Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
They arent tax free financing schemes. The tickets are taxed to repay the bonds. Anyone who leases the stadiums benefit by having lower financing costs, be it sports teams, concerts, seminars etc..
I have seen whole towns turned around due to TIF deals. Homestead PA for example used to have $10K homes, with a bunch of projects around before an out of state developer came in and used TIF's to develop a huge shopping complex which generats tens of millions a year in tax revenues to pay for police, fire, development etc..
They are tax free schemes, the residents pay but the purchasers are tax exempt on interest. One of the advantages of municipal bonds like those use to pay stadiums is that the interest is not taxed federally.
They are tax free schemes, the residents pay but the purchasers are tax exempt on interest. One of the advantages of municipal bonds like those use to pay stadiums is that the interest is not taxed federally.
I'm sure all the bars, restaurants, hotels, sporting goods stores, convenience stores etc. and their employees around those stadiums are happy to have them. I'm sure the taxes paid by the players are pretty helpful to the community
That isn't the issue. The issue is basically you are making the entire country pay for a sports stadium. If you live in Wyoming you are basically paying for the Cowboys stadium.
Let me explain how this works. Tax law allows municipalities to issue certain bonds where the interest is not subject to federal tax. This basically allows a municipality to basically get a better interest deal on rates at the expense of every other taxpayer in America. So when said municipality wants to attract a sports team to their city they basically finance stadiums with these bonds so a portion of the price tax is picked up by every single federal taxpayer in the form of a discounted interest rate due to the absence of federal taxes on this one type of bond.
It is a major issue as many tax policy people will point out.
Interest is never taxed federally.. Its actually a tax deduction..
What this means is if the teams owned the stadiums, they would pay even LESS taxes because they'd have all of the losses to write off..
Interest is taxed federally if you are the one collecting it. It is referred to as capital gains. Put very simply the advantage these bonds get is that the bond holder does not have to pay federal tax on the interest he or she accrues while holding then note. The result is that all other things being equal this results in a lower interest rate for the lender since it is one less expense/risk that the purchaser of the note bears. This lower rate reduces the amount the borrow has to pay in overall interest and does so at the expense of everyone else who has to pay federal taxes...this is to the tune of about 146 million dollars a year and over 4 billion over the life of the bonds. The result is basically federal financing of sports stadiums.
That isn't the issue. The issue is basically you are making the entire country pay for a sports stadium. If you live in Wyoming you are basically paying for the Cowboys stadium.
Let me explain how this works. Tax law allows municipalities to issue certain bonds where the interest is not subject to federal tax. This basically allows a municipality to basically get a better interest deal on rates at the expense of every other taxpayer in America. So when said municipality wants to attract a sports team to their city they basically finance stadiums with these bonds so a portion of the price tax is picked up by every single federal taxpayer in the form of a discounted interest rate due to the absence of federal taxes on this one type of bond.
It is a major issue as many tax policy people will point out.
And once again, if the teams owned the arenas, they have BILLIONS of dollars in write offs, and they would not only receive loss tax write offs thus paying less taxes, but also depreciable values on the assets.
Thats why they finance them through muni bonds.. Its no different than financing for roads, bridges etc, that left wing kooks celebrate as a "stimulus" to the economy..
Do you realize how much money these folks make of their TV contracts? The teams I mean? If folk would just vote NO the team will either mover or build their own damn stadium. Of course then out comes the economic impact studies that a major league franchise brings to a city and the debate just goes on and on. Many owner will move if their cities won't pay for a stadium. Speakin of that how did Dallas build that stadium of theirs a few years back. Cost a billion dollars............Did Jones foot a lot of it or did the taxpayers vote to pay for it? Hey if the "people" are allowed to vote on it then that is all I ask.
Sure there is no shortage of dollars from their TV contracts. So why can't they build their own workspace, with their own money. The people voted forPres. Obama too. That all you ask?
The sports teams dont own the stadiums.. They are owned by the tax payers.
The Chiefs did a renovation for 350 million back in what was it '09 or '10 if I remember correctly. It was approved by the voters of the county. Part of the agreement to renovate was the Chiefs agreed to a lease extension until 2031. They basically signed a 30 year rental agreement with the county so to say.
Interest is taxed federally if you are the one collecting it. It is referred to as capital gains. Put very simply the advantage these bonds get is that the bond holder does not have to pay federal tax on the interest he or she accrues while holding then note. The result is that all other things being equal this results in a lower interest rate for the lender since it is one less expense/risk that the purchaser of the note bears. The result is basically federal financing of sports stadiums.
And if they are receiving lower interest rates as the lender, and the tax payers are paying less in interest as the owner of the stadiums, its a net neutral to the federal government. They arent subsidizing anything.. They are just paying it through tickets rather than interest..
The Chiefs did a renovation for 350 million back in what was it '09 or '10 if I remember correctly. It was approved by the voters of the county. Part of the agreement to renovate was the Chiefs agreed to a lease extension until 2031. They basically signed a 30 year rental agreement with the county so to say.
Yes thats a lease, hence they dont own the stadium. I owned an indoor football team several years back, had to lease from a public stadium authority.
And once again, if the teams owned the arenas, they have BILLIONS of dollars in write offs, and they would not only receive loss tax write offs thus paying less taxes, but also depreciable values on the assets.
Thats why they finance them through muni bonds.. Its no different than financing for roads, bridges etc, that left wing kooks celebrate as a "stimulus" to the economy..
You just don't get it do you. The stadiums are built by the municipalities for the purpose of hosting and attracting teams. They do this with special bonds which are exempt from tax of interest on the bondholders.
For the record I think stimulus can be good but building a bunch of stadiums is probably not the most efficient use of tax dollars, you may disagree, you may think the government has a role to play in subsidizing the professional sports industry. That's fine, but I don't agree with you there.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
