This week, the Kansas City Chiefs announced they were relocating to the state of Kansas for a brand-new $3B stadium. The term sheet agreed upon by the team and state is outlandish. Joe Pompliano (who is one of the best at sports business news) has gone over the term sheet and claims it is the “Most Lopsided Stadium Deal In NFL History” thanks to $1.8 billion in taxpayer money being included. But the details of many important parts of the deal are still unknown. For example, we still don’t know where the new stadium will be located. In a recent press conference, the Chiefs president claimed that the team will decide later on the location. The look of the stadium? The look of the entertainment district around the stadium? Nothing. Heck, the team hasn’t even hired an architect. Yet, even with plenty of details still left unanswered, I found it odd that I continued to see the governor of Kansas go from media outlet to media outlet claiming that taxpayers somehow were protected with this deal.
“This agreement protects Kansas taxpayers, with the state’s portion coming from revenue generated by the stadium entertainment venues and the STAR bond district, as well as lottery funds” – Gov. Laura Kelly, 12/25/25, Kansas City Star
This comment drives me crazy. I can’t stand how often this line is used. I have lost count as to how many times I have seen articles where city/state leaders proclaim that local taxpayers won’t pay a dime thanks to revenues from the venue being used to pay for it. Yet, it rarely pans out, and taxpayers are left to deal with the financial consequences:
Cobb County, Georgia
In 2017, Cobb County convinced the Atlanta Braves to move to their city by offering $300M in taxpayer money to build a brand-new ballpark. This deal was called a “home run” by Cobb County leaders, who claimed that the “revenue generated by the stadium development would be so great that it would cover the costs to…taxpayers with plenty leftover to spare.” Years later, J.C. Bradbury, a professor of economics at Kennesaw State, published a study that concluded that the tax money collected from the Braves’ move “fell well short of covering the public subsidies that fund the stadium.” This came months after Bradbury wrote another paper examining how the revenue generated by the new ballpark was not “statistically significant.”
Nashville, Tennessee
In 2013, the Nashville Sounds wanted a new ballpark. The mayor proposed a deal that would cost $37M, with $23M set aside for land costs. Then the costs rose to $65M due to the team demanding that any new ballpark needed to be built quickly. Both sides agreed to a deal that saw the city take on $65M in debt. City leaders were telling the public that this deal would “pay for itself” thanks to it being financed with “tax revenues generated by the stadium.” What happens if private development doesn’t happen around the stadium and therefore the revenues don’t come? Well, the mayor claimed to have a “high degree of confidence” that it will happen, while the city finance director claimed that there was only a “remote” chance that the revenues won’t increase over time. Not sure about you, but I sure am sold on this idea. A few years later, the total cost of the project ended up being close to $100M, thanks in part to $21M worth of projects that the ballpark required yet were not included in the budget. These new expenses were “paid for with existing Metro capital funds.” Before the city agreed to the original deal, the Sounds owner “promised (a) $50 million mixed-use development” that would help the city pay off the debt. “That still hasn’t been built yet.” Whoops.
Pawtucket, Rhode Island
In 2019, it was announced that a new soccer stadium would be built with some taxpayer money. The original plan called for the state of Rhode Island to “sell $27M in state and city bonds” to pay for the soccer stadium. But do not worry, as the public will not pay for this project. Instead, money will come from the “tax revenue generated by the project,” and that “would be used to pay back local and state bonds, including interest.” Then the costs of the project went up to $36M. Then $54M. Fast forward to today, and the cost is…$128 million. What about the residential and commercial buildings that would be built around the new soccer stadium? As the Rhode Island Current notes in an article, when the developers were originally pitching lawmakers for money, they promised a significant amount of new buildings around the stadium. This would allow for more revenue to be funded to the state. However, the latest proposal by the developers includes just two buildings and is considered a “substantial departure” from past promises.
Columbus, Ohio
Between 1978 and 1997, voters were asked to publicly fund new stadiums five times. They rejected this proposal all five times. The last proposal was in 1997, and it would have allowed for the city to be given an NHL team if it had passed. Therefore, a group of investors decided to finance the construction of a new $150M stadium so that the area could get an NHL team. The lease agreement signed by the city and team called for the owners to be liable for yearly rent payments and any operating expenses involving the venue. Eventually, the owners complained that they weren’t making enough money, so the city agreed to buy the stadium from the owners. In 2011, the city purchased the stadium for $53.3M. Taxpayers would not pay a dime since the entire cost would be “funded entirely from casino-generated revenues” near the stadium. Before the casino revenues were given to the owners, this money was previously “earmarked for…improvements to public education, welfare programs, & civil services.” Overrated things, imo. Just three years later, the casino revenues were “running dry” due to “lagged predictions” about how much the city would get from the casino taxes. So now, the city is put in a financial position where they have “little for improvements — and nothing to pay off the loans the authority used to purchase the arena.”
San Francisco, California
When San Francisco tried to get a new stadium built in 2012, it was not easy. Nobody in San Francisco was willing to help a billionaire owner finance his new stadium. So, the team went out of the city and into Santa Clara. In 2012, Santa Clara leaders approved plans to build a brand-new stadium at a cost of $878.6 million. The city agreed to take out a loan for $850 million that will “pay for most of (the new stadium)”. The city would be paid back “from revenue generated by the stadium.” As the San Francisco Chronicle wrote, this deal was completed “without a direct public subsidy,” and therefore it was “possible to finance a new venue without a huge taxpayer subsidy.” In 2017, Robert Baumann, Victor Matheson, and Debra O’Connor wrote a paper for the College of Holy Cross on Levi Stadium. In it, they wrote that while the construction of the stadium “resulted in no direct tax increases,” it did allow for the team to “avoid many types of taxes on the income generated from Levi’s Stadium.” This resulted in the team saving up to $213M.
Worcester, Massachusetts
In 2018, the city of Worcester agreed to build a new ballpark for a Red Sox minor league team at a cost to taxpayers of $101M. City leaders “hailed (the) plan” as a “game changer” because taxpayers were not going to pay a dime. The city negotiator stated that the revenue generated by and outside the ballpark “will cover the debt…and even turn a profit (for the city).” The city negotiator claimed that other cities used this payment method and it worked great for them (yet we never found out who those cities were). WBUR wrote an article that detailed other cities that used this payment scheme, and it seems to have failed miserably almost every time. A few months ago, MassLive wrote an article on this topic and found that “for the second year in a row, revenue collected from the development district around Polar Park in Worcester has come up short to pay the stadium’s construction debt.” In this specific case, we have developers who are just not doing what they promised to do, and the city has little recourse to force them into finishing what they stated.
The bottom line is pretty simple. Every time a sports team wants a new venue, they will get people to say out loud that the economic benefits of a new venue will be massive! It can create new jobs! New Revenues! New Growth! Except, research on this assertion has been looked at and studied repeatedly. They show that sports venues do not magically increase economic development near a venue. Nor will a new venue miraculously generate new tax revenues. If a city or state is putting massive amounts of taxpayer money into a new arena, ballpark, or stadium, local taxpayers will be the ones left paying the bill…100% of the time.
