JACKSONVILLE, Fla. — Action News Jax Ben Becker investigates if the shipyards development proposed by Jaguars owner Shad Khan is a good deal for taxpayers.
Action News Jax first reported two weeks ago phase one of the project that could cost taxpayers at least $153 million.
The term sheet between the Jaguars and the city claim the return on investment will be $1.20 for every $1.00 invested by the city although the public investment for phase two has not been revealed.
“At best it’s break even and looks like slightly negative,” says Donald Wiggins who is a Professor Emeritus of Accounting and Finance at the University of North Florida.
Pushing for more answers, Becker obtained the economic impact study performed by consulting firm hired by the Jaguars. It claims both phases of the Shipyards project will create $6 billion of direct spending in the next 30 years.
“This looks like advocacy economics instead of actual economics,” says Dr. Victor Matheson who is a Sports Economist at the College of the Holy Cross. Matheson says spending does not necessarily mean more revenue for the city.
The study fails to mention if the Shipyards will bring new money to the city or just shift around where money was already going to be spent.
“This report had the single most embarrassing line I have seen in an economic impact statement,” says Matheson who is referring to the claim that a proposed 5-star hotel will “drive up average daily rates (ADR) and revenue per available room (PevPAR) at existing properties.”
Matheson says when you increase supply it doesn’t mean prices rise- quite the contrary- they go down.
“This is something that flies against the fundamental economics we teach,” says Matheson. Wiggins says the Shipyards isn’t a total economic wreck. “From the numbers I’ve seen so far, it’s better than Lot J,” said Wiggins.
Becker spoke with Jaguars team President Mark Lamping at the Regency Square Library prior to the first of 14 area-wide town halls that the team is hosting to pitch the plan. Lamping said he has a “180 degree different view” from critics and believes the Shipyards is good for Jacksonville.
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