Nfl’s Cash Cow Getting Too Fat
The National Football League will get $17.6 billion in TV revenues over the next eight years. The annual payout of $2.2 billion is greater than the general revenues of Boston, Houston, San Diego, or any other American city except for New York, Los Angeles, Chicago, Philadelphia, San Francisco, and Washington, D.C.
The payout is greater than the annual federal outlay for national parks, more than the federal cost of the school lunch program for the 21 states of the Northeast and Midwest, and greater than the 1994 total of major foundation grants toward education. It is seven times the money the 50 states spend on the arts and six times the federal spending on the Library of Congress.
It is greater than the combined local and state spending for public libraries in Austin, Baltimore, Boston, Chicago, Columbus, Dallas, Detroit, El Paso, Houston, Indianapolis, Jacksonville, Los Angeles, Memphis, Milwaukee, Nashville, New York, Philadelphia, Phoenix, San Antonio, San Diego, San Francisco, San Jose, Seattle and Washington, D.C.
One can be like me, a Cheesehead sweating out every Brett Favre pass, and still see that this cash cow is so fat the NFL should never again be allowed to milk us for a sports stadium.
On the basis of income, the $2.2 billion per year just misses placing the National Football League into the Fortune 500. It also means that the value of each team may have just doubled.
In the case of the New England Patriots and the Philadelphia Eagles, that would mean jumps in value for Bob Kraft and Jeff Lurie, respectively, from the $170 million and $175 million they paid for their teams four years ago to $350 million. With several other transactions within the decade of $140 million and $150 million, it is reasonable to assume that the league’s 30 teams now have a total worth of between $8 billion and $10 billion.
Any entity like that should be able to refurbish or build its own stadiums as well as purchase the land for them. Instead, the NFL, as well as pro basketball, hockey, and baseball teams, sucked cities into whirlpools of corporate welfare.
In recent years, nearly half of the teams in both the NFL and major league baseball have threatened moves to another city unless the city funded new or remodeled stadiums. As a result, cities have committed themselves to $12 billion of spending for new sports stadiums in this decade.
To consider what that amount means, at an average of $1.2 billion a year, the money being spent on sports stadiums could instead have raised the total that cities spend on police or education by 5 percent. The money could have raised the total spent on parks and recreation by 14 percent. It could have raised the total spent on transit by 20 percent. It could have raised the total spent on libraries by 50 percent.
Over the last decade, the evidence has mounted in books and studies that sports stadium building, despite the hype of jobs and commerce, are no net gain and perhaps even a loss to local economies. For example, Cleveland is often held up as a shining example of how new stadiums revive a dying downtown. But Cleveland spent so much money - $290 million - on its stadiums that the 1,250 full-time jobs created (many of them minimum-wage service jobs) cost $230,000 per employee.
“Nobody would do economic development for that,” said Mark Rosentraub, author of the new book “Major League Losers: The Real Cost of Sports and Who’s Paying for It.”
The average citizen has begun to challenge such folly. Voters in Pittsburgh and Minneapolis last year voted down stadium initiatives. Voters in Washington state nearly defeated a new $300 million football stadium for the Seahawks, owned by Paul Allen, the billionaire co-founder of Microsoft. Voters also barely missed stopping a new $525 million stadium for the 49ers football team. In New England, the Massachusetts Legislature has thus far resisted the Patriots’ whining for $50 million to improve the roads around Foxboro Stadium (i.e. making getting in and out of the stadium area more quickly), even though Kraft flirted with taking the Pats to Providence.
The new TV money should mean that if Kraft wants roads improved beyond normal potholes, he can pay for them. If owners want new skyboxes, they can leverage their new value to build them. For too long the NFL has been the National Fleecing League. If the owners keep coming for public assistance after this contract, the NFL should mean Nutty Foolish Lunatics.
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