Petco Park opened in San Diego in 2004 at the cost of $450 million after much negotiation between the franchise, city and members of the community. (Photo by Matt Thomas/San Diego Padres/Getty Images)
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Having covered ballpark, stadium and arena construction in the U.S. since the 1990s, I can’t argue with the economists. From a pragmatic viewpoint, there’s little doubt these structures aren’t worth the investment of public dollars.
It’s much more psychological than that. Each community has to decide whether hosting professional sports is a wise investment of their taxes.
“To be clear, the issue is not that public funding should never be used to build stadiums,” long-time economist and college professor Andrew Zimbalist said. “It’s that the public never had a choice in funding the project. Usually, the population in the U.S. is given a choice. Either we put up this billion dollars or the teams leave.”
And make no mistake the teams will leave. There’s always another suitor out there for a new home if a town doesn’t want to pony up the money. It happened to the NFL’s Chargers when voters in San Diego proper resoundingly sided against a referendum to build a new football stadium. They moved to Los Angeles instead.
When the city government in Oakland couldn’t agree with the A’s to build a new ballpark, Las Vegas stepped into the breach. If Tampa’s politicos decide the price tag is too high to keep the Rays, they will have their choice of Orlando, Nashville, Salt Lake City, or Montreal and no shortage of relocation options.
There never is. The number of franchises in each of the U.S. major professional sports leagues is limited, and those leagues keep their memberships artificially low. There are 53 major metropolitan cities in the U.S. with a population base of a million or more and only 30 Major League Baseball franchises.
It’s All About Economics When New Ballparks Are Proposed
That’s the dilemma. Losing teams on the field, bad ownership, and older ballparks with fewer amenities. No matter. Long-standing Oakland A’s fans can curse team owner John Fisher all they want. Now Vegas will have to deal with him. And if it wasn’t Vegas, another city would have stepped up.
Is any of this fair? No, it isn’t. When a team leaves it tears the heart out of a community. Nearly 70 years later, some people in Brooklyn still pine for the Dodgers. A contingent of fans want to bring the Expos back to Montreal 22 years after they left for Washington. Oakland will never get over losing the A’s.
At the conclusion of the A’s final home game in 2024, the great Ken Korack told radio listeners:
“Mason Miller slams the door on the Rangers as the curtain comes down after 57 years of incredible A’s baseball at the Coliseum. It’s over after 57 years of thrills and heartbreak, but also a sense of community. It was Oakland A’s baseball that brought so many people together. There’s a profound sense of loss and hurt, but yet the memories will hopefully last forever. May those memories be a blessing.”
What could have been a better epitaph to a community and team he loved?
There’s always been little correlation between the business of sports and the fans in the communities who support those teams. Billionaire owners want subsidies and, in most cases, they can get them in their present locales. If they don’t, they simply move without any regard to the fans.
The economic impact on a community of a new facility is usually colored by the mere fact that entertainment dollars are displaced from one venue to another – a movie to a ballgame, a museum to a concert, or simply shifting from the old facility to the new one.
For example, the Tampa Bay Times recently noted from a report that a new ballpark in Tampa for the Rays costing $2.3 billion – dispersed across the city, Hillsborough County, the state of Florida and the team – would have a $55.5 billion to $77.5 billion economic impact on the area over the course of 30 years.
That doesn’t account for the loss of economic impact the Rays have on St. Petersburg where they currently play at Tropicana Field. Many bars, restaurants, garages and parking lots will lose substantial revenue and perhaps go out of business when 81 games are no longer played each season at the Trop.
How the Padres Remained in San Diego
When the Padres made their pitch to the community in 1998 for a new ballpark, the result was a huge movement of spending dollars from Mission Valley to downtown.
It benefited then owner John Moores and the Padres that they had their own facility and no longer had to share revenue streams according to their lease with the Chargers, who lost that baseball revenue. While the Padres were a secondary tenant at Qualcomm Stadium, they now own 30% of Petco Park and control the staging of non-baseball events there.
The city of San Diego owns the other 70%. Their original investment of $169 million in tax-free municipal bonds is slated to cost $520 million in principal and interest once those bonds are retired in 2031 funded in part by a portion of the existing hotel-motel taxes in the area. The Padres financed their own portion of the ballpark that had a cost of $450 million when it opened in 2004, $760 million in today’s dollars. Moores and his JMI Reality, by agreement with the city, developed a large portion of a 26-square block ballpark district around Petco.
It was hugely successful endeavor. “And should have been 100-square blocks,” Moores said.
What the city and the general population gained was the redevelopment of a formally moribund area of downtown called the East Village. For the much narrower base of baseball fans, the Padres stayed in San Diego where they remain and thus far this season have sold out almost all of their home games.
Many economists argue that the investment of public dollars is never a good one on a sports facility. That assessment has to be analyzed from city to city. San Diego-type redevelopment around ballparks has been duplicated in San Francisco, Denver, Seattle, Washington, Cleveland and finally now even New York, where a casino has been approved next to Citi Field. A lot of that has been organic with huge investments from team owners, like the Mets’ Steve Cohen.
In Atlanta, with the help of Cobb County taxpayers, the Braves opened The Battery simultaneously with what is now called Truist Park leaving behind downtown and Turner Field. According to public documents, the entire project is generating enough tax dollars each year to pay off an annual $6.4 million public commitment.
This is the same concept proposed right now in Tampa – a $10 billion retail and entertainment complex around the $2.3 billion ballpark to be funded by the Rays, who have also committed $1.3 billion alone to the stadium project.
The process in San Diego was pretty transparent. There were dozens of meetings open to the public to discuss the final location of Petco Park and an advisory public vote in 1998 that overwhelmingly supported the project. The City Council ultimately agreed to apportion the money.
Tampa has a similar open-meeting process and some substantial opposition from political leaders. These projects are always complex, now even more than ever. The choice for taxpayers is to pay to keep pro sports or not.