A point about the investment priorities of local governments, stadiums, etc.
With regard to DC's machinations about funding a soccer stadium ("Muriel Bowser says she will remove Reeves Center sale from DC United stadium deal," Post; "The Incredible Shrinking Stadium-Deal Benefits," Washington City Paper), it's interesting to keep up with and compare media coverage about similar ongoing negotiations now in other cities such as Boston ("Soccer stadium could create an urban opportunity, if done right," Globe), Sacramento ("Mayor: MLS meeting productive, no timeline for expansion decision," Sacramento Bee), and South Florida, where David Beckham will be an owner ("David Beckham's Miami soccer gamble: If they build the stadium will the fans come?," Miami Herald).
The same goes for the Olympics. Other cities besides Washington ("USOC meets privately with Washington 2024 about Olympic bid," Washington Business Journal; "Washington's Olympic team: The A-list sports fans vying for the 2024 Games," Post) that are vying for the event in 2024 include San Francisco ("San Francisco puts in chips for 2024 Olympics" and "Bay Area’s Olympic dreams focused on landfill near Candlestick," SF Chronicle), Boston, and Los Angeles.
Aaron Renn of the Urbanophile also writes for Governing Magazine and his latest is an interesting story "(Lessons from Kokomo on How to Spend Responsibly") about this small town located north of Indianapolis known for large scale manufacturing that raised most of its revenue from property taxes on factories. When Chrysler stopped paying property taxes when the company entered bankruptcy--eventually closing the plant entirely--the city was on the ropes.
According to Aaron, to recover, the city adopted innovative practices to save money, cut staff, and annexed adjoining lands from the county where there was significant development activity, making the city larger and increasing tax revenues.
He avers that this allowed the city to generate capital to do "pay as you go" capital investment (I am okay with debt financing myself...), including a parking garage + housing development, a new YMCA downtown, and two new fire stations.
He contrasts this with Los Angeles, which because of its high cost of personnel including escalating pensions, can't invest in much of anything. Separately, the LA Times has an article, "Angelenos could tax themselves to fix roads under City Hall proposal," about the potential creation of neighborhood "beautification districts" that will allow neighborhoods to tax themselves additionally in order to fix damaged roads. It's pretty incredible that cities are driven to such an action. But that's what lack of funds will do.
So on the perennial argument of is it better to "invest" in sports stadiums and arenas or other projects, I was struck by a brief article (Lennar, Macerich Team Up on Mall," Wall Street Journal) on the redevelopment of SF's Candlestick Park stadium and abutting parking lots. The stadium, once used by the local baseball and football teams, so it had about 92 events/year, will be replaced by a mixed use development that will include:
- 6,225 housing units
- 500,000 s.f. shopping mall, done in conjunction with one of the nation's leading shopping center companies, Macerich
- 100,000 s.f. of additional retail space
- 220 room hotel.
(San Francisco, Philadelphia, and Baltimore are city-counties (technically, Baltimore County exists as a separate entity while the city is treated as a county for governance purposes). Washington is a city-state, with even more taxing power compared to the typical city--although the city is forbidden from taxing nonresidents.)
In the lines of the economic impact studies of the revenue potential to localities from different types of development, I bet that the economic value of this development will be greater than from the stadium. DC would benefit even more from a comparable development, because the city collects 100% of the "state" income tax, which no other city in America can do.
Tax yield per acre, Sarasota County, Florida