A point to ponder from last night’s debate:
“"Go look it up. Go look up stadium economists, and you're gonna see page after page after page. They all say the same thing: it doesn't work," Harry said.O'Grady countered, saying, "$168 million over 20 years. That's $8 million a year."
The debt service the city will pay on a 54 million dollar loan is 2.7 million dollars per year for 20 years. If, and that is a huge if, the city did see 168 million dollars in other revenue outside of the stadium that will equal 8 million dollars a year. The 8 million dollars is money spent at area businesses, not 8 million that is handed to the city. The only revenue the city will see is sales tax from these sales. 6.25% of 8 million dollars is 520 thousand dollars. Keep in mind that the city does not get to keep all of this. It gets sent to the State and then gets divided up between the county and cities located within the county.
So you can see the tax payers are not trading 2.7 million dollars for 8 million dollars, they are trading 2.7 million dollars for a portion of 520 thousand dollars per year. Let’s say for arguments sake that the city did get all of the 520 thousand in new sales tax revenue. If you add that to the 500 thousand Mandalay will pay each year for rent, you get 1.2 million dollars per year. Subtract that from 2.7 million dollar stadium payment and you are left with a 1.5 million dollar loss each year for the tax payers to absorb. It is more than that because the city does not get to keep all of that sales tax revenue and the 168 million dollars in new sales is pure conjecture. There are no guarantees other than the tax payers are the big losers even if all of the Mayor and Councilman O’Grady’s predictions/dreams come true. The other point Councilman O’Grady left out of his glowing claim of profits is the fact that the stadium does not pay property taxes when it is owned by the city.
The only way this becomes an asset to the community is if it is privately financed, owned and operated. The government collects property taxes and whatever sales tax revenue it “REALLY” produces. The government/tax payers do not pay a 2.7 million dollar loan payment plus the maintenance and upkeep costs.
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