What is a Stadium Worth?

I'd feel more pride in our city if we had a clean harbour, clean air, less unemployment and fewer vacant polluted lots than a decade of back-to-back Grey Cup victories.

By Christopher Kiely
Published July 15, 2010

What is it worth? This is an important question that is being asked more and more in this city. I'm reading it in posts, I'm hearing it in discussions, even the Spectator has joined in the chorus of questioners (albeit somewhat rhetorically). To answer the question properly, we need to consider a couple things:

  1. What is the actual economic benefit in new money of subsidizing the pro sport franchise?
  2. If there is minimal to no economic benefit, what is the social benefit worth?

The first part is the easy one. We can look at facts, data, debts, profits and some existing studies to get a better idea of the benefits (if any).

The second part is the tough one where emotion, civic pride and a whole slew of human emotions come into play. People's answers will vary dramatically based on many factors: from economic and political beliefs to whether or not they're a sports fan.

Economic Benefit

In 2003, Dennis Coates and Brad R. Humphreys from the University of Maryland, Department of Economics wrote a paper titled "Professional Sports Facilities, Franchises and Urban Economic Development". In their paper, Mr. Coates and Mr. Humphreys examine the reality of the economic benefits promised by the type of investment we here in Hamilton are currently debating:

...new sports facilities are frequently cited as important components of urban redevelopment initiatives and sources of considerable economic growth in terms of job creation and income generation. Cities provide the owners of professional sports franchises with hundreds of millions of dollars of subsidies for the construction of new stadiums and arenas and expect these facilities to generate economic benefits exceeding these subsidies by large margins.

Not only does their study throw cold water on the notion of any economic benefit, it raises the specter of a negative economic impact:

However, a growing body of evidence indicates that professional sports facilities, and the franchises they are home to, may not be engines of economic growth in urban neighborhoods. Econometric studies of the determination of income and employment in US cities find no evidence of positive economic benefits associated with past sports facility construction and some studies find that professional sports facilities and teams have a net negative economic impact on income and employment.

This conclusion is repeated multiple times in their study. There is minimal to no economic benefit in supporting sports facilities or franchises and in fact a negative economic impact is often the outcome. To understand why, they provide several factors. One of those factors is due to the lack of new money brought in by sports franchises. To understand that we need to understand what the term "new money" means.

New money is the money that comes from out-of-town. Money that if not for the sports franchise being in the city, the city would not see. We cannot look at all the money in the same way. The money spent on Hamilton Tiger-Cat games by local residents is not the same as that "new money". Unless the Ticats are bringing in out-of-town fans who would otherwise be spending their money in Toronto, Kitchener-Waterloo, Brantford, and so on - and they spend some of that money outside the stadium, there is no money coming into the city that would not be here even if the Ticats weren't.

Spending on entertainment, whether it be sports, movies, or a night out on the town, is discretionary spending. People do not increase their discretionary spending just because a sports franchise is in town. As Mr. Coates and Mr. Humphreys explain:

...household spending on sports - direct spending on tickets, licensed merchandise, etc. and indirect spending on food and drinks at or near a sports facility - is highly substitutable for other forms of entertainment... Professional sport does not induce residents to increase total spending by drawing on savings or borrowing against future earnings. Residents maintain their level of entertainment spending but alter the allocation of this spending toward sport-related spending and away from other close substitutes.

This is what leads to the possibility of negative economic impact. If money that would have gone to local entertainment establishments and subsequently to the local employees and owners of those establishments gets spent instead on a sports franchise that, even with that money coming its way, cannot make ends meet (as is the current admitted state of the Ticats) or in the case of successful franchises is simply funneled out of the city through salaries for rich owners and players who do not live in the city, a negative economic impact is possible.

When we look around this city and see the challenges we face - low income, low tax revenue, floundering economy - the conclusions reached by Mr. Coates and Mr. Humphreys are quite troubling.

No evidence exists that professional sports have a detectable impact on local government spending or tax revenues.

... when comparing a city with a sports franchise to one without such a franchise, all other things equal, one will find income lower in the former.

Much of this research doesn't seem to correspond to what we're being told. The city has hired consultants, the Ticats have hired consultants and they've all done studies. This stadium, in one location or the other, depending on who you believe, is supposed to benefit us... right? In their paper Mr. Coates and Mr. Humphreys quote a similar 1995 study by John L. Crompton to warn that we may not want to believe any of them:

Too often, the motives of those commissioning an economic impact analysis appear to lead to adoption of procedures and underlying assumptions that bias the resultant analysis so the numbers support their advocacy position

Although Mr. Coates and Mr. Humphreys never do assign numbers to the economic benefit of sports, if indeed there is any at all. An article by Tom Griffin that appeared in the University of Washington alumni quarterly Columns quotes UW professor Bill Byers, "an expert on economic impact studies", who states the economic impact of sports on the local economy to be:

...1/10th of one percent, and even that is probably overstating it

Based on these studies, the best case scenario is the city sees an insignificant economic benefit and the worst case scenario is a negative impact on our city's economy simply from the presence of professional sports. There would be an even greater negative economic impact by subsidizing them.

The results of these studies do not support either proposed stadium location. East Mountain may be a regressive approach but counting on a West Harbour location to do much of anything besides filling a brownfield may be wishful thinking on the part of the West Harbour supporters.

In their defense, I will say that the stadium is viewed by many West Harbour supporters as only one part of a larger urban renewal plan for the West Harbour, so all hope does not rest on the stadium. If there are those that still view a West Harbour stadium as the critical ingredient to rejuvenation, they may be seriously disappointed.

Social Benefits

So if there is minimal to no economic benefit to the city having pro sports, the entire benefit hinges on the second part of the equation, the social benefit. In their paper Mr. Coates and Mr. Humphreys cite a 2002 study by Bruce K Johnson., Peter A. Groothuis, and John C. Whitehead that uses a "contingent valuation approach to measuring the benefits of sports stadiums and sports franchises":

...people are told the local professional hockey team may leave town because their current arena is not adequate to generate sufficient revenues to put a quality team on the ice. They are then told that the city is considering buying the team to keep it in town and that doing so would require a tax increase of $X, where X is randomly assigned to the respondent and was either 1, 5, 10 or 25 dollars. Finally, the respondent is asked if he or she would be willing to pay $X each year in higher city taxes to keep the team in town. Respondents were then asked the most they would be willing to pay and presented with a card with dollar amounts listed for them to choose from. The study "suggests that the value of public goods generated by major league sports teams may not be large enough to justify the large public subsidies".

If what people personally value the presence of a pro sports team in their city to be still doesn't add up to the subsidies than we really do need to ask ourselves why we pay for these things at all.

Is it right for 600,000 people to foot the bill for ~15,000 diehard fans to attend a game ten times a year?

If the simple concept of supply and demand cannot support a corporation (i.e., fans of the team are not willing to pay enough in ticket cost to cover operations) is it the responsibility of citizens to support that business through incentives, subsidies and taxes?

What if businesses that do have a measurable positive economic impact on the city came asking for money and subsidies, would the demands be as positively supported as some have supported the Ticats demands? Would they be viewed as being "committed to the city"?

What are ten days of rah-rah, feel-goodness worth?

What is the value of civic pride created by the Ticats?

Cleaned-Up West Harbour

After the research and reading I've done on the topic, I believe the best economic choice would be a cleaned-up West Harbour site with a temporary Pan Am stadium and a conversion of the site to a lower cost rejuvenation project (i.e., sculpture park, skate park, even just an urban meadow) while letting Bob Young build his own stadium.

On the feel-good side of things, I'd feel more pride in our city if we had a clean harbour, clean air, less unemployment and fewer vacant polluted lots than a decade of back-to-back Grey Cup victories. Pro sports is a luxury this city can no longer afford to subsidize at the level it is being asked to.

But the above are all questions we need to answer individually and with the understanding that all we are actually buying is enjoyment. Economic benefit for the city is not guaranteed, (quite the opposite actually) nor is the success of the Ticats at a new costly location. So ask yourself what it is worth and let your answer be known to your representatives; otherwise they'll answer for you... and you may not be happy with their answer.

Christopher Kiely is a "middle class white guy" who was raised to believe certain things and has watched the world do the complete opposite for 30+ years. He attended Mohawk College in the 1990s, has traveled around some since and now lives with his family in Hamilton.


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By Mark (registered) | Posted July 15, 2010 at 22:58:36

"I believe the best economic choice would be a cleaned-up West Harbour site [...] a conversion of the site to a lower cost rejuvenation project (i.e., sculpture park, skate park, even just an urban meadow)"

You hit it right on the head. I do not support the stadium on the West Harbour, nor do I like the East Mountain site. But, in light of the fact that if we do not build a stadium, we will lose the Pan Am games to another city. The ti-cats are willing to put in a large amount of money towards the stadium and so are local businesses. However, if the businesses and the Ti-Cats do not feel that the location will help their respective businesses, they will not chip in. Therefore, the Ti-Cats and local businesses have the city by the balls.

As noted in the study above, there is no evidence that sports facilities (stadiums) and sport franchises bring in extra commerce to the city. Therefore, if the point of building the stadium downtown is to promote the local businesses, and if the study is right, there will be no extra commerce generated around the West Harbour. I will reiterate that the land at the West Harbour might be better used to extend the Harbour park or build a new separate green space.

Furthermore, the problem of transportation was brought up. People in Hamilton and from out of town will be driving to the stadium to see the venue. That's approx 7,700 cars. Pushing that many cars through small, one lane residential streets is a challenge. The only course of action is to enlarge streets, which is very difficult considering the dense zoning downtown, or to create temporary one-way streets. Neither of these scenarios foster any type of local commercial growth because neither offer suitable parking. As seen with Main street, King street and various other one-way streets in Hamilton, those types of streets actually devalue the businesses that reside on them. People are generally uncomfortable with stopping to enter those businesses because of the fury of cars travelling on them.

The East Mountain site has one thing going for it: the large amount of land. The land can be used to enlarge the adjacent streets and add an access to the RHVP or the Linc. The location is within a industrial/commercial zone which is away from residential housing. That buffer shields local communities from the noise generated by games, concerts and the like. If you do not believe that this is a problem, talk to the people that live by Ivor Wayne stadium. Their property value is nearly half of other neighbouhoods, just a half kilometer down the street.

However, the site does not offer a picturesque view of Hamilton, which is what the stadium is supposed to encourage. The Pan Am games will feature Hamilton and it's beautiful side. I would not be happy if our stadium was pictured with a large advertisement for "Super Sausage" in the background. But, the Pan Am games are going to last only a short time. In fact, it will be a small spark of time in the 20+ years that the stadium will be standing.

Anyway, that's my rant.

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By Thought Police (anonymous) | Posted July 16, 2010 at 05:07:44

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By HamiltonFan (registered) | Posted July 16, 2010 at 07:14:41

I agree Thought Police and will say the west harbour should be cleaned up without using a stadium for an excuse especially if the major tenant using it says it's not the right place for a stadium given the infrastructure currently available and likely to be available for quite a while ie. no perimeter road.

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By realitycheck (anonymous) | Posted July 16, 2010 at 07:38:48

Kiely is correct to question the actual value that would be brought by this stadium building exercise. I too have read the 2003 report by Coates and Humphrey, and agree with much of Kiely's interpretation of it.

Kiely's articulate essay does the entire stadium debate justice by challenging the wrongly-held notion that a stadium could be leveraged to act as a catalyst for economic growth. The economic spinoff would be minimal no matter where it would be located.

While the notion of a temporary stadium at West Harbour would at first blush seem reasonable, this scenario is not likely to be applied given that the Pan Am organization committee is designing sites with the goal of providing long-lasting legacies of sporting facilities throughout southern Ontario.

West Harbour needs to be developed as it was originally intended in the Setting Sail secondary plan. It has laid fallow far too long while talk of the stadium has lingered over the past few years. Remove the stadium from the speculation and it will develop as it should.

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By HamiltonFan (registered) | Posted July 16, 2010 at 08:24:06

Agree reality check and in the process it allows the TigerCats to explore the options and sites in the entire region where they feel best suits their needs. The real football fans like myself are going to go to the games regardless of location even if it's in Toronto, at least I will. That's what's nice about football, it's just about 10 homes games a year so it's not like you'd be travelling so much more of the time like in 40 games for hockey or for the crazy 80 games in baseball. I remember people in Hamilton who had Blue Jays season tickets and went to almost all the games in Toronto, honestly I remember someone who did this for a few years.

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By The Essential Point (anonymous) | Posted July 16, 2010 at 08:27:24

The fact remains that $60 million dollars of local public money is going to be spent on building a stadium. The question is do we want to promote more urban sprawl, or rejuvenate a brownfield and improve the waterfront?

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By nobrainer (registered) | Posted July 16, 2010 at 08:28:07

A downtown stadium connected to GO Transit actually could bring entertainment spending money into the city from outside it.

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By Tartan Triton (anonymous) | Posted July 16, 2010 at 08:33:42

Hamilton Harbour was treated as an open sewer for the better part of the 20th century. Local sewage outflows poured into it, both household and industrial, from every corner: Hamilton, Burlington, Stoney Creek and Dundas all had a go at the old girl. It wasn't without consequence, though. It got to the point that local papers regularly reported ungodly amounts of dead marine and avian life washed up along shorelines, oil-rainbowed ice in the winter and fecal chop in the summer. And of course the delicious waft that one gets from an unflushed toilet.

The most notorious residue of this unenlightened era in our fair city's history is the toxic blob known as Randle Reef. A carcinogenic morass on the harbour bed extending outward from the Sherman North inlet, it ranks as the second-worst coal tar contamination in Canada, trailing only the infamous Sydney Tar Ponds. It's one of the reasons that Hamilton Harbour was recognized as one of the most degraded bodies of water in the Great Lakes 25 years ago. In response, local stakeholders undertook exhaustive studies with an eye to remedial action and the aim of restoring environmental health to the harbour by 2015; the cleanup of Randle Reef became a top priority in order that the harbour be delisted as an Area of Concern. This was long, long before the bid cycle for the 2015 Pan Am Games.

And the process took a long, long time. The debate and negotiation has been much more of a grinder than even the Pan Am sessions. As with any multi-stakeholder, tri-governmental, cross-generational attempt at undoing the sins of the industrial age, it has been an unimaginably complex process, one complete with evasions and spin by dockland profiteers. But it looked as if we were moving toward a resolution after the feds and the province kicked in their respective thirds toward a cap-in-place remediation of the deadly mess. And we were told of the rewards that would come with delisting the harbour: York U researchers pegged potential economic uplift in the local market to be something like $1 billion. There has been just one snag. Three years after the feds and the province came up with their $30 million per, the City of Hamilton has yet to commit its share. In dragging its feet, the project cost has grown from $90 million to $105 million. And (stop me if you've heard this one before) the city is looking to upper government to cover the difference.

Another 2015 storyline is going just as badly in different ways, but we should have no doubt as to which is the priority. Both on grounds of being the better researched of the two and the more universal in its appeal and most egalitarian in distribution of benefits, Randle Reef should be the immediate priority for this city. Let's tackle a legacy project that will profoundly transform the identity and self-esteem of our city, and leave the embattled recreational infrastructure for another day.

Some might argue that there is merit in patience. The Commonwealth Games' centenary is 20 years from now (long enough to do thorough studies and build site consensus), and as birthplace of the Games, Hamilton would be a sentimental favourite. That inaugural event built Ivor Wynne, and it would be poetic if 100 years later the Games built IW's replacement. Failing that, let the diehard private sector boosters who maintain that the Cats are an essential Hamilton brand fund a Stoney Creek stadium. At $150 million, you only need 150 firms willing to commit $1 million. And from what I read, $74 million of that is already on the table. ;)

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By Kiely (registered) | Posted July 16, 2010 at 09:42:54

Kiely makes some interesting points then contradicts himself. He is a hypocrite. If stadia are not good for cities, they are not good for the west harbour either. The west harbour can be cleaned up regardless of any stadium construction.

I specifically say I support a temporary facility at the West Harbour. The only reason I support that at all is because I do believe it would have a negative impact on Hamilton to withdraw from the Pan Am games altogether, (although I admit that could be debated as well). So in my view we are on the hook for a facility for the Pan Am games. A temporary facility will not have the on-going costs of a permanent structure.

The fact remains that $60 million dollars of local public money is going to be spent on building a stadium. The question is do we want to promote more urban sprawl, or rejuvenate a brownfield and improve the waterfront? - The Essential Point

That is the question. I agree we probably are going to spend the money. Forget the economic benefits or what will make the Ti-Cats viable, none of that is guaranteed. What we are buying is either a cleaned up brownfield or a catalyst for urban sprawl… take your pick.

A downtown stadium connected to GO Transit actually could bring entertainment spending money into the city from outside it. - nobrainer

I have no doubt it could nobrainer, but we need to be careful not to get in our heads that it will no matter what, and that it will be enough economic benefit to justify the construction and on-going maintenance costs.

Thanks for the info Tartan Triton.

Comment edited by Kiely on 2010-07-16 08:54:11

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By lawrence (registered) - website | Posted July 16, 2010 at 11:41:45

Residents maintain their level of entertainment spending but alter the allocation of this spending toward sport-related spending and away from other close substitutes.

Can't say that I agree with this. I can't really afford to go to each home game but I find a way to do it because I wait all winter to return to IWS to see those 10 games.

I buy beer, food, the odd souvenir, see and hear corporate branding all over the stadium. Aren't all those people serving me and thinking up ways to entertain me and selling this product all from and living in the area creating jobs?

If the Ticats aren't around, what is going to get me off the couch to make me want to spend money I don't have just to get out. Even concerts, unless they are local, wouldn't encourage that. It's about civic pride and unless Rush is playing at Copps, there probably aren't many other things that would make me want to spend my last dollar to go out and enjoy it.

I enjoy seeing local bands and artists and such (and there are alot of things that do get me off the couch that don't cost anything), but on a larger scale, does any of this create the revenue and jobs that a sports franchise does? I understand that if the bigger business is losing money that revenue isn't helping a mom and pop restaurant like it could, but once again if I can't really afford it I am not going to spend it, unless I have been waiting all winter to enjoy it. How many people are employed on any given game day alone?

Talking of public money going to a losing cause, what about all the free festivals? What do they cost? I love them personal but it's entertainment right? Sure the Cats make no money and cost this city money, but it does so much more and it is another form of enterainment. You need things to do in a city to keep from getting depressed and sitting at home on the couch. I think we all need a little raw, raw and sure there are many ways to create that, but the Ti-Cats are one form of that I enjoy.

I don't really enjoy watching sports on television all that much. I want to be there and feel the energy. I can't afford to go to many NFL, MLB, or NHL games because the cost is pretty high. Sure the Bills are cheap and good entertainment (same goes for the Jays), but with travel and hotel and such, it adds up. Still good value for my money in the end but for $35, I can see some great football, support a local team and show my civic pride, spend another $25 on drinks, and I am only in for $60.

I hate all the money that is involved in sports. I was just talking to someone this morning at Hamilton's only walk-through coffee shop , and the very courteous woman serving me commented on my Hockey Night in Canada tee. My response, "I don't like the NHL. To me, CBC is hockey."

Sports are too much about money and in my eyes, the CFL is truly the last remaining Canadian sport standing. It could still use to get salaries and ticket prices down and promote more local talent to be a stronger league. Spread to the east coast and promote this game more at a high school and CIS level to create that Raw Raw at those events as well. That is when the CFL will be a much stronger, more successful business that actual can create true revenue for a city.

Going back to attending games at IWS, if you don't really like football per say, I have spent entire evenings at IWS and basically paid a $35 cover charge to catch up with friends in the endzone over a few wobbly pops. There is just something about all those people in one place, that makes that a cover charge I can justify, and have a great night and not even know who won or who was playing.

There are 100's of ways to enjoy a sporting event. Watch how kids entertain themselves at a game. They are proof alone that you can find fun in anything. Even if it's just watching the exctiement in the eyes of someone you love, in their element taking in something that they love and are so passionate about. Watching someone else have fun and being silly can be fun as well.

This is a great article with some great stats. I get it and on some level and it's probably all right. But this team is important to 15,000 citizens(and it's much, much more I am sure because there are many who just like watching it at home or simply can't make each game).

That's at least 15,000 people who are out in their community whether it's actualy bringing in any money or not. It's bringing 15,000 people together. I don't think you can put a price tag to that.

As for this temporary stadium thing. I am intrigued. Then put that 20 year plan in place to sustain IWS until the commonwealth games, and then the first city to host the games, hosts the centennial at the same building, rebuilt with money from those games, with an athlete village on the waterfront.

The Commonwealth games was once very proud of Hamilton as 'gracious hosts'. We lost the bid to hold the 2010 Commonwealth games, but let's slowly work on Hamilton as one poster above mentioned, from now until 2030 to once again be a city the games are proud to showcase.

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By Kiely (registered) | Posted July 16, 2010 at 13:15:20

Can't say that I agree with this. I can't really afford to go to each home game but I find a way to do it because I wait all winter to return to IWS to see those 10 games... If the Ticats aren't around, what is going to get me off the couch to make me want to spend money I don't have just to get out. - lawrence

That's the thing about studies though lawrence not all answers will be the same but at the end of the day you will get an overall picture. Based on the research, the overall picture shows the money simply goes elsewhere within the community, whether that is nights out or even just movie rentals and pizza delivery.

I do not doubt what you say, you just may be a statistical outlier.

That's at least 15,000 people who are out in their community whether it's actualy bringing in any money or not. It's bringing 15,000 people together. I don't think you can put a price tag to that. - lawrence

I can understand that lawrence, but when a city is in the financial position this city is in, I think we need to try.

Good post though... good stuff to think about.

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By A Smith (anonymous) | Posted July 16, 2010 at 15:56:23

nobrainer >> A downtown stadium connected to GO Transit actually could bring entertainment spending money into the city from outside it.

Or the city could use that money to lower tax rates so that we make investing in Hamilton a little more profitable. Currently, for every $100k dollar of new investment in Hamilton, things like condo units, the city asks for $1538 in residential taxes. In Burlington, this number is $1076 (2009), Oakville $1022 (2009) and Toronto $854 (2009).

Assuming that inflation increases at 2% per year, in order for Hamilton property owners to see a positive return on their investment, home/condo values must increase at more than 3.538% per year. If it's less than this, their homes will lose equity. In Burlington, home values only have to increase by 3.076% to make money, Oakville 3.022% and lucky Toronto homeowners will see equity gains at only 2.854%.

So, by having high tax rates on property, this city is decreasing the demand for Hamilton homes. If we really want more investment, we need to be tax competitive with other GTA communities. We simply can't charge people 50-80% more in taxes per dollar of investment and then expect people to pay it. They don't have to and they won't.

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By coleman (registered) | Posted July 16, 2010 at 19:29:29

Having grown north of jackson square, I can't see how a west harbour stadium would help the neighbourhood. most the arguments are about the stadium and the city. need an article from the other direction - how would a stadium affect the quiet neighborhood. i have read setting sail a while back and went to some of the info centers and i supported it becasue it would help the neighborhood. i think our city needs more people living in it. that would bring busines, transit etc. kinda scary reading someones ideas about widening queen, making it one way, additional parking and tailgate parties - that is not liveable-neighbourhood friendly. there are lots of things we can do to make it more liveable like a free downtown shuttle. stadiums don't fix neighborhoods - highly suspect if they will improve it or the downtown

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By slodrive (registered) | Posted July 17, 2010 at 01:21:03

It really bugs me when people say "15,000 diehards". To me, as a fan and citizen, that's a cheapshot. It's been many years -- and few since probably the 60's where crowds neared a 15,000 average. This also doesn't factor into the TV viewing audience within the region.

You can't tell me that part of this community's identity and civic pride lies with the Ticats. Ticket holder or not. Those are the intangibles that aren't calculated in dollars and cents.

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By Pigskin PPP (anonymous) | Posted July 17, 2010 at 09:55:59

I believe that if you sample the home game attendance for the last 30 seasons, it averages out just below 20,000 per game. David Braley's 1987-1990 ownership stint coincided with some of the club's worst gate figures in history. At least one of those averaged out at 14,000 and change.

The fact remains that it falls to an individual club and not the host city to rationalize their business model. Sure, the cats smeared the field with the Blue Bombers, but Winnipeg shames them as a business model ($761,000 profit in 2008) as do western franchises like the Eskimos ($416,492 profit in 2008) and the Roughriders ($1.6 million profit in 2009). The Cats, meanwhile, have apparently developed a dependency on a demographic that revolts at ticket price hikes. The limitation is not geographic.

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By Kiely (registered) | Posted July 17, 2010 at 11:12:39

It really bugs me when people say "15,000 diehards". To me, as a fan and citizen, that's a cheapshot. - slodrive

That is the reality. They draw around 20,000 fans a game. I think assuming 3/4 of them are "die hard" is pretty generous.

The fact remains that it falls to an individual club and not the host city to rationalize their business model. - Pigskin PPP

Exactly. Bob Young needs to start talking to the league about a reduced salary structure (i.e., salary cap) perhaps even reversing the import to Canadian player ratio and making the league a truly Canadian football league. The Aussies don't need to "import" players for their brand of football. It is not our job to provide stadiums, parking and concession profits to a business that essentially provides us with nothing more than 40+ guys in uniforms to cheer for because they use our city's name.

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By Undustrial (registered) - website | Posted July 17, 2010 at 19:02:14

Thank you Kiely, those numbers were a well-needed dose of reality for this whole stadium-craze.

There are a hundred better ways to spend $60 million in this city. New Go Station/service. Clean up Randle Reef. Upgrading schools (generates much more long-term value) or Hospitals (our hospitals are in a major budget crisis, and the Juravanskis can't do everything) or light rail. But there's one area, under constant threat, which is a little closer to this subject: sporting facilities - especially hockey rinks. Making ice time more expensive, and not funding necessary sporting facilities means its harder for kids to get into sports, and there are some definite long-term health expenses associated with inactivity.

The problem with all these big corporate sporting budgets is that poilticians and newspapers too frequently lose track of the line between public and private spending. Just because a business like the Ti-Cats uses Hamilton civic pride as a marketing technique doesn't mean that they're a public utility.

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By A Smith (anonymous) | Posted July 17, 2010 at 19:45:28

Undustrial >> There are a hundred better ways to spend $60 million in this city.

Are any of the projects you mentioned disallowed from receiving donations/monetary support from individuals? If not, then why not give the $60M back to the taxpayers and let them decide individually where the money should go. This would ensure that each and every citizen not only has a voice, but also the funds to support their cause of choice, even that is themselves.

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By ceesvang (registered) | Posted July 18, 2010 at 11:46:46

Thanks Mr. Kiely for asking the right questions. I hope our stadium grazed politicos are reading this.

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By BobInnes (registered) - website | Posted July 19, 2010 at 00:50:13

I'm on record as being against any new stadium, or even the Pan Am games until Hamilton fixes itself to the point we don't know what do do with all our surplus wealth but spend it on a stadium. One comment here though caused me to pause for a moment.

Lawerence noted there is a beneficial civic effect of bringing 20,000 citizens together. The problem as others pointed out this is just mostly Ticat and various music fans, ie. the experience is only for a minority of Hamiltonians. If the experience could be broadened to include most of us, that would be something of true value.

As one way of accomplishing this, I suggest that Hamiltonians throw out, not only all the councilors, but council itself, and in its place establish direct democracy, Athenian style. As I have argued before, this is the only way to rid the system of the elitism/cronyism that is manipulating the system to our detriment. Direct democracy would require a large assembly place which makes a new stadium a necessity, not a luxury. A few years of direct democracy would purge the city of its ills and restore it to health, economic and civic. The inrush of consequent benefits would pay the cost in short order.

Naturally, the Ticats could use the place on the weekends. If you want to put Hamilton back on the map, direct democracy would do it.

Comment edited by BobInnes on 2010-07-18 23:54:06

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By Undustrial (registered) - website | Posted July 19, 2010 at 10:39:11

Amen, BobInnes, tWime to get rid of the boondoggle that spawned all the others - city council itself.

Why do we vote for people? Why don't we vote on laws? Spending? Policy? We have no say, at all, over those maters. Therefore, we DO NOT have a democracy. We can only choose who's making the rules, and don't have a lick of say about which rules they choose. It's a glorified high school student council. We might as well just vote on colours vaguely associated with governance styles, like at the other two levels of government. One "X" on one piece of paper every four years communicates about a byte of data over that whole time period. Megabytes of feedback are needed for real democracy. And don't tell me we can call our councillors or write a letter to the press - we can complain to our dogs, too. Doesn't mean it's effective.

And therefore, like any other group of human beings given vast powers and no responsibilities, oversight or accountability - they fail, constantly and consistently. This kind of system is inherently biased toward big boondoggle development projects like this because it is fundamentally disconnected from the actual issues and people they affect, and the only thing people remember (especially the press) at election time is a few high-profile actions (like stadiums), not a solid comparative track record. Voters aren't the problem. Voting is.

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By Kiely (registered) | Posted July 21, 2010 at 12:03:07

Thank you Kiely, those numbers were a well-needed dose of reality for this whole stadium-craze. - Undustrial

Or lack of numbers : )

I actually tried to use sources that were light on numbers. I saw the numbers starting to fly in this debate (e.g., $74 million from the Ti-Cats) in an attempt to baffle with BS. I decided to write this with the intent of highlighting what we are spending and what we are getting, that is what matters… everything else is meaningless.

Voters aren't the problem. Voting is. - Undustrial

Interesting Undustrial, I've never heard it expressed quite that way before. Is the fallacy that we can actually vote for something different every 4 years the problem... Hmmm???

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By Ryan (registered) - website | Posted July 21, 2010 at 12:26:07

I've been thinking about your essay, Kiely, and I wonder if the model the analysts use is too static. Here's what I mean:

Given the difference between a stadium and some other arbitrary urban use on a given location, I think it's fair to say that the stadium won't significantly increase net investing and/or spending. However, the West Harbour isn't a choice between a stadium and another arbitrary use; it's a choice between a stadium and a toxic brownfield.

Right now the blighted nature of the WH site is a major disincentive to investors looking to develop adjacent properties. Replacing the blight with a viable urban use removes the disincentive and frees up the surrounding properties for redevelopment as well - particularly if the city gets the zoning and other regulatory elements right.

Now you can argue that this will merely make the WH more promising relative to other properties and hence divert investment from those other opportunities, resulting in a net wash. But investment in a city is not a zero-sum game.

For one thing, development opportunities will attract investors from outside the city - and an attractive amenity with good transportation access will attract customers from outside the city.

For another, intensifying and diversifying the land use of a city triggers the urban efficiencies that make cities viable living and working arrangements in the first place; whereas investing in low-density single use developments in the periphery, even if they cost the same amount of money to build, do not trigger the Jacobs externalities and become net money sinks over time.

Of course, you could argue that the net effect is still zero, only the container is bigger (the entire province, say, or the entire country). However, there is also the fact that productive investments actually produce net increases in total wealth. A two percent growth rate leads to a doubling of total economic activity in just 35 years.

Related to this is yet another consideration: we are in the early stages of what I expect to be a truly massive demographic shift of citizens from the suburbs and exurbs back into cities. If Hamilton is positioned to attract and accommodate those re-urbanizing citizens, we will gain the benefits of the wealthiest and most creative cohorts in our population.

But if we fail to revitalize our urban core and miss out on this demographic shift, we will continue to languish and our city will continue to decay.

Edit - having said all that, frankly I'd rather spend the entire Future Fund remediating urban brownfields, and follow up by spending all the money we plan to sink into AEGD into remediating yet more brownfields. However, political reality being what it is, the Pan Am Games hoopla provides the best feasible opportunity to recover a valuable brownfield and its surrounding properties from the industrial blight that currently traps it in disinvestment and stagnation.

Comment edited by administrator Ryan on 2010-07-21 11:48:31

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By Kiely (registered) | Posted July 21, 2010 at 14:39:11

I wonder if the model the analysts use is too static. - Ryan

I hear ya, Ryan. Keep in mind the paper sighted is an overview of several studies, so there may have been a variety of models used... all seem to point the same way though.

But I do understand what you're saying. Is there some benefit? Sure, the social benefit is a cleaned up brownfield and that is a big benefit in itself. If you just look at the benefit of a cleaned up brownfield compared to say doing nothing. I think you could easily make a case that a cleaned up brownfield will proved more economic benefit than leaving the brownfield there indefinitely.

As for building the stadium though, it could have economic benefits, just beware those they say it will (in either location), no matter what. That's what I'm cautioning. Know what we're spending and understand what we're buying:

EM = entertainment and a catalyst for urban sprawl.

WH = entertainment and a cleaned up brownfield.

Looking at the studies (and there are more besides the ones I cite) nothing else is guaranteed.

...having said all that, frankly I'd rather spend the entire Future Fund remediating urban brownfields, and follow up by spending all the money we plan to sink into AEGD into remediating yet more brownfields. - Ryan

I'm with you there Ryan.

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By BobInnes (registered) - website | Posted July 21, 2010 at 17:14:02

Is the fallacy that we can actually vote for something different every 4 years the problem... Hmmm??? - Kiely

I say yes. Most people agree to the point they've given up voting. Which is why i'm all of a sudden so keen on the concepts inherent in Athenian democracy - direct citizen decisions and non voting selection of officials. Its a little scary to consider something seeming so drastic but we do have experience with this system for jury selection.

This has been a great thread but one thing missing is a discussion of debt that will be created by this and other projects. Working Hamiltonians already are saddled with about $50,000 provincial debt and another 50% for federal. Multiply by # workers in your household. What happens as interest rates go thru the roof as bondholders start demanding they get real interest instead of nominal interest based on fictitious CPI numbers. This happened in the early 80s. Do we need to repeat history?

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