NCPA - National Center for Policy Analysis

STADIUM WELFARE SCHEMES

April 23, 2008

In 2007, plans were unveiled for a new arena for the Seattle Supersonics, a professional basketball team in the NBA. Voters had already rejected a $220 million taxpayer funded stadium, shopping area and practice court for the team in 2006.  Owner, Clayton I. Bennett concluded his only option was to move the team out of the state.  But to do so he needs to get out of his lease with Seattle's Key Arena.  The city argues that he should have to compensate it not just for the lost rental income but for the benefits the community receives as home to the Sonics.  That puts Bennett in the uncomfortable position of now minimizing the team's impact on the city, says Reason Magazine.

For example, Bennett's lawyers argue:

  • The financial issue is simple, and the city's analysts agree, there will be no net economic loss if the Sonics leave Seattle.
  • Entertainment dollars spent on the Sonics will be spent on Seattle's many other sports and entertainment options.
  • Seattleites will not reduce their entertainment budget simply because the Sonics leave.
  • Some 66 percent of Seattleites say there would be "no difference" in their lives should the team decide to leave.

Even if Bennett's legal strategy in Seattle is successful, it's almost certain to come back to haunt him, says Reason.  If, as Bennett's lawyers argue and most sports economists agree, money not spent at professional sports events would otherwise be spent of other entertainment in the city, Bennett will have a hard time making this case to voters in Oklahoma City.  There he's pushing for a $100 million dollar subsidy package to fix up the city's Ford Center stadium and build a new practice facility in the hope of bringing the Sonics to the Midwest.

Source: Radley Balko, "So Long, Seattle," Reason, May 2008.

 

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