NEW YORK (Reuters) - U.S. President Donald Trump on Tuesday stepped up his war of words over National Football League players’ silent protests against racial injustice, saying the world’s top-grossing sports league should not be given tax breaks while athletes kneel during the national anthem.
The NFL gave up its tax-free status two years ago, but new or renovated stadiums are often funded at least in part by tax-exempt municipal bonds issued by local governments or states. Team owners benefit from government financing via lower interest rate bonds backed by team lease payments, stadium-generated revenue and even tax dollars.
The administration could push for changes to the laws that allow professional sports teams to enjoy tax breaks normally aimed at city governments.
Below are five facts about the financing of sports stadiums.
1) Laws allowing teams to fund stadiums with tax-exempt bonds have cost the United States $3.7 billion in lost tax revenue from 2000 through 2014, according to a Brookings Institution paper released last year, a figure that reflects the lower interest rates paid on municipal debt and the tax exemption for bondholders.
2) Of the 16 NFL stadiums built or renovated from 2000 through 2014, 13 were financed in part by tax-exempt bonds with an average financing worth $360.2 million, according to Brookings, a Washington-based policy think tank.
3) Trump could propose tax reform legislation to remove the federal tax exemptions on debt financing for stadiums. However federal changes would not necessarily hinder any potential incentives offered by state and local authorities. The latest and largest subsidy offered to an NFL franchise is the $750 million Las Vegas is using to lure the Oakland Raiders to a $1.9 billion stadium. The money will come from public funds raised via a visitors’ tax on Las Vegas strip hotel rooms.
4) There are two bipartisan bills, one in the Senate and one in the House, before the U.S. Congress that seek to remove federal tax exempt status for bonds tied to sports stadiums by treating them as private activity bonds.
5) Former U.S. President Barack Obama proposed in two previous budgets for 2015 and 2016 legislation to eliminate the tax exemptions on stadium financing, Brookings said.
Reporting By Daniel Bases; Editing by Scott Malone and Meredith Mazzilli
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