The Big Bad Bet
People of goodwill can debate some of the proper functions of government, but I think most of us can agree that gambling with taxpayer money is not one of them. Yet that’s what is happening with this Rams stadium situation. Public officials are betting that a new stadium will be a winner for the region and for taxpayers.
Yesterday, Gov. Nixon announced that Ameren and Terminal Railroad have agreed to make adjustments to their assets (moving power lines and rail lines) so that the proposed new stadium on the riverfront can be built. I guess he thinks that’s good news, and it would be if it was the only thing standing in the way of a private developer wanting to build a new stadium on the riverfront, but that’s not the only thing.
The key ingredient to this project moving forward is that we are going to have to cough up more of our money ($405 million to be exact) to help finance this thing. Now it’s possible that such an investment could be worth the price tag if it will lead to redevelopment of the surrounding area. That’s what the governor believes. What’s the evidence that there will be redevelopment? It didn’t happen when we financed construction of the Edward Jones Dome. Why is this time different?
Gov. Nixon also stressed that if we did nothing, the city and state would lose out on millions in income tax revenue. It’s true, players do pay earnings taxes, but how much more money will we have to spend in order to make sure we still get those income taxes? Overall, will taxpayers see more in added tax revenue than the amount they had to pay in subsidies? It’s possible, but it’s also equally (if not more) likely that taxpayers would lose money. That’s why this whole thing feels like gambling, but at least at the casino you know the odds before you play. That’s not the case here. How much will players’ salaries grow (which influence income tax revenue)? How many people from out of state will visit the region to watch the Rams (this affects how much new sales taxes we get)? These questions and many more will affect the amount of added revenue the region will receive. It’s an awfully big risk to be taking with public money, and honestly we shouldn’t be giving a billionaire (Rams owner Stan Kroenke) taxpayer money on the hope that we MIGHT see a positive return.
Yesterday’s press conference was supposed to be an encouraging sign for those who want to keep the Rams here in Saint Louis. For me, it looked like someone was putting down a big marker on the roulette table with our money on the line. No matter if the project lands in the red or the black, in the end Stan Kroenke is going to be getting green.