When it comes to the Jacksonville Jaguars’ arguments in favor of taxpayer-funded upgrades for TIAA Bank Field, it’s time to blow the whistle on excessive economic promises. The team leadership’s claims that new public spending on the stadium would “provide a reasonable return on what will obviously be a sizable investment” by taxpayers long ago ran out of bounds on economic reality.
Jaguars team president Mark Lamping has reportedly told media that renovations to the stadium, which is owned by the city, would “provide the taxpayers a positive ROI.” That means that the city will get back more money as a result of the renovations – a positive return on investment, or ROI – than it spends on them.
That is, to put it kindly, incredibly unlikely. Stadiums don’t make money for the taxpayers who finance them; they make money for the teams that play there.
This isn’t a radical or controversial economic argument to make. On the pro-subsidy side, you may have the occasional economist who’s being paid by a team to come up with a made-to-order “economic impact” study. On the opposing side, you have almost every expert economist in the country.
No, seriously: In 2017, the University of Chicago surveyed a collection of distinguished economists from Harvard, Yale, MIT, Stanford, Princeton, UC-Berkeley, Chicago, Columbia, Northwestern and other respected economics departments. This panel, which included an incredible seven Nobel Prize winners in economics, was asked if stadium subsidies are likely to do the exact thing that the Jaguars are claiming will happen, which is generate a positive rate of return for taxpayers.
The answer was as close to a unanimous answer as economists ever get on anything. An overwhelming 83 percent of the panel said no, subsidies do not generate positive ROI for taxpayers; 11 percent were unsure and just four percent were pro-subsidy.
Just last month, three respected sports economists from Kennesaw State University, the University of Maryland, Baltimore County and West Virginia University published a comprehensive survey of the existing research evidence on the role that pro sports franchises and stadiums play in local economies. They found that pro sports teams and stadiums have “little to no tangible impact” on local economies, and what few positives they do create aren’t even close to being worth their massive subsidy price tags.
But you don’t have to be a Nobel Prize-winning economist — or even to have taken an economics class — to understand why stadiums like TIAA Bank Field are terrible economic development tools. All you have to be able to do is divide by 365 to see how economically insignificant a stadium is when you spread it over the course of a year, rather than just on gamedays.
Here’s what this looks like in Jacksonville: According to ESPN, 504,686 Jags fans attended games at TIAA Bank Field in 2019, before COVID disruptions upended sports. Spread out over the course of a year, that averaged out to just 1,383 fans per day.
In terms of daily customer count, that’s equivalent to the number of people shopping at a single midsized grocery store on an average day. That’s certainly not worth hundreds of millions of dollars in debt to bring to Jacksonville.
Unfortunately, the stadium isn’t the only place where claims of “economic development” have put taxpayers in debt for decades to help prop up the Jaguars’ profits. Thanks to the City Council’s vote last year, Duval County taxpayers are already on the hook for $60 million for the team’s “football performance center,” a bill that auditors say will end up costing the city $105 million over the course of the next three decades. That averages out to $3.5 million per year. That’s more money, for context, than the city’s budgeted share this year of the interlocal agreement that keeps Atlantic Beach, Jacksonville Beach and Neptune Beach safe, healthy and clean for residents and tourists.
How is it worth more to Jacksonville’s economy to spend more to maintain glittering exercise facilities for NFL players than it does to provide law enforcement, hospitals, rescue services, safe roads, waste disposal and other fundamental public services to the beach communities that help attract millions of visitors every year to the region? These are the kind of very real tradeoffs that sports teams don’t want communities discussing, because the answer is simply that their deals only look good for the rest of us when benefits are inflated and costs are ignored.
And frankly, they’re counting on fans’ love of the team to keep them from asking too many questions.