The Buffalo Bills owners want a new stadium, and they think New Yorkers should pay for it. The new stadium is estimated to cost $1.4 billion, of which the owners want taxpayers to foot more than half or upwards of $700 million.
Because there are so many different kinds of potential public subsidies, it’s very possible we’ll never know how much of the stadium’s total cost is paid by taxpayers. The Buffalo News recently detailed at length all of the possibilities:
- Raising taxes. The County could fund the stadium by increasing hotel room taxes, car rental taxes, tobacco taxes, etc.
- Cutting taxes, if the new stadium is the property of the Bills, and the new stadium involves a property tax break.
- Land acquisition, such as the cost for the county of obtaining the land for the stadium and conducting an environmental review.
- Borrowing. The Bills could issue general obligation bonds, which often involve tax increases on property or sales, or revenue bonds, which are backed by new revenue such as usage fees for the stadium (either could include tax-increment financing, through which a portion of the new tax revenue from the stadium is redirected back to the stadium and surrounding area). The interest payments on these bonds are typically free of local, state and federal taxes.
- Infrastructure. The state and County could fund new roads and other improvements in the area surrounding the new stadium.
- Site cleanup. The state and county could pay for preparing the new site and/or demolishing the old site.
- Reserve accounts. If some of the above measures fail, the County could be forced to dip into its reserve funds to pay the bills. This happened to Nevada’s Clark County, which backed a new stadium in Las Vegas through a hotel tax, then lost revenue due to the pandemic.
Transparency advocates, including Buffalo’s Paul Wolf, have called for the state to release the Bills-commissioned study of potential costs for a new stadium, which may clarify what the Bills are proposing. Wolf says, “We’re talking about a lot of public money … It could be a billion dollars … That is certainly a lot of tax dollars for any project and transparency should be an important part of that process.”
Other subsidy news
- Another great Buffalo News article covers all the ways New Yorkers might end up paying for a high-end apartment building: opportunity zones, brownfield grants, 485-a tax breaks, and more. The last might save developers $6.6 million dollars.
- New York officials are feeling hopeful that two chip manufacturers will come to the town of Clay in upstate Onondaga County (Syracuse.com).
- At a luncheon, Democratic Buffalo mayoral nominee India Walton butted heads with local business leaders over 485-a, which gives developers a tax break for converting non-residential property (Buffalo News).
What we’re reading
- At Boondoggle, Pat Garofalo explores why Google may have opted not to take NYC tax breaks. In short, it’s complicated.
- In a Times Union op-ed, Zephyr Teachout opines about Cuomo’s failed economic development policies and the need to invest in the public.
If you got this from a friend, sign up here. Subsidy Sheet is written by Tom Speaker, Policy Analyst at Reinvent Albany. Please send questions and tips to tom [at] reinventalbany.org. We look forward to hearing from you!