Utah Jazz 1, Utah taxpayers 0.
Taxpayers chalked up this loss June 14, when Salt Lake City officials voted to provide over $20 million in tax breaks for the renovation of Vivint Arena. This comes out of the pocket of hardworking Utah taxpayers, who will now be forking over their money to the arena’s wealthy owners.
Sadly, sports franchises and local governments have been playing this game for years; the franchises seek sweetheart deals paid for with taxpayer money, while politicians justify this expense with promised economic growth for the community.
But that’s a load of baloney. Putting families on the hook to pay for projects that benefit a private business is neither sound economics nor fair. It’s corporate welfare, plain and simple, and the promised economic benefits simply won’t materialize.
Getting taxpayers to pay the bill for sports franchises is a decadeslong tradition. Researchers from Texas A&M University and the University of Oregon chronicled the history of public financing for sports construction projects, noting that local governments and taxpayers usually covered 100 percent of the bills until 1984, when private franchises were expected to start pulling their weight.
Since then, however, franchises have still reaped generous taxpayer backing. The Vivint Arena is no exception: When it was built 25 years ago, taxpayers covered $24.6 million of the cost. Obviously it’s unfair to expect hardworking families to pay a private business’ personal benefit, yet when a sports franchise makes that argument, local officials seem to be willing to overlook the inequity.
Now those officials want to double-dip. The Salt Lake City Redevelopment Agency pledged $22.7 million in tax rebates to the owners of the arena, who promise that it will be a “significant economic driver” for years to come.
Really? Research published in the Journal of Sports Economics found that local sports teams do little to improve local economic prospects. A former member of President Barack Obama’s Council of Economic Advisers concurred last year, noting that the tax revenue from stadium and arena projects generally does not cover the cost of taxpayer subsidies for their construction. And even if arena projects weren’t economic duds, that still doesn’t make it right to force taxpayers to pay for them.
Adding insult to injury, the Jazz can certainly afford to foot this bill on their own. The president of the franchise recently noted that the team has been planning the future of the arena for years — in fact, construction on the renovation would go on even without taxpayers covering the cost. The Jazz are the 20th most valuable NBA franchise, according to Forbes, and have over $27 million in annual operating income, as of 2016. Beautifying their arena is their responsibility — and well within their ability to afford.
Every dollar of Utah taxpayers’ money should be used responsibly. The Salt Lake City Council acknowledged after the fact that rushing this funding through without a chance for taxpayers to weigh in was a “rookie mistake.” That’s certainly true, and if there’s no better use for our money than giveaways to special interests, they should return it to us.
The SLC Redevelopment Agency should reconsider its plan to give away another chunk of taxpayer-sponsored corporate welfare. We can all get behind the Utah Jazz winning — but not if taxpayers have to carry the ball.
Evelyn Everton is the Utah state director of Americans for Prosperity.