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Finance & Accounting
Pages 4 (1004 words)
1) Summary of the facts Hamilton County is the home of the baseball and football teams the Cincinnati Reds and Cincinnati Bengals. In 1996 the city had negotiations with both teams for two new stadiums. The Bengals stated that if they were not given a new stadium they would relocate…
The cost rose from $280 to an all inclusive costs of nearly $555 million (Albergotti & McWhirter). The county took out $1 billion in bonds to finance these projects. The county and its taxpayers are paying a hefty price for the bad decision that was made. In 2009 Hamilton County had to pay $34.9 million in costs related to the stadium deals which represent 16.4% of the county’s general fund. The normal cost to budget ratio in other counties that help finance stadiums is less than 2%. The county when the proposal was on the table exaggerated the economic benefits the new stadium would bring. Their absurd estimate was $300 million in benefits. These multi-million benefits never manifested. The stadium deal Hamilton County signed with the Bengals is considered the most lopsided deal in favor of a team in NFL history. It was a bad decision that will ruin the fiscal health of the county until the maturity date of the bonds. Currently 1 of 7 residents in Hamilton County is living below the federal poverty line. 2) Who had ultimate responsibility for the problems? The person that is ultimately responsible for this debacle is the mayor of Hamilton County. He selected a team of three negotiators that acted as puppets of the Bengals. ...
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