Gov. Cathy Hochul's decision to use tax dollars to fund the Buffalo Bills' new stadium has drawn new scorn — as the NFL team's billionaire owner sells a minority stake for a huge profit. The Post has learned this.
Hochul, a Buffalo native, had agreed to provide $600 million in 2022. After Bills owner Terry Pegula threatened to leave Western New York, Erie County spent another $250 million in state funds on a private stadium.
The new 62,000-seat Highmark Stadium, scheduled to open in 2026, played a key role in raising the bill's value by more than $2 billion, but the state still won't get much of a return on its investment. , said critics of the so-called bill. Buffalo Boondoggle insisted.
An adviser to former Gov. Andrew Cuomo familiar with Bills stadium discussions said, “This investment proves what everyone knew: The deal was great…if you're the Bills owner, but if you're the owner of Buffalo or the state… That's not the case for people.” post.
Dr. Mark Rosentraub, director of the University of Michigan Center for Sports Venues, said there would be no direct benefit to Buffalo residents because the new stadium would be built next to an aging stadium in the Orchard Park suburb.
“This was a terrible deal. There's no other way around it,” Rosentraub said.
“If this facility had been built in downtown Buffalo, it could have stimulated the economy. But they're just replicating what was in the same location.”
Hochul's office defended the stadium deal.
“In 2013, the state agreed to an agreement in which nearly 75% of the Bills' stadium renovations would be funded by taxpayers. Currently, this new stadium is being built with less than 30% state funding, a figure that is higher than any other “The stadium is significantly less expensive than recent NFL stadium projects,” a spokesperson for the governor said.
Hochul officials claimed the new Bills stadium project is injecting $2.1 billion into New York's economy.
Pegula, who paid the Bills $1.4 billion in 2014, had threatened to move the team to Austin, Texas, without public funds.
But Rosentraub said legally the Bills could not be moved if the government made a good faith effort to keep the team.
That could have included lending him money to build the stadium, which is expected to cost $2.1 billion, in exchange for giving the cash-rich Mr. Pegula a stipend.
Two recently constructed NFL stadiums, SoFi Stadium in Los Angeles and Allegiant Stadium in Las Vegas, received no public funding and both opened in 2020.
“Pegula negotiated the best deal for his business. The onus is on the public sector, not the private sector,” Rosentraub said.
When Hochul agreed to the deal, the note was worth $3.4 billion. According to Forbes magazine.
Since then, the value of NFL teams has exploded. According to , the average value of a franchise is currently $6.49 billion, with no team worth less than $5.25 billion. CNBC's official 2024 NFL team ratings.
In August, the league for the first time allowed private equity to buy up to 10% of an NFL team's stake.
Pegula took full advantage of it. Earlier this month, the hydraulic fracturing mogul sold a 10% stake to Arktos Partners and another 10% to 10 limited partners led by NBA Hall of Famer Vince Carter at a valuation of $5.8 billion.
The Bills, who lead the AFC East this season and are one of the favorites to win their first Super Bowl, expect the new stadium to increase revenue from individual seat licenses, suite sales and sponsorships.
“It's good to have a new stadium,” one banker told the Post. “This makes for a more attractive investment.”
“Has the value increased by 10%? Yes, that's the tax we're working with,” the banker said.
Another banker added: “I don't think a new stadium is important when evaluating a team.”
Hochul had previously attracted criticism for his alleged contract with his girlfriend. Her husband, William Hochul, is the former chief administrator of Delaware North, the Buffalo Bills' concessionaire.
She defended this decision at a press conference in March 2022.
“I went into this negotiation trying to answer three questions: How long can we keep the Bills in Buffalo? How can this project benefit the hardworking men and women of Western New York? “Can we get the best deal for them?” she said.
“After months of negotiations, we are pleased to have reached the best possible answer. The Bills will remain in Buffalo for another 30 years, this project will create 10,000 union jobs, and New Yorkers can be assured that their investment will pay off in the economic activity the team generates. ”
