05/25/2006
Super Bowl's impact in Michigan scores low
Three months after Super Bowl XL lit up Detroit for a few high-voltage days and nights, tax-revenue figures indicate the event, while fun, had little overall economic impact on the state's economy.
New figures released by the Michigan Department of Treasury show that the state's sales tax receipts for February and March -- the two months when most Super Bowl-related sales would have been reported -- were up just 2% over the year before.
That 2% statewide gain -- representing about $20 million more in sales tax revenue on a base of almost $1 billion -- could be too negligible to draw any conclusions about its source, because it came from throughout the state.
Meanwhile, statewide use-tax revenues levied on hotels were up less than 0.5% for February and March.
A Detroit-area convention facility tax, which essentially is a hotel tax for the tri-county area, showed a 70% jump in February. But even that increase represented less than $1 million in net new tax revenue.
Terry Stanton, a spokesman for the Treasury Department, said detecting Super Bowl impacts in the tax figures would be difficult. Tax receipts can be volatile from month to month and subject to timing issues regarding filing dates and times.
The National Football League and local tourism and economic development officials have reported a nearly $300-million local economic impact from hosting the game. That would include several types of spending, including hotels, meals and souvenir purchases.
But Dana Johnson, chief economist for Comerica Inc., said Monday the latest tax revenue figures show that the huge media coverage surrounding Feb. 5's Super Bowl obscured what is really a modest economic event.
"My take all along with that, even if you take the upper range of estimates, $300 million is less than 1% of the state's gross state product," Johnson said. "And it probably wasn't that big.
"It's a big event in terms of media coverage, a wonderful event where Detroit showed itself to wonderful advantage, but something that in economic terms is a very small part of economic activity here in Michigan."
Johnson and other economists acknowledge that the Super Bowl probably added more to Detroit's economy than would happen in a typical Sun Belt host city, such as Miami or Phoenix, where tourism is strong most of the year.
"But even so, it was still a relatively small event in terms of the overall economy," Johnson said.
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