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Huge Superbowl payoffs a myth, some experts say

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Benito Morales, left, John Kelke and Gary Jones, workers for Bosen of Detroit, lay brick pavers along Woodward in downtown Detroit. Economists worry that Super Bowl XL will not pay for its cost to the city and local businesses.

Huge Superbowl payoffs a myth, some experts say

NFL, cities scoff at notion, insist big bucks will roll in

By Louis Aguilar / The Detroit News

Hosting the Super Bowl is supposed to be the crown jewel of sports payoffs.

When Detroit hosts Super Bowl XL at Ford Field in February 2006, backers maintain that the big game will generate a big payoff for the Motor City - $302 million.

There's just one problem: "By any reasonable standard of statistical significance, that cannot be achieved," argues economist Victor Matheson.

The game is supposed to be the catalyst creating some 50 businesses, 100 lofts and $20 million of street improvements in blighted downtown, civic boosters contend. And that's on top of the 125,000 out-of-towners who'll come to Michigan in the dead of winter, spending an average of $2,500.

Matheson, of the College of the Holy Cross in Massachusetts, and fellow economist Robert Baade of Lake Forest College in Illinois reviewed every Super Bowl from 1970 to 2001. The economists conclude that instead of the $300 million or more of economic benefits touted by Super Bowl backers, the game puts only an estimated $90 million into a local economy.

The real beneficiaries are the NFL, the stadium owners and big businesses. The losers are taxpayers and local businesses.

"The biggest financial gains during the game are big chain businesses - the hotel chains, the operators of rental cars, restaurants," Matheson explained. "Imagine if the $300 million was investing directly to schools, the police and local businesses. That is the danger of the number. It creates almost a myth."

NFL officials and some host cities say the economists are passing judgments from ivory towers.

"It would be nice if they actually attended a game, but that would ruin their nice little economic models," countered Jim Steeg, NFL's senior vice president of special events.

Susan Sherer, executive director of Detroit Super Bowl XL Host Committee, says the game creates unique business opportunities for Detroit in February. "Maybe in Miami and San Diego, they have full hotel rooms at the time. But Detroit usually doesn't," she noted. "I'm confident that the methodology of our own independent study is quite sound."

In 1995, the NFL conducted a joint study that found the Super Bowl in Miami generated $393 million for South Florida.

The economists contend the NFL and host cities often attach too much economic activity to the Super Bowl, such as the amount spent by tourists, while not accurately weighing the investment made by the host city and businesses, or the amount of business displaced by the football crowds.

In addition, even the most profitable Super Bowl is just a drop in the bucket of any big city's economy, Matheson said.

Noting that that economic activity in the Detroit-Warren-Livonia area for 2006 will be roughly $175 billion, he added, "Even if the Super Bowl does contribute an additional $350 million in income, that is still just 0.2 percent of the whole."

Beyond the $300 million figure, host cities say the critics are missing the galvanizing effect A Super Bowl has on a region.

Detroit has set the game as a deadline for several ambitious goals for its downtown, such as repairing the facades of old buildings and pushing downtown landlords to fix up their properties. These and other public improvements prompted by the game - such as $20 million in upgrades along Woodward, Washington and Broadway - will be around long after the game, they add.

"The economists are na

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