Wednesday, October 24, 2007

Predation

Posted By on Wed, Oct 24, 2007 at 3:18 PM

As the city and the Predators flirt with deadlines, let's debunk a particularly specious argument for more taxpayer largesse that the local group seeking to buy the team has been offering. A statement released earlier this week by David Freeman on behalf of the buyers group said in part:


The lease changes we have proposed will make the franchise financially viable while accessing only money that would not exist in Nashville without the Predators and without substantial improvements in arena activity.


By "money that would not exist in Nashville without the Predators," Freeman is presumably referring to his proposal that the city let the team keep most of the state and local sales taxes and seat use fees paid by arena users (roughly $4 million in 2006). And, yes, it is literally correct that a given dollar of tax revenue generated by a Predator-related sale would not exist without the Predators. The same can be said of any revenue-generating business in the city.

But does Freeman think it sound public policy to prop up a private enterprise that cannot generate an operating margin by simply forgiving its tax obligations since those tax revenues wouldn't exist without that enterprise? Does he think that tax dollars generated by his profit-making business (and as we can see in the outsized capital gains about to be enjoyed by current Predators owner Craig Leipold, there are indeed handsome profits) are somehow less essential or more dispensable to the city than those raised by, say, residential property taxes? Seems like either kind of dollar will just as effectively buy replacements for outdated textbooks in Metro schools.

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