Sports Welfare

[Cackalacky]

Here is how Lucas Oil Stadium was funded:

Financing

The estimated stadium cost is $699.2million-$719.6million. It is being financed with funds raised jointly by the State of Indiana and the City of Indianapolis, with the Indianapolis Colts providing $100 million. Marion County has raised taxes for food and beverage sales, auto excise taxes, innkeeper's taxes and admission taxes for its share of the costs. Meanwhile, a small increase in food and beverage taxes in six "donut' counties and the sale of Colts license plates completes the total.

Construction of Lucas Oil Stadium and the expansion of the Indiana Convention Center are considered one project, so financing is lumped together. The budget for the stadium is $675 million, and the convention center is expected to cost $275 million, for a total price tag of $950 million. Once financing charges and interest are factored in, however, the cost rises to $1.8 billion. The debt is expected to be paid off in 2040.

Here's a breakdown of where public funds are coming from:

45 percent -- 1 percent increase in the Marion County food and beverage tax.consumption tax. I like consumption taxes.
22 percent -- 3 percent increase in the Marion County hotel tax.targets in city patrons of hotels attending the events
14 percent -- Revenue from the existing professional sports development area tax being diverted to the project.
6 percent -- 1 percent increase in the ticket tax at sporting venues.Obviously targeting the people purchasing the tickets
6 percent -- 1 percent restaurant tax in six neighboring counties.These will reap the benefits of people traveling into Indanapolis
5 percent -- 2 percent increase in the Marion County car rental tax.People attending events in the area of the stadium need transportaiton
1 percent -- Revenue from the sale of Colts license plates. Die hard fans buy state license plates

I like this. These are user taxes. These types of taxes do not penalize the county citizens as much as you think. These are more designed to get money for people who travel into the city because of the game(s) or events. This actually allows people from outside of the 6 counties and the state of Indiana to contribute to the revenue stream and receive benefits.

Another option is to vote on a specific tax or set of increases for a specified time to raise the money and target the specific clientele of the project. Once the money is obtained, the tax goes away. If wooly were here I am sure he could go into the municipal bonds and stuff which are also very useful.

 

[dudesthisisthebest]

I meant it the other way. I was just talking about tax policy.

NFL=Tax Exepmpt

Corp America > NFL

I may not be right about this, but isn't the NFL itself a non profit entity because all the money it makes(TV contracts, merchandise, etc.) gets filtered back equally to all the teams who then pay taxes on their profit. So the NFL doesn't actually have any money, the teams do. So it wouldn't make sense for the NFL to pay taxes.

 

[MNIrishman]

I'd like to see some major politician really put the screws to a team which tries to extort the local government, and see if they're actually serious about moving to LA. I don't think the Vikings corporation was ever actually going to move, and it is unfortunate that Governor Dayton gave more of his time to Roger Goodell than the people he represents.

 

[Cackalacky]

I may not be right about this, but isn't the NFL itself a non profit entity because all the money it makes(TV contracts, merchandise, etc.) gets filtered back equally to all the teams who then pay taxes on their profit. So the NFL doesn't actually have any money, the teams do. So it wouldn't make sense for the NFL to pay taxes.

Is NFL’s Tax-Exempt Status Corporate Welfare? - NPQ - Nonprofit Quarterly
Technically the NFL is a 501(c)(6) entity which is tax exempt. Now revenue sharing and things like that I am not sure of.

"The official IRS definition of 501(c)(6) organizations references chambers of commerce, real estate boards, boards of trade, and “professional football leagues.” Interestingly, it doesn’t reference basketball or baseball. The language was inserted in the Internal Revenue Code for the National Football League as part of then-NFL Commissioner Pete Rozelle’s successful lobbying of Congress for both antitrust and tax exemptions."

"the for-profit teams get their own additional heavy subsidies in the form of taxpayer incentives for constructing or renovating stadiums. In Charlotte, N.C., for example, the Carolina Panthers are providing broad hints that if the city wants to keep the NFL franchise, it will have to ante up taxpayer money to upgrade the stadium. The Pittsburgh Steelers are trying to get taxpayer money to add 3,000 seats to Heinz Field. Earlier this month, Goodell and Atlanta Mayor Kasim Reed joined Atlanta Falcons owner Arthur M. Blank in a pitch to Gov. Nathan Deal for a new stadium with a retractable dome to be partially paid for with taxpayer funds. Goodell described the plan as a public-private partnership but State Sen. Vincent Fort characterized it as “corporate welfare at its worst.”

"Is the NFL’s tax-exempt status another example of corporate welfare? Will the new Congress decide to open the question up for review? Or does the NFL—despite a limited membership of mostly billion dollar teams and billionaire owners like Paul Allen and Jerry Jones—deserve a 501(c)(6) tax-exempt status like any other association?"

 

[Rack Em]

I meant it the other way. I was just talking about tax policy.

NFL=Tax Exepmpt

Corp America > NFL

Mea Culpa.

 

[Black Irish]

Is NFL’s Tax-Exempt Status Corporate Welfare? - NPQ - Nonprofit Quarterly
Technically the NFL is a 501(c)(6) entity which is tax exempt. Now revenue sharing and things like that I am not sure of.

"The official IRS definition of 501(c)(6) organizations references chambers of commerce, real estate boards, boards of trade, and “professional football leagues.” Interestingly, it doesn’t reference basketball or baseball. The language was inserted in the Internal Revenue Code for the National Football League as part of then-NFL Commissioner Pete Rozelle’s successful lobbying of Congress for both antitrust and tax exemptions."

"the for-profit teams get their own additional heavy subsidies in the form of taxpayer incentives for constructing or renovating stadiums. In Charlotte, N.C., for example, the Carolina Panthers are providing broad hints that if the city wants to keep the NFL franchise, it will have to ante up taxpayer money to upgrade the stadium. The Pittsburgh Steelers are trying to get taxpayer money to add 3,000 seats to Heinz Field. Earlier this month, Goodell and Atlanta Mayor Kasim Reed joined Atlanta Falcons owner Arthur M. Blank in a pitch to Gov. Nathan Deal for a new stadium with a retractable dome to be partially paid for with taxpayer funds. Goodell described the plan as a public-private partnership but State Sen. Vincent Fort characterized it as “corporate welfare at its worst.”

"Is the NFL’s tax-exempt status another example of corporate welfare? Will the new Congress decide to open the question up for review? Or does the NFL—despite a limited membership of mostly billion dollar teams and billionaire owners like Paul Allen and Jerry Jones—deserve a 501(c)(6) tax-exempt status like any other association?"

This is B.S. You got people out of work, businesses closing left and right and these football barons are putting the screws to politicians to pay their expansion bills. If a die-hard capitalist like me is crying foul, there's got to be a problem.

 

[Cackalacky]

This is B.S. You got people out of work, businesses closing left and right and these football barons are putting the screws to politicians to pay their expansion bills. If a die-hard capitalist like me is crying foul, there's got to be a problem.

1st bourbon, now this, I think we are making progress... LOL.

 

[Cackalacky]

This is B.S. You got people out of work, businesses closing left and right and these football barons are putting the screws to politicians to pay their expansion bills. If a die-hard capitalist like me is crying foul, there's got to be a problem.

For me though, the problem is this

"The official IRS definition of 501(c)(6) organizations references chambers of commerce, real estate boards, boards of trade, and “professional football leagues.” Interestingly, it doesn’t reference basketball or baseball. The language was inserted in the Internal Revenue Code for the National Football League as part of then-NFL Commissioner Pete Rozelle’s successful lobbying of Congress for both antitrust and tax exemptions."

.

What you bolded is business as usual where I live. We gave Boeing and Amazon and BMW all kinds of subsidies, free land, tax exemptions, etc. to come and open up factories here. I don't see a difference capitalism wise.

 

[Bogtrotter07]

Anybody else have a hard time just reading this thread?

 

[Cackalacky]

Anybody else have a hard time just reading this thread?

Am I making a mess of this?

 

[Bogtrotter07]

Am I making a mess of this?

No, I am talking about the poor little rich kids, claiming empty pockets, using money that could actually help people or reduce our deficit, depending on what divergent philosophy you believe in.

CACK I KEEP TELLIN' YOU, I GOT NO CRIT!

 

[Cackalacky]

No, I am talking about the poor little rich kids, claiming empty pockets, using money that could actually help people or reduce our deficit, depending on what divergent philosophy you believe in.

CACK I KEEP TELLIN' YOU, I GOT NO CRIT!

Gotcha. I am dense to begin with but I got a lot more head space now I am done with school. Plus I jumped into this thread. I agree, sometimes it is hard to stomach how things get done to make a buck.

 

[MNIrishman]

I don't really agree with those kinds of special deals for any specific corporation, but at last Boeing is likely to generate net good for the state. All a football subsidy is good for is guaranteeing you'll be blackmailed again in the future with inflated job counts and deceitful tax revenues. For example, most of the jobs reported for the Vikings corporate facility are temporary and the revenue projections suggest Minnesota will never break even on its mugging...err....'investment'.

 

[Cackalacky]

I don't really agree with those kinds of special deals for any specific corporation, but at last Boeing is likely to generate net good for the state. All a football subsidy is good for is guaranteeing you'll be blackmailed again in the future with inflated job counts and deceitful tax revenues. For example, most of the jobs reported for the Vikings corporate facility are temporary and the revenue projections suggest Minnesota will never break even on its mugging...err....'investment'.

Time will tell. Boeing got at least $900 million in taxpayer incentives. And that is a conservative estimate. The metric used to talk about spin off jobs and such is non-existent and the legislators even admit they have no idea what the true impact ( net gain/loss) will be or what an estimate might be. But Boeing gets its own infrastructure improvement, interstate access ramp (costing us an additional $80 million), a $2500 tax credit for every employee it hires, is getting another $120 million this year for an expansion project, reduced property taxes till 2060 which are performance based so as long as Boeing is there the tax goes down. SC even flitted the entire $353 million dollar bill to train their workforce.

Sure we got some jobs, others, such as myself got to keep their jobs because of work at the site, but the reality is that no one has an idea how much we as taxpayers are paying Boeing to be here and they do not care.

A conservative estimate is that for every $1 SC spends on Boeing, it gets $0.45 back from Boeing in taxes and other sources of "revenue." This of course does not include employee payroll taxes but that is just for about 2000 employees who first needed to be trained.

Its a big hot mess and the government does not care as long as they came. They tried to do the same with a Mercedes plant, but some location in Alabama gave them an even crazier deal. We won't know the full impact for many years.

 

[NDohio]

Time will tell. Boeing got at least $900 million in taxpayer incentives. And that is a conservative estimate. The metric used to talk about spin off jobs and such is non-existent and the legislators even admit they have no idea what the true impact ( net gain/loss) will be or what an estimate might be. But Boeing gets its own infrastructure improvement, interstate access ramp (costing us an additional $80 million), a $2500 tax credit for every employee it hires, is getting another $120 million this year for an expansion project, reduced property taxes till 2060 which are performance based so as long as Boeing is there the tax goes down. SC even flitted the entire $353 million dollar bill to train their workforce.

Sure we got some jobs, others, such as myself got to keep their jobs because of work at the site, but the reality is that no one has an idea how much we as taxpayers are paying Boeing to be here and they do not care.

A conservative estimate is that for every $1 SC spends on Boeing, it gets $0.45 back from Boeing in taxes and other sources of "revenue." This of course does not include employee payroll taxes but that is just for about 2000 employees who first needed to be trained.

Its a big hot mess and the government does not care as long as they came. They tried to do the same with a Mercedes plant, but some location in Alabama gave them an even crazier deal. We won't know the full impact for many years.

It is very difficult to understand how much of an impact the companies you metioned have had on the economy. I am a vendor to two of the three(Amazon and BMW). We have been able to grow our business, and our staff, because of these companies moving in. Also, even though the interchanges were built for these companies, it has enabled other new businesses to come into the same business parks because of the these improvements in the infrastructure.

Really nailing down their economic impact goes well beyond just what those particular companies bring to the area(Heck, they brought me to SC - that's worth something!!).


NFL teams do not have near the day-to-day impact on the economy as a Boeing, Amazon, or BMW have on a city. Not even close. IMO

 

[Black Irish]

I worked for a soda bottler that got free water from the city. That's a hell of a corporate giveaway considering its the main ingredient in all of its products.

 

[RDU Irish]

If you need to raise any taxes to support a stadium, that says to me you cannot afford this discretionary pleasure. Bud Selig fleeced Wisconsin building a new stadium before selling his team. Now Herb Kohl is looking to do the same with the Bucks.

However, providing municipal bond access to lower borrowing costs fits a nice grey area for me. Why not just take a percentage of the gate on every single event at the thing until its paid off? Then they are motivated to hold special events and the actual users of the thing are paying the freight. If they can't write a lease deal to support the stadium construction, the government should get ownership in the team. Few things add more to team values than a new stadium yet cities continue to bankroll billionaires.

Tickets are so damn expensive to major sporting events that I have a hard time understanding the true entertainment value for average folks.

 

[Cackalacky]

If you need to raise any taxes to support a stadium, that says to me you cannot afford this discretionary pleasure. Bud Selig fleeced Wisconsin building a new stadium before selling his team. Now Herb Kohl is looking to do the same with the Bucks.

However, providing municipal bond access to lower borrowing costs fits a nice grey area for me. Why not just take a percentage of the gate on every single event at the thing until its paid off? Then they are motivated to hold special events and the actual users of the thing are paying the freight. If they can't write a lease deal to support the stadium construction, the government should get ownership in the team. Few things add more to team values than a new stadium yet cities continue to bankroll billionaires.

Tickets are so damn expensive to major sporting events that I have a hard time understanding the true entertainment value for average folks.

Exactly my point in response to this post

onstruction of Lucas Oil Stadium and the expansion of the Indiana Convention Center are considered one project, so financing is lumped together. The budget for the stadium is $675 million, and the convention center is expected to cost $275 million, for a total price tag of $950 million. Once financing charges and interest are factored in, however, the cost rises to $1.8 billion. The debt is expected to be paid off in 2040.

Here's a breakdown of where public funds are coming from:

45 percent -- 1 percent increase in the Marion County food and beverage tax.consumption tax. I like consumption taxes.
22 percent -- 3 percent increase in the Marion County hotel tax. targets in city patrons of hotels attending the events
14 percent -- Revenue from the existing professional sports development area tax being diverted to the project.
6 percent -- 1 percent increase in the ticket tax at sporting venues. Obviously targeting the people purchasing the tickets
6 percent -- 1 percent restaurant tax in six neighboring counties.These will reap the benefits of people traveling into Indianapolis
5 percent -- 2 percent increase in the Marion County car rental tax. People attending events in the area of the stadium need transportation
1 percent -- Revenue from the sale of Colts license plates. Die hard fans buy state license plates

User taxes work well as do municipal bonds as they have been explained to me. I have also previously stated that SC will vote on tax increases to fund civic projects and once the project is done the tax goes away, most of the time. Sometimes the government finds it to be such a cash cow, that it miraculously stays effective but usually goes to fund other civic projects.

 

[RDU Irish]

If Lucas Oil was the only draw to Indy then I would agree that the taxes target the appropriate users. At what point does a restaurant tax (for example) cost you more on off days than what you pick up on game days?

Incrementalism is the tool of the devil.