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Why local governments across the U.S. are racing to announce new sports stadiums

AYESHA RASCOE, HOST:

Construction is booming for stadiums across the United States. Pro sports teams are announcing new flashy venues at a red-hot pace, almost one per month in 2023. And a key part of these projects - public funding. David Lieb has been covering these projects for the Associated Press, and he joins us now. Welcome to the program.

DAVID LIEB: Hello. Glad to be here.

RASCOE: So put this in perspective. Just how many of these new venues and deals are currently being developed or have been announced in the last year or two?

LIEB: Well, there are 20 stadium proposals from national football league teams or major league baseball teams currently floating out there, some where the construction and renovations are already underway, like for the New Orleans Saints or the Tennessee Titans or the Buffalo Bills.

That also includes some where cities or states have approved the incentives, but construction hasn't started yet. That count of 20 also includes where they've been proposed and some where they're still on the conceptual stage, where teams have said, we want a new stadium, here's sort of what we like, but there's not a firm dollar figure, and the funding hasn't been approved yet.

RASCOE: So what's driving this surge in new developments? Is this about replacing, you know, rickety old stadiums?

LIEB: Well, most of these stadiums are not rickety or really old by most current standards, but they might be considered economically deficient by the teams. Many of these stadiums are about 30 years old, which has come to be the lifespan of a major league stadium.

Now, these stadiums are not literally in danger of falling down. Some of them maybe could use some repairs. But the main thing is they're just not as fancy as the current new stadiums are, and that's what teams want to do. They want to make their stadiums not necessarily bigger, but better when it comes to maximizing revenue with things like luxury suites or developments around the ballpark, where the owners could perhaps capitalize on things like restaurants, shopping centers or even residential apartment units built near the ballpark.

RASCOE: So what do economists tell you about the cost benefit of these deals for taxpayers?

LIEB: Well, this is one instance where most of the economists are unified in saying it's not worth it on a strictly dollars-and-cents base for the taxpayers. Let me give you one example of that. In 2017, Georgia's professional baseball and football teams each moved into new stadiums. The Atlanta Falcons built a 1.6 billion dollar downtown stadium and blew up the stadium that was next to it. Meanwhile, the Atlanta Braves, the baseball team, moved from downtown out to the suburbs.

An economist called J.C. Bradbury at Kennesaw State University studied the impact of the Braves' move to a stadium that was surrounded by housing, retail, entertainment, commercial developments - all the sorts of things that teams are looking for now. He found that there was an increase in local sales tax revenue consistent with greater economic activity in the new area where the Braves located, but it was not enough to cover the public subsidies that they received.

RASCOE: So why do local governments keep spending money on these projects?

LIEB: People have come to identify professional sports teams with their communities, as part of their culture, a sense of pride, perhaps, that comes along with being a major league city or an NFL football city. So there's the economics of it, which maybe don't always pan out, but then there's the political and cultural realities of it, and there is a public demand for professional sports.

RASCOE: Is there a tipping point, though, for taxpayers where they're like, look, you know, we love this team, but we don't want to foot this tax bill?

LIEB: Well, sometimes, voters do say no. Most recently, the voters of Kansas City, Miss., said no to a sales tax for new stadiums for the Kansas City Royals and renovations for the Kansas City Chiefs. Now, that wasn't the end of the matter. Both teams are still looking for new or improved stadiums. It has simply restarted the discussion about how to pay for those.

RASCOE: Reporter David Lieb of The Associated Press. Thank you for joining us.

LIEB: Glad to do so.

(SOUNDBITE OF HERMANITO'S "MARACUYA") Transcript provided by NPR, Copyright NPR.

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