The Chicago Bears have threatened to move to Northwest Indiana for the second time in 30 years, after having had difficulty drumming up support in the Illinois legislature for incentives for a new stadium.
Looking to leave the 101-year-old Soldier Field on the Museum Campus downtown, the Bears have been lobbying lawmakers in Illinois to approve tax breaks for a domed stadium in Arlington Heights, but have been told that would not be a priority in 2026. The team is also seeking $855 in public spending on infrastructure like roads and sewers.
Professional sports teams, including the Chicago White Sox and Indianapolis Colts, often seek public subsidies for new stadiums, arguing they have an economic benefit justifying taxpayer support. Kansas just agreed to fund 60% of the $3.3 billion the Kansas City Chiefs will spend on a new stadium and practice facility, offering a record $1.8 billion in public incentives to lure the four-time Super Bowl champion Chiefs across the state line.
But economic studies have shown that such investments do not yield the returns on investment many expect.
"There is a rich literature out there regarding the net economic impact the building sports arenas have on the communities within which they are built," said Indiana University Northwest Economist Anthony B. Sindone, director of the Center for Economic Education and Research. "The quick answer is that they generally do not result in a long-run net positive for the communities."
Garret Johnson's 2011 study "The Economic Impact of New Stadiums and Arenas on Cities" in the Denver Sports and Entertainment Law Journal found such projects were expensive for taxpayers and rarely created many new jobs, though they could have revitalized economically challenged downtown areas. Johnson cited a 1990 study that found a new Arizona Diamondbacks stadium would only create 340 new permanent jobs that each would cost the taxpayers of Arizona approximately $705,800.
Johnson's study found that new stadiums were seen as a status symbol but often just replaced existing stadiums while adding little more economically, and that the money people spent on paraphernalia, food and alcohol at new stadiums redirected discretionary funds they would have spent on some other type of entertainment.
"One of the reasons is what we call the substitution effect of public spending on these stadiums. A dollar of public funds spent on the stadiums that benefits few, is one dollar of less spending on other services that might benefit more members of the public," Sindone said. "While there might be a multiplier effect resulting from the building and operations of the arenas, that multiplier might not be as large as spending that money elsewhere."
Researchers John Charles Bradbury, Dennis Coates and Brad R. Humphreys recently published "The Economics of Stadium Subsidies: A Policy Retrospective," which concluded that stadiums are "poor public investments." The 2023 study found government spent $35 billion since 1970 on major league sports venues for the National Football League, Major League Baseball, the National Basketball Association and the National Hockey League, and that they were likely to spend another $20 billion in taxpayer funds by 2030. The authors found that even privately financed stadiums, like Gillette Stadium outside Boston, benefited from $70 million in sewer line and other infrastructure improvements, and that taxpayer obligations are often 25% or 40% higher than reported, due to associated costs including land, infrastructure, operations, municipal services and forgone property taxes. The authors found that stadiums in their study will cumulatively avoid paying $18 billion through the end of their current leases, resulting in an average annual loss of $5.7 million per venue.
Bradbury, Coates and Humphreys found that sports owners typically replace venues before they reach the end of their lifespan, and they get an average public contribution of $500 million. They cited research that found little net income increase from stadiums and no negative economic shocks from league work stoppages, suggesting games do not generate any new economic activity and just displace existing spending. It noted stadiums have non-economic benefits like civic pride and quality of life but concluded that gains from shifting local consumption to new stadiums "fell well short of covering the cost of the public outlays."
New stadiums also come with a cost, including a greater demand for public services, the study found.
"Though stadium debates largely focus on the potential positive spillovers, which appear to be small, economists have identified considerable evidence of negative externalities from crime, traffic, and pollution, which receive less attention. These spillovers impose significant costs on residential and commercial neighbors," the authors argued. "There is a strong relationship between sports events and criminal activity, where crowds of passionate fans gather and alcohol is often consumed heavily. Crime results from the concentration of spectators who are more likely to commit and become targets of crime, as well as displacing police from general law enforcement in order to monitor game-related activity. Increased criminal activity associated with U.S. sporting events is well-documented. Sports events are also associated with more automobile traffic, which results in inconvenience as well as health costs from emissions."
Teams are often putting up a higher proportion of stadium financing themselves in recent years, but they also are asking for larger subsidies as the cost of new stadiums, with luxury boxes and all the other modern bells and whistles, has skyrocketed, Sindone noted.
"Incidentally, the percentage of the funding for such arenas has diminished recently. Back in the 60s and 70s, we saw that nearly 100% of the funding to build these things was public money," Sindone said. "These days, about 35% to 40% of the cost is public money. But the dollar amount is much larger than in the past."
© Copyright 2025, nwitimes.com, Munster, IN