Thursday, June 17, 2010

Cincy Commissioner And Ballard Should Be Best Friends

You have to read this story to believe it. A Republican Commissioner in Cincinnati has suggested cutting funding to the hospital that serves the city's indigent patients in order to find enough money to pay for its costly new stadiums. The Enquirer reports on Hamilton County Greg Hartmann's plan:

Hamilton County Commissioner Greg Hartmann’s plan for plugging a shortfall in the cash needed to pay for the Cincinnati sports stadiums: cut health care to the needy.

The Republican commissioner’s plan, provided to the Enquirer Friday, drew immediate criticism from University Hospital and at least one other commissioner.

But Hartmann argues his is the only fix that won’t raise taxes.

He proposed Friday erasing a portion of the county’s property tax rollback beginning in 2012. In exchange, beginning that year he wants to reduce the indigent health care levy by 45 percent - cutting $22 million the levy funnels to University Hospital every year.

The plan raises $6 million a year needed to pay for the stadiums while being tax neutral for homeowners, he said. Commercial property owners – who now pay the indigent care levy but don’t enjoy the rollback - will see a drop in the taxes . . .

Hamilton County Commissioner Todd Portune, a Democrat, denounced the proposal, calling it “cold-hearted” and “barbaric" . . .

Hartmann is sympathetic to the hospital’s plight, but points out the stadium fund is an obligation that must be paid, while helping pay for indigent care is a “non-essential” expense.

Cincinnati raised sales taxes to fund two new stadiums for the Reds and Bengals, but the revenues are falling short as a result of the recession. Like the CIB, the stadium authority has been borrowing from Peter to pay Paul to plug the hole temporarily, but the budget deficits are expected to grow to $26 million by 2013 according to the Enquirer. The Bengal franchise has been estimated by Forbes magazine to be worth about $716 million. Mike Brown inherited it from his father, Paul Brown. The Reds are owned by a group of investors led by Cincinnati businessman Robert Castellini. The Reds are worth about $337 million according to Forbes. There's nothing quite like welfare for the rich.


Marycatherine Barton said...

Unbelievably mean is this Thom Hartmann! Does he worship power and money?

Concerned Taxpayer said...

Well, you know...maybe they are right. If TAXPAYERS were not FORCED to pay $$BILLIONS to people who won't work, maybe they would get a job.
And are their stadiums owned by the taxpayers? Do they get the income from them? Or did they do an Irsay/Simon and get ALL the money?

Bart Lies said...

You should check out the latest snafu brought to us by the Mayor's office:

Mayor's Action Center launches RequestIndy site

dcrutch said...

Another medium" market like ourselves, aspiring to be big.

We're in a bad convergence from which I think civilizations don't typically emerge intact. Prolonged & assumed affluence led to doling out money we no longer have, coiciding with excusing all manner of behaviors and ignorance. We now lack enough relatively educated working class citizens to fight-off across-the-board corruption, as exemplified by unaffordable entitlements, foreign policy, and stadiums (that are suppossed to help us so much).

The smaller are the weaker, and that's what we reap from trying to act BIG in Cincy & Indy.

Jeff Cox said...

We've been over this before, Gary, but to reiterate:

1. Unlike Indianapolis, the people of Hamilton County, Ohio (Cincinnati) voted in favor of the tax for Paul Brown Stadium and Great American Ballpark in a public referendum, which is what they do seemingly everywhere except Indiana. This was not the rich and powerful who rammed this tax through a compliant and bought off city-county council. The people there wanted to keep the Bengals and Reds. The teams were and are important to the people there.

2. I'm no supporter of the Colts (especially) or the Pacers, as you know, and I certainly hate paying for them, but to argue that a team is worth $800 million and therefore cannot be going bankrupt or losing money is a nonstarter. The team does not realize it's value until it's sold. It cannot
turn that value into income. The Pacers could be worth $800 million, but if they have no income and are paying $15 million for upkeep to Conseco Fieldhouse, they are still losing money - $15 million, in this example.

3. Again, you and I have been over this before, but you know I dispute the studies you cite allegedly showing that pro sports teams do not economically benefit their cities. I hate the Colts as much as anyone, but they have definitely helped Indianapolis economically.

Gary R. Welsh said...

There is also a taxpayer lawsuit in Hamilton Co. claiming that the Bengals made fraudulent representations to the public about the economic benefit of a new stadium to their community. Again, you don't know that the Pacers are losing any money. I think it is a complete lie. The Simons are very shrewd business people and are very good at playing others as the suckers. Not me. I know they are lying because the Simons never hold on to any business that loses that kind of money. They dump every losing venture as quickly as they can. They expect us to believe they've held on to this turkey and absorbed $200 million in losses. That's why they won't show us their audited financial statements. That's why none of the NBA owners show there audited financial statements. Perhaps you like being played like a fiddle, Procynic, but not me. And every single objective study has shown that professional sports teams do not have a net positive economic impact for the public dollars invested in them. The City of Indianapolis would be much better off if they simply took their team and got the hell out of this town. We're sick of their blood-sucking ways. Please, just go away.

Jeff Cox said...

Not saying I agree or disagree on the Simons' claims about the Pacers, Gary. What I am saying is that just because the team is valuable does not mean the team is making money. Think of it as a diamond. Diamonds don't make money unless you sell them. A diamond just sitting there doesn't make any money.

As for the studies, no, not every one of the studies says that pro sports are financially bad for cities. There is no unbiased study here. Some are financed by team owners, others are done by university academics who are often hostile to sports in general.

The problem with the studies you cite generally revolve around their definition of entertainment and their near-religious belief that someone not going to
a sporting event will instead go elsewhere, therefore the money would be spent but without the cost of stadium upkeep. There is little if any evidence to support such a proposition.

Different types of entertainment appeal to different people. Entertainment does not always crossover. For instance, football fans will generally not spend their money on ballet, with me being the obvious exception. To assume they would as these studies tend to do is preposterous. If I have to go to a sports bar to watch America's Team - the San Diego Chargers, I do so. If I don't, it doesn't mean I don't go someplace else. It often means I do not go out at all. I periodically fly to San Diego to see my Chargers. I'll often travel to other cities to see them, too. That's money these places are making because of the Chargers. For example, if I'm not going to St. Louis to see the Chargers, I'm probably not going to St. Louis. To argue otherwise as many of these studies do shows a profound lack of understanding of sports fans.

Additionally, I take issue with their contention that the businesses who locate around sports stadiums would simply have located elsewhere in town. The evidence for that proposition is nonexistent and contrary to common sense. The area around Nationwide Arena in Columbus, OH, is now active and bustling with people, restaurants and shops, where before it was a derelict. This was a new market created by the construction of Nationwide Arena. Opening a restaurant there is mire likely to make a splash than in the areas chock full of restaurants like Dublin-Sawmill and Polaris because of a less mobile market. You can't day with any authority, as these studies do, that these businesses would have otherwise located at Polaris. Same with Cleveland and Gateway, and to a lesser extent Pittsburgh and the North Shore.

Those studies you cite are generally biased, flawed and baseless. No less so that those commissioned by sports teams, and probably moreso.

That said, I am thoroughly disgusted with the Comts situation.

Gary R. Welsh said...

The evidence suggests Conseco Fieldhouse has harmed, not helped, businesses in its immediate area. There is no big boom in the area around Lucas Oil Stadium for that matter either. The expanded convention center will have a much greater impact on hotels and restaurants than the stadium or arena. And the notion that companies pick a city to locate their business because it has a professional sports team is complete bullshit. They consider tax burden, other costs of doing business, available workforce and quality of life in general, among other factors. Austin, Texas is a perfect example of a city that has flourished without professional sports teams. Austin has put its emphasis on music and culture in general that has made it very attractive to high tech businesses. The elevation of sports fanaticism in this city just reinforces our backwater ways. Look at all of the corporations that have moved their headquarters out of the city over the past 20 years.

Jeff Cox said...

1. Sorry, but Austin, Texas does have a team: the Texas Longhorns. The University of Texas is why Austin is doing so well.

2. You bet yer bananas companies consider sports teams in terms of location. They are part of what are called "amenities." Companies look for them when locating to make sure they can attract a workforce. Places with nothing to do can't attract people to move there. Young educated people want to live someplace fun. They don't generally care about taxes or mass transit or, yup, the worthless bike trails put on New York Street. If a place is not fun, people won't move there. Hence, Indiana's brain drain.

And, yes, sports teams are a big part of that. They can help convince people that a place is fun and help create that fun atmosphere, unless those teams pride themselves on being "hicks" as the Colts and Pacers do.

You may not like sports or care about it, but most other people do. Moreso than libraries or bike trails. You need to accept that.

Gary R. Welsh said...

Sorry, Procynic, but the Longhorns are not a professional sports team. The Longhorns are part of a very large state-funded university.

Bart Lies said...

Austin TX has, however, orderd up their own pitcher of Kool-Aid.

The city has tenatively agreed to a deal for having F-1 racing come to town for the next 10 years.

For that, they will have to build a brand new roadcourse on which to run the race. No word on how much THAT will cost.

Jeff Cox said...

The Longhorns serve as a pro sports equivalent. Helps give the same impression a pro sports team does. Trust me, the Longhorns are far bigger down there than the Colts are here. Plus, UT gives Austin a young educated workforce. Indianapolis has no equivalent.

Gary R. Welsh said...

More BS, ProCynic. Indy is home to IUPUI, which is anchored by the larger campuses at Purdue and IU, both within a short drive of Indy. Many of those graduates move out of state because Indy offers so little in the job market for them. When someone suggested we keep MSA for use by IUPUI's basketball team, the Simons immediately nixed it. They insisted it be torn down as part of their lease agreement for Conseco Fieldhouse. You have no clue how many decisions have been made in this town for the sole benefit of the billionaire sports team owners. It's as if that is the only reason downtown exists.

Blog Admin said...

Procynic is apparently unaware of the basic principle of discretionary income and comes to a false conclusion that because university studies use this principle, they're biased. Then he goes on to cite his personal (IE anecdotal) example, which proves...well, only his spending habits, not that of society.

If Option A for spending discretionary income vanishes, people are more likely to just go ahead and spend it elsewhere. They might not spend it in the same economic sector, or they might choose to invest or save if it's a sizeable chunk of change.

This means that, when sports teams hold regular season games, it mostly consists of people within the town. These people are not contributing additional money to the economy. They're just focusing their economic impact in one night in one section of town.

If the sports team were to shut down, these people still have money to spend. They are more likely to spend it elsewhere, with maybe a small nearly insignificant percentage of them choosing to save or invest rather than spend.

And university professors hate sports? It's often a university's atmosphere that fosters a sports heavy environment.

Jeff Cox said...

Are you actually saying the impact of IUPUI campus is comparable to that of the University of Texas at Austin? Wow. I mean, wow.

I won't argue about the negative effects of Conseco Fieldhouse. Sullivan Optical and Hollywood Bar and Filmworks are enough. But it is not the norm in other cities.

Gary R. Welsh said...

Indy is smack dab between IU in Bloomington and Purdue in Lafayette. I'm speaking of the educated workforce claim you made. Plenty of good graduates being churned out there, and IUPUI I believe has more than 35,000 students now.

Jeff Cox said...

Indy Student,

And you fail to grasp, as many of those university professors do, how sports fans think. Perhaps it is a symptom of Colts fans having (far) less emotional attachment to the team than, say, Browns or Steelers fans. Steelers fans generally travel well. They spend money on their team, and lots of it, judging by their merchandising and TV ratings. It's an event, an emotional commitment, not just entertainment, which means they are more likely to spend money on the teams than on other entertainment.

And, using your logic, why should a city want any business to open since it would only take away from existing businesses?

Blog Admin said...

Rampant fandom is usually the minority, not the majority. I'm willing to make an exception. I'm sure in the days of Michael Jordan people would travel from the tri-state area and beyond to go see him on occasion, or even in the case of Steelers, just like the band Phish's fans often follow them on tour and stay in campsites.

So I find it hard to believe that the NBA and NFL are filled with teams that attract Steelers-level of attention from fans. Especially since the NBA basically reported losing money across the board.

Even so, what you say about dedicated sports fans doesn't negate that if they didn't spend that money on sports, they'd spend it elsewhere or save it. Just like if my favorite music store closed, I'd find another use for the money.

Jeff Cox said...

Indy Student,

Never been to Pittsburgh, have you? Never been to Cleveland, huh? Denver? Green Bay? Might want to check them out before you start talking like that.

Downtown Indy said...

Does anyone really think that a dozen play dates a year (if lucky) amounts to a hill of beans as to financial impact from people travelling here for games?

C'mon. ~250 other days a year we have, what, people coming here to visit the empty building?

Nope. Let's have a show of hands who can work (or a business that can operate) +/- 15 days a year and be profitable.

I've seen people musing about 200 events a year there. Yeah? Maybe if you count every time somebody rents a meeting room for a couple hours. I'm sure that covers the operating costs. Ha!