Silver Nuggets: Publicly-Funded Stadiums

A look at some of the complaints against publicly-funded stadiums, plus your Sens links from the weekend.

If you never watch Last Week Tonight with John Oliver, you probably should. Each week he uses his unique brand of humour to discuss topics that normally are not funny, from the death penalty to Miss America Pageants to student debt. However, this column isn't supposed to be an ad for HBO. Rather, it's addressing his latest video, about publicly-funded sports stadiums. Over on the Silver Seven Facebook page, B_T shared an SBN article that examined the John Oliver video.

Oliver argues that stadiums for multi-million sports teams with multi-billion owners shouldn't get public money for stadiums. I don't think the issue is that cut-and-dry. In theory, a city with a partial claim to a stadium can make their investment back over decades of the stadium's operation. Notice though that I said in theory. There are issues with this. For example, often municipal governments have to take out loans for these stadiums. Municipal loans are supposed to be used to do things for a city: build roads, fix schools, provide city services. When cities start taking on loans to finance stadiums for teams owned by people with billions of dollars at their disposal, issues arise.

The most prominent example in the NHL right now is with the Arizona Coyotes in Glendale. Glendale city council recently voted to end the lease agreement with the team, citing breach of contract. The city claims that that their accountants said that ending the lease would lead to $8-million in profit per year for the city. The city was losing money by investing in the Coyotes' stadium. The team has since come back with a $200-million lawsuit against the city for breaking contract. Whether or not Glendale was exaggerating when they said the lease agreement was affecting healthcare and firefighting services, you have to imagine that $200-million would hugely eat up the city's budget.

In Oliver's video, he also looks at the Detroit Red Wings, who got $280-million from their city council days after the city declared bankruptcy. Olympia Development, behind the new arena, later countered Oliver, saying that the whole project is a downtown renewal, with $1.8-billion of public-private partnership. However, it could probably be argued that a city shouldn't be pumping 58% of $1.8-billion into downtown renewal short days after declaring bankruptcy. Especially when the focal point of this is a stadium for an NHL team that one assumes is highly profitable.

And I admit, I enjoyed watching Arizona fans tear into their mayor over the city council vote. But maybe I was just a little too quick to praise these fans. In the end, city council made the decision that it wasn't in the city's best interest to keep funding a sports team. That's a city council's job. Their job isn't to fund entertainment at a cost to the city.

The good news as a fan of the Ottawa Senators is that the current arena is not publicly-funded. The federal government put up $6-million in grants for the initial construction of the Palladium. The rest of the money was borrowed by Rod Bryden for the initial construction. The Sens own the land the Canadian Tire Centre is currently on. However, as discussed by B_T, with the Sens proposal to move to Lebreton Flats, it's unclear where funding would come from. Mayor Jim Watson has gone on the record saying he is opposed to public funding of an arena downtown. The numbers clearly show that cities hardly even profit from financing these arenas. Selling the CTC land is a decent option, but for a team that often cries (relatively) poor, it's hard to see them ponying up hundreds of millions of dollars for an arena. So though this issue doesn't affect Sens fans now, it could come into the picture in just a few short years.

Sens Links

  • The arbitration dates for Chiasson and Hoffman have been finalized: July 23 and 30 respectively [Silver Seven]
  • Jack Leiper asks how much Mike Hoffman should get in arbitration [SenShot]
  • Travis Yost says that Hoffman has a great case for arbitration [TSN]
  • Charlie Arsenault asks if the Sens should move Hoffman [SenShot]
  • SensChirp looks at the uncertainty in Hoffman's Sens future [SensChirp]
  • I had some thoughts this morning on the benefits and limitations of analytics in hockey [Silver Seven]
  • Former Silver Seven site manager The Artist Formerly Known as A with an excellent debut piece at Welcome To Your Karlsson Years about the Sens' offseason changes [WTYKY]
  • Trevor Shackles finishes up the series looking at the 30 most important Sens players -- you'll never guess who's number 1! [SenShot 11-20, 1-10]
  • Jack claims Clarke MacArthur is due for a big season [SenShot]
  • Trevor looks at the best- and worst-case scenarios for Mika Zibanejad next year [SenShot]
  • Jack asks if this is Jared Cowen's last chance to prove it [SenShot]
  • Jack looks at the Sens goaltending from a financial perspective; in short, the Sens are getting a good deal [SenShot]
  • One more from an impressive weekend by SenShot: Jack makes a list of the top-10 Sens prospects [SenShot]
  • The 6th Sens podcast is back! [6th Sens]
  • SensChirp with a series of videos reliving Ottawa's unprecedented run to the playoffs [SensChirp]
  • This week's Ottawa Senators photo gallery is of Mark Stone. As I'm sure you can guess, there are a lot of awesome pictures [Senators]
  • Finally, a couple quick reminders: first, about the Sens 25th anniversary logo contest, which runs until Sunday night [Silver Seven]
  • And Sens Summer Fan Fest runs on August 16th [Silver Seven]

Other Links

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