Nearly 70,000 people will converge today on a place many of them rarely visit: downtown Baltimore.
They will arrive in cars, trains, buses and airplanes. They will peel off $10 and $20 bills for everything from parking to programs and peanuts. They will hoist beers at local pubs, roast greasy bratwursts on grills, and cheer as the Ravens kick off in their new, brick stadium against the Pittsburgh Steelers.
Then they will stream out, to homes as close as Canton and as far off as California. Left behind will be a $500 million question for taxpayers: Was it worth it?
Today's ceremonial opening of the $223 million Ravens stadium, six years after the debut of Oriole Park, completes one of the most ambitious public works projects in state history and pushes the bill for both ballparks to more than half a billion dollars. The complex of side-by-side stadiums has become the envy of cities around the world. It has also drawn bitter criticism.
In study after study, independent economists cast serious doubt on claims that taxpayer-financed stadiums can generate for community thousands of new jobs or hundreds of millions of dollars.
Yet city after city has followed Baltimore's example, luring sports teams downtown with lucrative coliseums. Critics say that amounts to "corporate welfare." Supporters say the investment has as much to do with hope as economics.
Specifically, advocates say:
Attracting four million visits to the downtown each year keeps the central city in the minds of suburban fans, an awareness that narrows the cultural and political rift between them and city dwellers.
By rejoining the National Football League and retaining the Orioles, Baltimore maintains the prestige of being a "big league" city. It has also averted the public relations disaster that would have followed the loss of the baseball team after the Colts moved to Indianapolis in 1984 and the National Basketball Association Bullets departed for Landover in 1972.
Having a pair of fan-friendly parks enhances community pride and, through the revenue they produce for team owners, the quality of play of the teams.
And they are fun.
"The return of putting sports back into cities really touches on what urban living should be," said Patrick Sutton, a Baltimore architect who moved to Federal Hill in 1986 and is raising two children there.
He and his wife are turned off by the compartmentalization of suburban life, where living, working and playing tend to be conducted in strictly demarcated areas.
Living in Federal Hill and working in Mount Vernon puts home, work, shopping and trips to the ballpark within walking distance. This keeps him in touch with friends, neighbors and merchants.
Costly and controversial
Moving sports downtown re-establishes the urban core as the hub of local culture, a role it played before the post-World War II migration to the suburbs.
Of course, Camden Yards was just one of several high-profile downtown projects built in recent decades. The Inner Harbor, World Trade Center, Maryland Science Center and National Aquarium have all opened.
But the ballparks have been the most controversial. And costly. Buying the land and relocating two dozen businesses at the site cost nearly $100 million. Oriole Park construction was $106.5 million, Ravens stadium, $223 million. Assorted road and rail work, and construction of a pair of light rail stations cost $73.1 million. The Orioles contributed $9 million and the Ravens, the equivalent of $12 million.
Funding for the two stadiums was passed by the state legislature in 1986, at the urging of then-Gov. William Donald Schaefer. The vote, and similar projects approved in other cities in the years that followed, set off a fierce debate about the economic justifications used by supporters to win public funding.
Although political leaders and team owners continue to claim riches for cities that spend on sports, independent economists argue otherwise.
"Is there an economic gain to these projects? The answer is 'Hell no,' " said Bruce Hamilton, an economist at the Johns Hopkins University who co-wrote a chapter on Camden Yards for "Sports, Jobs & Taxes," a book published last year by the Brookings Institution that makes the case that stadiums do not generate significant economic development.
People have only so much money to spend on recreation, and what doesn't get spent at a game would likely be spent at a movie theater or the like, critics contend. The teams themselves employ only 100 to 150 people full time -- including about 50 players -- and the earnings of part-time vendors and other service providers have little impact on the region's multi-billion-dollar economy.
Even the public money spent to build a stadium would go for roads and other projects, negating the impact of the construction, Hamilton said.
For some urban thinkers, that doesn't matter.
"Does pulling off a successful [entertainment zone] mean that a city is making a comeback? No. But a Cleveland or a Baltimore is much better off for having done these things than not doing them," said David Rusk, a Washington-based urban policy consultant.
The economic arguments once used to sell stadiums have not held up well under scrutiny, he said. But sports complexes are worthwhile in other, more intangible ways, said Rusk, a former mayor of Albuquerque, N.M.
Newer cities such as Charlotte, N.C., Jacksonville, Fla., and Nash- ville, Tenn., have spent on sports to gain "major league" status. Older cities, such as Baltimore, Cleveland, Detroit and Cincinnati have done so to replace, if only partly, a loss of industry and esteem, he said.
"There is an element of desperation" to public investment in stadiums, he said.
Cities can't do much about the exodus of factories, Rusk said. Modern manufacturers need cheap land with highway access, not a pool of workers within walking distance as was required by factories a century ago.
There is one industry that is attracted by what cities offer: entertainment. Sports teams especially profit from a city's mass transit and aesthetic appeal.
"Very importantly, downtowns have a sense of place," Rusk said. "What is distinctive about Baltimore or Cleveland or other cities is their historic downtowns."
That's not to say these multi-million dollar sports complexes will, by themselves, reverse blight, he said.
Even in Baltimore, which can rightfully claim one of the highest levels of success with sports and tourism, a ruinous drop in population and tax base continues, he said.
Rusk's studies of Baltimore show that even though downtown property values and tax receipts were boosted by redevelopment, the increases failed to make up for a decline in commercial and residential property tax revenues from elsewhere in the city.
Nationwide trend
Of course, Baltimore is not alone in its spending on sports. It was just one of the first to adopt the strategy. Seattle is building new, domed homes for the Mariners and Seahawks that will cost $760 million. Cleveland's new Jacobs Field and Gund Arena, and a Browns stadium scheduled to open next year, may end up costing $600 million. Estimates for Cincinnati's two proposed stadiums are $635 million.
In each case, most of the funding is public.
Some of beneficiaries are easy to identify. The teams see their revenues and values climb as corporations jostle for luxury suites and fans scarf up season tickets and high-priced microbrews. The Orioles fetched a mere $70 million when they were sold in 1988, as a tenant of musty Memorial Stadium. But in 1993, a year after the move to Oriole Park, they brought $173 million. Now the team vies with the New York Yankees for the title of baseball's top revenue maker.
Players, too, gain. Stadium revenue allows team owners to bid up the salaries of free agents and is partly responsible -- along with big television contracts -- for the explosive growth of professional athletes' pay this decade. Oriole Park is the reason owner Peter G. Angelos is fielding the most expensive team in history this year.
For the host cities, the payoff is harder to quantify. Some bars and restaurants near a stadium may see an upturn in business. But those farther out may lose.
Lots of money is spent at a new stadium, but some of it leaches out of town to suppliers, team owners and concessionaires. Some flows to the places where players make their homes off-season, such as Texas and Florida, where low taxes have attracted colonies of highly paid athletes.
Mike Nasuti has worked in the downtown hotel industry since 1993, the year after Oriole Park opened. He is director of sales and marketing for Harbor Court Hotel, an upscale inn on Light Street between the Inner Harbor and Camden Yards.
When the Orioles are in town, business at the hotel bar zooms. Room rentals for football weekends this fall are running about 10 percent above comparable weekends without football last year.
"It's a marginal increase. The Harbor Court could do fine if the stadiums were never built. But it is a nice shot in the arm for us," Nasuti said.
The fall and early winter period tends to be slow in local convention and tourism trade, and the football season will be a welcome addition.
"It's definitely increased excitement levels downtown," he said.
A few blocks away, at the Southway Bowling Center at Charles and Hamburg streets -- in the shadow of Camden Yards -- manager Alva Brown has the opposite experience. Business slips during Ravens and Orioles games despite the thousands of people streaming through the neighborhood.
"It's down a little bit. I think the people are going to the games instead," Brown said.
Model city
Baltimore Mayor Kurt L. Schmoke, a proponent of the two stadiums, said he's not convinced of their direct economic impact but views them positively. Baltimore contributes $1 million a year to the Stadium Authority from the city's share of ticket taxes collected at Camden Yards.
"I won't argue the economics of it because you can argue that either way," Schmoke said.
What he will argue is that Camden Yards has salved the psychic wounds inflicted by the desertion of the Colts and raised the city's profile. "It gives us terrific recognition around the country," Schmoke said.
Actually, around the world. In the past year, delegations from Denver; Shanghai; Portland, Ore.; Akron, Ohio; New York and Montreal have come to marvel at the twin stadiums. Next week, a group from Houston will be here, and, after that, one from Philadelphia.
"We take Baltimore as an example. It's a success story," said Serge Savard, a Canadian hockey legend and stadium task force head who who last month led a delegation of 70 Montrealers to Camden Yards to see what a new ballpark might do for their city.
State officials contend that stadiums are good for business overall and good for the state, and that sports is a valid investment, along with schools and roads.
"You need this additional element to add or attract life in the evening," said Gov. Parris N. Glendening, noting that Baltimore's sidewalks are no longer empty at night or on weekends as they were before Camden Yards and other attractions existed.
The Orioles sold 3.7 million tickets to 81 home dates last year. The Ravens, with eight regular season and two preseason games, will sell fewer than 700,000.
The bulk of both team's sales are to season ticket holders who come over and over again.
An early opponent of Glendening in the gubernatorial primary campaign sought to make an issue of public discontent over state spending on stadiums. Even though funding was passed during Schaefer's administration, the Ravens arrived on Glendening's watch, and he vigorously fought efforts to rescind the money.
He contends that preliminary studies of Oriole Park's impact were too conservative and predicts that the same will be true of the Ravens stadium. A study by the state's Department of Business and Economic Development estimates that the Ravens will directly and indirectly generate the equivalent of 2,730 full-time jobs and $184 million in expenditures.
A separate study by the General Assembly's policy analysts came in lower: 889 jobs and $64.2 million in expenditures. This prompted an angry response from James D. Fielder, the department's acting secretary.
"We are certain that the assumptions and methodology used in our report are conservative, supported by generally accepted methodologies, and represent an accurate estimation of the economic and fiscal impacts of the new stadium," he said.
Hamilton, the Hopkins economist, reviewed the DBED study and disagrees. "They are fundamentally wrong. It's not that they claim it to be a big number and it's a small one. It's that it's negative," Hamilton said.
The cost to taxpayers for constructing and maintaining the stadiums is far greater than the financial benefits, he said.
Oriole Park probably contributes as much economically to its city as any stadium in the country, because it draws as many as a third of its fans from out of town. But it costs more than it contributes. Hamilton figures the ballpark contributes about $3 million a year to the state's economy, yet costs taxpayers $14 million.
"My reading of the economic impact of the baseball stadium is it is nil," he said. A football stadium, with fewer events and a home-grown fan base, will be even worse, he said.
Similar conclusions
Other economists have come to similar conclusions. The Congressional Research Service took it one step further, calculating in 1996 that if the state's estimates were correct, each job created by the Ravens cost taxpayers at least $127,000 to create ($331,000 if the legislative auditor's figures are used). The state's "sunny day" fund, used to attract and retain conventional businesses, was a relative bargain, creating jobs for $6,250 each.
Just last month, the University of California at Berkeley concluded in a study that "sports franchises do not stimulate a city's economy to a level that justifies the massive public subsidies."
However, Hamilton figures the costs of Oriole Park equal about $12 for each Baltimore household annually. That's a price people might willingly pay for the enjoyment of the team, he said.
But it does crowd out spending on other needs, he said.
Glendening said the schools vs. stadiums argument is faulty because the bonds used to build the ballparks are being repaid by a special lottery. Each year, up to four of the weekly instant games are designated "stadium games" and the proceeds given to the Stadium Authority.
"If you don't want to invest in the stadium, don't buy a lottery ticket," Glendening said.
Critics say it's not that simple. If not for the sports designation, that lottery money would go into the state treasury.
However, as Rusk, the urban strategist, points out, the money wouldn't necessarily find its way to social programs. "All the critics of the NASA program to put a man on the moon said we ought to put that money to work here on the earth," he recalls.
"After those expenditures were over, we certainly didn't divert those resources to social purposes."
Pub Date: 9/06/98