Last year, I wrote a story that discussed how the local sports teams in Cleveland were continuing to fleece local taxpayers year after year. In 2014, the city of Cleveland allowed for an extension of revenue from a sin tax to be put into a pot of $260 million (used over the next 20 years) and used by the three sports teams if they needed something. Unfortunately, both the Cleveland Cavaliers (“Cavs”) and Guardians have used up almost all of their allotments yet are continuing to demand more and more money from the city for so-called upgrades that the teams should pay for anyway. Last year, things got so bad that even the media was figuring out that the city was approving venue upgrades for the teams without even the slightest idea how or if the city could afford it.
— StatistaHow did we get here? Last year, Cleveland.com wrote a great story on the reason as to why things are so financially terrible between the city and teams. In 2004, the city was basically going broke from their sports teams. The lease agreements between the city and the Cavs/Guardians/Browns stated at this time that the city must fund all venue repairs, and that was killing the cities bottom line:
“In early 2004, Gateway faced a dilemma when it became clear that its agreements with the Cavs and Guardians were unsustainable. Under those contracts, Gateway was on the hook for nearly all maintenance expenses, leading one Cuyahoga County official at the time to say they were being “nickel and dimed to death.” To avoid bankruptcy, Gateway renegotiated its agreements with the teams. The new terms included a compromise: The Cavs forgave Gateway’s $9.4 million debt, and from then on, Gateway would be responsible for repairs, only if they were considered major capital improvements, exceeding $500,000. In return, the sports teams got to keep the revenue from selling the facilities’ naming rights. However, even though expenses must meet the $500,000 threshold to qualify for public funding, the sky is the limit on how much capital repair projects can cost taxpayers.” — Cleveland.com, 08/01/23
What are the teams doing? They are basically forcing the city to fund so-called upgrades that are not even remotely close to “major capital improvements”. Although both the Guardians and Cavs have each demanded tens of millions on various occasions over the last 15 years, the Cavs really do take the cake as the worst abuser of taxpayer money. Just weeks ago, the Cavs demanded the city fund almost $1 million dollars so that the arena was more protected from…bird strikes. Last year, they demanded $25 million for mainly electrical replacements. Funny, some local media wonder why the team didn’t bring up this issue years prior. Oh please, of course, we know why the Cavs waited to discuss it. The Cavs would have been forced to pay for the upgrades if they had mentioned it earlier.
But wait, didn’t the city give the team $70 million dollars of taxpayer money just a few years earlier? This was so that the arena could be renovated in a $185 million project. That renovation must not have been that good. In 2015, the city paid for a new roof on the Cavs arena. Then we have the Cavs wanting almost $20 million for “heating, cooling and ventilation systems”. Thankfully, it seems to me at least that more people are calling out the Cavs for this trend of spending so much money that wasn’t intended to be used by or for them.
— Signal ClevelandBut the Cavs claim in their recent Community Impact Report that their team has “generated $800 million in tax revenue and…been the catalyst for $2 billion in planned or completed development in the Gateway District”. Is that why the city can’t pay for a new jail? Is that why the city continues to struggle staying afloat financially? I wonder why this magic money isn’t propping all of this area up and out of financial hardship. Furthermore, I will just ignore the most obvious problem that not one thing said by the Cavs can actually be verified with facts. Nowhere can you find $800 million being generated or $2 billion worth of development that is tied to the team.
Fast-forward to today, and are things any better? No. Things have likely gotten worse. How? Well, the Cavs and Guardians continue to demand more and more money and the city continues approving the projects. This means that the Cleveland’s “bills keep increasing and no one knows yet where that money will come from”. Maybe the taxpayer funded group who reviews any request from the Cavs/Guardians/Browns can help? No, wait, “it has no money”. So the city will need to locate a new source of money. This means that the city will likely need to either raise taxes or take money from another city service to pay off the team expenses.
Let’s not forget about the Browns. In the last month, the team has met with multiple city and state leaders to emphasize that they expect hundreds of millions in taxpayer funds for their new stadium in the near future.
– Crains ClevelandAnd a soccer group wants $90 million worth of taxpayer money? Good lord. What?