You can google it but most of these economic impact numbers that are thrown about are done so in an extremely biased fashion. First of all the cited report doesn’t even state where it’s from not to speak of it doesn’t even show its methodology. But here’s a common trick that is used to justify economic impact let’s say you and your family of 4 go to the Canes game, you buy tickets, parking, some drinks, and have dinner before and it costs $500 because I’m not putting a lot of effort into this, these studies count that as $500 of economic impact. But what they fail to account for is that if there wouldn’t have been an event at an arena you and the typical family of four would have went to the movies or something else and spent $300 dollars on dinner and drinks and expensive chocolates. So is the economic impact of the arena $500 or $200 ? It’s pretty much impossible to say really but they float these numbers mostly unchallenged like they’re gospel. (Usually when they want more money from us)
Never imagined I’d be linking to an article written by someone from the John Locke Foundation.
But here we are…
(This is my darkest timeline)
https://www.investors.com/politics/commentary/why-is-there-no-economics-in-economic-impact-studies/
The study was also funded by PNC’s landlord
The numbers aren’t just fudged, they’re downright fictitious. Sports teams are notorious for commissioning these economic impact estimates that basically count up every dollar spent at a stadium and implying that the team or stadium’s presence puffed up the local economy by that much, when very little of that is actually new spending. The vast majority of this spending is really just shifting existing dollars into different pockets. If I spend $50 on Hurricanes tickets, that’s not $50 that’s been magically created. It’s $50 that I don’t have to spend at other local businesses. The study cited $14M in hotel spending and $6M in restaurant spending last year, which is maybe, maybe plausible. But that leaves $242M unaccounted for. If that’s just money spent on tickets and jerseys and such, very little of that is truly economic impact.
Basically, the way these “studies” work is that if I go to a Hurricanes game and buy a meal while I’m there, 100 percent of that spending gets counted as “new” spending attributable to the arena, on the theory that if there hadn’t been a Hurricanes game that night, I just wouldn’t have eaten anything for dinner.
(Sorry, @JosABanks, I cut and pasted this from something I had written previously before I saw that you had already said something very similar.) cc @RobertSanderlin
I mean that’s pretty much what I said in response to him as well. You never really see economic impact studies except when people want money for a specific thing probably because a real rigorous study is expensive and the answers would be really nebulous. It’s really hard to nail down the impact of one specific thing when there are so many factors and known unknowns.
$242M unaccounted for? That’s about 3 burgers, a beer and a popcorn at PNC
I do think the impact is much higher in a downtown walkable area. With PNC people drive to and from the arena and that’s it. With a walkable arena people go out to bars and restaurants before and after the events. Those meals are taxed for the purpose of investing in things that increase hotel and restaurant business so the city does get more return for its money in a downtown arena.
I think you are certainly spot on for local people going to games. It’s not any new money brought in. Where it changes is out of region / out of state people going to games. That is almost certainly money that would otherwise not be spent in the Raleigh area.
But what is the split between local and out of region attendance to events? That’s a crap shoot. 10%, 25%, 50%, 3%?
It’s probably more for special events like playoff games and concerts, much less for regular season games. How do you put a number on that?
Except the article specifically states that Wake County itself did the analysis on the economic impact. They have staff who does that kind of thing and they pretty much would have little or no reason to fudge the numbers. This analysis would be consistent with all the other analysis that Wake County does. And I happen to know some of the people who do these kinds of things and it is very much not fictitious or fudged or any such thing. Now you might be able to discuss the merits of the methodology and I would understand that it would be up to some debate.
The Centennial Authority put out the data and it seems to be just generic data collected from arena events. This is kind of like letting me write my own annual review. (Man, my output last year was amazing and I deserve so much more money. My work can’t see how much time I spend on here, can they?) I have so many questions about how they get their numbers… like… how did they get their numbers? Do they count events at Carter Finley (I’d assume so), the Fairgrounds (I’d assume not)?
An NC State professor did an estimate in 2012 that stated the arena generated $92 million annually and 6 years later the people who run the arena claim it’s up to $282 million. Why is the Centennial Authority not running the entire state?! 
Yeah, I definitely should have read the whole thread before I started commenting. My bad.
Yeah, definitely. The Canes are bringing in almost exclusively local fans, but PNC definitely does host a few events a year that are regional in nature and are going to create some hotel bookings that wouldn’t have otherwise existed. But those events are the minority, certainly less than 10 percent of the arena’s bookings.
It’s definitely good for a city of Raleigh’s size to have a PNC-quality arena, because it really does allow you to host some events that you wouldn’t be able to otherwise. And so it’s certainly sensible for governments to contribute some money, if need be, to bring these things into existence. But far too often, cities get caught up in the shiny pro sports team angle and end up contributing far more than could be rationally justified.
And here the added problem is that Raleigh already has a perfectly good arena. So the added value to the city of building another perfectly good arena, just in a different part of town, would be pretty close to zero, I suspect.
No worries. We’re pretty much on the same page. If I only commented when I read the whole thread or even the whole post I’d never comment 
I tracked down the “study” that seems to be cited in the report and it seems just like a bunch of numbers thrown together from a PowerPoint presentation or something. They even cite numbers from supply chain impacts… so if a vendor does business with PNC and that business generates a million dollars in revenue annually are they claiming the whole million as derived from the arena? It kind of seems like that but I have no idea because they don’t provide any of their data. Just like with polling data if people won’t show you how they got to their numbers you probably shouldn’t trust the numbers.
https://www.bizjournals.com/triangle/news/2019/03/01/nhl-picks-raleigh-born-technology-to-increase.html?iana=hpmvp_trig_news_headline
Interesting interview with a Raleigh start-up being deployed to help increase attendance for NHL, and begins with the Hurricanes. These statistics should be followed with an asterisk explaining not making the playoffs for nearly a decade has an affect. I’ll be front row if we make the playoffs this season!
“And the Canes, recent statistics show, could use some alternative solutions the team 28th among 31 teams when it comes to attendance for the current season, with an average attendance of 13,901.”
well, someones trying. mlb baseball if that’s your thing… https://mlbraleigh.com/
personally, i would prefer MLS and then minor league baseball if we have to get baseball.
I think it’s great people are trying to get a team but the economics of baseball are so skewed towards the big market teams any Raleigh or Triangle franchise is going to struggle mightily to be competitive. (Unless they have an owner who’s cool losing tens of millions a year)
With current revenue sharing model in MLB, owners are making a mint
Owners making a mint and teams being competitive are two wholly different things.
Looks more like a fundraiser for the Boys and Girls Club.
Still a worthy cause, though.
That’s not actually true.
The Brewers are a good example of a small market (smaller CSA than ours) making big money. They actually rank 10th in attendance and 1st overall in MLB for per-capita attendance. (Pittsburgh also is a good example and has a population base just larger than the greater Triangle area)
All of this is on that data page on the site.