Stadium developers across the nation routinely hire private consultants to conduct economic impact studies, which invariably promise that a new stadium will be a bounty of riches for the community.

Similarly, the Tripp Umbach report commissioned by Northwestern University, forecasts that the new Ryan Field will bring impressive economic benefits for Evanston and tax revenue for city coffers.

Architect’s rendering of proposed new Ryan Field, to replace Northwestern University’s current stadium. Credit: Northwestern University

Unfortunately, these studies are often cloaked in secrecy, do not share the basis for their projections, and are not vetted by independent experts. Almost always, these reports conclude that:

  • Building new stadiums create local jobs in construction and engineering.
  • People who attend events will produce new spending power within the community, which will expand local employment.
  • New stadiums attract tourism to the city, further increasing local spending and jobs for the community.
  • The new spending will have a “multiplier effect,” where the increased local income will trigger more spending and job creation.
  • All of this spending will create tax revenue to bolster city coffers.

It turns out that many nationally recognized, independent economists have exhaustively analyzed these studies for decades – primarily because billionaires routinely pressure politicians into approving tax dollars to subsidize dazzling new stadiums.

It has become common practice to use taxpayer dollars to demolish old stadiums and replace them with extravagant entertainment palaces featuring impressive architecture, luxury private suites, club boxes, in-stadium restaurants, catering and boutique concessions.

While it is true that Northwestern will not request tax dollars for the new Ryan Field, many of the claims listed above (also touted in the Tripp Umbach report) are relevant for Evanston.

Do new stadiums create jobs? Do new stadiums spur local economic development? Do new stadiums increase local tax revenue? To answer these questions, I began reading studies published by independent sports economists. Here is what I learned:

Robert Baade, a well-respected sports economist from Lake Forest College, conducted the first influential groundbreaking study of sports stadiums, examining the economic impact in 30 cities that built new facilities.

In 27 of those cities, he found no significant boost. In the other three, the impact appeared to be negative. Since then, study after study (more than 130) by leading economists, have produced similar findings.

These include studies by Allen Sanderson (University of Chicago), Andrew Zimbalist (Smith College), Roger Knoll (Stanford University), Brad Humphries (West Virginia University), Dennis Coates (University of Maryland), Christopher Briem (University of Pittsburgh) and Michael Leeds (Temple University).

After decades of research, there is universal agreement among them that sports stadiums don’t do much to boost a local economy, even in cities and neighborhoods that have not used tax revenue to fund developments.

The conclusions are remarkably consistent. All agree that new stadiums don’t create jobs, don’t spur local development, and don’t increase tax revenues – even when hosting mega-events.

They state that stadiums have a dismal track record of producing such benefits. Pretty much any study done by anyone anywhere that is credible and independent finds that new stadiums have next to no impact on the local economy. Here are more of their findings.

  • Net employment effects of stadiums are limited to a few specific narrow sectors, nearby restaurants and bars within a mile of venues. Other nearby businesses suffer economic losses. They often close on event days because their customers can’t find parking and stay away. Also, spectators have no interest in visiting a ballet school, insurance agent, veterinarian, guitar store, florist, optician, health food store, needlecraft hobby store, Pilates studio — on Central Street.
  • While stadium construction does create jobs, it is a short-term benefit and only if the stadium is built under agreements that guarantee the hiring of local companies and workers. Once a stadium is built the number of full-time jobs is reduced and replaced with primarily lower wage, part-time, seasonal jobs. Most income is overwhelmingly concentrated and pocketed by the owner and top personnel.
  • Sports venues do attract out-of-town fans who patronize local hotels and restaurants, but the jobs created and tax revenue generated rarely come close to the rosy projections.
  • The “multiplier effects” are very low or non-existent when compared to a city’s truly important economic drivers. For example, Michael Leeds, the Temple University economist, found little to no ripple effect when he assessed the impact of sports stadiums in Chicago, home to five major league franchises (Cubs, White Sox, Bears, Blackhawks and Bulls). He found that the income generated by those teams had a combined impact on the city’s economy of less than 1%.
  • The “novelty effect” of a new facility generates initial interest, but in the long run, does not contribute much to revenues. It wears off quickly. For example, the relatively new PNC Park in Pittsburgh ranks as the best, most family-friendly baseball stadium in the country because of its location, views of the skyline and river, timeless design and clear angles of the field from every seat. Yet, attendance consistently ranks 26-28th of 30 Major League Baseball teams. Sometimes the stadium is almost entirely empty.
  • Private studies almost always overstate the impact because they confuse gross and net economic effects. Most spending inside the stadium is a substitute for other local recreational and leisure spending, such as movies and restaurants. Spending on tickets and concessions comes largely from spectators who were already spending their income somewhere else locally. It’s not new spending. It’s the same spending reallocated to a different location, in this case, Northwestern’s coffers. Similarly, most tax collections inside a stadium are substitutes. As other entertainment businesses decline, tax collections from them fall.

Bottom line…Evanston residents and politicians should be highly skeptical of the enticing projections in the Tripp Umbach report.

Independent economists warn that everyone should cast a gimlet eye toward numbers put forth by self-funded studies promising a rosy local economic impact.

Invested parties are always anxious to show economic benefits, but the evidence from over 130 academic studies indicates that sports stadiums are notorious for over-promising and under-delivering positive economic impacts for the surrounding community.

Virtually every independent sports economist casts doubts, some going so far as to say developer-sponsored economic impact studies should not be viewed credibly by anyone.

In fact, privately funded studies are widely viewed by experts as self-serving shiny public relations documents disguised as economic impact studies.

Northwestern is attempting to dazzle residents, businesses and politicians with the same song and dance despite overwhelming evidence to the contrary. We are being fed the same seducing Kool-Aid. A determined Northwestern will likely say that this project will be different…the immaculate deception is underway in Evanston.

Ken Proskie
7th Ward Resident
On behalf of the Most Livable City Association

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  1. I see both sides of the argument here – but, ultimately where do all the cars park – currently, they park all over the residential streets around Ryan Field – is Northwestern able to increase the parking lot spaces for concerts as well
    Why doesn’t NU consider the concerts on their lakefront property where they will have to provide the parking off residential streets

  2. Excellent analysis! The NU projections also fail to take into account the negative impact on local property values (and taxes), increased cost for public services required on event days (and the long term cost of pensions associated with those employees), increased pollution and crime, and the overall detriment to the quality of life for neighbors and business not just in the immediate area, but for miles.

  3. Northwestern is saying they are unable to operate their new stadium unless they get commercial zoning use on their 37+ acres of tax exempt land. I am sure every tax payer in Evanston would love the same free ride, of not paying property taxes. An acre of Commercial land on Central St. generates about $620,000 so if the 37.3 acres in the U2 district were taxed as commercial, they would it would generate about $23,126,000 in taxes for city and schools. Why doesn’t NU have a pro forma ( https://www.investopedia.com/terms/p/proforma.asp) to validate their statement? Not that any reason to blow up the Evanston Comprehensive Plan and Evanston Zoning code would be acceptable. This is a proposed 35,000 person commerical entertainment center with greater capacity than the 23,000 person United Center and does not belong in the middle of residential neighborhoods.

    NU has an increased game schedule, that along with all the concessions will push them above $100,000,000 based on based on 2017 when they made $92.3 million in sports. “ While conference per-school shares make up a large chunk of a university athletic department’s total operating revenue, ticket sales and sponsorship deals also contribute to that number. The most recently available data from the U.S. Education Department’s Equity in Athletics study showed that Northwestern’s grand total revenue across all sports was $92.3 million for the 2017 fiscal year.

    NU says they can’t afford operations of their new stadium unless they get commercial zoning use but they don’t want to pay commercial property taxes. Of course not. Who wants to pay property taxes? But we pay our fair share of taxes because we realized that if we want have a great community and that costs money. Everyone need spays fees, electric taxes, water taxes etc, permit fee, transfer taxes etc.

    The letter by Mr. Proske highlights the facts that there is something severely wrong when a university with the reputation of Northwestern says they don’t yet have, or are they refusing to share the financials

    As Mr. Cook states, NU is not the most ideal neighbor. NU continues to push their tax-exempt boundaries into neighborhoods and downtown taking property off the tax rolls. When that happens greater costs of maintaining our city are put on the backs of the taxpayers.

    When NU expands into surrounding neighborhoods they fail to acknowledge the human cost, which is the the loss of the quality of life in the day to day lives of 1000s or people. Is it that the quality of life of the community, is not financially quantifiable and therefore irrelevant when it comes to Northwestern’s bottom line?

    The economic study by Northwestern regarding their economic contribution is interesting but self-serving and fails to address and acknowledge the 100s of millions of dollars Evanston the residents, local businesses and city taxes spend to create our Evanston home which enables NU students, faculty and visitors to make NU a work, attend and visit.

  4. I could not agree more.
    This is the letter that I sent to the local Alderperson yesterday.
    December 15, 2022

    Evanston City Council
    RE: Northwestern Zoning Variance Application

    As an Evanston resident, neighbor and an alumnus of Northwestern University (NU), I would like to see NU improve their facilities and increase their utilization of Ryan Field, providing they act like a good neighbor and citizen of Evanston. To date, NU has not been either a good neighbor or a good citizen. They do not contribute in any meaningful or fair monetary way to the city coffers, and they pass off their excess parking creating hardships for the local business district and community.

    To help sell the concept of a new stadium with increased events, NU retained a consulting firm, Tripp Umbach (TU), to provide a purported independent projection of the tremendous value a new stadium would bring to Evanston.
    https://rebuildryanfield.com/wp-content/uploads/2022/11/TU_Northwestern-University_Ryan-Field-v4.pdf

    The projections contained in the report should not be viewed as unbiased, or independent since TU was paid by NU for their opinions, and admits that they relied on NU’s forecasts for input into their projection software. All numbers contained within the report should be viewed critically.

    Although the TU report appears biased, TU did include the following valuable recommendations for NU on slide #10 titled Community Focus Groups Community Observations:
    o Resolving past issues raised by residents near Ryan Field should be the highest priority in the short term.
     Notably, a comprehensive parking plan that involves the City of Evanston in partnership with the university is recommended for all events held at the rebuilt Ryan Field.
    o NU should communicate the stadium design changes that were based on community feedback and should continue to develop mechanisms for community members to provide detailed recommendations for improved operations at the Central Street athletics facilities
    o Community stakeholders should be involved on an ongoing basis with respect to monitoring the impacts of any additional events and addressing any unexpected issues they may create.

    If NU followed their own Consultant’s recommendations, those efforts would move NU much closer to acting like a good neighbor and citizen. Notably, NU has not followed these recommendations. They have not put forward a parking plan, or indicated that they would be open to involving community stakeholders in addressing unexpected issues that may arise. TU also does not provide potential solutions to the parking concern and they also fail to outline how the community stakeholders could be involved in monitoring the impacts of these new events.

    TU fails to mention the following two additional community concerns: fair share payments to the City of Evanston, and Central St. business district vitality. This letter will attempt to highlight these concerns.

    Being a good neighbor means that you contribute fairly and equally to your community. The historical lack of funding contributions from NU to the City of Evanston contributes to the City’s budgeting problems and necessitates higher taxes for every taxpayer. Numerous studies show that while NU is among the top ten richest universities, it ranks near the bottom when it comes to tax exempt universities’ financial contributions to their host cities. First Ward Alderman Clare Kelly compiled a highly compelling report supporting her policy objective of NU paying its fair share to the City of Evanston A copy of her report can be found here:
    Clare Kelly Works for More Contributions from Northwestern University (clarekellyfirst.org)

    As a not-for-profit, NU historically has not paid real estate taxes in the City of Evanston. With this zoning variance request, NU is asking for a permission to hold football home games, 12 night time concerts and other additional unspecified and unquantified events, all while selling food and alcohol in their proposed stadium and grounds. Neither selling food, alcohol, nor any of these newly proposed events have anything to do with their core, not-for-profit mission.
    https://www.northwestern.edu/about/mission-vision-goals.html#:~:text=University%20Mission,in%20a%20diverse%20academic%20community

    If granted, all of NU’s requests would allow NU to compete unfairly with existing entertainment venues, restaurants and bars, which do pay property taxes to the City of Evanston. The existing bars, restaurants and to some extent hotels seem to be the only local businesses that currently benefit from NU home games. These businesses would not benefit much, however, if NU is allowed to compete with them without paying property or income taxes. If NU is allowed to compete with existing tax paying, for profit businesses, then it is the local government’s job to ensure that they compete on an equal footing. NU cannot have it both ways: they cannot be treated like a not-for-profit entity while making money tax free by selling event tickets, food, and alcohol.

    Being a good neighbor means that you respect each other, and you avoid creating problems for one another. If you do create a problem, you try to fix it. Currently NU’s excess parking needs for their football game attendees creates problems for the local business community. This is an ongoing problem that NU has been aware of, yet have never addressed. Attendees park-up Central St. and nearby side streets, preventing customers from obtaining access to their Central St. stores. This crushes most local business except for the few establishments that sell food and alcohol on Central St. These food and alcohol establishments are the establishments that NU wants to compete unfairly against as discussed above.

    TU opined in their report that additional events would help local businesses. They appear to have concluded that without talking to local store owners. Concert attendees do not regularly purchase bulk spices, a new shirt, attend a yoga class, or purchase a book on their way to a football game or evening concert. If NU is allowed to sell food and alcohol, the local restaurants and bars will also lose business.

    According to NU’s attendance records cited in the TU report, NU’s average game attendance over the past few years has been approximately 37,000. Therefore, reducing the capacity of the stadium to 37,000 will have no effect on the parking issues in the neighborhood or business districts surrounding the stadium. NU is simply right-sizing their stadium. Contrary to improving parking, NU is doing at least two things to worsen the situation:
    • Based upon a review of the site plan provided in the report, it appears that several current areas of parking will be eliminated to provide additional areas for food and alcohol sales.
    • By increasing the number of events from 7 to over 19, they are worsening the parking issue by over 270% annually.

    Based on the issues listed above, it is clear that NU is not acting like a good citizen or neighbor. The issues raised by TU in their report and those listed above must be addressed satisfactorily before the City Council considers granting NU a zoning variance or building permit for their proposed stadium. Now is the time for the Evanston City Council to do their job to protect the citizens and businesses of Evanston, and demand that Northwestern University properly address the City’s concerns.

    Sincerely,

    David Cook
    2683 Prairie Ave.
    Evanston, Il. 60201-1434

  5. Ken, do ANY of the “studies” you cite, focus specifically on a university football stadium in a college town? If so, which studies are you referring to, specifically? I want to read those “studies” because, as a taxpayer and resident of Evanston, I believe your arguments are specious and your “studies” are irrelevant based on the “facts.” This project will actually IMPROVE the present venue for nearby residents (Ryan Field has existed since 1926), as well as be an improved asset for which the entire City of Evanston will benefit and can be proud, WITHOUT requiring ANY taxpayer funds for its construction! We are NOT talking about a professional sports stadium (which most, if not ALL, your “studies” are focused on), e.g., for a NFL football team or ANY other professional sports venue, which often REQUIRE massive amounts of public support in the form of tax funds or bonds. Northwestern, a private, non-profit, nationally-ranked world-class university, was founded January 28, 1851, BEFORE the City of Evanston even existed (the City was incorporated in 1863), and Northwestern generates $145 to $175 million in revenues for the Evanston economy on a yearly basis, according to a comprehensive economic impact study based on the 2004 fiscal years of Northwestern University and City of Evanston (one can increase that annual economic impact by another 58% just based on inflation), see https://www.northwestern.edu/newscenter/stories/2006/05/economy.html . A major factor in why I chose to live in Evanston, was to be close to Northwestern and all it provides in benefits to all residents of the City of Evanston. Frankly, I don’t understand why anyone who intentionally chose to live next to a football stadium built in 1926, would now object to this thoughtful and improved stadium project (reduced seating capacity and modern design that will also reduce noise and light pollution) see https://news.northwestern.edu/stories/2022/09/northwestern-releases-early-design-concepts-for-dynamic-new-ryan-field/ . I support this project 100% (Thank You Ryan Family for your gift!), and I urge all Evanstonians and the City of Evanston to do the same.

  6. I appreciate the research and thoughtfulness Mr. Proskie put into his letter disputing the economic benefits of a new stadium suggested by the Northwestern study.
    I’ve not researched all of the studies cited, but did read the brief of the study published by Prof. Baade 24 years ago.
    This work examines the payback to state and local governments as a result of subsidizing stadium projects. Baade concludes that state and local governments might have better economic development results by public investment elsewhere. While this may be true, it’s not the situation in Evanston. To the best of my knowledge, Northwestern is not requesting local or state subsidies for the stadium project. It is not in or suggested to be a TIFF zone. Northwestern is taking on the financial risk for the new stadium, not taxpayers. So, if the other 130 studies Mr. Proskie cites have same premise, the analysis of taxpayer pay back is not relevant because there is no taxpayer investment.
    Further, the issue at hand is not whether there will be a Northwestern stadium. There is a stadium. The issue is whether Northwestern can build a new, privately financed stadium on the same site and recoup some of their investment by hosting concerts. Northwestern argues that there is an economic benefit to Evanston from concerts. I tend to agree.
    Americans for the Arts partners with economists from the Georgia Institute of Technology to report on Arts & Economic Prosperity every five years. The most recent report was from 2015 and the current report is underway. It’s extensive and breakdowns results by region. These economic analyses consistently, “Put to rest the misconception that communities support arts and culture at the expense of local economic development.” The most recent report from the City of Chicago for 2015 ( just the city) showed:
    1. Spending by Arts & Cultural Audiences totaled $ 1.84 billion excluding admission fees.
    2. $64, 521,000 in revenue was generated for the city and $55,691,000 generated for the state.
    3. The average attendee to an art and cultural event spent $50.56 in addition to admission fees.
    Just to our north, the city of Highland Park receives $1 million a year in ticket sales from not for profit Ravinia in addition to sales tax on food, beverages and merchandise.
    An independent analysis of the economic impact of rebuilding Ryan Field and hosting concerts is important. It may in fact show a less generous outcome than the NU consultants, but it seems unfathomable that it would be nothing. And, part of making an Evanston a most livable city is providing citizens with the opportunity to enjoy music and cultural events in our own hometown.