On August 28, the owners of the Cleveland Cavaliers, a National Basketball Association team, announced the end of a $140 million financing deal with the City of Cleveland and Cuyahoga County, citing a proposed ballot question challenging the deal’s approval as a reason for calling off the deal.
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“The Cavaliers’ exit from the deal is a slam dunk for area taxpayers, who would have been left with the check while the team made bank at their expense.
“Had the deal gone through, the city government would have given the team owners $88 million in hospitality and entertainment tax revenues funding arena renovations, in addition to taking out $140 million in new public debt and transferring more than $60 million in county government tax revenue.
“Sports stadium subsidies primarily benefit team owners, who get to reap the benefits of capital improvements without investing their own money to make those improvements. Economic study after economic study has demonstrated that shaking down taxpayers almost never delivers the prosperity promised by lawmakers, yet they keep on making this kind of deals with big businesses.
“Lawmakers should slap down handouts for sports teams and businesses, even when they’re hometown heroes like the Cavs. Everyone may love the local sports team, but building sports arenas is not a core function of government, nor is it an efficient use of taxpayer money.
“Instead of making more opportunities for corporate welfare, lawmakers should work to promote more private investment in their cities. Lowering taxes, reducing barriers to construction and development, and promoting pro-growth policies across the board would be a slam dunk for taxpayers and sports fans alike.”
“For far too long, taxpayers have been subsidizing stadium deals for billionaire professional sports team owners, who often hold cities hostage when they don’t get their way or put significant pressure on local businesses and politicians to support their taxpayer-funded projects. And while the rich get richer on the backs of everyone else, taxpayers inevitably lose.
“It’s great to see taxpayers finally get a win. If Cavs owner Dan Gilbert wants to renovate Quicken Loans Arena, he should use a small portion of his massive fortune to do it himself.”