Conzett Economic Impact of New Sports Arenas Cities Oklahoma City Seattle Sacramento Key Arena Seattle Opened in 1962 Cost 7 Million Dollars to Construct Home of the Seattle Super Sonics from 19672008 ID: 213531
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Slide1
Kyle Conzett
Economic Impact of New Sports ArenasSlide2
Cities
Oklahoma City
Seattle
SacramentoSlide3
Key Arena
Seattle
Opened in 1962
Cost 7 Million Dollars to Construct
Home of the Seattle Super Sonics from 1967-2008
New owner moved team to Oklahoma CitySlide4
Chesapeake Energy Arena
Oklahoma City
Opened in 2002
Cost 89.2 Million Dollars to Construct
Home of the Oklahoma City Thunder since 2008Slide5
Power Balance Pavilion
Sacramento
Opened in 1988
Cost 40 Million Dollars to Construct
Home of the Sacramento Kings from 1988 until nowSlide6
New Proposed Sacramento Arena
Will cost 387 Million Dollars to Construct
King’s owners will pay 75 Million Dollars upfront
AEG will pay 53 Million Dollars
City of Sacramento will pay the rest of approximately 259 Million DollarsSlide7
Opportunity Cost
Education
Highways
Police Officers
Other infrastructureSlide8
Direct Expenditures
Direct expenditures represent the money spent by sports franchises, employees & its patrons. Direct expenditures are received as direct income for the metropolitan businesses.
Then those businesses turn around and spend that money on other metropolitan businesses. Slide9
Indirect Expenditures
The second, third and such rounds of spending represent the indirect expenditures.
The direct expenditures are said to multiply through the economy.
Higher
multipliers tend to have a bigger effect on the economy. Slide10
“Psychological” Benefits
Hard to quantify
Bring pride to the city
Could increase the quality of lifeSlide11
Growth & Development
Increase or decrease in jobs
Increase or decrease in population
Increase or decrease in per capita incomeSlide12
Some Results
Population Growth from 2007 to 2009
Oklahoma City 2.4%
Seattle 4.05%
Sacramento 2.40%
Per Capita Income from 2004 to 2010
Oklahoma City -17.76%
Seattle -1.84%
Sacramento -23.73%Slide13
Conclusions
Economic effect of new sports arenas is very minimal.
Myth of bringing in money from out of town is indeed a myth.
Money is transferred from the metropolitan area to the arena area.
When team leaves money is spent on other entertainment.
“Psychological” benefits.