Ohio State Agencies Question Financial Viability of Proposed $2.4 Billion Cleveland Browns Stadium Project
CLEVELAND – The proposed $2.4 billion Cleveland Browns stadium project in Brook Park has come under intense scrutiny from two Ohio state agencies, raising serious doubts about the financial prudence of a $600 million state bond issuance for its construction. Both the nonpartisan Legislative Service Commission (LSC) and the state’s budget director have expressed concerns about the project’s economic impact projections and the state’s capacity to shoulder such a substantial financial burden.
The LSC, in a memo released Monday, questioned the "overly optimistic" traffic and event projections provided by the Browns. Concurrently, State Budget Director Kimberly Murnieks, in a letter obtained by News 5, stated her office’s opposition to the $600 million bond proposal. Both agencies cast doubt on the team’s economic impact analysis, including projections for construction jobs and spending within the planned 176-acre stadium district, which envisions a mixed-use development incorporating apartments, hotels, offices, restaurants, retail, and parking.
Murnieks’ letter directly criticized Haslam Sports Group, the Browns’ owner, for "inappropriately overstating projections of future taxes generated by the project," thus inflating the perceived positive impacts. The Browns countered these criticisms with a detailed response, refuting the agencies’ findings and highlighting the transformative potential of their project. They maintained that direct dialogue with Governor Mike DeWine and other officials had already addressed many of the stated concerns.
The central issue lies in the proposed financing mechanism: a $600 million bond issuance by the state, to be repaid using tax revenues generated within the stadium district. The Browns claim this revenue will more than cover the debt service, effectively making the project cost-neutral for taxpayers. However, the LSC and independent financial experts argue that verifying these claims is impossible without access to the underlying assumptions and calculations used by the team. Furthermore, the LSC cited extensive academic research demonstrating the negligible economic impact of publicly funded sports stadiums, cautioning that government subsidies often far outweigh any tangible benefits.
Murnieks expressed further reservations, labeling the Browns’ construction hiring projections as "wildly overblown." She also emphasized the state’s existing commitment to numerous capital projects, arguing that Ohio lacks the capacity to accommodate the stadium bonds alongside these other priorities. This assessment adds another layer of complexity to the budgetary deliberations surrounding the project.
The stadium funding proposal was initially included in the Ohio House’s version of the biennial budget bill. While proponents defended the plan as fiscally responsible, citing projected tax revenues covering the bond costs, the LSC and budget office had raised concerns weeks prior to the House vote. The budget debate has now shifted to the Senate, which is expected to vote on its version by mid-June. The final budget, including any stadium funding provisions, must be signed by Governor DeWine by June 30. The governor has previously proposed an alternative funding mechanism: doubling the tax rate on sports-gaming profits to finance stadiums and youth sports education.
Senator Nickie Antonio, the Senate Minority Leader, requested the LSC analysis and expressed renewed concerns after reviewing its findings. She stressed the magnitude of the financial decision and the need for greater transparency regarding the Browns’ projections. Key questions remain unanswered, including what will happen if tax revenues fall short of projections and the potential negative impact on the City of Cleveland, with concerns about the siphoning of resources and events from downtown venues. The Browns have also requested a $600 million bond issuance from Cuyahoga County, a request deemed excessive and risky by County Executive Chris Ronayne, who advocates for the team to remain downtown.
The available economic impact studies present conflicting narratives. A city-commissioned study highlighted the potential economic losses for Cleveland if the Browns relocate, estimating $11 million in annual tax revenue losses and potential negative impacts on downtown businesses. Conversely, the Browns’ own study projected a $1.2 billion economic boost for the region, attracting 1.5 million additional visitors annually and securing major events currently bypassing Ohio. However, the full details of this study remain undisclosed, hindering independent verification.
The LSC’s analysis further questioned the potential displacement of economic activity from other Ohio venues, citing the Browns’ recent decision to move a Columbus Crew game to Cleveland to capitalize on the draw of Lionel Messi. The memo also highlighted the legal ambiguity surrounding the constitutionality of issuing stadium bonds, acknowledging that only a court can definitively resolve the matter. The Browns contend that the proposed ownership structure, under a New Community Authority, aligns with state law and borrowing policies.
The state budget director’s concerns underscore the financial pressures facing Ohio, while the LSC’s memo raises broader questions about the economic rationale of publicly funded stadiums. The ongoing debate hinges on the credibility of the Browns’ economic projections and the long-term financial implications for the state and local communities. The final decision will require careful consideration of the potential benefits and risks, ensuring a responsible approach to public investment.