To be fair it is not the City it is the County that passed that bit of legislation.
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A little math to help illustrate what this “corporate welfare” means to Seattle.
The base rent for the facility is $1.5mm per year, for 25 years, which is $37.5mm. However, there’s an annual CPI adjustment baked in that raises the annual rent, so without having divine foreknowledge of Seattle’s economic performance over the next 25 years, it’s hard to say. If we project a fairly middling 2% CPI annually from, that works out to roughly $50mm give or take.
According to the consultant report in the Seattle Weekly article, Safeco events (ticket and concession taxes) generate $46mm in tax revenue for city and county, and supports $100mm in wages, which should produce an additional $1mm or so in sales tax (based on IRS sales tax estimations based on the local rate for Shoreline, WA, though it would be distributed across the county and in other municipalities; I needed a shorthand), annually.
Finally, the team has an obligatory contribution of revenue sharing of 1.5% gate revenue below $100mm (and to be generous, we’ll assume the Mariners suck for the next 25 years and draw about 2mm per year, with no ticket price inflation, and we’ll low ball the average ticket value to the low ticket average of $41), which is $1.23mm annually.
Disregarding momentarily the B&O tax for Baseball Club of Seattle LLP (which is, I imagine, classified under “services – other” at 1.5% of all revenues), we’re looking at a total haul for the county of right around $50mm AAV on Safeco lease and ballpark operations tax revenue. This puts their 25-year revenues from the Mariners’ running Safeco Field, assuming all numbers stay at present levels – which is silly – at about $1.25bb.
The Mariners are basically asking for a 10% reinvestment of the revenue their economic activities at Safeco render, while contributing to the CapEx fund themselves.
Seems like a good idea to invest to keep the Mariners around…
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Seattle has a $6 billion annual operating budget making the revenue from the Mariners a small drop in the bucket. I also have no doubts that the revenues are hugely offset by the other impacts – traffic, crime, wear and tear to infrastructure, and such.
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I do like my football, but 5-to-4 should be behind bars.
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You sure this is Seattle and not Oakland?
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That’s what the robber barons would like you to believe, yes. Free market capitalism should ensure that no public funds or tax breaks go to private enterprise. What we suffer under here in the US is pure oligarchy.
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In my city, I pay personal property tax, real estate tax, a city income tax, and sales taxes. If I ask the city to reinvest in me just 10% of the taxes I’ll pay over the next 25 years, what do you think they’ll say?
Maybe I should threaten to relocate team me.
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There have been efforts to stop this, but I’m not seeing a lot of success. Here’s coverage from a few years back in the Philly area (the Eagles are worth about 3 billion dollars): https://www.phillymag.com/citified/2015/03/23/public-financing-sports-stadiums/
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Yes $50mil is a “drop in the bucket” of a $6billion budget - but that’s not the point I was making. The author and commentators make the argument that Seattle is propping up this organization and foregoing on other needs (affordable housing, combating drugs etc), when in reality King Co. and Seattle reap $50mil/year in benefits that wouldn’t be realized had the team not been here. To your point I agree that extraneous impacts i.e. traffic, crime etc are inherently raised, but do you think they’re raised to the point of costing $50mil/year? If your answer is no then there is still ample benefit to the team being a tax paying entity and contributor to the city as a whole.
In the most basic of maths, this $135million the city committed to the Mariners will be repaid in less than three years using current tax levels and attendance metrics. The remaining 17 years of the contract will net Seattle and King Co. $850million.
I understand your point - not saying I agree, but I understand the argument being made.
What I don’t understand is why you are measuring in millimeters. This is America, dagnabbit! Our dollars are measured in inches and feet!
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I am also just as confused by it. For whatever the reasons are that the majority of people are okay with their elected officials supporting such allocation of taxpayer money, I figure a healthy middle ground would be to have those tax dollars come with the expectation that the professional sport teams that benefit from this “investment” cannot be male-only teams.
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John Stanton is worth a billion. The board of Trilogy combined probably worth something like 5-7 billion. They run a business (and let’s be real, a side business) that is practically guaranteed to turn a profit, even without fielding a decent team practically every year (longest current playoff drought in MLB.)
Let’s not forget that the stadium was built with taxpayer dollars in the first place, in a backhanded move by the state legislature after a public vote against it. Construction topped out over 500m. I’m not gonna bother with the math, but let’s say the final tally for those bonds closed in at somewhere near 700m. Now they are asking for more money. Have the taxpayers received nearly a billion dollars worth of baseball? Fuck no. And fuck these rich fucks and their rent-seeking bullshit. They got the money, they can do it themselves. Seattle however has a massive shortage of affordable housing that taxpayer funds would be much better spent on.
Ask John Henry and co of the Red Sox. They’ve privately financed over 300m in renovations, repairs, and maintenance at Fenway since buying the team in 2002.
I love baseball. If citizens have to pay out the nose for the privilege of having a professional sports team in their city, they should be the owners. Fuck giving welfare to the people who need it least.
ETA: although I don’t have time to get into a lengthy debate about the economics behind subsidizing sports franchises, the research I have seen suggests that the economic benefits are negligible at best.
https://digitalcommons.pace.edu/cgi/viewcontent.cgi?article=1023&context=pipself
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As a resident of King County I say screw that noise.
The COLA here is already extremely high (high property taxes, high sales tax, ridiculously high RTA taxes, and the list goes on and on – and yes, I realize part of it is because we don’t pay state income tax). Even with all this expenditure we still have a massive shortage of housing, Sisyphean infrastructure projects that just cannot keep up with the area’s growth, bad public transit, bad traffic, and so on.
There’s so many other more useful ways this money could be spent that don’t involve propping up sportsball teams that despite being hugely profitable still manage to suck away taxpayer dollars.
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No, that is what the robber barons would like you to believe.
Preferable while they take something that is already yours, or should be yours, and sell it back to you at a tidy profit.
Related: religion is being replaced by professional sports as opium for the masses.
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Like I said, no good argument. The profits from this team, and their resulting tax burden, are meager in relation to Seattle’s entire economy. And that money isn’t being generated by the team, it’s being redistributed from other venues during baseball season (a season which is seemingly interminable, but still). Take the stadium away, and other, better forms of entertainment would spring up to fill the void.
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