soccer stadium discussion, June 12 work session

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soccer stadium discussion, June 12 work session

Postby Leslie Pool » Mon Jun 11, 2018 4:18 pm

Colleagues,

I am looking forward to having a discussion on the site analysis and economic impact analysis related to the city-owned McKalla Place property.

I appreciate the hard work that our city staff have done to compile information on the site, certain infrastructure costs, and a high-level discussion of opportunity costs in a relatively short period of time.

I do have some concerns about the economic impact analysis submitted by a third-party consultant, B&D Venues. My office has spent the past week reviewing the assumptions and estimates related to this analysis and have identified a number of issues that appear to overstate the economic impact potential of a stadium.

My staff have drafted one document outlining our concerns and another document reviewing the relevant academic literature on the economic impact of sports stadiums. I will provide links to these documents as soon as they are finalized.

In the meantime, I am providing a non-comprehensive list of key questions related to the staff memo and the economic impact analysis. These questions are available here: http://assets.austintexas.gov/austincou ... 160801.pdf

I believe that we need robust information on the costs and benefits of any specific proposal for the McKalla Place site in order to make an informed decision.

As the Mayor has noted, economic impacts are not the only impacts we will be looking at as a Council. We will also be looking at any cultural or other intangible benefits that having a soccer stadium at this location might provide, and that is an important conversation. But even these intangible benefits have a cost, and we need to know what that cost is before we can decide whether we can afford it.

I look forward to discussing how we can obtain all of the information we need on realistic economic impact estimates, city costs, and opportunity costs so that we can weigh all of the considerations at hand and make an informed decision.

Finally, I want to share a segment from John Oliver's Last Week Tonight show where he discusses public funding of private, for-profit stadiums.

Here it is: https://youtu.be/xcwJt4bcnXs "Cities spend massive amounts of public money on privately-owned stadiums. Cities issue tax-exempt municipal bonds that — wait, don’t fall asleep!"

Leslie
Council Member District 7
Leslie Pool
 
Posts: 127
Joined: Mon Jan 12, 2015 4:22 pm

Re: soccer stadium discussion, June 12 work session

Postby Alison Alter » Tue Jun 12, 2018 6:40 pm

Colleagues,

I appreciate the opportunity to begin discussions on the MLS proposal and would like to thank staff and the consultants for their work on this item. I share many of the concerns outlined by Council Member Pool and have many of the same questions that were raised today during the work session. As I mentioned in our discussion, I would like to highlight a University of Chicago Booth School of Business survey that was circulated to some of the nation's top economists. Below, please find a link to the survey.

When asked to evaluate the following statement, only 2% of economists disagreed: "Providing state and local subsidies to build stadiums for professional sports teams is likely to cost the relevant taxpayers more than any local economic benefits that are generated."

I look forward to receiving staff’s specific analysis of the PSV proposal so we can continue these discussions.

http://www.igmchicago.org/surveys/sports-stadiums


Regards,
Alison Alter
Council Member, District 10
Alison Alter
 
Posts: 52
Joined: Fri Jan 13, 2017 4:52 pm

Re: soccer stadium discussion, June 12 work session

Postby Leslie Pool » Wed Jun 13, 2018 5:56 pm

Colleagues,

Thank you again for engaging on the McKalla Place conversation – I appreciated the questions and discussion as we think through this together. As promised, I wanted to provide links to several resources that I believe can help inform our deliberations:

- My office’s in-depth review of the economic impact analysis and proposal terms: http://assets.austintexas.gov/austincou ... 192220.pdf
- Information on the terms of stadium deals in other cities: http://assets.austintexas.gov/austincou ... 163308.pdf.
- The staff memo and B&D economic impact analysis (for ease of access): http://www.austintexas.gov/edims/pio/do ... ?id=299569
- Precourt Sports Ventures (PSV)’s proposal: https://www.dropbox.com/s/bwe935rg1vw9q ... 8.pdf?dl=0 .
- Opinion column by University of Texas Professor Nate Jensen: https://www.mystatesman.com/news/opinio ... CgYGXl0oK/

Professor Jensen’s column partially answers one of my questions from yesterday. As we discussed, PSV indicated they intend to finance the stadium construction through a mixture of private funding and federal subsidies, though we did not know the amount of federal subsidies involved. That information is still not fully clear, but Professor Jensen does note in his column that the tax credit PSV has indicated they plan on using “rebates 39 percent of the private investment.”

I also wanted to reiterate that I believe a professional soccer team could be a real community benefit to the city – but that it depends on how and where that gets done. There have been conversations for years about Major League Soccer’s interest in coming to Austin and PSV presents a compelling case for why Austin would be a receptive community.

But I firmly believe we need a deal that invests in our community rather than a deal that wants an investment from our community. To that end, I will work in good faith to consider all proposals regarding the McKalla Place site and -- even if we choose to go with another vision for McKalla specifically -- will work constructively to support other ways to bring a privately financed soccer stadium to Austin. Ultimately, no matter what we decide as a Council, I want us to make that decision with full information and clear eyes.

Thank you,

Leslie
Council Member District 7
Leslie Pool
 
Posts: 127
Joined: Mon Jan 12, 2015 4:22 pm


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