A Cincinnati, Ohio business group is asking the state to subsidize a proposed Major League Soccer stadium.
On November 30, the Cincinnati Business Committee sent the Ohio General Assembly a list of local capital spending proposals it wants state taxpayers to fund in 2018, including $10 million for a new soccer stadium.
In addition to the $10 million requested from the state, the plan calls for the City of Cincinnati and Hamilton County to give a total of$51 million in taxpayer money for the stadium’s construction
The team’s ownership group, led by Carl Linder III, would be responsible for paying $200 million towards the stadium’s remaining construction costs.
MLS leadership met in December 2017 to select two cities from 12 applicants to host new teams in the league. The stadium financing deal and request for state capital funds depend on the city being selected.
Greg Lawson, a research fellow with the Buckeye Institute, says business groups should work together to finance stadium construction instead of asking for handouts.
“If private-sector actors want to join forces, that is perfectly acceptable, but public dollars should not go to pro sports teams,” Lawson said.
When the government funds stadiums, taxpayers typically lose out, Lawson says.
“Taxpayers are almost universally on the hook,” Lawson said. “Ask the Hamilton County taxpayers who are still paying a portion of their sales tax for Paul Brown Stadium, where the Cincinnati Bengals play.”
Warns of Additional Costs
Craig Depken, an economics professor at the University of North Carolina at Charlotte, says sports stadium subsidies carry a hidden cost: interest payments.
“It’s more than $10 million when you think about it, because you’re servicing a debt,” Depken said. “You’re going to pay interest on this over time. It’s kind of like asking for more and more resources to be dedicated towards servicing this debt. You have this building, but it has an obvious increasing opportunity cost as schools, roads, or fire engines need to be replaced.”