State and county have little bargaining power in Bills stadium negotiations, economists say

ORCHARD PARK, N.Y. (WIVB) – Leverage is important at the negotiating table. At the one where representative of the Buffalo Bills, New York State, and Erie County are trying to figure out where the team should be playing its games and how to pay for it, economists believe the government has little of it.

“I’m wondering if they are concerned that they don’t have a lot of bargaining power,” said Dr. Rob Baumann, a professor of economics at the College of the Holy Cross in Worcester, Massachusetts.

Specifically, Baumann points to the small market dynamic at play in Western New York and the prospect that the team could make more money elsewhere as factors which may affect how much public officials offer the Bills.

Currently, The Bills lease to play at Highmark Stadium expires after the 2022 season. The team wants to build a new venue across from Highmark Stadium in Orchard Park. They estimate it would cost $1.4 billion, a price tag they’d like to share with taxpayers.

Bills won’t renew lease in July ’23 without new stadium deal

“Usually, the subsidies can be larger for these places that have less bargaining power because they don’t have a team or they’re worried that they’re not going to be able to attract another one if the team were to leave,” Baumann said.

Dr. Andrew Zimbalist, an economist who teaches at Smith College in Northampton, Massachusetts, agrees that the public doesn’t have much leverage in negotiations.

“It means the economic deal will be worse,” Zimbalist predicted. “It means it’s more likely that rather than having a zero impact, it could actually have a negative impact.”

A spokesperson for Empire State Development, the arm of state government involved in the process, didn’t specifically address the economists’ claims about their bargaining power, but reiterated talks are ongoing. A spokesperson for Erie County Executive Mark Poloncarz said his goal is to enter into a deal that is fair for the people of Erie County, New York State, and the team.

State study of Bills’ stadium needs reviewing all possibilities, including renovation

Although the Bills have been very open about asking for public funds to help construct a stadium, they haven’t said how much money they’d be asking for. A spokesperson for Pegula Sports and Entertainment did not answer that question for News 4.

Both Baumann and Zimbalist say research shows building a new stadium does not lead to economic growth.

“The whole proposition is a proposition that is balanced economically against the citizens of the cities that host professional football teams,” Zimbalist said. “But you have to live with that. At the end of the day, the best thing to do is be clear-eyed about what you’re getting.”

“You should build a stadium and put public money toward it if it makes your city happier,” Baumann said.

Chris Horvatits is an award-winning reporter who joined the News 4 team in December 2017. See more of his work here.

Leave a Reply

Your email address will not be published. Required fields are marked *