A Critical Analysis of the Economic Impact of the Proposed Browns Dome Stadium in Brook Park

By Don Iannone, PhD

The Cleveland Browns and Haslam Sports Group have proposed a $2.4 billion domed stadium in Brook Park, Ohio, a western suburb of Cleveland, which they argue would generate $1.2 billion annually in direct economic impact. According to the RCLCO Consulting study, the project would anchor a mixed-use development expected to create 5,400 permanent jobs and attract 1.5 million additional visitors annually to the region. The study also claims the stadium would diversify the local economy by enabling year-round events, including concerts, conventions, and sports tournaments, thus offsetting the limitations of the existing lakefront facility used primarily for Browns games.

In my judgment, this development's economic potential is dubious. The study fails to account for the $1.2 billion in public financing requested for the project. Other study shortcomings are the omission of comprehensive cost analyses, overly optimistic economic projections, and the failure to account for abundant academic research on the limited benefits of publicly funded sports facilities.

Economic impact analysis (EIA) and cost-benefit analysis (CBA) are distinct methodologies used to evaluate projects, but they differ significantly in scope and purpose. The RCLCO study is an economic impact analysis. EIA measures the total economic activity generated by a project, such as jobs created, income generated, and spending within a region. It often emphasizes gross economic outputs without fully accounting for the costs associated with the project or the opportunity costs of alternative investments. In contrast, CBA evaluates a project's benefits and costs, considering not only the direct economic gains but also the expenses, risks, and externalities borne by taxpayers, governments, and other stakeholders. This comprehensive approach includes intangible benefits like civic pride and costs such as public subsidies and environmental impacts, offering a more balanced assessment of whether a project creates net value for society. CBA is a superior methodology for analyzing the Cleveland Browns stadium proposal because it accounts for the full financial burden on taxpayers, the opportunity costs of alternative uses for public funds, and the potential displacement of economic activity from one area to another. It clarifies whether the project will genuinely benefit the region or redistribute resources, helping policymakers make more informed decisions.

Flaws in the Economic Impact Study

1. Underestimation of Costs to Government and Taxpayers The RCLCO study does not address the substantial public funding required, leaving taxpayers uncertain about their financial obligations. Estimates suggest the public share will exceed $1.2 billion, with potential contributions from sales taxes, hotel bed taxes, or state allocations. Such mechanisms significantly strain public resources and divert funds from essential infrastructure, education, and social programs.
2. Overly Optimistic Revenue Projections The RCLCO study cites examples of successful sports-anchored developments, such as The Battery in Atlanta. Still, it does not adequately account for Northeast Ohio’s stagnant population growth. A 2022 review in the Journal of Economic Surveys found that sports facilities generally shift economic activity within a region rather than create net new growth. As noted in the study, “most spending on game tickets, concessions, and hospitality near a sports venue would have occurred elsewhere in the host jurisdiction without the presence of a pro sports team.” This suggests that much of the $1.2 billion impact is likely exaggerated.
3. Neglect of Opportunity Costs The proposed stadium relocates economic activity from downtown Cleveland to Brook Park, potentially undermining existing businesses near the current stadium. Mayor Justin Bibb’s office emphasized that “fewer people in our downtown area means less vibrancy and economic activity for our city and our businesses.” While compelling, the vacated lakefront site's redevelopment potential remains speculative and dependent on substantial investment.

Critique Based on Comparable Case Studies

Economic impact studies for similar projects, such as the publicly funded stadiums in Indianapolis, Minneapolis, and Detroit, often overstate benefits while neglecting long-term costs. For example:

• Detroit’s Ford Field: Despite initial projections of transformative economic growth, the stadium has done little to uplift its surrounding area, which continues to struggle economically.
• Indianapolis’ Lucas Oil Stadium: A 2017 analysis revealed that much of the projected impact materialized as economic redistribution rather than growth, with suburban areas benefiting at the expense of the urban core.

These precedents underscore the risks of optimistic assumptions about visitor spending and regional economic gains.

Alternative Projections and Policy Recommendations

A more realistic assessment of the Brook Park project would temper expectations. For instance:

• Direct economic output will likely fall below the projected $1.2 billion due to leakage, whereby spending benefits suppliers or businesses outside Cuyahoga County.
• Job creation figures should account for temporary construction roles versus permanent positions, often fewer than promised.

Policymakers should require independent, peer-reviewed studies to validate claims and mandate public referenda on financing decisions. If public investment proceeds, mechanisms like revenue-sharing agreements and equity stakes could ensure taxpayers receive a direct return on their investment.

Conclusion

While the proposed domed stadium offers appealing prospects for Brook Park and the Cleveland Browns, its economic impact study leaves critical questions unanswered. With rigorous cost analysis and evidence-based projections, the project can avoid repeating the pitfalls of similar endeavors elsewhere. Public officials and stakeholders must scrutinize the plan thoroughly, ensuring that public resources are allocated to projects with demonstrable and equitable benefits for the region. As economists have long argued, the public funding of sports venues often fails to deliver on its promises—a history Cleveland cannot afford to ignore.

About the Author

Don Iannone frequently writes about economic and business issues related to sports, including articles about the proposed new Browns stadium. He is the author of 26 nonfiction, fiction, poetry, and photography books. He teaches graduate business courses at Transcontinental University, which is based in the EU. He has a PhD in philosophy and lives in Greater Cleveland.