Anyone who knows anything about sports knows that the big bucks are in corporate sponsorships and related dollars. The flinty-eyed gnomes of the International Olympic Committee zealously guard their corporate dollars, and on down the sports feeding chain.
So why, on earth, did the City of Toronto practically give away the most lucrative part of its new $62.5 million soccer stadium?
As usual in these cases, taxpayers will pay most of the costs while private corporations will reap most of the benefits.
Next to lucrative defense contracts, sporting endavours are probably the best way for corporate welfare bums to pick the pockets of humble taxpayers.
Here are the numbers for Toronto’s soccer stadium, as reported in the business section of The Toronto Star (so, of course, the numbers must be right!):
- taxpayers have been forced to pay $54.8 million of the total stadium cost – that’s almost 90% of the bill.
- a private company, Maple Leaf Sports Enterprises, is supposed to kick in $18 million.
However, MLSE is apparently getting set to sell its stake to the Bank of Montreal. Those canny bankers know a good deal when they see one.
Once the deal goes through, BMO will have a 20-year exclusive hold on corporate sponsorship fees, fees from private boxes and other fat little items. The deal is expected to deliver as much as $27 million in the first ten years.
What’s worse, every time some rich corporate rents a private box, not only does BMO bank the revenue, but the taxpayers will get another hit as the corporation deducts the expense from their taxes as entertainment.
So, taxpayers pay to build the stadium, and we pay again every time a corporate guest chows down on an over-priced hotdog, and a private corporation banks the revenues.
Sweet.
The head of Toronto’s 1996 Olympic bid, Paul Henderson, crowed to a documentary filmmaker back in late 1980s that he had figured out a bunch of ways to hide corporate revenue (including luxury box sales) from the grasp of the International Olympic Committee. He was rewarded for his cleverness by being appointed to the IOC a few years later.
There’s big money to be made in sports.
Too bad that it’s taxpayers’ dollars.
Even worse that it flows right into the bank account of private corporations.
It all brings back sweet memories of Toronto’s SkyDome. Paul Godfrey, then chair of the Metro Toronto Council, promised in January of 1982 that the sports stadium could be built with $75 million in private dollars. Some people apparently believed him.
The final dollars are still murky, but it cost about $600 million – most of it from taxpayers. By 2004, Rogers Communications offered to buy the building for $25 milion – about 4% of the original cost.
Paul Godfrey, who was the architect of the original financial disaster, emerged at the end as President and CEO of the Toronto Blue Jays, one of the major tenants at the SkyDome – whoops make that the Rogers Centre.
After all, they paid 4% of the construction cost. Why shouldn’t they be allowed to name it and make all the revenues?
That’s how is works in the world of $port$.
- Michael Shapcott
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