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View Full Version : Has the New Comiskey Park Stadium Deal Been a Good Investment?


TomBradley72
01-18-2006, 07:43 PM
Similar to the other thread regarding the expanded White Sox season ticket base and the franchise's overall profitability under Einhorn/Reinsdorf...has anyone ever seen any analysis of the Illinois Sports Authority and how the "new Comiskey Park" stadium deal has worked out for the taxpayers? Between most of the dollars coming from taxes/surcharges related to business/tourist travel (hotels, rental cars, etc.) and renovations being funded by the US Cellular naming deal...has this been a good deal for the State of Illinois? I know the state gets extra revenue for all attendance > a certain level, etc.

doublem23
01-18-2006, 07:47 PM
Who cares? As an Illinois taxpayer and Sox fan, I can say that the park has payed millions of times its worth:

http://www.sportsteams.com/acbnet/stores/1/images/MLB/LOGOS/ChicagoWhiteSox.jpg

If it wasn't for it, the Sox would be in St. Petersburg.

TomBradley72
01-18-2006, 07:55 PM
Who cares? As an Illinois taxpayer and Sox fan, I can say that the park has payed millions of times its worth:

If it wasn't for it, the Sox would be in St. Petersburg.

I agree 200%....I was just interested to if anyone had any take on the true financials of it. I think the overall deal has always received a bad rap...the funding sources were nearly all tourist/business travel..so minimum impact to the typical Illinois citizen...and in years of good attendance...extra revenue coming in for the State of Illinois.

SouthSide_HitMen
01-18-2006, 08:45 PM
I agree 200%....I was just interested to if anyone had any take on the true financials of it. I think the overall deal has always received a bad rap...the funding sources were nearly all tourist/business travel..so minimum impact to the typical Illinois citizen...and in years of good attendance...extra revenue coming in for the State of Illinois.

Well the United Center was a much better deal for Illinois taxpayers as Reinsdorf, Wirtz and bankrupt United (who taxpayers nationwide have subsidized in the $ billions post 9/11) picked up much of the tab (taxpayers did pay for infrustructure and have annual costs as well. Wrigley Field is the best deal for taxpayers.

Based on a study which unfortunately is conducted through 2001 (which do not include the "new" Soldier Field) All $s in 2001 (inflation adjusted):

http://policy.rutgers.edu/faculty/long.html

http://policy.rutgers.edu/faculty/long.html


http://policy.rutgers.edu/faculty/long/LongDataSeries5History.pdf

Chicago White Sox
Stadium Cost $246.9 mil ($157 mil in 1991 for the stadium and $30 mil for the land) - Of the $246.9 mil, $165.4 is IL's share, $81.5 is Chicago's share

Annual Public Expense - $62.0 mil
Annual foregone property tax - $49.7 mil
Annual Revenue for the government - $63.1 mil

Total Public subsidy $295.6 mil


Chicago Cubs

Stadium Cost $17.7 mil ($250,000 in 1914)- 100% funded by the Cubs.
(Cumulative) Annual Public Expense - $24.8 mil
Annual waived property tax - $0 (no exemption)

Total Public Subsidy $24.8 mil

Untied Center

Stadium Cost $205 mil ($238 mil in 2001 $s)
Public Cost $34.9 mil (Infrastructure)
(Cumulative) Annual Public Expense = $24.8 mil

Total Public Subsidy $59.7 mil

Stoky44
01-18-2006, 09:30 PM
Chicago White Sox
Stadium Cost $246.9 mil ($157 mil in 1991 for the stadium and $30 mil for the land) - Of the $246.9 mil, $165.4 is IL's share, $81.5 is Chicago's share

Annual Public Expense - $62.0 mil
Annual foregone property tax - $49.7 mil
Annual Revenue for the government - $63.1 mil

Total Public subsidy $295.6 mil



Am I stupid or is $157M + $30M = $187M, not $246.9M. Could somebody explain how $187M is $246.9M? Thanks. BTW $157M is so cheap, that would not even cover the roof expenses at Miller Park.

SouthSide_HitMen
01-18-2006, 09:36 PM
Am I stupid or is $157M + $30M = $187M, not $246.9M. Could somebody explain how $187M is $246.9M? Thanks. BTW $157M is so cheap, that would not even cover the roof expenses at Miller Park.

http://www.westegg.com/inflation/

Also, I'll take 0.1% of that cheap money (an amount less than a rounding error). :redneck

A. I just have a question, why were you inflanting the money to today's value? B. Is the state still paying for it? C. I am not being a smart ass, I really a quite stupid with this kind of thing.

1. The study was done by a professor at Rutgers. I just quoted it (and noted the $ was presented in inflation adjusted dollars). You need to use inflation adjusted dollars to compare stadiums built say in 2000 vs. 1980 (or in Wrigley Field's case 1914 though there are other factors in play besides inflation when you go back this far).

2. There are annual maintenance and other costs the state paid by the ISFA (Illinois Sports Facilities Authority). The study showed the costs paid out are about equal to what they take in via the terms in the lease.

Current costs of the state / city at this point -

A. The bonds to pay off the stadium are paid via revenue from special sales tax enacted on several types of businesses (hotels & restaurants) located downtown (IIRC) under the provisions of the stadium deal (others on the site have more details or you can research this yourself).

B. A second "cost" is not an actual cash outlay. The White Sox are not obligated to pay real estate taxes on the stadium (which they do not "own" per se) and thus the real estate taxes the county / city would collect if other businesses / homes were located on the site and paid taxes.

There are other marginal costs (police, other public services) but they are covered by taxes collected on tickets and food sales.

C. I linked the calculator so you can play with the numbers as you see fit. The study said they used inflation adjusted dollars (for 2001, the year the study was completed).

Stoky44
01-18-2006, 09:41 PM
http://www.westegg.com/inflation/

Also, I'll take 0.1% of that cheap money (an amount less than a rounding error). :redneck

I just have a question, why were you inflanting the money to today's value? Is the state still paying for it? I am not being a smart ass, I really a quite stupid with this kind of thing.

Hitmen77
01-18-2006, 10:27 PM
Similar to the other thread regarding the expanded White Sox season ticket base and the franchise's overall profitability under Einhorn/Reinsdorf...has anyone ever seen any analysis of the Illinois Sports Authority and how the "new Comiskey Park" stadium deal has worked out for the taxpayers? Between most of the dollars coming from taxes/surcharges related to business/tourist travel (hotels, rental cars, etc.) and renovations being funded by the US Cellular naming deal...has this been a good deal for the State of Illinois? I know the state gets extra revenue for all attendance > a certain level, etc.

I don't know if just spewing dollar amounts would answer the question for me. I doubt that any government public works project of this scope can be shown to make a profit. Can you put a price on keeping the Sox in Chicago? Or what about the civic pride of having a world champion baseball team in Chicago? If Chicago or Illinois only spent money on things that were sure to turn a direct profit I think it would be a pretty drab place to live.

I agree with doublem23. As a Sox fan, I definitely think the stadium deal was worth it. If it wasn't for the new park, Chicago would be a one team town and we'd be stuck with the losers on the North Side as our only team. No pennant, no world championship, no victory parade, no trophy tour. NOTHING.

I wouldn't say it was a bad deal. Did the city or state go broke financing new Comiskey? Did the city lose any tourism or conventions or business because of the tax to finance the new park? As far as stadiums go, it seems like Comiskey II was a relative bargin compared to what other cities paid for other stadiums - or what we paid for Soldier Field.

Hitmen77
01-18-2006, 10:44 PM
I agree 200%....I was just interested to if anyone had any take on the true financials of it. I think the overall deal has always received a bad rap...the funding sources were nearly all tourist/business travel..so minimum impact to the typical Illinois citizen...and in years of good attendance...extra revenue coming in for the State of Illinois.

I think you hit the nail right on the head here. I think this deal really did get a bad rap at the time. For those who didn't live here 15 years ago, you might not appreciate how brutal the coverage against the Sox was. I think by comparison, it made the Soldier Field renovation debate (which by the way cost many times more for for 1/10th the number of games per year) look like a Bears lovefest.

But, the impact on the typical IL taxpayer has been minimal and the region has benefitted from 2 million people a year coming into the city to see the White Sox. Do you think the city looked good on national TV three months ago when the nation watched the Sox in the World Series? I do.

SouthSide_HitMen
01-18-2006, 11:12 PM
Obviously being a White Sox fan, I am glad the team stayed. I would have been more happy if Reinsdorf built a stadium with the team's cash like he did in partnership with Wirtz for the United Center. Also, as White Sox ticket buyers we have had a portion of our tickets subsidized by the rest of the population. If the stadium was built with White Sox money they would have had to have charged higher ticket prices to help pay for it.

And yes the amount taxpayers are on the hook for is a "bargain" if you look at other stadiums including our vulgar Soldier Field. But one may ask "Is building stadiums to benefit private ownership groups something government should engage in?." If no other cities (i.e. Tampa) offered to build stadiums the White Sox would have not considered moving and would have either built their own stadium (as JR did with his Bulls) or not cried about Comiskey and either restored it or played in it as is. However, since we live in reality and know government can be easily encouraged to spend money on practically anything including new stadiums, the White Sox deal is better than many of new stadiums built over the past generation.

This really comes down to how you view the role of government and what it should or should not provide and is outside of the bounds of what is discussed here. Whether the amount paid is an expense or an "investment" depends on your viewpoint. A wise man once said "Remember that a government big enough to give you everything you want is also big enough to take away everything you have."

dickallen15
01-19-2006, 12:34 AM
Wasn't the rebuilding of Soldier Field and the building of the New Comiskey Park funded by a City of Chicago hotel tax? Tourists and conventioneers are picking up most of the tab. Of course the argument could be made that that money could be used for something more important, and you probably wouldn't have an argument.

Fredsox
01-19-2006, 06:53 AM
OK so we have the costs, where's the revenue to the state and city? This of course would take the form of the rent that the White Sox pay every year. The tables are pretty hard to read but it looks like they get about $16.5 mil per year in rent (bottom of p40). The other revenue sources appear to be retained by the White Sox. If that average was retained over the 20-year life of the lease the stadium authority would get about $330 million (not adjusting for inflation or increases in the average). Am I reading this incorrectly?

GoSox2K3
01-19-2006, 09:08 AM
OK so we have the costs, where's the revenue to the state and city? This of course would take the form of the rent that the White Sox pay every year. The tables are pretty hard to read but it looks like they get about $16.5 mil per year in rent (bottom of p40). The other revenue sources appear to be retained by the White Sox. If that average was retained over the 20-year life of the lease the stadium authority would get about $330 million (not adjusting for inflation or increases in the average). Am I reading this incorrectly?

...and are there any estimates on the additional revenue generated by the city, state, and local businesses by having 2 million people a year come in to the city to watch a ballgame? I know there are people who just see the game and then go right back home, but there also alot of people who are coming into the city (from the suburbs, NW Ind, etc) to see a game who stick around before or after a game to have dinner, shop at Michigan Ave, see another Chicago site, etc. The Sox are bringing them into the city and they're spending more money elsewhere in the city.

Fenway
01-19-2006, 10:15 AM
The should update the ISFA website more often

http://www.isfauthority.com/index.asp


I think overall Illinois got a good deal on this. There are so many variables on these kind of projects. One example is the amount the State of Illinois takes in on income tax from the players which would have been lost if the team had moved to Florida.

soxinem1
01-19-2006, 10:50 AM
...and are there any estimates on the additional revenue generated by the city, state, and local businesses by having 2 million people come in to the city to watch a ballgame? I know there are people who just see the game and then go right back home, but there also alot of people who are coming into the city (from the suburbs, NW Ind, etc) to see a game who stick around before or after a game to have dinner, shop at Michigan Ave, see another Chicago site, etc. The Sox are bringing them into the city and they're spending more money elsewhere in the city.

In all honesty, people are going to spend that money in the city anyway so it does not bear a lot of credence to this issue. When Comiskey was open, as is the case with Wrigley and the old Chicago Stadium, they were bought and paid for, so the revenues were dispersed directly. I still think Comiskey could have survived, especially if Fenway and Wrigley have, but that is another story.....

The Democratic convention in 1996 was probably a good example of a major revenue increase. Hotels, restaurants, parking garages, rent-a-cars. I do not see that happening with any sporting venue in this city, and I doubt if many fans go down to Michigan Ave to eat after a Sox game. Tourists go to tourist type places, Navy Pier, museums, etc.

From what I see stadium deals are sort of like a mortgage for the stadium, thus they really don't make a ton of money for return purposes, but do provide cash flow. By the time the deal is paid off, we will have an outdated stadium on our hands. 30-40 years has been the life expectancy of most modern stadiums. So all these ticket, parking, tourist, and tax 'revenues' they receive are a little tainted. It does provide short term jobs, but little else in the way of an effective monetary return.

While it did keep help keep the Sox in Chicago it also saved Reinsdorf's collective *** in the long run, because the result of the Sox going to Florida would have been an earlier version of the D-Rays: crappy park, low attendance, total lack of revenue, etc. and probably a defunct team by now.

But since Reinsdorf Field, which does look much better now than when it opened, kept our beloved Sox in Chicago, we should realize that if the new park was not built, no World Series celebration for us in 2005!