Debating William & Mary, sports and culture since 2011. Updated every Wednesday.

Big Trouble Right Here in River City

In Football on February 16, 2013 at 4:41 pm

The St. Louis Rams want a new stadium. Here’s why St. Louis shouldn’t pay for it.

There’s a quote from the film Gladiator that says, “The beating heart of Rome is not the marble of the senate, it’s the sand of the Colosseum.” It conjures images of grand architecture, exciting battles and the splendor of one of the world’s great cities. Now, try and substitute “St. Louis” for Rome and “Edward Jones Dome” for Colosseum. The picture changes: bland architecture, bad football and an unappealing airport connection. Doesn’t really have the same impact, does it?

Most people would agree that the Edward Jones Dome, home of the Super Bowl XXXIV Champion St. Louis Rams,[1] needs to be renovated, and it’s not hard to see why. The sightlines are terrible, the seats are cramped, the scoreboard is tiny, the sound system vacillates between inaudible and jumbo jet exhaust, and the ambient light is practically non-existent. The Edward Jones Dome is like the cave you visited that one time as an elementary schooler, except there’s beer and you paid $200 to get in. Unfortunately for the denizens of St. Louis, they might be on the hook for a lot more than a new scoreboard.

That’s due to a quirk in the stadium leasing agreement between the Rams and the St. Louis Convention & Visitors Commission, which manages the Dome. And by quirk, I mean the entire lease. Long story short, the Rams can get out of their lease in 2015 unless the Dome is in the top-tier of NFL stadiums.[2] The CVC proposed a $124 million renovation plan that would add new luxury features to the stadium, with the team covering about half of the cost. The Rams’s counterproposal was a near-reconstruction of the Dome, including expanding the stadium’s footprint, a new glass façade and a new retractable roof. The plan didn’t have a price tag, nor did it include the public-private contributions, but officials with the city estimated the cost at nearly $700 million dollars. An arbitration panel sided with the Rams, so the ball is now in the city’s court to accept or reject the team’s plan. But it begs the question, “is it worth $700 million to keep the Rams in St. Louis?”

Obviously, there are benefits to keeping the National Football League in St. Louis. Watching the Rams win on Sunday Night Football[3] or seeing quarterback Sam Bradford on an ESPN highlight reel certainly boost civic pride. And stadiums can become popular — even historic — landmarks, like Soldier Field in Chicago or Fenway Park in Boston. And, of course, there’s the revenue generated from hosting eight NFL games (and other events) every year. The problem is, a lot of those benefits are unquantifiable — ethereal, even — and the team’s economic impact isn’t well defined. Having a professional football team is nice, but civic pride doesn’t keep the city’s budget in the black.

So it comes down to money. Does the cost of renovating the Dome outweigh the economic benefit of keeping the team in St. Louis? First, let’s look at the real cost of stadium upgrades. While no hard figures have been discussed, it’s likely that the city would have to cover a large portion of the $700 million renovation plan. The Rams could qualify for the NFL’s new G-4 loan program, which could provide up to $250 million toward stadium upgrades. Under the terms of the program, Rams owner Stan Kroenke would have to contribute at least $200 million of his own money toward the renovation to receive G-4 funds. That would leave the city with a bill of about $250 million dollars. For perspective, the Dome cost $280 million when it was built in 1995.[4] The stadium underwent a $30 million renovation in 2009 that installed a new scoreboard, interior paint and luxury suites. And the state of Missouri, the city and St. Louis County together pay $24 million annually in bond payments to cover construction costs. The Rams, meanwhile, pay $500,000 annually to use the Dome, or $62,500 per game.

Now, let’s examine the economic benefit of football in St. Louis. No recent economic impact study of the team is publicly available. However, the NFL Players Association compiled reports on 10 NFL teams in 2011. Those studies projected that professional football annually provides an average of about $160 million in local spending and 3,000 jobs for NFL cities. The per game revenue generated ranged from $12 million to $40 million. The annual range was even wider, stretching from $70 million in Indianapolis to $382 million in Houston. As the 19th-largest metropolitan area in the country, St. Louis matches fairly well with the NFLPA’s study, especially compared to 35th-ranked Indianapolis and 46th-ranked New Orleans. However, every team in the sample has made a playoff appearance more recently than the Rams, five have played in Super Bowls, and four have won championships. St. Louis might have a higher population than Indianapolis, but it’s unlikely that a team that went 22-72-1 from 2007-2012 would generate more revenue than the Peyton Manning/Andrew Luck Colts.

Even if the Rams exceed the last-ranked Colts in revenue generated — let’s say $100 million annually — it would still take multiple years for the city, county and state to recoup their investment. Since none of those public entities have $250 million laying around, the cost of the renovation would rely on bonds. Public funds still go towards construction costs from the original Dome construction, and the recent trend of publicly financed stadiums has not been encouraging. CBS Minnesota compiled a list of every NFL stadium constructed since 1997.[5] Of 20 new stadiums, public money went toward 19 of them.[6] The public financed 37 percent of Cowboys Stadium in Dallas, 68 percent of University of Phoenix Stadium in Glendale, and an eye-popping 86 percent — $619.6 million — of Lucas Oil Stadium in Indianapolis. The worst example of stadium excess, however, goes to Miami, where $500 million in public bond money went to construct the monstrosity known as Marlins Park. The Miami Herald crunched some numbers and determined that the actual public cost to cover the bonds will be in the billions of dollars.

The city and the Rams are still in negotiations, with speculation that a new stadium proposal could be in the works. If the city can learn from its own mistakes and the debacles in Indianapolis and Miami, and if the team can produce at least league-average annual revenue generated, it could make sense to contribute some public funds toward a stadium project. But St. Louis isn’t exactly known for its frugality. Maybe they should just build a monorail instead.

[1] I will ride that win until I die.

[2] Which is problematic for several reasons. 1. The lease defines “top-tier” as “in the top 25 percent,” which has less meaning than it seems. 2. The Pontiac Silverdome is probably a better venue than the Edward Jones Dome, and it currently looks like this.

[3] Ha! Like that’s going to happen.

[4] That’s about $427 million in 2013 dollars.

[5] Check it out here. It’s definitely worth a look.

[6] Only the New Meadowlands Stadium was 100 percent privately financed.

  1. Bring them back to L.A. where they belong!

  2. WOW! Dude, you seriously might want to remove this article and do a LOT of fact checking before you post it again. You are so far off on so many things I wouldn’t even know where to start correcting you with figures and numbers. I would have to rewrite this entire blog and I don’t have that kind of time. Just wow.

    • I try to make articles as accurate as possible. If I need to correct something, please let me know. If you have the time, of course.

  3. You’re so cool! I dont suppose Ive read anything like this before.
    So nice to find a person with some original thoughts on this subject.
    really thank you for starting this up. this website is one thing that’s wanted on the web, somebody
    with a bit of originality. useful job for bringing
    something new to the internet!

  4. All data in this blog is common in dynamics and should never be utilized in the place
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    and viewpoint.

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