The Tennessee Titans may have a high draft pick Thursday night, but their biggest win of the week could come Tuesday night. The Nashville, Tennessee, city council is expected to approve major grants for a new $2.1 billion stadium for the team.
The city’s likely approval of $760 million in revenue bonds, combined with the $500 million already approved by the state, brings the total public contribution for the stadium to $1.26 billion, by far the most largest sports grant in US history of almost 50%. But outside of California, Tennessee’s move seems to be the new normal after $750 million in tax dollars to build the Las Vegas Raiders stadium, then $850 million from New York State to build a new one. venue for the Buffalo Bills, which is currently the most ever given by public coffers. Maryland committed $1.2 billion last year to stadium renovations, split between the Orioles and Baltimore Ravens.
Bills’ 30-year stadium deal will include $850 million in public money
“We see this happening in many states,” said JC Bradbury, an economist at Kennesaw State University, who testified against the Titans’ proposal. “So, for example, out of nowhere, Milwaukee, the Brewers want funding and they’re asking for it at the state level… I think part of it had to do with the remaining COVID relief dollars. And it’s that there’s money that states have access to, they’re fed up with it, and they don’t know what to do with it, and sports teams see this and say, “Aha, we’ve got the lobbying machine to tell you how to spend it.
Before the Raiders secured their largesse from Nevada in 2016 to propel their move from Oakland, Calif., stadium subsidies had dwindled in the wake of the 2008 financial crisis. According to research by College economist Victor Matheson Holy Cross.
This trend has changed, and dramatically, as the voluntary state has pointed out. Public authorities are now ready to spend taxpayers’ money on sports venues, making the same economic impact arguments regularly rejected by sports economists.
In the case of Tennessee, the city and state argue that the development of dozens of acres of real estate adjacent to Nissan Stadium will generate tax revenue to pay the bonds. Economists like Bradbury argue that all new development does is shift spending; if the city’s inhabitants go to dine near the stadium, that is money that is not spent elsewhere. It’s an old debate that goes around in circles with both parties.
The biggest argument made by the team and city leaders like Mayor Jon Cooper is that the lease requires the now 24-year-old stadium to be “world-class”. Last year, a consultant hired by the city pegged the cost of a renovation to meet that goal at $1.8 billion, which the city would be responsible for, prompting the creation of a new venue .
But the mayor’s office late last year backed out of that figure when it emerged the number was essentially what the Titans wanted for an expensive renovation wishlist.
“It’s vastly greater than anything the city would be required to do under the existing lease,” said Bob Mendes, council member-at-large and leading opponent of public funding. “And the thing is, the mayor’s office never calculated what it would cost to meet the minimum standards.”
Mendes is resigned to passing the bill, noting that under city rules, the funding must pass three times, with a public hearing preceding the third vote if the first two pass. Tuesday is the hearing and the third vote.
The team did not respond for comment.
A person close to the club, however, said the cost of minimal renovation would be more than the money the city puts up, and the city can develop the land near the stadium.
To this, Mendes counters that there is already development less than half a mile from the stadium, and that the proposed new development is on a floodplain that was inundated as recently as 2010.
The Titans and the NFL would be responsible for $840 million in stadium funding, or 40% of the stadium’s cost. Part of the team’s contribution would come from personal seat license sales.
Mendes said the use of public money contrasts with Tennessee presenting itself as a fiscally conservative state.
When asked why there seems to be such a willingness to use public funds in a state that prides itself on being fiscally conservative, Mendes said there was a contrast.
“It’s still shocking to me that in a state with no income tax, a state that prides itself on being low tax, and we have a special ‘Don’t tread on me’ plate and one way or another, we’re going to end up having the biggest public spending for a stadium in American history,” he said.
(Top photo: Brett Carlsen/Getty Images)