Last spring the Milwaukee Bucks’ new principal owners crowed to their investors that the value of the team had risen by 37 percent in just one year. And, in fact, the value of the team had just about doubled in the four years since the New York hedge fund operators bought the team from former U.S. Sen. Herb Kohl. They paid Kohl $550 million in 2014 and the team is now worth just over a billion dollars, proving that it really does pay to shop at Kohl’s.
I would be happy for them if it wasn’t for the fact that this is the worst kind of Robin Hood in reverse socialism. A big reason for the sky rocketing worth of the team is the Buck’s new $525 million arena, which is being built with $250 million in taxpayer money.
So, what’s the upside for us? Did we get an equity stake in the team and see the value of our investment double just like the owners? Well, no, taxpayers just pay. Oh, and by the way, the new building will never be more valuable than when it opens in late August. It is a depreciating asset, which means the value of our taxpayer investment will go nowhere but down. Someday, the Bucks’ billionaire owners can sell the team, pocket an enormous profit and just walk away leaving us with a big old building worth nothing. But no doubt we will get to pay for tearing it down, so there’s that.
Now the Bucks have added insult to injury. Last week they announced a naming rights deal with an outfit called Fiserv. The new arena won’t be an arena at all, it’ll be Fiserv Forum. There doesn’t seem to be any reason to call it a forum except for the iteration. Fiserv does something techie behind the scenes that nobody understands and makes a ton of money doing it. Very new economy.
Fiserv is probably paying the Bucks $7 million to $10 million a year for the naming rights. We don’t know exactly because the Bucks won’t tell us. But the taxpayers have $250 million invested. Since state and local taxpayers are paying half the cost of the place, couldn’t the owners at least have the decency to call it Wisconsin and Milwaukee Taxpayers’ Arena? Guess not.
Look, I like sports. I like baseball mostly, but I’m just as peeved that the Milwaukee Brewers ripped off taxpayers to build Miller Park. (Well, at least we know what Miller makes and it’s a likable product.) This kind of shake down won’t end until states and local governments get together and tell big sports to pay for their own palaces. Until then, rich guys will keep playing one community off against another to get their unnecessary handout while they laugh at us all the way to the big bank.
As sports fans we’ve got to stop being so literally fanatical. Yeah, I like the Brewers but if they had left Milwaukee because we stood up to their extortion, well, I’d be proud of us and I guess I’d be a Cubs fan. (No, what am I saying? I could never be that. Maybe the Twins.)
Professional and big time college sports are hugely profitable businesses. The average NBA team is now worth $1.65 billion. I don’t begrudge them that. I do begrudge them their outrageous public handouts.
Postscript: And, believe it or not sports fans, it gets worse. As this was being prepared to be posted the Milwaukee Journal reported that Fiserv will get a $12.5 million state handout if it keeps its corporate headquarters here. That provision was tucked into the massive $3 billion ($4 billion overall counting the local giveaways) Foxconn taxpayer subsidy bill. So, Fiserv could use our own tax dollars to pay the Bucks to put their name on the arena.
