Harrison, New Jersey, used to be a nice town. There was a time when people here didn't lock their doors, and the apothecary made tinctures from local berries. Then the Red Bulls showed up with their Austrian owner and built their stinking $200 million arena. The town took on $39 million in debt to clean out muck or something under the stadium. The town thought it would get the money back. Nein! Nein! Nein! Harrison is now the fourth-most-likely city in the United States to go broke, according to 24/7 Wall St:
4. Harrison, NJ
> Credit rating: Ba3
> 2009 revenues: $32,763,000
> 2009 debt: $92,613,000
> Median household income: $49,596
Harrison "issued a significant amount of debt to foster redevelopment, and continues to collect substantially less revenue from those developments than projected," Moody's explains. One of the largest projects is the $200 million Red Bull Arena, which was opened in March 2010 and cost the city $39 million in debt but has yet failed to have the expected returns. To help solve its debt problem, the city, which has a population of 13,620, plans to fire some police officers and firefighters.
A few months ago, Bloomberg ran a story on the impact of the arena on Harrison. It's not pretty. Least attractive is that the Red Bulls are trying to weasel out of a $1.4 million property tax, arguing that it doesn't own the land. I've been to Red Bull Arena. It's actually a nice little venue. It only took me two hours to get out of the parking lot.
Nine American Cities Going Broke [24/7 Wall St.]
Red Bulls' Stadium Bonds Sap New Jersey Town as Condominium Visions Vanish [Bloomberg]
H/T Ren R.