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The Chargers Should Build a New Stadium

Tuesday, December 3, 2013
posted by Brian Brady

It’s rare that I disagree with the new U-T San Diego editorial board, but it is dead wrong on a tax-payer funded football stadium.  This is just a classic example of a wealth transfer and, on moral grounds, I oppose this sort of rent-seeking.

The U-T editorial board argues that Qualcomm (former Jack Murphy) stadium is really old.  It argues that former NFL Commissioner Paul Tagliabue threatened San Diego with the loss of the Super Bowl unless a new venue was built.  It argues that City Hall is losing tax revenue from unseen losses due to an outdated stadium.

I stipulate each point of the argument, but reply “So What?”

Buildings get old and sometimes become functionally obsolete; one only needs to look at the San Diego Sports Arena as an example.  But the Sports Arena still seems to find a way to make a profit by serving up concerts, swap marts, and other events.  If the ownership of the Arena saw a potential for greater revenue, it would be refurbished in less than 24 months — that’s how the free market works.

he NFL commissioner can threaten San Diego County taxpayers all he wants but the simple fact is this — the Super Bowl ain’t that “super” when it comes to impacting the local economy.  NASCAR had a greater economic impact on Phoenix than the two Super Bowls they hosted.  By that logic, a world-class NASCAR track should be funded by the taxpayers rather than a football stadium (I don’t approve of that, either).

City Hall is losing revenue?  Spending county taxpayers’ money, for the purpose of generating city taxpayer revenues, is just a classic example of  Bastiat’s Broken Window Fallacy; it ignores the unseen.  If the boondoggle costs $900 million to build, that’s encumbering each and every County resident to the tune of about $300 over the next 30 years.  That’s twice the “estimated lost revenue” to the City of San Diego.  It would be cheaper to just have each County resident send $5/year in to the City (and NO, I also don’t support THAT).

That ten bucks a year is each County resident’s money — neither the Board of Supervisors, the Spanos family, the U-T editorial board, nor the voters of San Diego County have a “claim” on those individual’s money.  Building a private business like a stadium, or an office building, or a store, simply isn’t the proper role of government.

What if we flipped the tables?  What if a ballot initiative demanded that the Spanos family build a stadium from their own funds or move out of the County?  What would happen?

The Spanos family would be gone.  Why?

Because it doesn’t make economic sense to build a new stadium and the voters would be trying to steal the Spanos’ money.

The U-T editorial board knows this too.  Four to five years ago, as daily print media were losing revenue, an idea for publicly-funded newspapers was floated.  Nobody bought into it and newspapers had to retool or perish.  The ones which perished were great acquisition targets for bold entrepreneurs, like Messrs. Manchester & Lynch, and have thrived since the right ownership took over. THAT is how the free market works.

This whole idea is just one more rotarian socialist scheme and it’s wrong.  The U-T plans to publish a series of articles to argue for this and I’ll refute each one of them here.  They may have a bigger reach than we do at Rostra but, by the time this thing hits the ballot, I’ll win.  Why?

I’m making a moral argument while the U-T is advocating for theft.  In the end, the moral argument wins.

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24 Responses to “The Chargers Should Build a New Stadium”

  1. W.C. Varones says:

    Yes! There are still a few principled, non-crony Republicans in the county.

  2. doug porter says:

    OMG! Shocking! (LOL) I agree. Put this in the record books.

  3. Thor's Assistant Thor's Assistant says:

    Doug may be surprised how many Rostra readers actually do agree with this sentiment.

  4. D7 Voter says:

    All I know is I want Fabiani’s job. Ten years of going nowhere while collecting big bucks. It’s not only City of Bell city managers that rip people off.

  5. Brian Brady Brian Brady says:

    I agree with Doug Porter more often than he thinks.

  6. Justin Vos says:

    I agree with your logic but disagree with your view. Football is one of my favorite things about America and I’d love to see the Chargers stay here for the rest of my life. Bring on the 900 million dollar stadium I’ll pay the $10 each year for 30 years. I’d rather do that than pay a librarian 260K in pension. I payed $250 for the Lambeau Field renovations and have no regrets about that decision.

  7. La Playa Heritage says:

    There are many ways to finance a full Reclamation of our Tidelands. Along with a Contiguous Waterfront Multi-Purpose Stadium and Convention Center.

    http://www.tinyurl.com/20120606a

    First by moving all CEQA Planning Duties of the Port and the Airport Authority to SANDAG and CalTrans, our Federal and State Mandated Metropolitan Planning Organization (MPO).

    The Port and Airport Authority would remain in charge of daily Port and Airport Operations. Only long term Regional Planning would be moved to SANDAG/CalTrans. This would free up at $200 Million a year for Infrastructure on public State tidelands, including a Chargers stadium. San Diego should have separate Port and Airport Authorities. Only the planning should be moved to get rid of the extra 2 layers of Engineering and Planning mismanagement. Put the issue to a public vote.

    Another way is to allow the public the opportunity to vote to replace the TMD and Special Tax, by the same 5% Increase the TOT. For a Maximum Effective TOT of 15.5% The Hoteliers and City Council already agreed to the 5% increase.

    David Alvarez could win if he allows the public the opportunity to vote to increase taxes. The private Hoteliers that back Kevin Faulconer refuse to discuss a public vote on visitor Hotel taxes to decide the fate of our NFL Chargers.

    SANDAG is required by law to put a Tax Increase on the County-wide ballot by November 2014. Say the Tax Increase can only be used for public infrastructure including a stadium, SDSU and Community College Student Housing and River Park along Qualcomm Stadium.

  8. Barry Jantz Barry Jantz says:

    Justin identifies the rub. Should something individuals are willing to pay for by choice, because they like it, be imposed on others through taxation?

    When it comes to public uses, the law says yes, whether we individually always agree or not.

    But, for private uses? Even if a majority of the citizens (or those voting) enjoy the benefits?

    Where does that end?

    Think about a myriad of privately purchased things many of us enjoy and from which we reap personal benefit, but which are also not guaranteed to us or even a life necessity. What about things we use every day? TV, cable, internet, a car — as a start.

    There are many things in life I like, for which I would willingly pay, but also don’t think my enjoyment should be billed to others.

    I’d like to hear from others how they think a sports stadium crosses into the realm of “public benefit.” I’m open to hearing the views of others.

    Barry (Longtime Charger fan and sometime season ticket holder)

  9. D. Morton says:

    I agree with you Brian, but be careful with views like that. Running so far afoul of the hoteliers and downtown development folks doesn’t bode well for people with aspirations to build our local party.

  10. Hypocrisy questioned says:

    Barry,

    There is absolutely no way to justify giving a gift of public funds (with or without a vote of the people) to a private business. On the other hand, don’t governments do that all the time when they want to attract businesses into their jurisdiction?

  11. Barry Jantz Barry Jantz says:

    Yes, oftentimes they do. I was hoping someone would ask:

    San Diego County Taxpayers Association — Metro Golden Fleece 2013

    City of El Cajon – Investment in Microbrew

    Not all craft brew operations in San Diego are created equal. In 2009, the City of El Cajon decided it would get involved in San Diego’s emerging craft brew scene by investing $345,000 in a new local brewery. Before the brewery opened for business, another $300,000 was needed. A year after its doors opened, the brewery filed for Chapter 11 bankruptcy and has now closed its doors. With only some beer equipment estimated to be worth less than half of their investment, over half a million in taxpayer dollars is at risk because the city decided to take a gamble in the restaurant business at taxpayer expense. On the bright side, the city is optimistic a new brew business will come in, set up shop, and even pay off past debts. We have a feeling this is just the tip of the ice-cold-beer-berg, but until then…bottoms up, taxpayers!

  12. D7 Voter says:

    One of the larger questions in this debate is: What is the primary purpose of the governmental entity (in this case, the City of San Diego) and would their actions be consistent or in conflict with that primary purpose? Arguments for things such as stadiums can be made both ways. As far as an “in favor” argument, things such as impetus for revitalizing run down areas (e.g. Petco Park) and providing an enjoyable quality of life for the citizens come into play. If left only to market forces, without Petco, would downtown have developed as rapidly as it has (again, arguments out there for and against)? And do things such as stadiums and grandiose libraries help attract and retain individuals and residents wanting those things as a part of their community? And then, of course, it boils down to the cost-benefit analysis.

  13. Brian Brady Brian Brady says:

    “One of the larger questions in this debate is: What is the primary purpose of the governmental entity (in this case, the City of San Diego)”

    Great question but the entity is the County. The U-T Editorial Board wants the COUNTY taxpayers to fund the City stadium.

  14. D7 Voter says:

    Sorry, I didn’t read the editorial, and only was half paying attention to Rostra as I wrote my comments while also working on something else.

    For what it’s worth, I work with a group of investors that has the interest and wherewithal to privately finance stadium projects (without wanting ownership in the team). We are working on college and pro stadium projects around the country.

    They have looked closely at the Chargers / San Diego deal, and over the years have had discussions with many of the key players, but:
    a) they don’t have faith in the ownership to get a deal done;
    b) they don’t want to get mired down in a lengthy political battle; and
    c) they really have no interest in doing business in California.

  15. bill @ the county says:

    Just a couple of questions–I don’t know the answers:

    1) Where would SDSU and the other sports (CIF, Soccer) that use the stadium play if there was no stadium? What about large concerts? Where would the Giant Used Car Tent Sale and Motorhome show go?

    2) Who paid for the dredging of San Diego Bay and the creation of Shelter Island and Harbor Island where all the private hotels are now? Who paid for the creation of Mission Bay resulting in all the hotels there?

  16. La Playa Heritage says:

    http://www.delmarfairgrounds.com

    The Giant Used Car Tent Sale and Motorhome shows would move to the Del Mar Fairgrounds. Qualcomm Stadium and the Del Mar Fairgrounds are Regional Emergency Homeless Shelters for all County Residents during a State of Emergency. Such as the Fire of October 2003 and 2006.

    The City of San Diego does not receive profits from concerts in the outdoor amphitheater in Chula Vista, or events at local State Universities. Most big name concert bypass little San Diego. A new multipurpose NFL Stadium and Convention Center Expansion would bring a new source of Revenue to be spent in City limits.

    San Diego Bay was first dredged in 1850 by the US Army Corp of Engineers. Prior the Bay was silted up and navigation was impossible. Cabrillo and others had to anchor far in the Bay Channel. Then row to the nearby bay-side Beach. “La Playa.”

    San Diego Bay, Shelter Island, Harbor Island, Mission Bay belong to the “People of the State of California” as part of our California Tidelands held in the Public Trust through the Public Trust Doctrine.

    http://www.slc.ca.gov/policy_statements/public_trust/public_trust_doctrine.pdf

    http://www.portofsandiego.org/public-documents/doc_view/2196-california-tidelands-land-held-in-public-trust.html

    The Airport Authority is so rich that they could afford to give away $67 Million to McMillin NTC, LLC for a hidden amendment to the contract voted on by the public.

    http://www.blogofsandiego.com/BlogArchives/2007-2nd-Quarter.htm#06/08/07a

    http://www.blogofsandiego.com/Waterfront.htm#04/05/10

  17. Micheal Erl says:

    PaPa Brady. May I call you PaPa? You summed it up for me.

  18. Brian Brady Brian Brady says:

    ” May I call you PaPa?”

    Michael, may I call you Smalls because you’re killing me ;)

  19. Richard Rider says:

    Justin says he’ll gladly pay $10 a year to keep the Chargers here. Good for him. He can pay MY $10 too!

    And feel free to pay the $10 due by many (perhaps most) other folks who would chose not to pay this tax. Certainly Justin should be willing to pay the $10 tax for all those under — say — age 8 or younger who can’t afford nor have a say in the tax. I have two local grandkids who have tacitly agreed to allow Justin to cover their $10′s.

    Wait. I’ve got a better idea. Call me wild and crazy, but we could pay for it with a tax on Charger TICKET sales. Even better, we should allow the Charger owners to factor the new stadium cost into their OWN ticket prices, and pay for the stadium that way.

    Gosh, what a concept. User pays. VOLUNTARY payments. Payments set by the owners who profit most from such improvements, and are HURT the most by ticket prices so high that more and more people choose not to come to the games.

    But then, the Chargers would not want a stadium where just their fans had to pay without taxpayer subsidies. For you see, the stadium makes zero economic sense when it is supposed to pay for itself.

    Ya think???

  20. Richard Rider says:

    While naturally I disagreed with the U-T pro-stadium article, it had one excellent suggestion. If taxpayers are to be put on the hook, it should be a COUNTY tax, not a city tax. With a population of 3.2 million people in the county, on about 1.3 million live within the city. I’m confident when I say that most of the stadium ticket buyers are from OUTSIDE the city.

    As the editorial said, we should vote on it (if it gets that far). What the editorial failed to mention (perhaps an oversight) is that such a “special tax” or bond requires a TWO-THIRDS vote. And it should.

    After all, when the original Jack Murphy stadium bonds were approved in the 1960′s, it was done with a 2/3 vote. Hopefully politicians will not attempt some subterfuge to bypass this state constitutional requirement.

  21. Mole says:

    R.R.:

    When I lived in the county I thought one should not look a gift horse from the city in the mouth. Now that I live in the city it seems like cattle drive time to round up those county free range taxpayers . Any Imperial County stray taxpayers that could be branded as little regional doggies? They have an ex officio position on SANDAG. Let’s not forget Temecula and Murietta. Riverside County would surely understand our need to have help in paying for their entertainment games. Yeeeaaah! Dig in them tax spurs. We are entitled.

  22. Richard Rider says:

    Just to be clear — if this stadium boondoggle moves forward, I’ll be in the thick of the fight AGAINST this subsidy. But I DO favor requiring a citizen vote for the new obligation to be imposed on taxpayers — with a 2/3 majority requirement for such a special tax/bond.

  23. Mole says:

    R.R.

    Jesting aside, you are absolutely right. Your leadership in opposing crony capitalism is much appreciated as always.

  24. Kirk Effinger says:

    Examination of the dwindling readership at the U-T vs. significant increases at the OC Register, the hypothesis that Manchester and Lynch are running a successful newspaper is dubious, at best.

    Their continuing to press for a taxpayer subsidy of an entertainment business that only a segment of the population supports is a disservice to the region where they claim a leadership role.

    If anyone wonders how millionaire team owners become billionaires and men who can throw a ball can command and receive payments for their skills running into the tens, if not hundreds of millions of dollars, look no further than the corporate welfare the NFL has successfully extorted from millions of taxpayers throughout this country.

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