But the cost is undeniable, and the future incredibly uncertain. Of the $448 million being used to build the stadium, $258 million is being paid by the city – a city already facing an $8.9 million deficit for the next year. The Kings hope to break ground on the new project immediately, so the money will likely need to be raised through bonds issued by the city – bonds that will need to be repaid, and through other avenues that amount to the city being on the hook for over half the cost of the stadium. Cincinnati, another city which assumed debt to build their team’s Paul Brown Stadium, now faces a $30 million deficit.
Throughout the United States and Canada, 64 major league sports teams have stadiums built through partially or wholly taxpayer funded means. The largest, the 80,000 seater Cowboys Arena in Arlington, Texas, will be an undeniable boon to the area. The Cowboys are a destination team, and have long had a reputation as being one of the titans of the game, despite losing seasons. Fans can, have, and will flock to the stadium in droves, giving Arlington the financial kick in the pants it wanted.
But the situation isn’t as rosy for other teams, and other cities. The University of Maryland’s Dennis Coates looked at papers that studied the economic effect from new stadiums. Most studies found “lack of evidence for widespread growth in income and employment, or even increased hotel occupancy.”
If you’ve noticed a common thread, it’s a universality that new stadiums have failed to revive failing teams. Instead, the teams struggle to fill in shiny new stadiums. Exceptions like the Cowboys are nothing to look at. They’d be successful if they built a new stadium on the moon. So Sacramento taypayers and Kings fans should look at the new deal to keep their team in town with some skepticism. At least the city will have the stadium’s naming rights. Have we considered “Taxpayer’s Arena?”