While the public is increasingly accustomed to hearing about cities handing out taxpayer funds to professional sports teams for stadiums, details on how these handouts are structured are less understood.
Governmental entities have long used tax-free municipal bonds to finance infrastructure projects, including sports stadiums … Bloomberg calculated that the $17 billion in tax-exempt debt used to build stadiums since 1986 would cost taxpayers $4 billion.
However, bonds are just one of several public funding options for new stadiums. Povich reports that, of the 91 publicly funded stadiums built since the early 1960s, “ were funded through a hotel tax, 27 were funded through general obligations, 24 were funded through sales taxes, 23 were funded through bonds and 4 were funded from lottery or gambling revenues.”
As Moody’s Investor Service reports an uptick in stadium construction, taxpayers should be wary of the many corporate welfare schemes—all too often touted as economic boosters.