News Story

Lansing Stadium Subsidy: Big Promises, Little Information

City claims massive return on investment; experts say no way

The ranks of Michigan professional sports teams — and taxpayer subsidies to support them — will grow by one next month as the minor league soccer franchise Lansing Ignite kicks off its inaugural season.

The Ignite will have a 15-game home schedule in 2019, to be played at Cooley Law School Stadium, which is owned by the city of Lansing and is home to minor league baseball’s Lansing Lugnuts.

Under an agreement signed between the soccer franchise and the city last year, Lansing will bankroll costs for marketing the new team. It will also pay for turf equipment to prepare the baseball field for soccer and annual maintenance. Local news reports suggest the cost to taxpayers will run up to $3 million or more over the 16-year life of the agreement.

Scott Keith, CEO of the Lansing Entertainment and Public Facilities Authority, the stadium’s de facto landlord, said this week he believes that figure is overstated and doesn’t factor in revenue the city will gain from ticket sales and concession revenue.

But the question remains: Why is a cash-strapped city with crumbling roads and $700 million in unfunded retiree debt subsidizing a privately owned professional sports team?

The answer provided by Mayor Andy Schor and City Council — which approved the deal unanimously — is that thousands of new fans will flock to Lansing. According to the Lansing City Pulse, Schor claimed they will spend at a rate of $100 per person, contributing to the city’s prosperity.

That optimism is almost certainly unfounded, said University of Michigan-Flint economics professor Chris Douglas, who has reviewed academic analyses of sports and stadium subsidies around the country.

“I think there is zero evidence that these subsidies pay for themselves,” Douglas said.

Politicians and sports fans are energized by the excitement (at least for some teams) they get on game day, Douglas said. But there are many more days, especially for an open-air stadium in a northern climate, when the facility sits empty, he said.

“Politicians like these subsidies because they’re kind of fun and people are having a good time,” Douglas said, “Addressing pension liabilities is not fun.”

The argument that sports teams can’t operate without taxpayer support is challenged by the experience of those who thrive without it.

Lansing Ignite is almost certainly hoping to replicate the model of Detroit City FC, a minor league soccer affiliate known for its rowdy and passionate fan base.

Detroit City regularly draws thousands to its games in Hamtramck, where it moved to after outgrowing the stands at a Detroit high school.

To make the move possible, the team raised $741,000 from its private investor fan base to refurbish WWII-era Keyworth Stadium.

Supporters of the Lansing Ignite deal claim city taxpayers will benefit from increased use of the ballpark.

Facilities Authority CEO Keith said the city’s agreement with the soccer team is modeled on one that’s been in place with the Lugnuts for 24 years. He said he believes subsidies to the baseball team are now completely offset by the city’s cut of revenues but could not provide precise figures. The city also shoulders capital costs for the stadium, he said.

Lansing Communications Manager Valerie Marchand said this week she did not have details on the soccer subsidy, but would try to locate them.

The subsidies Lansing may provide to the baseball and soccer teams are minor in comparison to what big league owners routinely wring from their host governments. State and local taxpayers covered nearly $500 million of the cost to build Ford Field, home to the Detroit Lions, as well as Little Caesars Arena, home to the Detroit Red Wings and Detroit Pistons.