Title: Hidden subsidies and the public ownership of sports facilities: a case study of Levi's Stadium in Santa Clara

Authors: Robert Baumann; Victor A. Matheson; Debra J. O'Connor

Addresses: Department of Economics and Accounting, College of the Holy Cross, One College Street, Worcester, Massachusetts 01610, USA ' Department of Economics and Accounting, College of the Holy Cross, One College Street, Worcester, Massachusetts 01610, USA ' Department of Economics and Accounting, College of the Holy Cross, One College Street, Worcester, Massachusetts 01610, USA

Abstract: Levi's Stadium in Santa Clara, California is an example of a private financing/public ownership arrangement. While the stadium's construction resulted in no direct tax increases and officially included only $114 million in direct subsidies, this ownership arrangement allows the San Francisco 49ers to avoid many types of taxes on the income generated from Levi's Stadium. We estimate the total tax savings for the 49ers to be between $106 and $213 million over the first 20 years of operations at Levi's Stadium compared with a privately financed and owned option. These amounts match or exceed the more widely publicised direct construction subsidies for the stadium. We argue that tax savings inherent in private financing/public ownership arrangements represent indirect and hidden subsidies.

Keywords: Levi's Stadium; stadium construction; economic impact; public sport facilities; public policy; Santa Clara; sports management; sports economics; subsidies.

DOI: 10.1504/IJSMM.2020.10032914

International Journal of Sport Management and Marketing, 2020 Vol.20 No.3/4, pp.181 - 192

Accepted: 08 Dec 2018
Published online: 30 Oct 2020 *

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