Governor DeWine has proposed doubling Ohio’s sports betting tax from 20 to 40 percent. The governor’s primary goal with this additional revenue is to designate a separate state fund with its own commission to distribute finances for sports team applicants’ facility upgrades.
“No longer will we have to, at any time in the future, go to the people of the state of Ohio and say, ‘Your tax dollars will go to this stadium or that stadium,’” DeWine said. “This gives us an opportunity not to have to take general fund dollars away from education or something else and to be able to actually fund these in the future.”
Many states and cities offer subsidies for professional sports stadiums. In 2024 alone, the Chicago Bears were seeking $2.4 billion and the St. Louis Cardinals were asking for $600 million. In over a dozen major cities, teams demand major cash, and governors and mayors are often on board to raise the funds. The defense for these subsidies tends to be the same: stadiums support the local economy, and upgrades will bring new jobs to our regions.
Unfortunately, the academic consensus overwhelmingly contradicts this position: investing in professional sports stadiums yields no tangible economic benefits for their home communities. This means that no economic growth, tax collection growth, wage growth, increase in migration, or increase to city-wide or state-wide property values have been achieved by the host city.
If lack of return on this investment isn’t enough to bench Gov. DeWine’s proposal, when you look at Ohio’s current revenue estimate from sports betting, it should make it game over for Governor DeWine’s proposal.
Ohio has already collected over $130 million from sports betting taxes in 2023, and while we await final figures from 2024, initial estimates suggest the state may have collected $200 million in sports betting taxes. It’s a solid revenue stream, yet higher tax rates could encourage Ohioans to flee from legal markets to avoid the tax.
To make matters worse, the Cleveland Browns already have a relatively new facility at Huntington State Field. The Browns’ home is only 25 years old, about the same age as Paycor Stadium and many years newer than places like Progressive Field. It has years ahead of it before additional revenue investments would warrant discussion.
Taxpayers should be skeptical of the governor’s promise that this new fund will solve all future requests for taxpayer-subsidized stadiums. Experience has shown that, whenever the public is footing the bill, stadiums become ever more expensive and the time between replacements becomes shorter.
If policymakers truly want to help grow Ohio’s economy, a more strategic game-plan than a stadium subsidy is needed. Ohio taxpayers deserve a win more than billionaire sports team owners.
Adam Hoffer is director of excise tax policy at the Tax Foundation.
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