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Ready to pay for the Raiders' Vegas stadium?
Senate and House disagree on sports stadium subsidies
Al Davis’s “eternal flame” planned for the stadium the Raiders intend to build in Las Vegas
The Senate and House have passed their own versions of new tax legislation, and now they must reconcile their differences in a conference committee.
Wisely, the House version eliminates federal bond subsidies for pro sports stadiums; stupidly, the Senate does not eliminate those subsidies.
Under today's laws, pro sports stadiums subsidized by local governments are financed by tax-exempt municipal bonds, and interest on those bonds is exempt from federal taxation.
In a study last year, the Brookings Institution calculated that over a 15-year period beginning in the year 2000, no fewer than 36 pro sports stadiums in the National Football League, Major League Baseball, National Basketball Association, and National Hockey League have been subsidized by these tax-exempt bonds for a whopping $3.2 billion.
As the Brookings study points out (and the Reader has been saying for decades) this is a colossal misuse of federal funds — as well as local public funds. Economists are almost unanimous saying this tax subsidy is a waste of funds.
If the Senate prevails and subsidies remain a viable source of funding for team owners, San Diego taxpayers will subsidize the Oakland Raiders' new home in Las Vegas two years from now.
Here's something you might be interested in.
Ready to pay for the Raiders' Vegas stadium?
Senate and House disagree on sports stadium subsidies
Ready to pay for the Raiders' Vegas stadium?
Senate and House disagree on sports stadium subsidies
Al Davis’s “eternal flame” planned for the stadium the Raiders intend to build in Las Vegas
The Senate and House have passed their own versions of new tax legislation, and now they must reconcile their differences in a conference committee.
Wisely, the House version eliminates federal bond subsidies for pro sports stadiums; stupidly, the Senate does not eliminate those subsidies.
Under today's laws, pro sports stadiums subsidized by local governments are financed by tax-exempt municipal bonds, and interest on those bonds is exempt from federal taxation.
In a study last year, the Brookings Institution calculated that over a 15-year period beginning in the year 2000, no fewer than 36 pro sports stadiums in the National Football League, Major League Baseball, National Basketball Association, and National Hockey League have been subsidized by these tax-exempt bonds for a whopping $3.2 billion.
As the Brookings study points out (and the Reader has been saying for decades) this is a colossal misuse of federal funds — as well as local public funds. Economists are almost unanimous saying this tax subsidy is a waste of funds.
If the Senate prevails and subsidies remain a viable source of funding for team owners, San Diego taxpayers will subsidize the Oakland Raiders' new home in Las Vegas two years from now.
Comments
What you point out is just one of thousands of pieces of social engineering that are built into the current tax code, and which will still be built into any revised tax code. Get rid of this piece of subsidy, and we should do that, and there will still be many other such outrageous bits of special-interest giveaways that are left.
I'm hearing that this tax revision is a major, sweeping change. A close look at the current tax code will reveal that the last time it was scrubbed and rewritten from scratch was in 1954. Everything that happened since then was amendments and revisions done on a piecemeal basis, and that includes TRA 86, the last "big" change. Since that time, the tax code has been used to favor certain uses of funds, to favor some types of investment and to discourage others, and to modify human behavior. I'd go so far as to say that the tax code has been subverted from a way to get necessary government revenue into a way to manage society through incentives (tax credits) and punishments (penalties) for actions that otherwise would seem normal.
Would it be possible to get back to a tax code intended to pay the bills and stop meddling with the lives of taxpayers? Possible I think, but most unlikely.
Visduh: Oh, absolutely. Look at the current one: the log-term deficit as a result of this plan will be at least $1trillion -- this from a party that used to oppose deficit financing. The current plan -- probably a compromise between the House and Senate versions -- beyond question is a scheme for the Republicans to pay off their billionaire donors. Steal from the poor and steer the money to the rich. This is the kind of "social engineering" we are getting now.
Raising money to finance the government is no longer an aim of a tax plan. Best, Don Bauder
they are, as the saying goes " just kicking the can down the road"
Murphyjunk: But this can may come back to hit the politicians in the gut sooner than other episodes did. Best, Don Bauder
more likely the tax payers will be the ones hit in the long run.
Murphyjunk: You are right. The politicians who passed this unpopular abomination will be long out of office -- and probably retired to the Cayman Islands -- when the negative effects really hit. Our children and grandchildren will have to pay off this deficit. Best, Don Bauder
If people watched their elected officials as closely as they watch their sports heroes, we wouldn't have so much official corruption.
swell: Brilliant observation. I wish I had thought of that. Best, Don Bauder
sports entertainment figures provide more fun than politicians
Murphyjunk: And they are equally corrupt. Best, Don Bauder
true, but we can't take it or leave it when it comes to what politicians do to us.
Murphyjunk: In democratic theory, we can remove them from office. But then Russia decided to affect our elections and…. Best, Don Bauder
Hold on Don. I share your opposition to public funding for sports stadiums. But I assumed all munis were tax-exempt. Are you suggesting the carving out of a new category of munis that are dedicated to this funding, and making them taxable?
MuirAvenueAle: All munis are not tax-exempt. Yes, if the conference committee adopts the House version, use of munis for professional stadiums would be dropped. Best, Don Bauder