his half-brother Lamar Hunt, Jr. [ [link removed] ] both claim in their official bios to care about Kansas City. It’s hard to take them seriously when, by threatening to leave, they’re basically extorting the state to the tune of $100s of millions.
Where’d all the concern with efficiency go?
All of this is happening because the state of Kansas is dangling tax breaks of its own [ [link removed] ] to entice the Chiefs and the Royals across State Line Road [ [link removed] ]. (It should be noted: these teams would still be in the Kansas City area even if they do move!)
But there’s already question of whether Kansas can even afford [ [link removed] ] the subsidies it’s offering. I don’t know why Missouri is so keen to engage them in a race to the bottom.
Missouri has all sorts of problems with efficiency [ [link removed] ]. But this sort of rob-from-the-poor-and-give-to-the-rich policymaking would take things to a new level.
Look, money alone doesn’t fix our problems [ [link removed] ]. But with St. Louis still dealing with the impact of tornado damage [ [link removed] ], and with the state comparing as poorly as it does to the rest of the country on health [ [link removed] ] and crime [ [link removed] ] and education [ [link removed] ] and road safety [ [link removed] ], how can we seriously consider spending almost 10% of the state’s general revenue [ [link removed] ] on something so clearly inefficient?
Our legislators have to vote this down.
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