Heavy Lifting - thoughts and web finds by an economist
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Tuesday, August 17, 2004

User fees go to the Cowboys?!?

The master plan for the Cowboy's stadium calls for: a) 1/2 cent sales tax locally, b) 2-percentage point increase in hotel occupancy tax; c) 5-percentage point increase in local car rental tax; d) $3 tax on parking at the stadium; e) 10% sales tax on tickets.

Taxes (d) and (e) have been advertised as "user fees" that will force those who use the stadium and enjoy events in the stadium to pay more for the experience. This follows the theory of Lindahl that users should be taxed their marginal benefit for the provision of "public goods." However, in today's Star-Telegram a little nugget indicates that the "user fees" will go to the team, not the stadium authority nor the city.
Revenue from user fees, including a 10 percent ticket tax and a $3 parking tax, would go to the Cowboys, said Donna Swarb, the city's chief financial officer.
This "master plan" is really sizing up to be a screw job for the city of Arlington. Where is Tarrant County in all of this? Where is common sense? I think the county (and Jerry Jones) is hoping it has found a sucker.

Found a link to Heavy Lifting from FakeCurtis. Thanks.

No problem about the link. I'm trying to understand more about economics, so I've been enjoying your posts.
I agree with some of your earlier numbers. Nothing in the ERA report adds up to a profitable investment for the City. I wish someone could explain why they used 2010 dollars. Hey maybe the Cowboys can convince the NFL to hold 3 super bowls at the stadium every year, or convince the DNC or the RNC to hold a presidential convention every year.

I wager the study uses 2010 dollars because that is when the stadium will open (actuall 2009). I have heard from certain authorities that the 2010 year was chosen because it was one year after the stadium would open, thereby avoiding the "honeymoon" effect of the new stadium. Unfortunately, academic research suggests the honeymoon effect might last up to five years, so it is not a good argument.

I think 2010 dollars were chosen to artificially inflate the numbers released in the media, trusting that the vast majority of people would not take the time to read the study nor would they understand it if they did.
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