Cubs Chairman Tom Ricketts is seeking a public subsidy that is often overlooked in debates about publicly financed sports stadiums, according to economists
In pitching his plan to publicly finance Wrigley Field renovations, Cubs Chairman Tom Ricketts has argued he’s not asking taxpayers for anything.
Some government officials have scoffed at the notion because Ricketts proposes to use revenues from anticipated growth in existing amusement taxes that the team pays to Chicago and Cook County to pay off more than $200 million in state-issued bonds to fund the improvements. Those are tax dollars that could be used to hire more police officers or add libraries, critics have suggested.
Ricketts also is seeking another public subsidy that is often overlooked in debates about publicly financed sports stadiums, according to economists. That’s the federal subsidy that arises when a stadium is financed with tax-exempt bonds.
The federal government has long allowed state and local governments to issue bonds and use the proceeds to make loans to private businesses for such things as manufacturing.
Such bonds offer a discounted cost of capital to private individuals in the form of below-market interest rates, paid for through the exemption of the bonds’ interest income from federal income taxes.