Check the math, methodology on economic benefit claims

The City of St. Paul estimated economic benefit of $10 million per year at new ballpark.

Curtis Gilbert of Minnesota Public Radio had one question that many of you have: How do you calculate the economic benefit of a stadium?

“When we as journalists see economic benefit numbers, our antennas go up because it’s hard to know if the numbers are legitimate,” he says.

His question came from an application for $27 million in state funds to build a new ballpark for the St. Paul Saints, a minor league team. The 500-page document cited a benefit of $10 million. But around page 400, the cited methodology didn’t match, Curtis says.

Curtis Gilbert

“Ask the people making the economic impact claims to show you how they arrived at their numbers,” Curtis says. “In this case the city couldn’t produce any math to back up its $10 million claim, and the analysis it did conduct yielded a much smaller figure.”

With no further details from the city, he contacted the economist whose work was cited in the application, John Crompton, a Texas A&M University professor. Curtis’s segment quotes him as saying: “’I have no idea how they get from the $650,000 – $950,000 range to $10 million…. Certainly, in terms of economic impact, I can’t even guess how they do that.”

You can learn more about analyzing economic studies with the Reynolds Center webinar “How Not to be Bamboozled by Local Economic Studies.” The webinar occurred in February, but you still can access the recordings, PowerPoint slides and PDFs.