Advocates of a new downtown Sacramento sports arena rolled out a study Thursday that puts an eye-popping number on the building's projected economic benefits: $7 billion over 30 years.
The study, commissioned by Mayor Kevin Johnson's arena task force, said the new facility would shower the region with $157 million a year. That includes spinoffs such as sales at restaurants and hotels, as well as $6.7 million in taxes.
The $7 billion estimate includes assumptions about inflation.
While a lot of the money would come from area residents and wouldn't be new dollars for the region task force members said the building would still bring huge benefits.
"The return on investment the public would get from this is enormous," said political consultant Chris Lehane, executive director of the task force.
The task force formerly known as Here We Build, now named Think Big has yet to unveil a plan for raising the $387 million or so needed to build an arena. But it's expected to be a "public-private partnership" that would take revenue from multiple sources. Lehane said a report on arena financing is expected Sept. 8.
The Sacramento Kings are almost certain to leave town if a financing plan for a new building isn't in place by next spring. The economic-impact report is part of the task force's effort to convince the community that a new arena would bring financial benefits that transcend a basketball team.
For one thing, the new building would be able to host more high-caliber concerts and other events than aging Power Balance Pavilion, according to Lehane and others. Lehane said Power Balance would quickly fade as an entertainment venue if the Kings left.
Economic-impact studies on sports arenas are almost always controversial. Critics say the economic benefits are usually overstated. David Carter, a University of Southern California sports-business expert who has conducted such studies, said the reports can be "imprecise."
"Economic reports are equal parts business, politics and public relations," said Carter. "It doesn't mean the numbers are incorrect."
The Sacramento study's author, Sacramento consulting firm Capitol Public Finance Group, contends that the downtown location would create considerable economic activity beyond the walls of the building itself. The arena would draw 3.1 million new visitors a year downtown, the report said.
The arena would be "an economic catalyst for future development," said Cathleen Dominico, a managing partner at Capitol Public.
She said the $157 million in annual impact wouldn't all be new-found money for the region. But even after spending by area residents is subtracted, the net benefit to the region would come to $24.6 million a year, she said.
A new building would be "not only good for downtown, not only good for Sacramento, it's good for the six-county region," said Sacramento City Council member Rob Fong.
In releasing the report, task force members acknowledged that a new arena downtown could harm Natomas, home of the current arena. City Council member Angelique Ashby, who represents Natomas, said city officials must create a "re-use plan" for the arena site.
The report didn't predict how many jobs would be created but referred instead to an earlier study by Capitol Public. That study predicted 3,700 construction jobs would be generated. In addition, that study said the arena would employ 375 permanent workers above the staffing levels at Power Balance.