Saturday, June 4, 2011

Sports Welfare is a Losing Game

Many big city mayors reportedly are getting very nervous about the prospect of an NFL player lockout later this summer, which threatens to cancel or shorten the 2011 season, and it's not because they're sports fans. It’s because taxpayers in too many NFL cities have been seduced, blackmailed or bamboozled into bankrolling lavish new stadiums for the privately-owned teams, in what must rank as one of the most egregious examples of corporate welfare there is. And the direct and indirect losses could mount for some cities if the season is canceled because they didn’t bother to write revenue guarantees into whatever agreements they made with fat-cat franchise owners.

The prospect of a canceled season is belatedly highlighting the inequity of such “deals.”

Reports Governing Magazine:

“There's been an ongoing debate in communities across the country over whether NFL teams will still have to pay their leases on publicly-owned stadiums if games are canceled due to a lockout. In many cases, it appears the teams would be off the hook for those payments -- even though they'd be the ones who canceled the season in the first place.

In some cities -- such as Denver and St. Louis -- the teams never pay rent to use the publicly-owned stadiums. So while the municipalities wouldn't technically be losing a revenue stream, they'd be getting no return on the major gift of that free rent itself if the season was canceled.”

Indianapolis Mayor Greg Ballard is leading an effort “to get cities that host sports teams to form an organization that would represent their interests,” according to the story. "We want to make sure the cities kind of understand that they're a piece of this," Ballard said. "We have the owners. We have the players. But the cities have a voice in this too. There are a lot of people involved in the city who've put a lot of heart and soul, and a lot of tax dollars, into these things."
And we’re talking about a lot of tax dollars – possibly as much as $10 billion, according to Governing:

“Many city leaders and fans have expressed frustration at the potential loss of an NFL season, due largely to the massive amount of public dollars put into stadiums. Since 1992, 29 of the 32 NFL stadiums have been built or refurbished at a cost of $10 billion, and more than 60 percent of that total was paid by municipalities, according to Ballard. Teams also typically get favorable lease and taxing terms, as well as other perks such as infrastructure construction and operational expenses at below-market price.”

That level of “investment” is dragging cities into something which in a saner world they wouldn’t and shouldn’t be a part of. They not only now want to have a say in absurd collective bargaining disputes between billionaire owners and millionaire players, but city politicians and citizens also are becoming pawns in these conflicts.

“Mayors in Kansas City, Minneapolis, Miami and Houston, along with elected officials in San Diego, have reportedly contacted league and team officials to advocate against a canceled season. Meanwhile, the players' union has mailed letters to city and state officials to emphasize the negative economic impact a canceled season would have on cities that host teams. In the players view, a canceled season would be the fault of the owners -- as would any negative financial side effects that result from it.”

Mayor Ballard wants to call his new group the “Municipal Alliance for Taxpayer Equity in Sports.” Part of its mission will be “to protect municipalities' capital investments -- the stadiums -- and the city income associated with teams,” according to Governing, and to “retain teams in their home cities based on terms that strike an appropriate balance between taxpayers, players and team owners” But there was never any “equity” for taxpayers to begin with. The real beneficiaries of such “partnerships” are wealthy owners, wealthy players and the highly-profitable professional sports business, along with a few businesses located near stadiums.

Most objective studies have shown that the economic benefits of football and baseball welfare are either exaggerated or illusory. Most taxpayers never attend these games in person – mainly because they can’t afford it. And many aren’t even sports fans. The answer isn’t in trying to achieve “equity” from these patently-lousy deals, but in avoiding such fiascoes altogether by refusing to buckle-under when sports franchise owners threaten to take their team and go elsewhere. That sort of disloyalty, and attempted-extortion, should be met with public anger, not acquiescence.

Pro sports welfare is a losing game that savvy taxpayers should simply refuse to play.

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