Cities go into red on stadiums to lure tourists
The Arizona Republic
Mar. 31, 2006 12:00 AM
From the Governor's Office to city halls, spring training in Arizona is hailed as a huge economic driver.
Yet of the eight municipalities that host Cactus League teams, every one but Pima County loses money maintaining the stadiums, according to records obtained by The Arizona Republic.
Despite the losses, three more cities - Glendale, Goodyear and Casa Grande - are jockeying to build a spring training facility that could cost more than $70 million and result in annual operating losses of $1 million to $2 million. Leaders from those cities say the losses are worth absorbing because of the gains spring training would provide.
"What it does is accelerate the quality of development in the town," Goodyear Mayor Jim Cavanaugh said. "We think there's a big economic benefit."
The amount of red ink varies depending on how cities calculate their losses. Mesa, for example, has the biggest losses at $1.3 million, but the city counts year-round expenses for running Hohokam Stadium and minor-league facilities for the Chicago Cubs. Tucson has a $35,000 loss for running Hi Corbett Field, but it counts operating time as only when the Colorado Rockies are in town.
The Cactus League estimates that spring training will pump up to $230 million into Arizona's economy this year, with some of the roughly 1.1 million local and out-of-town fans driving rented cars, eating at area restaurants and sleeping in the region's hotels. Scottsdale and Mesa leaders say their economies reap $16 million and $20 million, respectively, by hosting the San Francisco Giants and Cubs each spring.
But sports economists say spring training isn't the tourism magnet it's touted as. Most of the tourism dollars would come to the Grand Canyon State anyway, they say, from tourists looking to escape cold climates. They also say the related seasonal jobs typically are low-wage, part-time positions that have little effect on the economy.
The teams are the primary beneficiaries of spring training facilities, particularly new stadiums, said Roger Noll, a Stanford University economics professor who has studied the financial benefits of sports facilities. The 12 Cactus League teams receive annual payouts of up to $2.5 million. Unlike the municipalities, the franchises do not disclose whether they make a profit.
"You don't have to have a Ph.D. in economics to know that (a ballpark is) a silly investment," he said. "They shouldn't expect an economic return. They will have to spend more on taxes and get less services because they will have a world-class spring training facility."
Litchfield Park resident Albert Rodriguez doesn't think it was silly to bring spring training to Arizona.
"It brings in money for the cities, so I think it's all right," said Rodriguez, who goes to about three spring training games a year. "And it's good for the kids."
Glendale, Goodyear and Casa Grande want to build complexes that likely would host teams from the 18-squad Florida Grapefruit League, which lost the Kansas City Royals and Texas Rangers when they relocated to Surprise in 2003.
Goodyear has $10 million in voter-approved bonding capacity to get a 10,000-seat stadium started, while Casa Grande plans to increase its sales tax by 8/10 of 1 percent to pay for its project, which also would include an equestrian center and exhibition hall. Glendale, which provided a $180 million subsidy to build Glendale Arena for hockey's Phoenix Coyotes, would not disclose how it would pay for its facility.
Florida lawmakers, in order to keep other teams from leaving, are considering a bill that would provide millions of dollars to renovate spring training sites. A few teams, whose leases are set to expire, are considering moving West because of the better financial deals and upgraded facilities. Better seats and amenities allow teams to charge fans higher ticket and concession prices.
"All of the teams in the Grapefruit League that have an interest in leaving are waiting to see if that legislation has legs," said Bill Bridwell, chairman of Casa Grande Baseball 2008, a citizens group trying to build a spring training facility. He said the earliest any move could occur is in two years.
Bridwell said he has been negotiating with four Grapefruit League teams, but he declined to identify them. Two teams, Cleveland and Baltimore, told The Republic they would consider moving if the Florida legislation failed.
Arizona officials have said the Indians, Orioles and Cincinnati Reds are considering a move. The Orioles trained in Yuma and Scottsdale in the 1950s. The Indians trained in Tucson from 1947 to 1992. The Reds never trained in Arizona.
David Cardwell, director of the Grapefruit League,said roughly half of the state's host cities make money. Many of the Grapefruit League's teams play in cities with older parks that have little debt.
In 2000, the Legislature created the Arizona Tourism and Sports Authority to keep the Cactus League healthy and to pay for a new Arizona Cardinals stadium. Maricopa County voters that year approved $205 million for Cactus League projects over 30 years, with financing mostly coming from rental cars and hotel taxes.
The sports authority has paid $68.3 million for stadium projects in Surprise, Scottsdale, Tempe and Phoenix.
That funding source has helped Arizona poach two from Florida. But there is no Cactus League money available until 2019, when the sports authority could start reimbursing any Maricopa County community for up to two-thirds of a stadium's cost, said Brad Parker, a sports authority spokesman.
Casa Grande, in Pinal County, is not eligible for sports authority money. Dennis Burke, chief of staff to Gov. Janet Napolitano, said his boss believes it's "economically beneficial" to have more teams training in Arizona.
"We are just selling our product. We don't fly to Florida and say, 'Here is your sweetheart deal in this town in Arizona,' " he said. "We sell the entire package."
John Zipp, a University of Akron sociology professor who has studied the economic impact of spring training in Florida, said Arizona and its cities would be better off marketing and building their assets than trying to lure teams for spring training because baseball has such a small economic impact.
"What we found in Florida is most people come for the weather," he said. "They leave places like Ohio and go there for the beaches and sun. In Arizona, it would be for the sun."
But Burke said he has firsthand experience that fans come specifically to Arizona instead of other sunny states because of spring training.
"My aunt is at my house," Burke said. "She flies in from Chicago, and her dog is named Cubbie. . . . The only reason she comes out here for two weeks is to come to spring training games. Otherwise, I guarantee you she wouldn't be here."
East Valley communities of Gilbert and Chandler, which hosted the Milwaukee Brewers from 1986 to 1997, said they are not interested in building a costly spring training site. The Brewers are now in Maryvale.
"Every year, you have to spend a significant amount of money, and you get a bump for, what, a month or so?" said Harry Paxton, a Chandler economic development expert.
But Mark Coronado, Surprise's community and recreational service director, said that although his city loses at least $300,000 during spring training, the ballpark put the small city on the map with media features.