Wednesday, May 24, 2006

More Sports Corruption

Hot on the heals of one of their better seasons, the Cleveland Cavaliers have a reward for the fans: corporate welfare! From the Pain Dealer:
The Cavaliers want taxpayers to help pay for a proposed $20 million practice facility in Independence [a well to do suburb south of Cleveland].

The team wants to borrow money from the Cleveland-Cuyahoga County Port Authority and then use some of the taxes it will pay on the sports complex -- which normally go to schools and government -- to repay the loans.

Asked if that means the Cavs are in line for a tax break, Independence Mayor Fred Ramos said: "They may be, yes."
Said Mayor Fred "My taxpayers shall spare no expense to make me look good to my peers".

What do these breaks entail? I guess a money losing loan from the local governmental Port Authority, which will be paid back with the local real estate taxes on the new facility. In other words, the Cavs will get a B.S. interest loan that the city of Independence will pay back for them.
But that's not all, what about the deal splitting up that salary bounty?
Cleveland's part of the deal is to split evenly with Independence the 2 percent wage tax that Cleveland collects on players' and coaches' salaries. Cleveland will collect about $550,000 in taxes on player salaries this year. If the tax-sharing deal were in place today, Independence would get $275,000 of that.
Although mentioned later in the article, a little math will give us the payroll that is being taxed. Since it's only half a year, that $550,000 actually only constitutes ONE percent of the payroll, so 100 times 550,000 gives us, that's right, $55,000,000; or around twice as much as the yearly gross of where I work.

What's up with the sweetheart deal on the personal taxes for the players anyway? Isn't it bad enough that the business they work for gets huge government subsidies in order to provide salaries to millionaires? They cut the rate down to reflect when the team actually plays, but do teachers who work in Cleveland only have to pay 75% of the Cleveland personal income tax? How about if the teachers don't live in the city Cleveland? Does the city happily split the taxes with the other municipality?

Or, undoubtedly, would teachers have to pay the same effective 3% local tax rate that I and every other sap has to pay?

I only wish I had an interest in watching the Cavaliers so that I could lose it....

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