Bill Stadium Deal ‘One of the Worst for Taxpayers’, Says Economist

WORCESTER, Mass. (WIVB) — When New York State, Erie County and the Buffalo Bills agreed to build a new football stadium in Orchard Park, they struck one of the “worst” deals for taxpayers, says Victor Matheson. He is a professor of economics at the College of the Holy Cross in Massachusetts.

“There’s a lot of competition out there for the worst deal. But it’s certainly negotiating for the goat – for ‘the greatest of all time,'” Matheson said.

Under the agreement, the state will spend $600 million to build the $1.4 billion facility. Erie County will kick in $250 million. Combined, the public is paying around 60% tab. The largest is the $850 million subsidy for an NFL stadium.

“Over the past 15 years, we’ve seen that nearly a third of all stadium construction costs are being borne by taxpayers,” Matheson said. “Here, we have almost twice.”

On the day the deal was announced last month, Governor Cathy Hochul specified those in Cincinnati, Indianapolis and Baltimore, as compared to other small-market NFL stadiums, represented a public share of the cost. But Matheson, who has studied the economics of stadiums and mega-events for more than two decades, said there must be a caveat.

“He is very selective about the people he chooses,” he said. “She’s also picking out very old examples. We haven’t seen many examples like hers in the last 15 years.”

Baltimore’s M&T Bank Stadium opened in 1998. Cincinnati’s Paul Brown Stadium opened in 2000. Indianapolis’s Lucas Oil Stadium opened in 2008.

Hochul has consistently argued that the state’s share of the construction cost will pay for itself over time. She cites a state-commissioned study released in November 2021, which found that the bills generate $26,675,000 in fiscal impacts annually for the state, county and city of Buffalo. The state’s share of this is $22,342,000, most of which is generated through personal income taxes. This number can increase over time as the NFL’s salary range increases.

Of course, the stadium deal as well as the accompanying lease also puts the bill in Buffalo for an additional 30 years. The stadium is expected to open in 2026. If it does, the bills will run there until 2055.

“I wanted to accomplish two major goals,” Hochul said. “Put the bills in Western New York, keep them in New York State because that’s not just Western New York’s point of pride. It’s a point of pride for all New Yorkers. But also make sure it makes sense to our taxpayers. Comes.”

Similarly Erie County Executive Mark Poloncarz said the deal was good for the county, which would no longer contribute to annual operating and capital costs.

“We got a great deal for the people of Erie County,” Poloncarz said.

However, economists have concluded that the construction of new football stadiums is not related to economic growth.

“You could argue that it leaves the business and you lose their income tax,” Matheson said. “But unless you assume that no other business will ever come to replace that expense, that’s a false argument.”

Chris Horvetits is an award-winning reporter who joined the News 4 team in December 2017. see more of his work Here,

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