Wooly at the ballpark

Governments frequently subsidize pro sports teams.  Whether a lot or a little, it's an abuse of taxpayers.

Bloomberg recently published an article with the headline, "You Can Pay for a Ballpark Without Fleecing Taxpayers."  The author of this piece calls it "a rather different story, about the efforts of the Pawtucket Red Sox, the Triple-A minor league affiliate of the Boston Red Sox, to get a new ballpark."  He says, "it does show that a team and a government can put together a deal that includes public financing but doesn’t hose the taxpayer. ... all the parties acted in good faith to build a stadium without mauling taxpayers."

This shouldn't be newsworthy!  Of course you can pay for a ballpark without devastating taxpayers.  Yet this piece was published by a top American news organization.  It implies that a valid metric for public policy success is that it "doesn't hose the taxpayer."  Ultimately, it reveals how routine it has become for American taxpayers to be forced to subsidize for-profit sports teams.

What the author seems to be enamored with is that both the State of Rhode Island and the City of Pawtucket are loaning money (like banks) instead of giving money outright (like charities) for construction of the PawSox stadium.  He makes a valid point - loaning is better than giving.  But he never asks whether either is appropriate at all.

In May of 2017, "the PawSox released the details of the [new stadium] financing ... The ownership group would put up $45 million, with the state contributing $23 million and Pawtucket $15 million."  He says, "The city and state would receive a revenue stream [from stadium revenues] that would not only cover the debt service but would probably make it a profitable venture for the government."  All the taxpayers get is to be not-necessarily-willing participants in a "probably" profitable commercial venture.  Does that sound like good public policy?  Is that fair to these taxpayers?

If this stadium is a good idea, why aren't banks and other financiers jumping at the opportunity to finance it?  If this stadium is commercially viable, why does the government need to be responsible for funding almost half of it? (($23 million state + $15 million municipal / $83 million total = 45.8%))  Either the government is offering a special deal at lower rates, or is the only one offering financing at all because other financiers don't believe it will be successful.  That should frighten Rhode Island taxpayers.

If the particulars don't bother you, consider the bigger picture.  Professional sports teams, including the PawSox, are generally for-profit entertainment companies.  If governments should be offering cut-rate financing to entertainment companies, is there anything that is out of bounds?  Can American taxpayers be dragged into any capitalist enterprise that government officials believe could be a good idea?

A truly "different story" would be one that doesn't involve Rhode Island taxpayers being put on the hook for a $48 million loan.  Sure, that's better than the $120 million in charity that was originally discussed (("$4 million a year for the next 30 years")).  But it's not right.  The author should get credit for appreciating that things are being done better in Pawtucket than they could have been.  But he says "Kudos to Pawtucket, Rhode Island, for doing stadium financing right" - and he's wrong.  Doing stadium financing right means not involving taxpayers at all.