Lucas Oil Stadium, home of the Indianapolis Colts, first opened its doors 10 years ago this month. And for the last decade, the Colts have held the inauspicious title of playing in the NFL’s most heavily-subsidized stadium, whose initial public subsidy of $620 million would be worth $725 million in 2018 dollars. Until the Raiders’ new Las Vegas stadium opens with the help of $750 million in public funding, the Colts will continue to hold this unfortunate trophy.
But the initial subsidy was only the beginning of public costs. Three years ago, Indianapolis had to pay an additional $71 million to re-finance the risky debt issued to fund stadium construction. On top of that, the city is still paying off the RCA Dome debt, 10 years after it was demolished in 2008.
In a recent interview, Colts COO Pete Ward didn’t rule out threatening to leave Indianapolis in 2034 to pressure the city into providing a new stadium. Fred Glass, former president of the Indianapolis Capital Improvement Board—the city-created entity responsible for Lucas Oil Stadium—acknowledges that “when you’re in a small market, the team has leverage.” Cities like Indianapolis may know they’re getting a bad deal, but fear of losing the home team is crippling: “If we had lost the Colts, we would never have gotten another NFL franchise.”
To be fair, their fear isn’t unfounded. Indianapolis knows a thing or two about Colts fleeing for greener pastures. After all, the city itself lured the Baltimore Colts to relocate in the middle of the night with the promise of then state-of-the-art Hoosier Dome.
While Indianapolis’s extraordinary sports subsidies may serve as a warning, the city isn’t alone.
Collectively, Americans have spent nearly $7 billion on professional football facilities since 1995. These massive costs don’t come without tradeoffs. To fund stadium projects, taxpayers are forced to make sacrifices on actual public services like transportation, education, and safety (as we’ve written about here, here, and here). These costs are largely unseen, so local residents often don’t associate sports subsidies with their real-world impact. Meanwhile, the high visibility of stadiums and sports teams works to the advantage of public officials and team owners who argue that subsidizing sports creates jobs—though economic research concludes they don’t. Ultimately, local residents are the ones bearing the burden of these sweetheart deals.
Perhaps Indianapolis is willing to do anything to keep its team in town. But on the anniversary of Lucas Oil Stadium’s opening, local officials should keep this in mind: pouring money into the Colts may produce sentimental value and a sense of local pride, but the so-called economic benefits don’t justify the cost.
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