Missouri

Sports teams are again benefitting from state tax incentives. Last week the Missouri Development Finance Board approved a plan to aid renovations to the Kansas City Chiefs and Royals stadiums.

Preferential treatment for sports teams is nothing new. I'm more interested in the wording of the AP article that describes the state effort. Apparently, the "stadium deal calls for the Royals and Chiefs to come up with a total of $100 million themselves, plus $425 million from Jackson County and $50 million from the state." This gives the impression that somehow Missouri is actually giving the teams $50 million to help with renovation.

Don't be so sure, however. "The $50 million in tax credits can be spread out over up to four years, starting with the state fiscal year that begins Saturday. The Chiefs will get $37.5 million of the tax breaks and the Royals the remainder." It turns out then that Missouri, rather than directly contributing $50 million to the cause, the state government there is just taking in less money. Thus, if the teams' total state tax bill is $60 million, the credit reduces this burden to $10 million. I don't think it is appropriate to label this type of policy as a subsidy or government goodwill when the government took the money in the first place.

I'd also like to point out another interesting political tidbit from the article. At one point state representative Wes Shoemyer "sponsored failed legislation that would have prohibited the [Missouri Development Finance Board] from authorizing state tax credits at sports stadiums, essentially forcing such aid to be approved by legislators." That's a great idea and it is not a surprise that it failed. Rather than be held accountable for favoring sports teams and big business, state lawmakers are more than happy to pass the buck to an unelected state government organization.