It’s summertime, and the Chicago Bears have put their players through sweltering offseason practices. Inside the team’s front office, a few people might be feeling the heat, too.
It’s got nothing to do with how draft picks play or whether the team shakes the losing habit this season. It’s about the upcoming financial decision that looms as the biggest in the franchise’s history and ultimately might affect control of the team.
Heading into the second half of the year, the Bears will have to compile serious development plans, and weigh counterproposals, over a new stadium.
Will the team stay in Soldier Field, winning an agreement for a retrofitted stadium that it rents, or go to Arlington Heights, where it has a deal to buy the 326-acre former Arlington International Racecourse for $197.2 million?
Bears President George McCaskey said he wants to close the sale early in 2023. Even if he gets to that point, that’s only one step in a circuitous route.
Taxpayer subsidies will weigh heavily in the decision. The Bears will have digested details of the NFL’s latest deal for a new stadium. The $1.4 billion plan to put the Buffalo Bills in new digs comes courtesy of $850 million in financing from state and local governments, a commitment that New York Gov. Kathy Hochul insists will be repaid from tax revenue the club’s business will generate.
Economists who examine sports subsidies have grown weary of rebutting that argument. Numerous studies contend that stadiums produce a fraction of the promised gains. Yet the subsidies have risen with the construction costs.
“I think it just goes to show that policy decisions don’t seem to be tied to actual knowledge,” Kennesaw State University economics professor J.C. Bradbury told USA Today. The University of Chicago’s Allen Sanderson has argued that stadium fiscal benefits are commonly oversold by a factor of 10.
NFL markets, however, believe they must spend to keep their teams and the prestige they represent. As a percentage of the project costs, the Buffalo Bills subsidy is hardly an outlier.
Reviewing the financing for the 21 new NFL stadiums since 1998, the Buffalo News found public financing commonly was 60% or more. It was 100% in Tampa, Florida. The newest stadium, shared by the Los Angeles Rams and Chargers, was the most expensive ever at $5 billion and had zero public subsidies because the uber-rich owner is relying on the development of 300 surrounding acres.
The Bears’ principal owner, Virginia McCaskey, heads a family modestly situated by league standards and without capital to risk. The family has a large third generation that might have different views about keeping the team.
The size of the Arlington Heights venture also has implications for team control. To develop most of the racecourse site, the Bears will need partners or a joint venture for the real estate. The team can count on the NFL to back a charter franchise and on revenue from personal seat licenses, stadium naming rights and more luxury suites, clear advantages over Soldier Field.
Mayor Lori Lightfoot, however, has factors in her favor for keeping the Bears. As you read details of stadium subsidies, you get repeated references to bond issues and taxes on retail sales, hotel stays and car rentals, all ready-made Chicago revenue sources Arlington Heights cannot match. The city has better odds of drafting a package for the Bears that doesn’t require state money.
Whichever way the Bears go, the demands from the league and its consultants are to spend more on stadiums. The NFL is the world’s most pumped-up TV show, and it wants staging to match. Trends in stadium design call for more technology sold as enhancing “fan experience,” but it’s really about mining data and separating people from their money. In 2019, analysts in the U.S. sports practice for Deloitte Consulting imagined football fans’ “smart-stadium experience” and described this scene during a big play:
The team bracelet on your wrist pulses faster, in sync with the heartbeat of the running back dashing to the end zone. Your glasses render numbers hovering over the player showing his speed and distance covered as he scores for the home team, while chats from stadium friends scroll down the side of your view. You stomp your feet in rhythm with 80,000 fans, inflating a giant balloon on the Jumbotron until it finally bursts. From the end zone, the running back opens a camera stream that broadcasts a personal message out to VIP ticket holders.
Your smartphone lights up: The bet you placed on the play earns a free sponsored concession. Across the stadium, fan jerseys glow with LEDs blazing the teams’ colors as machine algorithms review the play and stitch together a highlight reel for distribution to networks, social media, virtual reality (VR), and augmented reality (AR).
Sheesh — you’ll have to smuggle in a hip flask just to calm your nerves.
