Author Topic: Jaguars’ stadium, sports district could cost City of Jacksonville more than $1B  (Read 48794 times)

Ken_FSU

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This attorney makes some excellent points about why the community should pause on giving big bucks to Khan for the stadium project.  Whether pro or con (no pun intended  8) ), the community should take into account his 6 considerations in deciding how to proceed.

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Local attorney: Jaguars' stadium project a leadership moment for mayor, City Council

With all the discussions surrounding the “Stadium of the Future” announced by the Jacksonville Jaguars, here are six things Duval County citizens should know about the proposed project.

One, building a new stadium will have little economic impact on our city, no matter how much we love the Jaguars. Dozens of economic studies have confirmed that stadiums (and, for that matter, the presence of an NFL team) do not have any meaningful impact on jobs, economic activity, business relocations to the host city, property values or household income. Likewise, cities like San Diego and St. Louis losing NFL teams suffer little economic effect per those same studies.

All the economics nerds (disclaimer: I myself am an economics nerd/data scientist by trade) look at these things purely in a vacuum.

Professional sports are as much an investment in quality of life and civic pride as they are an economic engine. It's stupid to look at the decision as purely an ROI calculation.

Further, Jacksonville isn't San Diego, or even St. Louis, for that matter. Both have multiple other major league professional sports franchises to fall back on, as well as other advantages that Jacksonville doesn't have.

It is INSANE to suggest that losing the Jags wouldn't have serious long-term consequences for Jacksonville.

We put tens of millions into the Zoo every few years, do we ask these same sterile questions about ROI?

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Two, city funding for the stadium is an enormous wealth transfer to owner Shad Khan, as NFL teams are valued at 30 to 45 times EBITDA cash flow (earnings before interest, taxes, depreciation and amortization. A leaked investment proposal for the Washington Commanders suggests that a new stadium and a sportsbook — a company that accepts bets on sporting events — could add up to $80 million to $100 million to the Jaguars’ annual cash flow. 

Even at $50 million, the new stadium would increase the net worth of the team by $1.5 billion. That helps explain why the Chicago Bears are building a stadium at their own expense and suggests that Khan would still benefit even if he fully funded the new stadium.

Three, taxes raised to generate city funding for a new stadium have real economic consequences for the community. Any tax other than a ticket surcharge or in-stadium sales tax violates the benefit principle of taxation, meaning that the people paying the tax aren’t the people benefiting from the stadium. Moreover, any tax reduces the disposable income of those paying the tax, reducing economic activity in the city.

The author is effectively describing just about every single subsidy we give as a city.

You think the taxpayers are benefiting from the Laura Street Trio? Or Paycor? Or the District? Or the American Lions phantom tower at the Landing? It's just the nature of the beast.

Any comparisons to privately funded stadiums in Los Angeles, New York, or Chicago are absurd. These are World Cities routinely in play for the World Cup, Olympics, and major world tours. Privately building and owning a $1 billion+ stadium makes sense in these markets. It doesn't make sense in Jacksonville.

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Four, city funding for the stadium carries a significant opportunity cost. Jacksonville is burdened with pension debt and unfulfilled promises and seems unable to be able to even build a park or to open public pools in the dead of summer. We must rethink our priorities and make economically sound decisions if we want to be a great city.

Strawman argument.

We're unable to build a park or open public pools because of INCOMPETENCE in leadership, not opportunity cost. The public pools are a drop in the bucket compared to the stadium, and the problem there was staffing and lack of care from the mayor's office. Even dating back to the original Metro Park, when the state was literally throwing money at us, we had no idea what we were doing. Curry put $100 million in the budget for parks. We still can't figure out how to open Friendship Park.

It's a bad faith argument to suggest that pools and parks are somehow being sacrificed in favor of the Jags.

There's plenty of room for both.

Look at ANY project the Jags have project managed (such as Four Seasons, which is months ahead of schedule of going vertical) and ANY project the city has managed (again, Friendship Park, which is three years behind schedule), and tell me where the problem is.

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Five, taxpayer-funded subsidies for billionaires are unjust and anti-capitalist, as libertarians and progressives generally agree. There are good reasons why our Florida and federal governments have moved away from subsidizing sports stadiums.

The reason that Florida has moved away from subsidizing sports stadiums is because Ron DeSantis got upset that Tampa Bay Rays ownership had the AUDACITY to speak in favor of gun control on social media following mass shootings in Uvalde and Buffalo. The decision wasn't morally or economically motivated. It was pure politics.

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Six, politicians routinely ignore the economic data and succumb to the fancy renderings, exaggerated promotional studies and relocation threats by the NFL team (see Buffalo and Nashville).

This is a leadership moment for Mayor Donna Deegan and the City Council. I urge residents to share with them their views.

To me, just a dumb, one-sided, incendiary column overall without a clear call to action. Where's the mention of positive externalities on the development or quality of life side? What is this guy asking people to do? Let the Jags walk? Refuse to subsidize improvements of the oldest stadium in the NFL?

Plenty of reasons to support or not support a new stadium in Jacksonville.

Don't find this piece particularly balanced or compelling.

Zac T

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As a younger resident of the city, I've only known a Jacksonville with the Jaguars and at least for the younger generation, the source of pride and community that the team brings is immense and probably can't be measured on paper. For my peers and I, the Jags have given us an opportunity to be vocally and visibly proud of our city in spite of all of the other things Jax lacks in comparison to other places.

As silly as it may sound, many of my peers have increased political and civic engagement due to the Jags. They go to the games and have to drive through Downtown and want to see the city do better and be better. When the Jags do good (rare), it increases pride and we want to see the rest of the city do good as well. With the recent success of the Jags, I've seen many friends who swore off Jacksonville in high school begin to trickle back in and look at the city in a new light. They've talked about moving back and starting a life here. For new residents, going to a game and getting to experience tailgating and the unabashedly Duval culture you get to experience at a home game has allowed for them to assimilate and be welcomed here.

And then for me personally, one of my earliest memories was Jaxson DeVille visiting me while I was in the hospital as a kid. Going to training camps and meeting players. As a current season ticket holder, I take every chance I get to bring someone new to a game, a chance to be surrounded by thousands of people who are proud of Jax and rooting for the team that represents our city, and after a game, finishing off at a bar or restaurant Downtown or 5 Points. It's always a great time and brings so much positive energy that currently isn't being replicated anywhere else in the city on such a massive scale.

I firmly believe the city should negotiate hard with the Jags and make sure the taxpayers get a fair deal but Ken is absolutely right that the quality of life and civic pride the Jags bring has to be a major part of the conversation as well

Jax_Developer

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I have an econ degree. One thing I'll say is that this is a micro case-study. Macro factors really aren't a valid argument here.

Second is that our situation requires a deep analysis into the cost-benefit matrix. I can't imagine what would the expense & wasted opportunity cost would be if the Jags vacated 30+ acres in our DT. We can't get our ducts in a row with prime DT waterfront property. What would we do with a rotting stadium and new player facility? 

fsu813

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I can't imagine what would the expense & wasted opportunity cost would be if the Jags vacated 30+ acres in our DT. We can't get our ducts in a row with prime DT waterfront property. What would we do with a rotting stadium and new player facility? 

Healthy Town 2, but this time with an athletic complex. The ultimate Healthy Town luxury amenity.

BridgeTroll

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Outstanding points Ken fsu
In a boat at sea one of the men began to bore a hole in the bottom of the boat. On being remonstrating with, he answered, "I am only boring under my own seat." "Yes," said his companions, "but when the sea rushes in we shall all be drowned with you."

Jax_Developer

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I can't imagine what would the expense & wasted opportunity cost would be if the Jags vacated 30+ acres in our DT. We can't get our ducts in a row with prime DT waterfront property. What would we do with a rotting stadium and new player facility? 

Healthy Town 2, but this time with an athletic complex. The ultimate Healthy Town luxury amenity.

Perfectly placed next to 100 year old brownfields, just like the previous rendition lolol

Ken_FSU

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Outstanding points Ken fsu

Thanks!

With the necessary disclaimer that I was DRUNK AS A SKUNK after the LSU-FSU game when I posted this  ;D

Was browsing the board the next day and thought, “I agree with a lot of this guy’s points!”

By the end of the post I’m like, “Oh shit! This is me.”

You know you’re getting older when instead of waking up next to a stranger from a bar, you wake up to message board posts defending tax subsidies for a billionaire.

10/10 night; would do it again.

jaxlongtimer

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^ LOL.  Sounds like a split personality.  Glad you can see two sides to the coin.  Will be interesting to see how the City balances competing viewpoints.  I hope the Jags are somewhat negotiable.  Ramming their leverage down the City's throats isn't going to win many brownie points, even from die hard fans.  Be fair  8).

As an aside, Pete Prisco (former T-U sports columnist), is picking the Jags vs. the 49ers in the Super Bowl.  If that comes true, the Jags will have even a tighter hold on the City.  Here is the link:  https://www.cbssports.com/nfl/news/nfl-week-1-power-rankings-jaguars-49ers-set-to-meet-in-2024-super-bowl-thanks-to-talent-and-weak-divisions/

BridgeTroll

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Outstanding points Ken fsu

Thanks!

With the necessary disclaimer that I was DRUNK AS A SKUNK after the LSU-FSU game when I posted this  ;D

Was browsing the board the next day and thought, “I agree with a lot of this guy’s points!”

By the end of the post I’m like, “Oh shit! This is me.”

You know you’re getting older when instead of waking up next to a stranger from a bar, you wake up to message board posts defending tax subsidies for a billionaire.

10/10 night; would do it again.


A 10/10 night??  Woohoo!
In a boat at sea one of the men began to bore a hole in the bottom of the boat. On being remonstrating with, he answered, "I am only boring under my own seat." "Yes," said his companions, "but when the sea rushes in we shall all be drowned with you."

marcuscnelson

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Action News Jax reported that the City and Jaguars held their first negotiation meeting at Everbank Stadium last Wednesday.

https://www.actionnewsjax.com/news/local/duval-county/city-jacksonville-jaguars-begin-negotiations-stadium-renovations-deal/5HGO2JR3SBB3JGOFK2VVAP5XME/
So, to the young people fighting in this movement for change, here is my charge: march in the streets, protest, run for school committee or city council or the state legislature. And win. - Ed Markey


thelakelander

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^We'd do really well if we can get a CBA similar to the St. Petersburg deal.
"A man who views the world the same at 50 as he did at 20 has wasted 30 years of his life.” - Muhammad Ali

thelakelander

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In similar news, Oklahoma City is about to construct a $900 million arena for the NBA's Oklahoma City Thunder franchise:

https://www.okc.gov/Home/Components/News/News/4564/18

The Thunder will put up $50 million. OKC taxpayers will cover the rest.
"A man who views the world the same at 50 as he did at 20 has wasted 30 years of his life.” - Muhammad Ali

Ken_FSU

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Probably the most thoughtful local poll done on the subject yet.

https://www.jaxdailyrecord.com/news/2023/sep/18/poll-offers-insight-into-public-support-for-jaguars-stadium-renovations/

Percentage of locals who support spending $1 billion in public dollars on a new stadium for the Jags - 6%.

Percentage of locals who support spending $1 billion in public dollars on a new stadium for the Jags if NOT spending means the Jags leave the city - nearly 50%.

The first number is the one that the media always grasps onto when discussing public subsidies for the stadium.

The second number is the one that actually matters.

tufsu1

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^ that's still underwater though - I don't see spending $1B of local tax dollars on the stadium alone as feasible. An overall investment of $1B for the stadium district as a whole is palatable though.