Is OKC Thunder's $50M contribution a fair comparison to other NBA arenas?
With $850 million in taxpayer money now up for a vote, KOCO 5 investigated the amount of private investment other NBA team owners are making.
With $850 million in taxpayer money now up for a vote, KOCO 5 investigated the amount of private investment other NBA team owners are making.
With $850 million in taxpayer money now up for a vote, KOCO 5 investigated the amount of private investment other NBA team owners are making.
The Oklahoma City Thunder's $50 million contribution to build a new arena pales in comparison to other NBA arenas built in the last 15 years.
But is that a fair comparison? With $850 million in taxpayer money now up for a vote, KOCO 5 investigated the amount of private investment other NBA team owners are making.
KOCO 5 asked Mayor David Holt if voters turn the arena, will the Thunder leave OKC?
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"Well, it's basically self-evident," Holt said.
Holt said there are two eras: before the Thunder and after the Thunder.
"To deny that the Oklahoma City Thunder has been a world-changing event for Oklahoma City is to basically insist that we don't listen to our lying eyes," Holt said.
Holt wants voters to give the green light in December to a new downtown arena. Some have been critical of the amount of green being offered by the team itself.
"The $50 million contribution to the Thunder is absolutely laughable. It's embarrassing. The owners should be embarrassed that they only put out $50 million like that's a meaningful contribution," said J.C. Bradbury, an economist at Kennesaw State University.
Bradbury was one of the leading critics of publicly funded stadiums and arenas. He said recent NBA history is trending toward arenas being built with more private money than what's on the table in OKC.
"The public's going to pay for it, but the private part will keep all the money. That's not a partnership. That's exploitation," Bradbury said.
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Here is a list of new NBA arenas opened since 2010.
- The Golden State Warriors in San Francisco chose to pay 100% of the construction costs
- Orlando's owners paid around 10% of the total price
- In Brooklyn, private money paid about half
- Sacramento's owners contributed around 41%
- In Detroit, 62% was paid for with private money
- Private money paid for about 52% of Milwaukee's new arena, which OKC city leaders toured last year
The offer from Thunder ownership comes out to just 5.5%. KOCO 5 said some people said they're taking advantage of the fear that OKC residents might have of losing the team in their level of investment.
"There's a lot of layers to it. First of all, Detroit has over four million people," Holt said.
Holt and others who KOCO 5 spoke with who are close to the team said the comparison isn't fair because every arena deal is different with different revenue streams and incentives. Holt said better current comparisons are New Orleans and Memphis, which opened arenas in 1999 and 2003 and were paid for entirely by taxpayers.
However, a closer look reveals the comparisons are also not ideal because New Orleans built their arena before the arrival of the Pelicans and Memphis agreed to build their arena in order to secure the Grizzlies from Vancouver.
"But really, the real comparison is us versus the cities that don't have a team. That's the free market, right? That's what we're competing against. Right? Right. Any team that chooses to operate in the city has to weigh what we have, versus the opportunity cost of not being in Las Vegas or Seattle or the other 16 metros that are bigger than Oklahoma City," Holt said.
Holt pushed back against claims from Bradbury and other economists who said decades of studies have shown professional sports teams and arenas do not create economic growth.
"And this is largely because most of the spending related to a stadium where a sports team is just reallocated local spending, so that is most people who would spend their money at a baseball game, basketball game, football game would otherwise be spending in movie theaters, restaurants, grocery stores around town, so we tend not to find large economic impacts," Bradbury said.
Holt said he's seen the studies but said most of them involve cities that already have other major professional sports teams. In OKC, he said the impact is greater because the Thunder is the only game in town.
"I think when you want to look at the real change and you want to put it in economic terms, our GDP in our city since 2008, has increased by 62%. And just so that's not in a vacuum, Tulsans have increased 44% over that same time period," Holt said.
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