Stadium proposal rendering
Last month, a poll by the Union-Tribune and 10News delivered encouraging news: only 30 percent of respondents were in favor of a stadium subsidy; 40 percent opposed it and 30 percent weren’t sure. Although more than half of those taking the poll identified themselves as Chargers fans, two-thirds disapproved of the way the team has handled the matter.
An important question was not asked: if a new stadium were built, would Chargers fans be willing to pay a lot more for tickets than they do now?
“I do not think that exact question has arisen in the normal back-and-forth with our media partners,” says Jay H. Leve, president of SurveyUSA, which did the poll.
Whenever a new stadium is built, or an older stadium is significantly rehabbed, the ticket and concessions prices rise sharply in the first year of operation. And in the National Football League, those prices do not come down, except in rare circumstances.
Thus, if this subsidy goes through, San Diegans will have their pockets picked twice: once when hotel taxes pay for a subsidy to a billionaire, and a second time when prices to get into a game shoot upward.
Dennis Coates, professor of economics at the University of Maryland, Baltimore County, has done numerous studies on sports economics. According to the most recent data he has, ticket and concessions prices will rise 17 to 25 percent when a new stadium opens. Do those prices ever go down?
“Ticket-price reductions are pretty unusual,” he says, although if prices remain the same and inflation rises, prices could be going down, in effect. However, inflation in recent years has been quite low.
“Economists say to be careful on what you wish for in a new stadium,” says Victor Matheson, professor of economics and accounting at the College of the Holy Cross. “A new stadium might be good for the fans, but team owners know that and capture it in the prices.”
San Diegans will be stuck with the higher costs. Price decreases occur “only occasionally, such as after a disastrous performance on the field the year before,” says Matheson, who agrees with Coates’s estimate that prices normally rise 17 to 25 percent in the first year of a new or substantially rehabbed stadium.
Philip Porter, professor of economics at the University of South Florida, says a 25 percent hike is more like it.
Roger Noll, professor emeritus of economics at Stanford University, says that the price increase in the first year of a new stadium is “highly variable.” However, “there is always an increase — normal is 10 to 20 percent, but sometimes increases are as much as 50 percent.” (Prices at the new, swelteringly hot San Francisco 49ers stadium in Santa Clara went up roughly 50 percent from those at the damnably windy former home, Candlestick Park.)
Do prices ever go down? “Never!” chuckles Noll, although some teams cut prices as the season is coming to a close. However, that happens in other sports — not the National Football League, he says.
Robert Baade, professor of economics at Lake Forest College, north of Chicago, points out that when seeking a huge handout, team owners are likely to claim there won’t be a price increase. “In the vast majority of places, despite the fact that the team argues or did argue that the ticket price would go down, on average it did not.” He can think of only two Major League Baseball instances in which ticket and concessions prices in a ballpark went down. “The hard-and-fast rule is that ticket prices will go up with a tiny, tiny number of exceptions.”
The most publicized case of a team lowering prices was the New York Yankees. It got barrels of taxpayer money to build a new ballpark. Then it launched audacious plans to segregate the rich from the middle class and the merely rich from the superrich. Choice first-row seats went for $2500 a game. That’s a game. Other highly desirable seats went for absurd prices.
In April of 2009, shortly after the season began, the team, pretending to stay humble, cut the fattest of the prices. The Great Recession, which hit Wall Street hard, was just ending, but not everybody was convinced that the economic carnage was over. The mighty Yankees struck out. More than 40 percent of the front-row seat prices were slashed by up to 50 percent. Many of those who had bought seats close to the field for $325–$1250 became eligible for additional free seats. Seats costing $1000 were cut to $650.
Television played a role in the price-cutting. Early on, it was apparent that those plutocrat-only seats close to the field were the ones not being purchased. That meant empty seats would be noticeable on TV.
The team “wildly overestimated how much they could charge,” says Coates.
With the financial crash on everyone’s mind, “It was unseemly for people to be occupying seats behind home plate for $2500,” says Baade.
The Padres opened their new, highly subsidized ballpark in 2004. Although the team said it would not raise prices, it did — substantially. Initially, attendance was worse at Petco Park than it had been at Qualcomm Stadium, where the team had a lousy record. The price increases drove out some of the most loyal fans, particularly Hispanics. People complained about the difficult downtown traffic and parking and the forced decline of tailgating. The Padres then slashed prices in the years 2009, 2010, and 2011.
Price-cutting by the Yankees and Padres were aberrations, says Coates.
Despite all the propaganda about Qualcomm Stadium being a rattletrap, foul-smelling, decrepit stadium, the average price of a Chargers ticket in 2015 (the last data available) was $84.55, only slightly below the National Football League average of $85.83, according to Team Marketing Report, which keeps price statistics. The cost for a family of four attending a game, paying for parking and buying beer, soft drinks, hot dogs, a program, and a hat, is $478.19 per game, says Team Marketing Report. The league average is almost the same — $480.89.
Given the team’s historically poor record, Chargers fans are already getting diddled. Now the team wants the public to get double-diddled.
If those prices go up — say, 20 percent — the Chargers will wring more out of its attendees than most National Football League teams. If they get their taxpayer-financed stadium, will they be obliged to put good players on the field?
The Chargers did not respond to questions.