City Acknowledges Weak Economic Support for Cubs Deal

At a recent public meeting, the mayor of the City of Mesa was asked about the economic justification for the proposed Chicago Cubs spring training facility. The mayor compared the project to parks and swimming pools and stated that baseball stadiums do not “cash flow”. Specifically, related to the amount of benefit Mesa residents could see as a result of the new development, the mayor said the retail sales in the city were $50 million higher in March of 2010 than in either February or March. Translating the big number down to actual revenue by applying the current sales tax rate, this means the City of Mesa received less than $1 million as a result of spring training this year.

The bottom line here is – on an investment of $100 million, the city can only anticipate a return of less than $1 million per year. Since the debt service alone on the money needed to be borrowed to build this project will amount to about $7 million per year, a very substantial annual loss can be expected. As the mayor said, these deals do not cash flow.