Seattle to Vote on Stadium Subsidy

Published November 1, 2006

Taxpayers across the nation are voicing concern over tax subsidies for private sports teams. One of those debates is occurring in Seattle, Washington, centered on the National Basketball Association’s SuperSonics.

Citizens for More Important Things, founded in 1995, recently submitted 17,700 petition signatures to qualify an initiative to give Seattle voters a chance to block the Sonics’ shot at possible tax subsidies for a new stadium.

The proposal will be on the November ballot unless the city council adopts it without a vote of the public. The council also may write an alternative proposal and place both proposals on the ballot. It has until mid-October to decide.

Market Return Required

Initiative 91 would require the city to receive a return “at or above fair market value” for any taxpayer investment in KeyArena or another facility leased to “for-profit professional sports organizations.”

“Fair market value” is defined by I-91 as “no less than the rate of return on a 30-year U.S. Treasury Bond.”

If approved by Seattle voters, I-91 likely would kill subsidy proposals being pushed by the Sonics and area politicians.

Sonics ownership has made it known the team wants taxpayer subsidies, but team owners and local politicians have provided no details about the subsidy discussions.

New Arena Proposed

Prior to the Sonics being sold this past July, then-owner Howard Schultz, chairman of coffee conglomerate Starbucks, was seeking approximately $200 million in taxpayer subsidies to renovate KeyArena.

KeyArena was renovated in 1994 to accommodate the Sonics, at a cost of more than $100 million, with most of the money coming from public funds.

Schultz sold the Sonics this year for $350 million to Oklahoma businessman Clay Bennett. Bennett is no longer seeking renovations to KeyArena but is instead planning for a new “world-class multiuse arena.” He is threatening to move the team to Oklahoma if a new stadium isn’t subsidized.

Open Disdain Displayed

Seattle taxpayers are fighting back.

Citizens for More Important Things makes no attempt to hide its disdain for public resources being used on private sports teams.

According to its Web site, supporters have a “single agenda focus on what matters most, on more important things, and leave sports entertainment to the private sector. … We simply question the reasonableness of any government that would subsidize private entities whose average player salaries are in the millions of dollars per year.”

‘Political Statement’ Heard

Responding to news that I-91 had qualified for the November 7 ballot, Seattle Deputy Mayor Tim Ceis told the Seattle Times the measure was “not helpful” in the city’s efforts to keep the Sonics in Seattle.

Ceis went on to say, “All this is is a political statement against professional sports franchises. That’s their right and privilege, but let’s not kid ourselves this is some legitimate mechanism to establish fair-market rent for KeyArena.”

Chris Van Dyk, a spokesperson for Citizens for More Important Things, is unconcerned about attempts by politicians to end-run the initiative should it be successful in November.

“If we come in with a decent vote total it will be really tough for the city, county, or state to overturn this,” Van Dyk said.

Encouragement Offered

Sensing an attitude of resignation across the nation among taxpayers facing public subsidies for sports teams, Van Dyk offered the following encouragement: “The problem with this fight is that it’s a national fight that gets battled at the local level. Some will say ‘we can’t fight subsidies, this is the way the game is played.’ That’s nonsense. I-91 is proof that taxpayers can fight back.”

State taxpayer advocates are encouraged by Van Dyk’s efforts.

“It’s unfortunate elected officials are incapable of limiting spending to core functions of government,” said Bob Williams, president of the Evergreen Freedom Foundation.

“With the qualification of I-91, Seattle voters now have the opportunity to determine if the city will remain a haven for taxpayer sports subsidies,” Williams said.

Jason Mercier ([email protected]) is senior budget analyst at the Evergreen Freedom Foundation in Olympia, Washington.