Stadium subsidies have repeatedly been shown to be one of the worst development deals local governments can make. Or get snookered into. While deals tend to vary, with some being less bad than others, local governments almost always lose in the long run: subsidies stadiums don't generate the expected economic gains, and the opportunity cost means subsidy funds can't be spent on infrastructure investments that would have a stronger, more immediate economic benefit. The perceived rational for stadium subsidies tends to focus on two main benefits: construction jobs, and a multiplier effect that's tied to tourism as well as local sports spending. One analysis, for example:

> In our forthcoming Brookings book, Sports, Jobs, and Taxes, we and 15 collaborators examine the local economic development argument from all angles: case studies of the effect of specific facilities, as well as comparisons among cities and even neighborhoods that have and have not sunk hundreds of millions of dollars into sports development. In every case, the conclusions are the same. A new sports facility has an extremely small (perhaps even negative) effect on overall economic activity and employment. No recent facility appears to have earned anything approaching a reasonable return on investment. No recent facility has been self-financing in terms of its impact on net tax revenues. Regardless of whether the unit of analysis is a local neighborhood, a city, or an entire metropolitan area, the economic benefits of sports facilities are de minimus.[0]

Multiple surveys of economists have shown a strong consensus against stadium and professional sports subsidies: one survey indicated that 86 percent agreed "local and state governments in the U.S. should eliminate subsidies to professional sports franchises" while another from 2017 showed "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."[1][2] Michael Leeds, a sports economist, put it this way: "If every sports team in Chicago were to suddenly disappear, the impact on the Chicago economy would be a fraction of 1 percent...A baseball team has about the same impact on a community as a midsize department store."[3]

But people love their teams, and the simple threat of moving is often more than enough to push subsidy deals past any roadblocks even when a move is highly unlikely. Plus, they're stuck with an old, empty stadium afterwards: when Rams left St. Louis for LA, the city was still carrying >$100 million in bonds from the old stadium's construction in 1995.[4] Plus another ~$17 million spent on developing a new stadium plan in the two years before the move. No wonder the city tried to sue.

Stadium subsidies are bad deals sold with irrational projections with fans' emotions used to grease the deal the rest of the way. The only thing worse than a city declaring victory with a stadium deal is a city actually winning an Olympic bid.[5] Apologies for the length; I got a bit carried away :).

0. https://www.brookings.edu/articles/sports-jobs-taxes-are-new...

1. https://research.stlouisfed.org/publications/page1-econ/2017...

2. https://people.uwec.edu/jamelsem/fte/fte/efl/teacher_stuff/a...

3. https://www.marketplace.org/2015/03/19/business/are-pro-spor...

4. https://www.huffingtonpost.com/entry/rams-los-angeles-st-lou...

5. https://astro.temple.edu/~mleeds/documents/CEP.pdf