Stadium subsidy issues, Los Angeles and beyond

LA Neighbors United ran a full-page ad in Tuesday's Los Angeles Times saying: "The odds are high that the proposed downtown stadium will produce zero lasting benefits for the people of Los Angeles." The community group's founder, Cary Brazeman, said that's because most of the tax revenue generated by the deal would go not to the city but rather back into stadium management, operations and infrastructure—"a misappropriation of our tax dollars and an unlawful gift to the facilities operator." AEG said the plan is still being negotiated but independent reports to be released on Wednesday predict more than $40 million in new tax revenue for the city, state and county. The mayor's office didn't comment. (text from the Wall Street Journal)

It's not just because the same person who owns the Washington Examiner is a big player in Los Angeles entertainment venues that I am interested in this issue, it's because it's about big money and big subsidies and involves many actors, and raises key questions about local funding priorities, dealing, and the Growth Machine. (Although I do love the hypocrisy of the Washington Examiner editorializing at the drop of a dime against taxpayer subsidies of various things, while the owner of the paper has his hand out big time.)

For example, does the fact that Rupert Murdoch's FoxSports interests are involved in the Los Angeles Dodgers have anything to do with the fact that the Wall Street Journal ran a good piece on stadium subsidies, "Stadium's Costly Legacy Throws Taxpayers for a Loss" which was used to call attention to the Anshutz Entertainment Group's proposal for football stadium in Los Angeles asking for $200 million in local bonds ("Los Angeles Slows Down Football Stadium Deal" from the WSJ)?

Meanwhile, a competitor against AEG in Texas has lobbied the California State Legislature for restrictions on AEG's plans in Los Angeles ("Longtime Anschutz rival challenges plans for a Los Angeles stadium" from the Los Angeles Times). And the San Diego Union-Tribune reports, in "What it might cost for Chargers to play in L.A." that a Los Angeles football team may derive by relocating the San Diego Chargers.

There's interesting stuff in the various reports about how income from an LA stadium would be greater because of the use of the facility for other events. Generally, the municipal funders of stadiums don't benefit from such revenue streams.

Wall Street Journal graphic.