Private Spaces, Publicly Funded
BY ALEX LEICHENGER
Over a decade ago, the St. Louis Rams were the “Greatest Show on Turf,” a high-scoring juggernaut that played in two Super Bowls and welcomed the new millennium with a thrilling championship conclusion (search Mike Jones tackle on YouTube).
The Rams are now well on their way to an 11th consecutive season without a winning record. Perhaps you are neither a football fan nor a native St. Louisan, so this fact is less relevant to you than for the thousands of dejected fans dreaming about the glory days. But for every St. Louis taxpayer, regardless of personal connection to football or the Rams, the state of the local team should be a prime item of focus.
Starting Jan. 28, 2015, the Rams are eligible to move into a year-to-year lease at downtown’s Edward Jones Dome. Essentially, the franchise can decide to kiss the Midwest goodbye at any point starting then. Los Angeles, where the Rams played from 1946 to 1994, is rumored as a probable destination.
St. Louis lured the Rams away from Los Angeles with an alluring stadium deal that has now turned into nothing short of a fiscal disaster for the St. Louis region and the State of Missouri. As a publicly funded project, the Edward Jones Dome construction relied on 50 percent financing from the state and 25 percent apiece from the city and county. The state, city, and, county pay a $24 million annual tab to cover debt and stadium upkeep. Even that price is apparently not enough—the St. Louis Post-Dispatch reported in June, that the St. Louis Regional Convention and Sports Complex Authority is asking for as much as $40 million in additional government funding over the next 15 years.
The Dome, meanwhile, is already considered one of the NFL’s worst stadiums just two decades after being built. To stay put in Missouri, the Rams want either a major renovation or a new stadium altogether. And again, they are asking local and state government to foot a significant portion of the bill. Last year, the Rams proposed that the public pay for $700 million in stadium upgrades, a plan summarily rejected.
“There was nobody in St. Louis who thought that the Rams’ proposal was a good idea, other than the Rams,” Jeff Rainford, Mayor Francis Slay’s cChief of sStaff, told the Associated Press.
Nonetheless, government officials still hope to work out a deal enticing enough to have the Rams stay. In early November, Governor Jay Nixon called keeping the Rams in St. Louis “a matter of civic and state pride, and one of international significance.”
Ignoring the hyperbole, Nixon said he expects at least some private investment toward renovation or a new stadium this time around. The history of American sports venue development, however, suggests that taxpayers will be forced to vastly overpay yet again.
Studies have found that sports stadiums generate far less revenue than teams boast they will, due to the economic substitution effect. If there’s no NFL franchise around, people do not suddenly stop spending money on their nights out. Rather, they budget for trips to the movies, restaurants or other cultural institutions that bring in tax revenue for the state, city, or county. But as any sports fan (including myself) will tell you, the games carry a profound psychological impact, which is why cities and states get suckered into financing athletic pantheons that billionaire owners and private investors should be supporting.
St. Louis has a history of falling for this trap. American Studies scholar George Lipsitz wrote in a 1984 volume of the Journal of Sport and Social Issues that the mid-1960s construction of the Busch Memorial Stadium (old home of the Cardinals) brought profit to corporations at the expense of citizens.
While city services declined and families and resources fled to the suburbs, St. Louis’ urban renewal commission, Civic Progress, made “blighted” areas downtown into tax-free zones for corporations. The Cardinals’ owner, August “Gussie” Busch, used the team as a piggy bank for his family company, Anheuser-Busch. City funds and services continued to evaporate.
Decades later, St. Louis was able to resist having significant public funds go into the construction of downtown’s new Busch Stadium. The bargaining success was primarily due to the leverage fans had over franchise ownership. The Cardinals’ brand is inextricably tied to St. Louis, and relocation would have been a poorer financial choice than privately covering nearly 90 percent of the stadium’s costs.
However, the new facility left a vacant lot in the space once occupied by Busch Memorial Stadium. This lot quickly became a source of contention in downtown development. After seven years, construction finally finished on the $100 million first phase of Ballpark Village, a Cardinals-themed consortium of restaurants and bars, plus a team museum.
The ballclub pitched the Village as a game-changer for downtown St. Louis. But at what cost? The project dipped into the state’s trove of tax-increment financing (TIF) funds. TIF subsidies take a portion of tax revenue generated from development projects and put them back toward paying off the construction debt. If a facility does not keep pace with its expected revenue, then taxpayers are more directly on the hook. The corporate partners involved in the project end up taking on less risk than the consumers for whom it is supposed to benefit.
If other sports facilities are any indication, the projected windfall from Ballpark Village is probably an overeager estimate. The TIF district for Louisville’s KFC Yum! Arena, for example, has fallen woefully short of expectations. From 2010 to 2012, TIF revenues comprised just 32 percent of the original forecast. The substitution effect is crucial, according to Missouri State professor David Mitchell, who studies regional economics.
“[Ballpark Village is] unlikely to have as much of an economic impact as they think it is, because in order to have a huge economic impact, you have to get people to do something that they’re not already doing,” he said.
The Cardinals expect their sizable draw to out-of-town fans to create additional sources of revenue, but those visitors will only come 81 days of the year (the number of home games in a baseball season). The franchise hopes turning Ballpark Village into a multi-use facility for concerts and other events will solve that problem. However, development officials for the Edward Jones Dome made the same pitch 20 years ago, and taxpayers took the bait.
However, it’s not only the cost of the projects, but also the nature of them that is distressing.
To develop Ballpark Village, the Cardinals hired Cordish Companies, which has a track record of racial discrimination lawsuits against it in Louisville and Kansas City. In Louisville, the lawsuit alleges that a Cordish-owned property’s employees refused to allow a group to hold an event after determining that the proportion of black attendees would be too high. In the Kansas City case, plaintiffs claimed that a nightclub demonstrated a “pattern and practice” of harassment and denied entrance.
At Ballpark Village, the intent of whom the facility is meant to serve (and deny) is quite transparent. Just take a look at the dress code:
The following is not permitted under our dress code after 9 pm: Main Level: sleeveless shirts on men, profanity on clothing, exposed undergarments on men, sweat pants, full sweat suits, excessively long shirts (when standing upright with arms at your side, the bottom of your shirt can not extend below the tip of your fingers), athletic shorts, excessively sagging pants or shorts, and bandanas.
Apparently, bandanas pose a more severe threat to public safety than drunk driving, since a new parking lot takes up most of the Village’s property space. Serving the interests of Budweiser, however, is more important to the developers than making urban development projects productive for all segments of the population.
Issues of race and class are an unavoidable subtext to any discussion of sports development. Egregious financing and other harmful development tactics exacerbate racial and class divides outside of the facilities themselves. In the 1960s, white flight to St. Louis County and misguided urban development,drained desperately needed resources from the city while benefitting plutocrats like Gussie Busch.
In the 1990s and 2000s, white flight from North County to even further suburbs combined with more misguided urban development, continues to drain desperately needed resources from everybody.
If planned the right way, stadiums have the potential to build on athletics’ most desirable quality—the ability to unify people of diverse backgrounds toward a common psychological purpose of winning. Instead, the developments go hand-in-hand with gentrification and exclusion. Indeed, a future phase of Ballpark Village construction calls not for mixed-income housing, which should be an essential part of any stadium project, but luxury condos.
The Cardinals are a civic treasure, and the Rams were once one as well. In their development practices, they must also live up to the billing.