Describe in 500 words additional ethical considerations that will come into play if forecasted financial data is overstated or overestimated. How can this be problematic? What can you do to ensure that you accurately represent the financial information for your organization? How will you ensure that you accurately forecast financial information while remaining mindful of ethical considerations? Please type

With the Super Bowl tomorrow being played in a stadium built with public money, the discussion of whether or when state and local governments should (help) pay for sports stadiums is back in the news. Once you understand the reality of what creates economic impact, the answer is easy. Governments should never finance a stadium with public money as it is simply a subsidy to rich team owners and a few businesses that stand to benefit from the events held there. The argument is frequently made that all the visitors coming to spend money at and around sports events will produce enough economic impact to pay for the stadium. This argument falls apart when you realize two key points: economic impact is not the same as tax revenue and when evaluating such events you must account for visitors budget constraints. It is easily possible (and in fact quite likely) that a new stadium will produce more in related economic activity than the cost of any public financing (even if a government pays for all the costs). However, it doesnt matter if businesses take in more money than taxpayers shelled out to build the stadium; what matters is whether the taxes collected from all that activity are more than the up-front taxpayer cost. A visitor to the Super Bowl might spend $500 on an airplane ticket, $2000 on his hotel, $300 on food, plus $500 on the ticket to the game. That sounds like a lot of economic activity for just one visitor. However, the plane ticket generates roughly zero money for local and state governments (there may be some airport taxes but they will go toward running the airport). The hotel stay probably produces $200-250 in tax revenue, the restaurant bills another $20, and the game ticket another $35. That means the over $3000 in spending really amounts to around $300 in tax revenue. Some of that tax revenue has to go toward government costs associated with the holding of sports events: extra police, traffic control, perhaps more public transit, etc. At the end of the day, only a very small fraction of total spending associated with stadium events is left over to help pay back the taxpayers for building a stadium. Businesses near the stadium like restaurants and hotels might win from the extra local spending, but why should taxpayers pay so that a few favored businesses can see greater profits? On to the second point. When people spend money to go to a sporting event, they cannot just pull that money out of thin air (tragic, but true). Rather, the money comes from their family budget, meaning something else has to give. If I buy tickets to an Atlanta Hawks game, the result of that spending might mean several fewer trips to the movies, not going to a local amusement park, or not going to a local restaurant or two. Stadium boosters like to point to all the money I will spend going to, at, and associated with my trip to see the Hawks, but they never focus on the fact that other businesses are going to lose a roughly equal amount of spending that I would have done instead. All that substitute spending would also have produced tax revenue. Those taxes associated to sporting events are not all new revenues, but mostly just substitutes for taxes that would have been collected on an alternate activity. In fact, local and state governments get new tax revenue from stadium-related events in only two ways: steering purchases toward activities with higher tax rates and taxing out-of-town visitors. Hotels and rental cars are examples of spending that generally is taxed at a higher rate than other types of spending. Hotel stays are usually taxed in the 10-12 percent range, much higher than ordinary sales taxes, so there is some gain there. But my pre-game meal before a game generates no more tax than a meal I might have eaten in my neighborhood if I had skipped the game. Thus, the second hope for capturing new revenue is out-of-town visitors. I live an hour from Atlanta, in a different tax jurisdiction. So when I go to a Hawks game and eat a pre-game dinner in Atlanta (usually at Teds Montana Grill), Atlanta gets some tax revenue and my hometown loses an equal amount. If the Hawks attract fans from far enough away to stay in hotels, Atlanta wins some more. Once you look at things this way, you see that stadiums can only justify public financing if they will draw most attendees from a long distance on a regular basis. The Super Bowl does that, but the average citys football, baseball, hockey, or basketball team does not. Since most events held at a stadium will rely heavily on the local fan base, they will never generate enough tax revenue to pay back taxpayers for the cost of the stadium. So support your local sports team, enjoy the Super Bowl, but never support public financing of a sports stadium. You as a taxpayer are virtually guaranteed to lose that game.