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Economists Say DC Soccer Stadium Funding 'Cannot be Justified'

Posted Nov. 19, 2008 / Posted by: admin

Contact:
Ed Lazere, DC Fiscal Policy Institute, (202) 408-1080
Chris Weiss, Friends of the Earth, (202) 222-0746
Brad Humphreys, University of Alberta, (780) 492-3406

WASHINGTON, D.C.—The proposal to spend $150 million or more in D.C. taxpayer funds to subsidize a new soccer stadium “will not generate notable economic or fiscal benefits for the city” according to 26 economists from across the nation who signed a joint statement being released today.

“Most studies find that new sports stadiums do not increase employment or incomes and sometimes have a modest negative effect on local economies,” the economists wrote. Although the new facility “may shift some entertainment spending from the Maryland and Virginia suburbs to the District,” the economists conclude that this outcome is not likely to justify the outlay of tax dollars.

Dr. Brad Humphreys, an economist at the University of Alberta who has studied the economic impacts of numerous sports stadiums, explained that “a soccer stadium that is used just 20 to 30 times per year cannot realistically be expected to be a driver of economic development.” Humphreys also noted that sports stadiums don’t tend to increase the amount people spend regionally on entertainment, and will not lead to higher employment or income. His research even finds that stadiums can be a drain on local economies, in part because team players often take their salaries and spend them elsewhere.

In addition, Humphreys noted that the stadium is listed as optional in plans for the proposed Poplar Point site that were prepared by the master developer. This suggests that a stadium is not critical to the multi-year development of Poplar Point and may even displace more desirable development, such as housing, retail, or green space.

Doubts from economists about the impact of a D.C. soccer stadium echo the concerns of D.C. residents—who oppose public stadium financing—as well as those raised by a number of area newspapers and non-profit organizations.

“If DC is facing a windfall in tax collections from the baseball stadium, it would be far better to pay off the baseball debt faster or to invest in important public services that residents really care about—housing, libraries and parks, education, and the environment,” said Ed Lazere, Director of the DC Fiscal Policy Institute.

“Public financing of a soccer stadium gets us farther from, not closer to, the realization of a revitalized and unpolluted Anacostia waterfront,” said Chris Weiss, an advocate with Friends of the Earth. “It’s simply ridiculous to spend money we don’t have on a soccer stadium that a vast body of research suggests will not generate notable economic benefits for District residents.”

The economists’ statement is available at http://dcfpi.org/?p=164

 

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