Belmont Stakes Odds: Final leg of Triple Crown will depend on slot machines
FRIDAY, 10 JUNE 2011 19:25
http://www.newjerseynewsroom.com/professional/belmont-stakes-odds-final-leg-of-triple-crown-will-depend-on-slot-machines
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
The eve of the running of the annual June Belmont in Elmont, New York is a good time to review the "racino" industry. For those who have never heard of the time “racino” you better get used to it. A "racino" is a horse racing facility whether it is for thoroughbreds or harness or standard bred horses, which depends on a casino loaded with slot machines to survive.
For the most part, standard bred racing in the northeast United States would be gone by now without the “machines” and the thoroughbred industry would be on life support. Around 1950, baseball, boxing and horse racing were the crown jewels of American sports. Horse racing has diminished in popularity because of the abundance of state sponsored gambling through lotteries at local stores and in New York, keno in restaurants.
The horse racing business is now surviving in many areas, except New Jersey, through proceeds from on site slot machines and table games (in some states) at racetracks. New Jersey is not keeping pace with neighboring states like New York, Pennsylvania and Delaware and has no "racinos", preferring to keep operations going in Atlantic City.
New Jersey residents can go to Yonkers and bet the slots or into eastern Pennsylvania. Sometime this fall, they will be able to go to Aqueduct in Queens and deposit money into “machines” which may help bolster thoroughbred racing at Belmont, Aqueduct and in Saratoga.
“Too much in terms of gaming?” asked Charles Hayward, the President and Chief Operating Officer of the New York Racing Association, in response to a question about gaming and slot machine saturation on the east coast. “No, I think there is a fair amount of density in casinos throughout Pennsylvania, Delaware, West Virginia. The Aqueduct facility will be the first casino within New York City.
“We think the projects we have between $300-350 win per machine are very conservative. When we had our partner MGM, this goes back a few years; they said the biggest problem we were going to have would be managing the crowds on weekends when people would be lined up behind all of the 4,500 machines.
“There is no question there has been more saturation. Pennsylvania, which is much closer to that market you are speaking of (New Jersey), I don’t know how many slot machines and now they have gone to full blown table games but that had to increase the number dramatically and it has had a big impact on Atlantic City. But I think the Aqueduct "racino" is geographically situation to do well and I think more importantly Genting (Malaysia’s Genting Group-a casino operator) is a world-class operation. They are going to put more money into this, making the amenities better. It is not a destination resort by any stretch of the imagination but it will be a place people will want to go.”
The Aqueduct "racino" should be in business sometime after Labor Day.
The slot machines at Aqueduct figures to give a big push to help revive an ailing business – thoroughbred racing in New York.
“The money comes in in a bunch of different tranches,” said Hayward. “One is purses and that is probably an increase of somewhere around $30 million just to give you a frame of reference. Purses last year were about $103 million and it will be about the same this year. So that is about a 30 percent increase. We can tap X money, which again depending upon win per machine will be between $20-25 million. We get operating expense monies, so we can do more marketing customer service things and then there is a breeder award.
“So all in all, the racing industry and NYRA gets about 16 percent of the net win from the VLT (video lottery terminal or slot machine) so that is going to be significant. We have undertaken some studies for Cap Ex (Capital Expenditure) improvements at all three of the tracks (Aqueduct, Belmont and Saratoga) and we can start working on that once we got the money.”
Video Lottery Terminals are saved a lot of tracks thorough New York and in Delaware. The horse racing industry is dependent upon the slot machines.
Hayward is hoping that people will return to horse racing as owners. Since the economic meltdown of September 2008, a lot of horsemen and horsewomen have left the industry.
Hayward is monitoring what is going on in New Jersey in the struggle between bolstering Atlantic City and saving the horse racing industry but doesn’t have much to say about the New Jersey legislative battle to help both industries.
“I wish Morris Bailey (who now runs Monmouth Race Track) a lot of luck on the thoroughbred side, I had the good fortune of meeting the gentleman at the Preakness (in Baltimore). I think he knows what he is getting himself into,” said Hayward. “Look, it is important for racing to have various circuits, it is important for us for Monmouth to be a strong track. Obviously, the Meadowlands was a premier harness track for many, many years and Jeff Gural (who has a lease at the Meadowlands) is a very talented guy. He has brought back some harness racing here in state (upstate New York). I don’t know what is going to happen but it looks to me that the current administration (Governor Chris Christie) is certainly protecting Atlantic City. Under that scenario, it would seem unlikely that they would do anything (installing slot machines) at the Meadowlands
“But as you know, those things can change very quickly.”
Don’t look for slot machines at Belmont race track anytime soon. There has been mention that as part of the New York Islanders quest to gain a new arena for the hockey team in Nassau County that land which could be used for a Shinnecock Indian Casino in Uniondale (as suggested by former New York Senator Al D’Amato) should be shifted to Belmont but Hayward isn’t interested in the idea.
“We have not been involved,” he said. “Our position and our board’s position, you know the state (New York) has an option. If they put VLT’s here, they have an option on 10 acres of land at the end of building here (at Belmont). But, our view is let’s get the VLT’s going at Aqueduct; it is only nine miles away. I think to bring another entity in the market until we establish what is going on and until Genting gets some return on their $380 million investment would be inappropriate. You know, Nassau County, you can understand given their financial situation why they would want more economic development but we have not been involved in any conversations about gaming at Belmont nor will he be or putting an arena here. We have about 400 acres so we got some room but we would like to do some expansion. We need to build a few new barns. This is a beautiful old building we have; it’s an old building that doesn’t have a lot of air conditioning or heat so we have some challenges.”
The horse racing industry seems to be surviving thanks to the slot machines in various states. NYRA has been on the ropes for a long time but like a number of other horse tracks, its future depends on slot machines and eventually table games.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition" is available at bickley.com, Barnes and Noble or amazonkindle.
Showing posts with label Chris Christie. Show all posts
Showing posts with label Chris Christie. Show all posts
Saturday, June 11, 2011
Thursday, April 21, 2011
NFL lockout 2011: Why are Gov. Christie and other politicians strangely silent?
THURSDAY, 21 APRIL 2011 12:03
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/nfl-lockout-2011-why-are-gov-christie-and-other-politicians-strangely-silent
The National Football League Draft is on the horizon and there has been a deafening silence from a group of people who actually have some power to exert some influence on what appears to be stagnating talks between the owners, who have locked out their employees — the players — and the players representatives.
People like New Jersey Governor Chris Christie who has no problem yelling at his employers in public settings — New Jersey voters — has gone mute on the issue. Christie is no better than Texas Congressman Lamar Smith who doesn't think Congress ought to be involved in the dispute or President Barack Obama. Christie is in a governor's league that includes both Democrats (Andrew Cuomo of New York, Jerry Brown of California, Mark Dayton of Minnesota among others) and Republicans (Rick Scott of Florida, John Kasich of Ohio, Scott Walker of Wisconsin, Rick Snyder of Michigan, Rick Perry of Texas, Jan Brewer of Arizona, Bobby Jindal of Louisiana) who should be out there jawboning NFL owners to get a deal done with the players.
All the governors are cutting costs so you figure the potential of losing money because there will be no business conducted because of the lockout would stoke their combative fires.
But it hasn’t.
You see taxpayers are on the dole for stadiums that NFL owners use. In Christie's case he inherited a $300 million commitment for infrastructure at the New Meadowlands Stadium and New Jersey is still paying off the debt on the defunct Giants Stadium. Jindal signed off on a deal that calls for cash strapped Louisiana to contribute up to six million annually in public subsidizes for Tom Benson's New Orleans Saints. New York is giving Ralph Wilson some three million dollars annually for upgrades at Wilson's Buffalo Bills facility.
You go from state to state and you will see just how much government money has been invested in the National Football League through stadium building or renovation with the old adage that stadiums are economic engines.
Stadiums are not economic engines and that has been documented time and time again.
The governors are not the only ones who have lost their usually loud voices. There are mayors and city councils that have been strangely silent. The noise machine on AM radio is also strangely quiet on this issue (although given the very nature of talk radio whose content will never be confused with any serious discussion on anything of importance, it might be a blessing in disguise).
Congress too is not touching this issue but there is a big role here that can be played. Congress knows how to apply pressure on sports. But for some reason, Congress even during the days of steroids hearing up on the hill has treated the NFL with kid gloves. Congress praised the NFL's drug testing polices a few years ago.
Here is another reason Congress needs to get involved. Discarded NFL players cannot get health insurance because of pre-existing conditions. No one knows just how many of the former players are now on the public dole on social security insurance or Medicare. As the debate on the future of those programs continues, someone in Congress should be asking why football players who suffered disabling injuries in a sport that brings in a reported $9 billion annually are on the public dole.
National Football League owners, of course, are highly political creatures. San Diego's Alex Spanos gave a speech at the 2000 Republican Convention in Philadelphia when George W. Bush accepted the party's nomination as the GOP's candidate. Spanos also spent a lot of money on 527 attack ads against John Kerry in 2004 when he ran as the Democrat's candidate against George W. Bush. Yet Spanos did know this, you can be a good Republican soldier but sometimes you need a Democratic operative to help you get a new stadium. Spanos hired Mark Fabiani who was deputy campaign manager for communication and strategy for Al Gore during his 2000 run against George W. Bush.
If National Football League teams contribute so much to local economies as the former National Football League Players Association (the group no longer exists) claims, why have the elected officials suddenly becoming like Harpo Marx and Marcel Marceau?
Doesn't the NFL create jobs in a community?
Then there is the TV issue. The NFL Network and ESPN continue to collect subscriber fees from viewers and some of those dollars have been put into a war chest by NFL owners. The use of 2011 TV monies is a another bone of contention between the NFL owners and the now decertified National Football League Players Association with the disbanded association complaining that Rupert Murdoch's News Corp (FOX), Comcast/GE's NBC, Sumner Redstone's CBS, the Walt Disney Company's ESPN and DirecTV money should be frozen and the owners should not have access to those funds.
The NFLPA brought the issue to court and a judge will eventually rule if the NFL owners can use that money.
The money issue is a big deal. Why should non football fans who never watch the NFL on ESPN or ESPN for that matter pay for a service that never use. Because of the 1984 Cable TV Act, anyone who gets basic expanded cable is paying for ESPN. That is another reason that Texas Republican Lamar Smith, the Chairman of the Committee on the Judiciary is wrong when he says that Congress doesn't have a role in the lockout.
The NFL's success is the result of Congressional activity. The Sports Broadcast Act of 1961 was pushed through the House by Brooklyn Democrat Emanuel Cellar and flew through the Senate in what seems like record time and was signed into law by President John F. Kennedy on September 30 of that year. The law allowed the NFL's 14 teams to become one entity when it came to TV negotiations which allowed NFL Commissioner Pete Rozelle to sell the league's teams as one to the highest bidder at the time. William Paley's CBS beat David Sarnoff's NBC but Sarnoff in 1964 decided to bankroll the American Football League.
Sarnoff's money gave the AFL the wherewithal to sign players like Joe Namath and eventually provided the impetus that forced the NFL and AFL to merge. That marriage needed to be approved by Congress. NFL Commissioner influenced two key legislators Louisiana Senator Russell Long and Congressman Hale Boggs with the promise of putting a team in New Orleans in exchange for their votes. The merger was approved by Congress and President Lyndon B. Johnson in the fall of 1966 and New Orleans had a franchise a few days later.
The revision of the 1986 Federal Tax Code featured a loophole that owners immediately embraced. Any municipality building a stadium could only get back eight cents of every dollar generated in the facility to pay down the stadium debt. Owners, depending on the lease terms, could keep 92 cents of every dollar spent in the building.
Taxpayers should be asking why the politicos have gone troppo on this issue. Sports fans are not rational when it comes to their teams, their sport. They don't understand that sports is a business first and is heavily dependent on government support. State and local governments are spending hundreds of millions of dollars on facilities and are not coming close to breaking even on the projects. Because of that, governments have to tap other taxable areas to pay off the debt. There are all kinds of taxes, a hotel tax, a motel tax, car rental tax, sewer tax, cigarette tax, beer and alcohol tax, water tax and whatever else politicians can find to tax for sports. Sports owners can depreciate player contracts and don't pay any property taxes on facilities.
Still sports fans go on blithely and are wondering about their favorite NFL team's draft strategy. Next week's draft is the final product of the 2006 owners-players agreement. Both sides agreed that they would be a draft even if there was a lockout. There is an interesting aspect to a draft. It is, in itself, a restraint of trade but in a free market society accepted. Thirty one owners and the Green Bay Packers Board of Directors divvy up players and the players have no choice but to go to the team that drafts them. There are a few exceptions, Bo Jackson, John Elway and Eli Manning were able to beat the system and get to a preferred destination.
The owners and players continue their pitched battle. The owners claim the economic system is broken though have presented no public proof that they are hurting as an industry and the players don't want to give up the gains they have made financially over the years. The players also seem to not want to be bothered with taking care of their former members or are thinking about their own future down the road in terms of medical benefits. There is always social security and Medicare for them down the road — if the solons of DC decide to continue the safety net like many other industrialized countries although those aging Beltway solons just see darkness ahead for America.
Obama, Lamar Smith, Harry Reid, John Boehner, Chris Christie, Andrew Cuomo are at best ambivalent about the NFL lockout. There should not be. The do have a responsibility to NFL fans who spend money on the product, to taxpayers who have to pay for NFL stadiums, to cable TV subscribers to jawbone the two warring sides. Instead they are missing in action and have sloughed off their responsibility to get involved in an industry they built.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at bickley.com, Barnes and Noble or amazonkindle.
THURSDAY, 21 APRIL 2011 12:03
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/nfl-lockout-2011-why-are-gov-christie-and-other-politicians-strangely-silent
The National Football League Draft is on the horizon and there has been a deafening silence from a group of people who actually have some power to exert some influence on what appears to be stagnating talks between the owners, who have locked out their employees — the players — and the players representatives.
People like New Jersey Governor Chris Christie who has no problem yelling at his employers in public settings — New Jersey voters — has gone mute on the issue. Christie is no better than Texas Congressman Lamar Smith who doesn't think Congress ought to be involved in the dispute or President Barack Obama. Christie is in a governor's league that includes both Democrats (Andrew Cuomo of New York, Jerry Brown of California, Mark Dayton of Minnesota among others) and Republicans (Rick Scott of Florida, John Kasich of Ohio, Scott Walker of Wisconsin, Rick Snyder of Michigan, Rick Perry of Texas, Jan Brewer of Arizona, Bobby Jindal of Louisiana) who should be out there jawboning NFL owners to get a deal done with the players.
All the governors are cutting costs so you figure the potential of losing money because there will be no business conducted because of the lockout would stoke their combative fires.
But it hasn’t.
You see taxpayers are on the dole for stadiums that NFL owners use. In Christie's case he inherited a $300 million commitment for infrastructure at the New Meadowlands Stadium and New Jersey is still paying off the debt on the defunct Giants Stadium. Jindal signed off on a deal that calls for cash strapped Louisiana to contribute up to six million annually in public subsidizes for Tom Benson's New Orleans Saints. New York is giving Ralph Wilson some three million dollars annually for upgrades at Wilson's Buffalo Bills facility.
You go from state to state and you will see just how much government money has been invested in the National Football League through stadium building or renovation with the old adage that stadiums are economic engines.
Stadiums are not economic engines and that has been documented time and time again.
The governors are not the only ones who have lost their usually loud voices. There are mayors and city councils that have been strangely silent. The noise machine on AM radio is also strangely quiet on this issue (although given the very nature of talk radio whose content will never be confused with any serious discussion on anything of importance, it might be a blessing in disguise).
Congress too is not touching this issue but there is a big role here that can be played. Congress knows how to apply pressure on sports. But for some reason, Congress even during the days of steroids hearing up on the hill has treated the NFL with kid gloves. Congress praised the NFL's drug testing polices a few years ago.
Here is another reason Congress needs to get involved. Discarded NFL players cannot get health insurance because of pre-existing conditions. No one knows just how many of the former players are now on the public dole on social security insurance or Medicare. As the debate on the future of those programs continues, someone in Congress should be asking why football players who suffered disabling injuries in a sport that brings in a reported $9 billion annually are on the public dole.
National Football League owners, of course, are highly political creatures. San Diego's Alex Spanos gave a speech at the 2000 Republican Convention in Philadelphia when George W. Bush accepted the party's nomination as the GOP's candidate. Spanos also spent a lot of money on 527 attack ads against John Kerry in 2004 when he ran as the Democrat's candidate against George W. Bush. Yet Spanos did know this, you can be a good Republican soldier but sometimes you need a Democratic operative to help you get a new stadium. Spanos hired Mark Fabiani who was deputy campaign manager for communication and strategy for Al Gore during his 2000 run against George W. Bush.
If National Football League teams contribute so much to local economies as the former National Football League Players Association (the group no longer exists) claims, why have the elected officials suddenly becoming like Harpo Marx and Marcel Marceau?
Doesn't the NFL create jobs in a community?
Then there is the TV issue. The NFL Network and ESPN continue to collect subscriber fees from viewers and some of those dollars have been put into a war chest by NFL owners. The use of 2011 TV monies is a another bone of contention between the NFL owners and the now decertified National Football League Players Association with the disbanded association complaining that Rupert Murdoch's News Corp (FOX), Comcast/GE's NBC, Sumner Redstone's CBS, the Walt Disney Company's ESPN and DirecTV money should be frozen and the owners should not have access to those funds.
The NFLPA brought the issue to court and a judge will eventually rule if the NFL owners can use that money.
The money issue is a big deal. Why should non football fans who never watch the NFL on ESPN or ESPN for that matter pay for a service that never use. Because of the 1984 Cable TV Act, anyone who gets basic expanded cable is paying for ESPN. That is another reason that Texas Republican Lamar Smith, the Chairman of the Committee on the Judiciary is wrong when he says that Congress doesn't have a role in the lockout.
The NFL's success is the result of Congressional activity. The Sports Broadcast Act of 1961 was pushed through the House by Brooklyn Democrat Emanuel Cellar and flew through the Senate in what seems like record time and was signed into law by President John F. Kennedy on September 30 of that year. The law allowed the NFL's 14 teams to become one entity when it came to TV negotiations which allowed NFL Commissioner Pete Rozelle to sell the league's teams as one to the highest bidder at the time. William Paley's CBS beat David Sarnoff's NBC but Sarnoff in 1964 decided to bankroll the American Football League.
Sarnoff's money gave the AFL the wherewithal to sign players like Joe Namath and eventually provided the impetus that forced the NFL and AFL to merge. That marriage needed to be approved by Congress. NFL Commissioner influenced two key legislators Louisiana Senator Russell Long and Congressman Hale Boggs with the promise of putting a team in New Orleans in exchange for their votes. The merger was approved by Congress and President Lyndon B. Johnson in the fall of 1966 and New Orleans had a franchise a few days later.
The revision of the 1986 Federal Tax Code featured a loophole that owners immediately embraced. Any municipality building a stadium could only get back eight cents of every dollar generated in the facility to pay down the stadium debt. Owners, depending on the lease terms, could keep 92 cents of every dollar spent in the building.
Taxpayers should be asking why the politicos have gone troppo on this issue. Sports fans are not rational when it comes to their teams, their sport. They don't understand that sports is a business first and is heavily dependent on government support. State and local governments are spending hundreds of millions of dollars on facilities and are not coming close to breaking even on the projects. Because of that, governments have to tap other taxable areas to pay off the debt. There are all kinds of taxes, a hotel tax, a motel tax, car rental tax, sewer tax, cigarette tax, beer and alcohol tax, water tax and whatever else politicians can find to tax for sports. Sports owners can depreciate player contracts and don't pay any property taxes on facilities.
Still sports fans go on blithely and are wondering about their favorite NFL team's draft strategy. Next week's draft is the final product of the 2006 owners-players agreement. Both sides agreed that they would be a draft even if there was a lockout. There is an interesting aspect to a draft. It is, in itself, a restraint of trade but in a free market society accepted. Thirty one owners and the Green Bay Packers Board of Directors divvy up players and the players have no choice but to go to the team that drafts them. There are a few exceptions, Bo Jackson, John Elway and Eli Manning were able to beat the system and get to a preferred destination.
The owners and players continue their pitched battle. The owners claim the economic system is broken though have presented no public proof that they are hurting as an industry and the players don't want to give up the gains they have made financially over the years. The players also seem to not want to be bothered with taking care of their former members or are thinking about their own future down the road in terms of medical benefits. There is always social security and Medicare for them down the road — if the solons of DC decide to continue the safety net like many other industrialized countries although those aging Beltway solons just see darkness ahead for America.
Obama, Lamar Smith, Harry Reid, John Boehner, Chris Christie, Andrew Cuomo are at best ambivalent about the NFL lockout. There should not be. The do have a responsibility to NFL fans who spend money on the product, to taxpayers who have to pay for NFL stadiums, to cable TV subscribers to jawbone the two warring sides. Instead they are missing in action and have sloughed off their responsibility to get involved in an industry they built.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at bickley.com, Barnes and Noble or amazonkindle.
Thursday, March 10, 2011
Sports costing taxpayers billions
THURSDAY, 10 MARCH 2011 13:17
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/sports-costing-taxpayers-billions
As National Football League Commissioner Roger Goodell and his owner team personnel continue bargaining with National Football League Players Association Executive Director DeMaurice Smith to reach a new agreement that covers players working conditions, New Jersey Governor Chris Christie wrestles with his state's budget and the possible layoffs of government workers and still has one budget item that will not go away. New Jersey still owes about one hundred million dollars on a facility that no longer exists — Giants Stadium.
More than 100 days from now, National Basketball Association Commissioner could announce that NBA owners have voted to lockout their employees — NBA players — because the owners and the players could not reach a new collective bargaining agreement. NBA owners claim they are losing copious amounts of money yet in Manhattan, the owner of Madison Square Garden (Cablevision's James Dolan) is pocketing money from his regional cable TV network and sellout crowds at Knicks games and not paying some $13-14 million annually in property taxes on a prime piece of real estate between 31st and 33rd Streets and Seventh and Eighth Avenue. Dolan is paying two players more than $20 million a year each (Amar'e Stoudemire and Carmelo Anthony) which suggests he has the means to pay the taxes.
In cash strapped New York City where Mayor Michael Bloomberg has declared war on teachers’ tenure and salaries and New York State where Governor Andrew Cuomo has promised that he will change the way Albany does business and cut expenses, there is no stomach to put the Garden back on the tax roll. Some of those Knicks fans who love STAT (Stoudemire) and Melo (Anthony) may be out of jobs but as long as the team gets tax breaks that seems to be okay with the fans. The more tax breaks, the more money that can be spend on a player.
New York has laid out hundreds of millions of dollars for infrastructure at the new Yankees and Mets stadiums as well as giving the two franchises many tax breaks and incentives. Former New Jersey Nets owner Bruce Ratner has gotten a slew of tax breaks and incentives to build a Brooklyn arena. New York City Mayor Rudy Giuliani built the two most expensive minor league baseball stadiums ever in Brooklyn in Coney Island and on the Staten Island waterfront.
New York City Mayor Ed Koch and New York Governor Mario Cuomo in 1982 along with the state legislature removed Madison Square Garden from the city tax roll because then-Garden owner Gulf and Western claimed the Knicks and NHL Rangers could no longer compete with in the Knicks case, the Milwaukees and Portlands of the world and the Rangers were not in a position to spend the same type of money on players as Hartford and Winnipeg. If Koch and Cuomo refused to help, Gulf and Western would put the Knicks at the Nassau Coliseum and the Rangers in the new Meadowlands arena.
The gullible Koch, Cuomo and elected state officials bought the Gulf and Western line hook, line and sinker.
In 1995, New Jersey Governor Christie Whitman rewrote the lease between the state and Devils owner John McMullen even though McMullen had years remaining on the deal. McMullen ended up with a much more favorable Meadowlands arena lease and decided not to move his team to Nashville.
On Tuesday, National Hockey League Commissioner Gary Bettman lashed out at the conservative Goldwater Institute, an Arizona think tank that is questioning Glendale, Arizona's selling of municipal bonds to make a sale of the Phoenix Coyotes more palatable to a prospective owner. If Glendale and the NHL filed suit against the Goldwater Institute, one of the targets could be Randy P. Kendrick, the wife of Arizona Diamondbacks owner Ken Kendrick and a Goldwater board member. Goldwater doesn't like the idea of Glendale being so heavily involved in the saving of the Coyotes franchise. There is one problem that Mrs. Kendrick has that gets to the heart of her credibility with Goldwater. The Diamondbacks franchise operates in a facility that was built on the taxpayers’ dime.
Politicians look at the construction of sports facilities as an economic engine. In virtually every case, sports arena and construction building has been a failed policy. The construction jobs are temporary and aside from the players and owners not many jobs created by a team are substantial. On game day, there are quite a few per diem slots available such as parking lot attendants and vendors.
The Baltimore Inner Harbor project started without a baseball stadium or a football stadium and did well when the facility opened in the 1980s. Maryland residents are paying millions of dollars a year to pay off the debts on the Baltimore baseball and football stadium.
Just over the Bergen County line in Rockland County, the town of Ramapo is building a small baseball park for an independent minor league baseball team. Town residents said no to funding in a referendum last August but the town supervisor, Chris St. Lawrence, will have none of that. St. Lawrence decided to fund the project with private money but there is a problem. He hasn't found private money and the town residents keep getting stuck with the tab for construction costs.
St. Lawrence joins the likes of the Washington state legislature, elected officials in Pittsburgh, Charlotte and other areas who overturned referendums and built money losing facilities anyway.
There are far more non sports fans than sports fans if television ratings are accurate and the number of empty seats can be counted on in the thousands at various venues in the New York area on a nightly basis (Mets games, Devils games, Nets games, Islanders games) but non sports fans are paying and paying and paying for sports expenses.
What if there is an NFL lockout? What if there is an NBA lockout? How would that impact both the sports and non sports fans? The New York Giants and New York Jets football teams play sixteen home games during the regular season and an additional four pre-season games at the Meadowlands. That is just twenty days a year without playoffs and if the two teams play one another during the regular season, that is one less opening. Under the right circumstances there could be as many as 24 dates in a 365 day calendar. That means there are 341 other days where there is no NFL football at the East Rutherford facility.
In addition to owning about $100 million to pay off the debt on a stadium that is no longer standing, New Jersey sunk about $300 million for infrastructure for the East Rutherford stadium and the Giants/Jets venture isn't fully paying property taxes for the building. Instead they Giants/Jets real estate venture is paying a far lesser fee through a mechanism called payment in lieu of taxes (PILOT) and East Rutherford is getting a bit more than six million dollars annually through rent and the PILOT scheme. East Rutherford probably should get closer to $15 million annually.
It is hard to image that businesses near the stadium would lose significant money if there is an NFL lockout. The NFL is about tailgating not people wandering through an area to spend money before and after a game. In fact, unless NFL owners own a nearby retail facility (such as New England Patriots owner Robert Kraft's Patriot Place, which according to the Patriot Place website, "features more than 1.3 million square feet of shopping, dining, and entertainment. You will find major fashion retailers, live and interactive entertainment, eateries, a four-star hotel, state of the art theatre and much, much more."), the owners don't want fans to spend their money anywhere except at team-licensed or owned facilities.
One of the reasons Sacramento could not build a new basketball facility for the Maloof brothers Kings franchise was that the 2006 arena proposal took away parking lots and replaced them with businesses around the facility. The Maloofs refused to give up 8,000 parking spaces and the $3 million or so in revenue that was generated from the lots. The arena proposal was voted down by Sacramento residents in overwhelming numbers. The Maloofs never campaigned for the building as it was not in their best financial interest.
In Philadelphia, there is not much around the South Philadelphia sports complex which houses the Phillies, Eagles, 76ers and Flyers except for roads and parks. Eventually Comcast hopes to replace the old Spectrum arena with a retail, restaurant and entertainment district called Philly Live! which means that all business will be conducted inside the sports complex with monies going to Comcast and their partner the Cordish Company? (Cordish was the partner for the stalled St. Louis Cardinals stadium village concept). Comcast is hoping the center will be open by the start of the 2012 Philadelphia Phillies season.
Madison Square Garden is undergoing an $800 million renovation, all designed to extract more money from patrons. Sports does practice class segregation even though sports operators and some sports fans would beg to differ. Sports owners want customers not fans. Customers can spend money for very expensive personnel seat licenses, club seats, luxury boxes and dine in expensive stadium or arena eateries. Customers can also take off the cost of sports tickets as a business expense.
If the National Basketball Association players are locked out, just how much of a real economic impact will the lockout have on cities? Probably very little. There are 41 regular season games, a few pre-season games and some playoff games. Not many fans travel for an NBA game so most of the people in the stands are local and if there are no games they would spend their money elsewhere. Teams have traveling parties of member 30 people and there are just six games a month between November and April, so that isn’t much of an economic generator. Cities like New York and Philadelphia will lose one day of player salary taxes or six in a month or maximum 50 times over a year if the team advances to the playoffs. Cities should be able to get rent money from teams. In 1999, Golden State Warriors owner Chris Cohan tried to skip out on rent payments at the Oakland Coliseum Arena for missed games. An arbitrator ruled against Cohan and made him pay rent. It was an owners’ lockout after all, not a players strike in the 1998-99 NBA labor dispute.
The middle class has been priced out of attending a cluster of games. But there is always cable TV. Cable TV prices for ESPN and other sports channels are pretty reasonable on a monthly basis thanks to socialism. In 1984, Congress and President Ronald Reagan came up with the Cable TV Act which allowed multiple systems operators (MSO) to create a basic expanded tier and group together channels and sell it as one to a consumer. If you wanted ESPN back in 1984, you had to also take CNN and the Weather Channel if the MSO decided that is what was best for their customers. (Remember the "I want my MTV campaign?") Sports channels ended up on those tiers nationally which enabled sports to migrate from over-the-air TV to cable. Cable channels made more off of consumers whether they watched sports or not and some advertising.
Sports has made billions off of people who never watch a sports event on cable TV which is a significant majority of cable TV subscribers.
The segregation of fans started in 1965 with the opening of the Houston Astrodome when Astros owner Roy Hofheinz included "sky boxes" in the stadium.
Hofheinz was charging about $20,000 annually for the boxes, and that did not go unnoticed by his fellow owners. NFL Commissioner Pete Rozelle said in the 1980s that the sky box was a "bane to the business," and because of them, NFL owners needed stadium renovations or new stadiums with built-in luxury boxes. Rozelle was correct, and the 1980s and 1990s were a time of franchise shifts in the NFL because owners were looking for stadiums with luxury boxes. Hofheinz also influenced entertainment by using a scoreboard to entertain people during games. Hofheinz went after the non-sports fan who he felt would show up at an event and not be concerned with the action on the field. Hofheinz even put in a Dow Jones ticker in the original boxes.
McMullen once commented that sports is all about emotion and rational thinking goes out the door in sports. In Washington, DC Goodell and Smith are trying to slice up billions that flow into the industry. They are doing that obvious to what has made football — the 1961 Sports Broadcast Act which was signed into law by President John F. Kennedy after sailing through the House and Senate which enriched the football industry, the shifting of stadium costs from private ownership to municipalities (a trend that started in Milwaukee in 1950), the 1984 Cable TV Act and the real dagger in the back of the average fan, the 1986 tax code revision. By accident Congress and Ronald Reagan approved a bill that put a ceiling of eight cents on a dollar generated in a stadium that would go off to pay the municipal debt of taxpayers funded facilities. New arena and stadium building and renovations sprung up everywhere as owners wanted the latest shiny gadgets compete with luxury boxes, club seats and eateries along with other revenue generating sports in a building. Ticket prices exploded even on the minor league level.
Minor league baseball changed as well as the Major Leagues and Minor Leagues Player Development Contract mandated new or renovated parks be completed by 1994 or teams could move. That is how Sussex County ended up with a New York Penn League team as Glens Falls, New York refused to go along with the 1990 baseball agreement. Mario Cuomo approved more than $60 million for New York minor league park upgrades.
Everyone pays for sports in the United States whether it is through a hotel/motel tax, car rental tax, a "sin" tax (alcohol and cigarettes in Cleveland), a water tax (Nashville) or hikes in sales tax (Arlington, Texas). In a sense, both fans and non sports fans should have a seat at the bargaining table in the NFL dispute, the upcoming NBA contract dispute and the possible Major League Baseball and National Hockey League labor disagreements that could take place this winter and in the summer of 2012. Americans are also paying for the care of discarded football players who are in their 40s and 50s who are disabled from injuries suffered in games through social security insurance and Medicare.
The true cost of sports in the United States to taxpayers is in the billions in government spending.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at www.bickley.com, Barnes and Noble or amazonkindle. He can be reached at evanjweiner@yahoo.com
THURSDAY, 10 MARCH 2011 13:17
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/sports-costing-taxpayers-billions
As National Football League Commissioner Roger Goodell and his owner team personnel continue bargaining with National Football League Players Association Executive Director DeMaurice Smith to reach a new agreement that covers players working conditions, New Jersey Governor Chris Christie wrestles with his state's budget and the possible layoffs of government workers and still has one budget item that will not go away. New Jersey still owes about one hundred million dollars on a facility that no longer exists — Giants Stadium.
More than 100 days from now, National Basketball Association Commissioner could announce that NBA owners have voted to lockout their employees — NBA players — because the owners and the players could not reach a new collective bargaining agreement. NBA owners claim they are losing copious amounts of money yet in Manhattan, the owner of Madison Square Garden (Cablevision's James Dolan) is pocketing money from his regional cable TV network and sellout crowds at Knicks games and not paying some $13-14 million annually in property taxes on a prime piece of real estate between 31st and 33rd Streets and Seventh and Eighth Avenue. Dolan is paying two players more than $20 million a year each (Amar'e Stoudemire and Carmelo Anthony) which suggests he has the means to pay the taxes.
In cash strapped New York City where Mayor Michael Bloomberg has declared war on teachers’ tenure and salaries and New York State where Governor Andrew Cuomo has promised that he will change the way Albany does business and cut expenses, there is no stomach to put the Garden back on the tax roll. Some of those Knicks fans who love STAT (Stoudemire) and Melo (Anthony) may be out of jobs but as long as the team gets tax breaks that seems to be okay with the fans. The more tax breaks, the more money that can be spend on a player.
New York has laid out hundreds of millions of dollars for infrastructure at the new Yankees and Mets stadiums as well as giving the two franchises many tax breaks and incentives. Former New Jersey Nets owner Bruce Ratner has gotten a slew of tax breaks and incentives to build a Brooklyn arena. New York City Mayor Rudy Giuliani built the two most expensive minor league baseball stadiums ever in Brooklyn in Coney Island and on the Staten Island waterfront.
New York City Mayor Ed Koch and New York Governor Mario Cuomo in 1982 along with the state legislature removed Madison Square Garden from the city tax roll because then-Garden owner Gulf and Western claimed the Knicks and NHL Rangers could no longer compete with in the Knicks case, the Milwaukees and Portlands of the world and the Rangers were not in a position to spend the same type of money on players as Hartford and Winnipeg. If Koch and Cuomo refused to help, Gulf and Western would put the Knicks at the Nassau Coliseum and the Rangers in the new Meadowlands arena.
The gullible Koch, Cuomo and elected state officials bought the Gulf and Western line hook, line and sinker.
In 1995, New Jersey Governor Christie Whitman rewrote the lease between the state and Devils owner John McMullen even though McMullen had years remaining on the deal. McMullen ended up with a much more favorable Meadowlands arena lease and decided not to move his team to Nashville.
On Tuesday, National Hockey League Commissioner Gary Bettman lashed out at the conservative Goldwater Institute, an Arizona think tank that is questioning Glendale, Arizona's selling of municipal bonds to make a sale of the Phoenix Coyotes more palatable to a prospective owner. If Glendale and the NHL filed suit against the Goldwater Institute, one of the targets could be Randy P. Kendrick, the wife of Arizona Diamondbacks owner Ken Kendrick and a Goldwater board member. Goldwater doesn't like the idea of Glendale being so heavily involved in the saving of the Coyotes franchise. There is one problem that Mrs. Kendrick has that gets to the heart of her credibility with Goldwater. The Diamondbacks franchise operates in a facility that was built on the taxpayers’ dime.
Politicians look at the construction of sports facilities as an economic engine. In virtually every case, sports arena and construction building has been a failed policy. The construction jobs are temporary and aside from the players and owners not many jobs created by a team are substantial. On game day, there are quite a few per diem slots available such as parking lot attendants and vendors.
The Baltimore Inner Harbor project started without a baseball stadium or a football stadium and did well when the facility opened in the 1980s. Maryland residents are paying millions of dollars a year to pay off the debts on the Baltimore baseball and football stadium.
Just over the Bergen County line in Rockland County, the town of Ramapo is building a small baseball park for an independent minor league baseball team. Town residents said no to funding in a referendum last August but the town supervisor, Chris St. Lawrence, will have none of that. St. Lawrence decided to fund the project with private money but there is a problem. He hasn't found private money and the town residents keep getting stuck with the tab for construction costs.
St. Lawrence joins the likes of the Washington state legislature, elected officials in Pittsburgh, Charlotte and other areas who overturned referendums and built money losing facilities anyway.
There are far more non sports fans than sports fans if television ratings are accurate and the number of empty seats can be counted on in the thousands at various venues in the New York area on a nightly basis (Mets games, Devils games, Nets games, Islanders games) but non sports fans are paying and paying and paying for sports expenses.
What if there is an NFL lockout? What if there is an NBA lockout? How would that impact both the sports and non sports fans? The New York Giants and New York Jets football teams play sixteen home games during the regular season and an additional four pre-season games at the Meadowlands. That is just twenty days a year without playoffs and if the two teams play one another during the regular season, that is one less opening. Under the right circumstances there could be as many as 24 dates in a 365 day calendar. That means there are 341 other days where there is no NFL football at the East Rutherford facility.
In addition to owning about $100 million to pay off the debt on a stadium that is no longer standing, New Jersey sunk about $300 million for infrastructure for the East Rutherford stadium and the Giants/Jets venture isn't fully paying property taxes for the building. Instead they Giants/Jets real estate venture is paying a far lesser fee through a mechanism called payment in lieu of taxes (PILOT) and East Rutherford is getting a bit more than six million dollars annually through rent and the PILOT scheme. East Rutherford probably should get closer to $15 million annually.
It is hard to image that businesses near the stadium would lose significant money if there is an NFL lockout. The NFL is about tailgating not people wandering through an area to spend money before and after a game. In fact, unless NFL owners own a nearby retail facility (such as New England Patriots owner Robert Kraft's Patriot Place, which according to the Patriot Place website, "features more than 1.3 million square feet of shopping, dining, and entertainment. You will find major fashion retailers, live and interactive entertainment, eateries, a four-star hotel, state of the art theatre and much, much more."), the owners don't want fans to spend their money anywhere except at team-licensed or owned facilities.
One of the reasons Sacramento could not build a new basketball facility for the Maloof brothers Kings franchise was that the 2006 arena proposal took away parking lots and replaced them with businesses around the facility. The Maloofs refused to give up 8,000 parking spaces and the $3 million or so in revenue that was generated from the lots. The arena proposal was voted down by Sacramento residents in overwhelming numbers. The Maloofs never campaigned for the building as it was not in their best financial interest.
In Philadelphia, there is not much around the South Philadelphia sports complex which houses the Phillies, Eagles, 76ers and Flyers except for roads and parks. Eventually Comcast hopes to replace the old Spectrum arena with a retail, restaurant and entertainment district called Philly Live! which means that all business will be conducted inside the sports complex with monies going to Comcast and their partner the Cordish Company? (Cordish was the partner for the stalled St. Louis Cardinals stadium village concept). Comcast is hoping the center will be open by the start of the 2012 Philadelphia Phillies season.
Madison Square Garden is undergoing an $800 million renovation, all designed to extract more money from patrons. Sports does practice class segregation even though sports operators and some sports fans would beg to differ. Sports owners want customers not fans. Customers can spend money for very expensive personnel seat licenses, club seats, luxury boxes and dine in expensive stadium or arena eateries. Customers can also take off the cost of sports tickets as a business expense.
If the National Basketball Association players are locked out, just how much of a real economic impact will the lockout have on cities? Probably very little. There are 41 regular season games, a few pre-season games and some playoff games. Not many fans travel for an NBA game so most of the people in the stands are local and if there are no games they would spend their money elsewhere. Teams have traveling parties of member 30 people and there are just six games a month between November and April, so that isn’t much of an economic generator. Cities like New York and Philadelphia will lose one day of player salary taxes or six in a month or maximum 50 times over a year if the team advances to the playoffs. Cities should be able to get rent money from teams. In 1999, Golden State Warriors owner Chris Cohan tried to skip out on rent payments at the Oakland Coliseum Arena for missed games. An arbitrator ruled against Cohan and made him pay rent. It was an owners’ lockout after all, not a players strike in the 1998-99 NBA labor dispute.
The middle class has been priced out of attending a cluster of games. But there is always cable TV. Cable TV prices for ESPN and other sports channels are pretty reasonable on a monthly basis thanks to socialism. In 1984, Congress and President Ronald Reagan came up with the Cable TV Act which allowed multiple systems operators (MSO) to create a basic expanded tier and group together channels and sell it as one to a consumer. If you wanted ESPN back in 1984, you had to also take CNN and the Weather Channel if the MSO decided that is what was best for their customers. (Remember the "I want my MTV campaign?") Sports channels ended up on those tiers nationally which enabled sports to migrate from over-the-air TV to cable. Cable channels made more off of consumers whether they watched sports or not and some advertising.
Sports has made billions off of people who never watch a sports event on cable TV which is a significant majority of cable TV subscribers.
The segregation of fans started in 1965 with the opening of the Houston Astrodome when Astros owner Roy Hofheinz included "sky boxes" in the stadium.
Hofheinz was charging about $20,000 annually for the boxes, and that did not go unnoticed by his fellow owners. NFL Commissioner Pete Rozelle said in the 1980s that the sky box was a "bane to the business," and because of them, NFL owners needed stadium renovations or new stadiums with built-in luxury boxes. Rozelle was correct, and the 1980s and 1990s were a time of franchise shifts in the NFL because owners were looking for stadiums with luxury boxes. Hofheinz also influenced entertainment by using a scoreboard to entertain people during games. Hofheinz went after the non-sports fan who he felt would show up at an event and not be concerned with the action on the field. Hofheinz even put in a Dow Jones ticker in the original boxes.
McMullen once commented that sports is all about emotion and rational thinking goes out the door in sports. In Washington, DC Goodell and Smith are trying to slice up billions that flow into the industry. They are doing that obvious to what has made football — the 1961 Sports Broadcast Act which was signed into law by President John F. Kennedy after sailing through the House and Senate which enriched the football industry, the shifting of stadium costs from private ownership to municipalities (a trend that started in Milwaukee in 1950), the 1984 Cable TV Act and the real dagger in the back of the average fan, the 1986 tax code revision. By accident Congress and Ronald Reagan approved a bill that put a ceiling of eight cents on a dollar generated in a stadium that would go off to pay the municipal debt of taxpayers funded facilities. New arena and stadium building and renovations sprung up everywhere as owners wanted the latest shiny gadgets compete with luxury boxes, club seats and eateries along with other revenue generating sports in a building. Ticket prices exploded even on the minor league level.
Minor league baseball changed as well as the Major Leagues and Minor Leagues Player Development Contract mandated new or renovated parks be completed by 1994 or teams could move. That is how Sussex County ended up with a New York Penn League team as Glens Falls, New York refused to go along with the 1990 baseball agreement. Mario Cuomo approved more than $60 million for New York minor league park upgrades.
Everyone pays for sports in the United States whether it is through a hotel/motel tax, car rental tax, a "sin" tax (alcohol and cigarettes in Cleveland), a water tax (Nashville) or hikes in sales tax (Arlington, Texas). In a sense, both fans and non sports fans should have a seat at the bargaining table in the NFL dispute, the upcoming NBA contract dispute and the possible Major League Baseball and National Hockey League labor disagreements that could take place this winter and in the summer of 2012. Americans are also paying for the care of discarded football players who are in their 40s and 50s who are disabled from injuries suffered in games through social security insurance and Medicare.
The true cost of sports in the United States to taxpayers is in the billions in government spending.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at www.bickley.com, Barnes and Noble or amazonkindle. He can be reached at evanjweiner@yahoo.com
Wednesday, January 26, 2011
Gov. Christie should seek a disgruntled NBA owner instead of lobbying David Stern for Nets replacement
WEDNESDAY, 26 JANUARY 2011 12:59
http://www.newjerseynewsroom.com/professional/gov-christie-should-seek-a-disgruntled-nba-owner-instead-of-lobbying-david-stern-for-nets-replacement
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
There is an odd dynamic that plays out in sports. Elected officials genuflect before the commissioners of Major League Baseball, the National Football League, the National Basketball Association, the National Hockey League and Major League Soccer along with NASCAR officials begging them for a franchise or in NASCAR's case an annual event. Conversely, a sports commissioner lobbies before elected officials for stadiums/arenas and on the federal level before Washington lawmakers to make sure various antitrust laws and in Major League Baseball's case, a full antitrust exemption, stay in place.
Big time college sports executives also show up in Washington to make sure big time college sports keep tax exemptions in place.
So it should not be surprising that New Jersey Governor Chris Christie has begun a lobbying effort, not quite begging yet, in an attempt to get NBA Commissioner David Stern to think about replacing the soon-to-depart Newark-based New Jersey Nets with another team.
New Jersey's chances of landing a team on the surface seem to be non-existent however Christie has an ace in the hole that other prospective cities don't have. A major regional cable sports network that has limited winter programming, SNY, who could pay much more money in TV rights than say Louisville, Kansas City, Las Vegas, Seattle and Vancouver. In David Stern's three-legged stool world for a successful franchise, a large, local cable TV is an absolute must as is local government support (Christie is in favor of a Nets replacement) and corporate support. That last plank in Stern's platform is the major problem in New Jersey and has been a thorn in the side of past and present day Nets (and New Jersey Devils) ownerships.
Christie will have to wait though. The Brooklyn building has been on hold for years although there seems to be momentum to get the arena finally done. The NBA may not be operating in the fall of 2011 because the owners and players need a new collective bargaining agreement and Stern, as lead negotiator, figures to take a very hard line as he and the 30 NBA owners want changes in how players are compensated.
The NBA has some franchises that are on shaky financial footing. The league now owns the New Orleans Hornets, a franchise in desperate fiscal shape. The old Hornets ownership had attendance clauses built into the team lease with the state at the New Orleans Arena. There was a benchmark that needed to be reached by the end of January or the team ownership could pay $10 million and relocate. The league celebrated that the benchmark was hit but that doesn't mean the team will last in New Orleans beyond 2014. Indiana's owner Herb Simon is financially struggling and Charlotte has not been performing well financially since the NBA returned to the city in 2004.
The Maloof brothers are in a financial mess in Sacramento and claim they need a new arena. With California's financial woes and a proposal by Governor Jerry Brown to de-fund local redevelopment agencies on July 1, getting an arena built in Sacramento with public funding may be difficult. The Maloofs have failed in their quest for a new building on a number of occasions. (The Brown proposal could kill NFL stadium development in San Diego and a baseball park in San Jose for the Oakland A's.).
Newark has an NBA ready building for some owner and probably a lucrative cable TV deal. But Newark isn't the only NBA suitor. Louisville, Kentucky is once again seeking a team despite losing out on the Charlotte Hornets and the Vancouver Grizzlies about a decade ago. Vancouver may be back in the NBA wannabe category. The Vancouver saga in the NBA's mid-1990s expansion plans is worth noting in that the NBA decided to take Arthur Griffith's money ($100 million) in what seemed to be a cash grab.
Griffiths built a new arena with his own money and bought the franchise when the Canadian looney was worth 62 or 63 cents compared to the U.S. greenback. The two countries' dollar is around par right now. Griffiths sold the franchise to American businessman Michael Heisley in 2000. Heisley moved his franchise to Memphis in 2001. The Grizzlies franchise remains a cash-challenged NBA organization. A few years ago, Stern said he felt the NBA could not go back to Vancouver.
Stern can be a bullheaded bully. In 2005, the one-time New Jersey resident Stern trashed New Jersey politicians saying "you blew it" when another set of Nets owners could not get an arena built in Newark. Eventually Devils owner Jeffrey Vanderbeek worked out a deal with Newark officials and got an arena built with some of his money thrown into a publicly funded facility.
Christie seems to be willing to play ball with Stern. What Christie should be seeking out is an unhappy owner looking for greener pastures and go after that owner instead of Stern. Although the NBA blocked the planned sale and move of the Minnesota Timberwolves to New Orleans in 1994, a strong headed owner might tell Stern and his fellow owners to go stuff it and move anyway as Donald Sterling did in 1984 when he moved his San Diego Clippers to Los Angeles without league permission.
Moving an existing franchise to Newark may not be a large problem as the NBA, unlike Major League Baseball, is subjected to antitrust laws. It would take moving heaven and earth to put a third Major League Baseball team in the New York City area whether it is in Northern New Jersey or Brooklyn because Major League Baseball is exempt from certain portions of the Sherman Antitrust Act. The Steinbrenner Yankees or the Wilpon Mets or both could say no to the idea and that would be it.
Major League Baseball is struggling to find a solution to the San Francisco Bay Area problem. The San Francisco Giants franchise has the territorial rights to San Jose and Santa Clara County, California even though those areas are much further away from the Giants home base in China Basin than Oakland, the city which houses the A's. Oakland A's owner Lew Wolff wants to move his team to San Jose but cannot because the Giants ownership group has the rights to the territory. Major League Baseball is looking for a solution. The solution will come when Wolff pays millions of dollars for "invading" Giants territory or if he wins an antitrust case against the Giants and Major League Baseball.
Wolff does not seem willing to sue Major League Baseball. Sterling told the NBA to try and stop me. The NBA didn't. But Christie may have to wait before he can really go after a disgruntled owner. There is the threat of the NBA lockout on July 1 and that takes precedent over everything else.
But Christie has thrown his hat in the ring and is running. The campaign has started to replace the New Jersey Nets in Newark as soon as possible.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at www.bickley.com, Barnes and Noble or amazonkindle. He can be reached at evanjweiner@yahoo.com
WEDNESDAY, 26 JANUARY 2011 12:59
http://www.newjerseynewsroom.com/professional/gov-christie-should-seek-a-disgruntled-nba-owner-instead-of-lobbying-david-stern-for-nets-replacement
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
There is an odd dynamic that plays out in sports. Elected officials genuflect before the commissioners of Major League Baseball, the National Football League, the National Basketball Association, the National Hockey League and Major League Soccer along with NASCAR officials begging them for a franchise or in NASCAR's case an annual event. Conversely, a sports commissioner lobbies before elected officials for stadiums/arenas and on the federal level before Washington lawmakers to make sure various antitrust laws and in Major League Baseball's case, a full antitrust exemption, stay in place.
Big time college sports executives also show up in Washington to make sure big time college sports keep tax exemptions in place.
So it should not be surprising that New Jersey Governor Chris Christie has begun a lobbying effort, not quite begging yet, in an attempt to get NBA Commissioner David Stern to think about replacing the soon-to-depart Newark-based New Jersey Nets with another team.
New Jersey's chances of landing a team on the surface seem to be non-existent however Christie has an ace in the hole that other prospective cities don't have. A major regional cable sports network that has limited winter programming, SNY, who could pay much more money in TV rights than say Louisville, Kansas City, Las Vegas, Seattle and Vancouver. In David Stern's three-legged stool world for a successful franchise, a large, local cable TV is an absolute must as is local government support (Christie is in favor of a Nets replacement) and corporate support. That last plank in Stern's platform is the major problem in New Jersey and has been a thorn in the side of past and present day Nets (and New Jersey Devils) ownerships.
Christie will have to wait though. The Brooklyn building has been on hold for years although there seems to be momentum to get the arena finally done. The NBA may not be operating in the fall of 2011 because the owners and players need a new collective bargaining agreement and Stern, as lead negotiator, figures to take a very hard line as he and the 30 NBA owners want changes in how players are compensated.
The NBA has some franchises that are on shaky financial footing. The league now owns the New Orleans Hornets, a franchise in desperate fiscal shape. The old Hornets ownership had attendance clauses built into the team lease with the state at the New Orleans Arena. There was a benchmark that needed to be reached by the end of January or the team ownership could pay $10 million and relocate. The league celebrated that the benchmark was hit but that doesn't mean the team will last in New Orleans beyond 2014. Indiana's owner Herb Simon is financially struggling and Charlotte has not been performing well financially since the NBA returned to the city in 2004.
The Maloof brothers are in a financial mess in Sacramento and claim they need a new arena. With California's financial woes and a proposal by Governor Jerry Brown to de-fund local redevelopment agencies on July 1, getting an arena built in Sacramento with public funding may be difficult. The Maloofs have failed in their quest for a new building on a number of occasions. (The Brown proposal could kill NFL stadium development in San Diego and a baseball park in San Jose for the Oakland A's.).
Newark has an NBA ready building for some owner and probably a lucrative cable TV deal. But Newark isn't the only NBA suitor. Louisville, Kentucky is once again seeking a team despite losing out on the Charlotte Hornets and the Vancouver Grizzlies about a decade ago. Vancouver may be back in the NBA wannabe category. The Vancouver saga in the NBA's mid-1990s expansion plans is worth noting in that the NBA decided to take Arthur Griffith's money ($100 million) in what seemed to be a cash grab.
Griffiths built a new arena with his own money and bought the franchise when the Canadian looney was worth 62 or 63 cents compared to the U.S. greenback. The two countries' dollar is around par right now. Griffiths sold the franchise to American businessman Michael Heisley in 2000. Heisley moved his franchise to Memphis in 2001. The Grizzlies franchise remains a cash-challenged NBA organization. A few years ago, Stern said he felt the NBA could not go back to Vancouver.
Stern can be a bullheaded bully. In 2005, the one-time New Jersey resident Stern trashed New Jersey politicians saying "you blew it" when another set of Nets owners could not get an arena built in Newark. Eventually Devils owner Jeffrey Vanderbeek worked out a deal with Newark officials and got an arena built with some of his money thrown into a publicly funded facility.
Christie seems to be willing to play ball with Stern. What Christie should be seeking out is an unhappy owner looking for greener pastures and go after that owner instead of Stern. Although the NBA blocked the planned sale and move of the Minnesota Timberwolves to New Orleans in 1994, a strong headed owner might tell Stern and his fellow owners to go stuff it and move anyway as Donald Sterling did in 1984 when he moved his San Diego Clippers to Los Angeles without league permission.
Moving an existing franchise to Newark may not be a large problem as the NBA, unlike Major League Baseball, is subjected to antitrust laws. It would take moving heaven and earth to put a third Major League Baseball team in the New York City area whether it is in Northern New Jersey or Brooklyn because Major League Baseball is exempt from certain portions of the Sherman Antitrust Act. The Steinbrenner Yankees or the Wilpon Mets or both could say no to the idea and that would be it.
Major League Baseball is struggling to find a solution to the San Francisco Bay Area problem. The San Francisco Giants franchise has the territorial rights to San Jose and Santa Clara County, California even though those areas are much further away from the Giants home base in China Basin than Oakland, the city which houses the A's. Oakland A's owner Lew Wolff wants to move his team to San Jose but cannot because the Giants ownership group has the rights to the territory. Major League Baseball is looking for a solution. The solution will come when Wolff pays millions of dollars for "invading" Giants territory or if he wins an antitrust case against the Giants and Major League Baseball.
Wolff does not seem willing to sue Major League Baseball. Sterling told the NBA to try and stop me. The NBA didn't. But Christie may have to wait before he can really go after a disgruntled owner. There is the threat of the NBA lockout on July 1 and that takes precedent over everything else.
But Christie has thrown his hat in the ring and is running. The campaign has started to replace the New Jersey Nets in Newark as soon as possible.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at www.bickley.com, Barnes and Noble or amazonkindle. He can be reached at evanjweiner@yahoo.com
Monday, December 6, 2010
New Jersey’s horse racing problems rooted in NFL wanderlust
Monday, 06 December 2010 12:01
http://www.newjerseynewsroom.com/professional/new-jerseys-horse-racing-problems-rooted-in-nfl-wanderlust
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
As New Jersey continues to figure out what to do with the state's financially ailing horse racing tracks, the "popular" (according to media pundits who like to affix tags like popular, hapless or weak to political figures or sports teams) or "superstar" (according to the Tucker Carlson founded Daily Caller conservative political website) Governor of New Jersey Chris Christie has to balance his desire to "fix" the industry with the reality that New Jersey is leaking gambling money to New York, Pennsylvania and Delaware. For more than four decades states have been adding all sorts of ways for the average person to spend money gambling near their homes whether it was at an Off Track Betting facility (and that is now an endangered species in New York) to playing all sorts of games at the local 7-Eleven or Wawa stores. The state would get a percentage of the take and pay off bills.
That opens up a real ethical debate that no one seems to want to address.
Should the state encourage legal gambling knowing that people who have addiction problems might add betting to their addictions as a way to generate revenue or just raise taxes?
Tax hikes, of course, are highly unpopular so why not hide them?
Gambling is a form of taxation and across the Hudson River in Queens, New York, a casino will be opening in 2011 at Aqueduct racetrack. New York's gain could potentially be a New Jersey's revenue loss.
The Queens casino will be operated by a Malaysian company, Genting, and will eventually house 4,525 video lottery terminals. The first 1,600 will be opened sometime in early 2011.There will eventually be a major structure housing the terminals at the Queens racetrack and New York racing will be able to up purses and draw a better grade of horse to Aqueduct, Belmont and Saratoga. New York is also hoping that some of the casinos proceeds will go to pay off education costs in the state. That brings up another ethical question that politicians ran away from.
"Neighborhood" casinos don't attract the "high rollers" who can afford to lose money. The crowd is a lower to middle class crowd that is there for either enjoyment or hoping to hit the jackpot. It is a tax although on the lower and middle class yet it never is packaged that way. Those people will be paying a tax they have never considered because gambling is a form of recreation even though they are the ones shouting about high tax rates.
The same media people who tout "rising star" politicians or "popular" politicians or "superstar" politicians never bother to actually understand that an elected official makes decisions that impact lives and is not a celebrity. The pundits never explain state gambling. Politicians more than four decades ago decided to start state gambling games as a way to collect revenues. That is why there are so many "racinos" — racetracks with slot machines and in some cases table games. That is why restaurant goers can play keno while waiting for a slice of pizza in New York.
Aqueduct will be just another casino within a driving distance of northern New Jersey. It will join the Empire City Casino at Yonkers Raceway as a close competitor. Pennsylvania casinos are also within a quick drive and one Poconos casino regularly runs ads on an AM northern New Jersey radio station telling people to make the drive there. In the Philadelphia area, there are slots at racetracks and Delaware along with Maryland also feature slot parlors. Atlantic City is not the only game in town anymore and for those in northern New Jersey, there will be a casino/resort opening in what used to be known as the Borscht Belt near Monticello, New York in the next few years.
That is a problem for the "popular" and "superstar" governor whose main job is to get New Jersey out of the fiscal mess the state is coping with. Of course New Jersey is not alone in the budget problems and no amount of "media celebrity" accolades is going to pull the any state out of the financial crisis.
If that were the case, California with Governor Schwarzenegger would have turn the financial ship around and the Golden State would be swimming in money. It is just not that easy.
Both the thoroughbred and standard bred horse racing industry have been dying for years. At one time, Yonkers Raceway packed 40,000 people into the stands on a Saturday night. That was four decades ago. Now the venue is a casino that features some racing most nights. The same is true at Dover Downs in Delaware and the trend around the country has been to put slots into tracks in an attempt to get people into the venue to bet on something, not necessarily horses. Christie's problem is that Atlantic City is the hub of gambling in New Jersey and the casinos there don't really want any in-state competition for gambling dollars from New Jersey racetracks. Ideally the Meadowlands and Monmouth Park would be the perfect venues for slot machines but that is not happening anytime soon, like this afternoon, and New Jersey is losing money on the racetracks.
Apparently Monmouth lost about $6.5 million this year and the Meadowlands came in at around $11 million in losses. The total was offset by contributions from Atlantic City casinos and taxpayers dollars. Governor Christie wants to end the subsidies but others want to save horse racing in the state and some of the suggestions include internet gambling on races, opening New Jersey's version of Off Track Betting, selling off Monmouth (no one would buy the facility for just horse racing) and limiting racing at the Meadowlands to just a few days a year.
All of the solutions are flawed. If New Jersey does get out of the horse racing industry, the state will lose horse farms and that has a domino falling impact on all sorts of secondary industries from veterinarians to stable operators to people spending money in the community where the farms are located. That means a job and tax revenue loss. Because of casino gambling, Delaware was able to save horse farms that would surely had left if horse racing ended at the remaining tracks in the state. New York and Maryland are struggling with that problem although both states think that they can stem the tide of farms leaving with money from the "machines" as Yonkers Raceway owner Tim Rooney calls them.
The National Football League and other sports leagues would fight legalized sports gambling in Atlantic City although New Jersey lawmakers had the ability to legalize sports gambling in 1993 and passed on the opportunity.
Delaware does have legalized "parlay" National Football League action at the state's casinos.
Ironically, New Jersey got into the racetrack business because of the National Football League. In 1971 and 1972, state elected officials built the Meadowlands racetrack with the thought that the proceeds from the track would help pay down the debt at the new football facility that would eventually house the New York Giants. The football venue was completed in 1976. Meanwhile Leon Hess was becoming more and more unhappy with the terms of his lease at Shea Stadium as his Jets franchise played second fiddle to the New York Mets at the New York City-owned sports facility in Queens. Hess was eyeing New Jersey and his lease with the New York City ended in 1983.
Hess was a member of the Board of Directors of the Monmouth Park Jockey Club. By 1985, Hess had a deal for his Jets to play in the Meadowlands and New Jersey bought Monmouth Park from Hess and his fellow Jockey Club members for $45 million. The Hess-New Jersey negotiations for the football team move to New Jersey started in 1983 as did the Monmouth Park talks. The two negotiations were not linked.
At least not officially.
The state originally went after the Yankees in 1972 and thought a deal which about to be struck between Yankees owner CBS and a local New Jersey businessmen for about $13 million. New Jersey would have built a baseball park in the Meadowlands for the Yankees. In 1972, CBS Chairman William Paley told Yankees President Michael Burke to either sell the team or buy it himself. CBS could not put Yankees games on CBS' owned and operated WCBS-TV, Channel 2 in New York because of Federal Communication Commission rules. Back in 1972, that was where the real money on the team could have been made through TV advertising revenue and promotions. New Jersey officials felt that a deal to move the team to the state was imminent but Burke informed New Jersey interests that the team wasn't for sale near the end of 1972, A few days later, on January 3, 1973, Burke announced that a group led by George M. Steinbrenner III had purchased the club for $10 million (along with a $1.5 million tax credit).
The New York Yankees franchise remained in the Bronx.
New Jersey has to do something soon because of pressures from inside the state and external pressure has gambling money seeps into neighboring states. The longer politicians kick the can down the street, the harder it will be to solve New Jersey's horse racing and gambling problem.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at www.bickley.com or amazonkindle. He can be reached at evanjweiner@yahoo.com
Monday, 06 December 2010 12:01
http://www.newjerseynewsroom.com/professional/new-jerseys-horse-racing-problems-rooted-in-nfl-wanderlust
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
As New Jersey continues to figure out what to do with the state's financially ailing horse racing tracks, the "popular" (according to media pundits who like to affix tags like popular, hapless or weak to political figures or sports teams) or "superstar" (according to the Tucker Carlson founded Daily Caller conservative political website) Governor of New Jersey Chris Christie has to balance his desire to "fix" the industry with the reality that New Jersey is leaking gambling money to New York, Pennsylvania and Delaware. For more than four decades states have been adding all sorts of ways for the average person to spend money gambling near their homes whether it was at an Off Track Betting facility (and that is now an endangered species in New York) to playing all sorts of games at the local 7-Eleven or Wawa stores. The state would get a percentage of the take and pay off bills.
That opens up a real ethical debate that no one seems to want to address.
Should the state encourage legal gambling knowing that people who have addiction problems might add betting to their addictions as a way to generate revenue or just raise taxes?
Tax hikes, of course, are highly unpopular so why not hide them?
Gambling is a form of taxation and across the Hudson River in Queens, New York, a casino will be opening in 2011 at Aqueduct racetrack. New York's gain could potentially be a New Jersey's revenue loss.
The Queens casino will be operated by a Malaysian company, Genting, and will eventually house 4,525 video lottery terminals. The first 1,600 will be opened sometime in early 2011.There will eventually be a major structure housing the terminals at the Queens racetrack and New York racing will be able to up purses and draw a better grade of horse to Aqueduct, Belmont and Saratoga. New York is also hoping that some of the casinos proceeds will go to pay off education costs in the state. That brings up another ethical question that politicians ran away from.
"Neighborhood" casinos don't attract the "high rollers" who can afford to lose money. The crowd is a lower to middle class crowd that is there for either enjoyment or hoping to hit the jackpot. It is a tax although on the lower and middle class yet it never is packaged that way. Those people will be paying a tax they have never considered because gambling is a form of recreation even though they are the ones shouting about high tax rates.
The same media people who tout "rising star" politicians or "popular" politicians or "superstar" politicians never bother to actually understand that an elected official makes decisions that impact lives and is not a celebrity. The pundits never explain state gambling. Politicians more than four decades ago decided to start state gambling games as a way to collect revenues. That is why there are so many "racinos" — racetracks with slot machines and in some cases table games. That is why restaurant goers can play keno while waiting for a slice of pizza in New York.
Aqueduct will be just another casino within a driving distance of northern New Jersey. It will join the Empire City Casino at Yonkers Raceway as a close competitor. Pennsylvania casinos are also within a quick drive and one Poconos casino regularly runs ads on an AM northern New Jersey radio station telling people to make the drive there. In the Philadelphia area, there are slots at racetracks and Delaware along with Maryland also feature slot parlors. Atlantic City is not the only game in town anymore and for those in northern New Jersey, there will be a casino/resort opening in what used to be known as the Borscht Belt near Monticello, New York in the next few years.
That is a problem for the "popular" and "superstar" governor whose main job is to get New Jersey out of the fiscal mess the state is coping with. Of course New Jersey is not alone in the budget problems and no amount of "media celebrity" accolades is going to pull the any state out of the financial crisis.
If that were the case, California with Governor Schwarzenegger would have turn the financial ship around and the Golden State would be swimming in money. It is just not that easy.
Both the thoroughbred and standard bred horse racing industry have been dying for years. At one time, Yonkers Raceway packed 40,000 people into the stands on a Saturday night. That was four decades ago. Now the venue is a casino that features some racing most nights. The same is true at Dover Downs in Delaware and the trend around the country has been to put slots into tracks in an attempt to get people into the venue to bet on something, not necessarily horses. Christie's problem is that Atlantic City is the hub of gambling in New Jersey and the casinos there don't really want any in-state competition for gambling dollars from New Jersey racetracks. Ideally the Meadowlands and Monmouth Park would be the perfect venues for slot machines but that is not happening anytime soon, like this afternoon, and New Jersey is losing money on the racetracks.
Apparently Monmouth lost about $6.5 million this year and the Meadowlands came in at around $11 million in losses. The total was offset by contributions from Atlantic City casinos and taxpayers dollars. Governor Christie wants to end the subsidies but others want to save horse racing in the state and some of the suggestions include internet gambling on races, opening New Jersey's version of Off Track Betting, selling off Monmouth (no one would buy the facility for just horse racing) and limiting racing at the Meadowlands to just a few days a year.
All of the solutions are flawed. If New Jersey does get out of the horse racing industry, the state will lose horse farms and that has a domino falling impact on all sorts of secondary industries from veterinarians to stable operators to people spending money in the community where the farms are located. That means a job and tax revenue loss. Because of casino gambling, Delaware was able to save horse farms that would surely had left if horse racing ended at the remaining tracks in the state. New York and Maryland are struggling with that problem although both states think that they can stem the tide of farms leaving with money from the "machines" as Yonkers Raceway owner Tim Rooney calls them.
The National Football League and other sports leagues would fight legalized sports gambling in Atlantic City although New Jersey lawmakers had the ability to legalize sports gambling in 1993 and passed on the opportunity.
Delaware does have legalized "parlay" National Football League action at the state's casinos.
Ironically, New Jersey got into the racetrack business because of the National Football League. In 1971 and 1972, state elected officials built the Meadowlands racetrack with the thought that the proceeds from the track would help pay down the debt at the new football facility that would eventually house the New York Giants. The football venue was completed in 1976. Meanwhile Leon Hess was becoming more and more unhappy with the terms of his lease at Shea Stadium as his Jets franchise played second fiddle to the New York Mets at the New York City-owned sports facility in Queens. Hess was eyeing New Jersey and his lease with the New York City ended in 1983.
Hess was a member of the Board of Directors of the Monmouth Park Jockey Club. By 1985, Hess had a deal for his Jets to play in the Meadowlands and New Jersey bought Monmouth Park from Hess and his fellow Jockey Club members for $45 million. The Hess-New Jersey negotiations for the football team move to New Jersey started in 1983 as did the Monmouth Park talks. The two negotiations were not linked.
At least not officially.
The state originally went after the Yankees in 1972 and thought a deal which about to be struck between Yankees owner CBS and a local New Jersey businessmen for about $13 million. New Jersey would have built a baseball park in the Meadowlands for the Yankees. In 1972, CBS Chairman William Paley told Yankees President Michael Burke to either sell the team or buy it himself. CBS could not put Yankees games on CBS' owned and operated WCBS-TV, Channel 2 in New York because of Federal Communication Commission rules. Back in 1972, that was where the real money on the team could have been made through TV advertising revenue and promotions. New Jersey officials felt that a deal to move the team to the state was imminent but Burke informed New Jersey interests that the team wasn't for sale near the end of 1972, A few days later, on January 3, 1973, Burke announced that a group led by George M. Steinbrenner III had purchased the club for $10 million (along with a $1.5 million tax credit).
The New York Yankees franchise remained in the Bronx.
New Jersey has to do something soon because of pressures from inside the state and external pressure has gambling money seeps into neighboring states. The longer politicians kick the can down the street, the harder it will be to solve New Jersey's horse racing and gambling problem.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition is available at www.bickley.com or amazonkindle. He can be reached at evanjweiner@yahoo.com
Tuesday, October 12, 2010
Should Chris Christie be considered one of the most powerful people in sports?
TUESDAY, 12 OCTOBER 2010 16:22
http://www.newjerseynewsroom.com/professional/should-chris-christie-be-considered-one-of-the-most-powerful-people-in-sports
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
It is silly season again as a S. I. M. magazine "the only global sport business magazine targeting a dual readership that focuses exclusively on influence and affluence in today's ever-changing world" is polling readership and asking readers to name the most influential people in the world of sports. For the record, this United Kingdom-based publication has Joseph Blatter, the President of FIFA (Soccer) out in front in the voting followed by the President of the International Olympic Committee, Dr. Jacques Rogge and Herbert Hainer, the Chairman and CEO of adidas in the top three slots. The first American on the list and coming in at number four is Heidi Ueberroth, which is a head turner. Ueberroth's father Peter, of course, ran the 1984 Los Angeles Olympic Committee and was the Commissioner of Major League Baseball but his daughter simply doesn't belong as high on this list as President of NBA International. Her boss David Stern as the Commissioner of the National Basketball Association has more power.
Stern is ninth on the list well ahead of NHL Commissioner Gary Bettman who is at 50. NFL Commissioner Roger Goodell, who cannot get his league market attention and traction outside the North American continent unlike Stern, Bettman and Major League Baseball Commissioner Bud Selig, who is 11th. Selig is 32nd, one spot ahead of CBS Sports President Sean McManus, which makes no sense. McManus just gave the NCAA billions of dollars in a partnership with Turner Sports for the NCAA Men's Basketball Tournament. McManus' Turner Sports Partner David Levy is ranked 54th.
For some reason, S. I. M. magazine has San Francisco 49ers owner Denise DeBartolo York in the Top 100. York doesn't run the football team, her 29-year-old son Jed with a rather thin business resume does.
Stern, the former Teaneck resident, understands where the real power in sports is located. Stern's three legged stool formula for success always starts with government. In the United States and in a great many countries, elected officials either directly give money to sports (as in Malaysia) or set up laws that funnel money into sports whether it is through tax breaks, tax incentives, the building of facilities at taxpayers' expense and in America, the federal government changed the cable TV laws which allowed owners like the Yankees George Steinbrenner, the Mets Fred Wilpon and the Dolan-family owned New York Knicks, New York Rangers and New York Liberty to make enormous sums of money from cable TV. The feds also give tax breaks to corporations buying high item sports event seats for "business purposes."
In New Jersey, Chris Christie as Governor is more important to the sports world than the state's highest paid employees, the Rutgers football coach and the Rutgers men's and women's basketball coach. Christie has to decide the fate of the Meadowlands at some point soon along with the horse racing industry in the state. Horse racing is a sport even though none of the top 100 on S. I. M.'s list represent horse racing.
Governors, mayors, state elected officials are major players in sports as they control the purse strings. The Meadowlands complex never would have opened without government support.
When publications and websites put out lists of the Top 100 this, the Top 100 that, they are should always to be taken with a grain of salt. In 2007, BusinessWeek posted a list of the Top 100 Power People in sports with National Football League Commissioner Roger Goodell on the top of the list. BusinessWeek should have asked me to be part of their panel because their list is filled with questionable choices and omissions.
BusinessWeek asked the wrong people — players, agents, sports gadflies, for their opinions and didn't know that there is a formula for sports success — government support, a large local cable TV deal and corporate support, the latter two made possible by government assistance.
It's too bad because that Power 100 list might be far more accurate with real sports business experts than the BusinessWeek 100 that was presented. There really is nothing on the list that indicates that the panelists thought about the UEFA 2008 football tournament. That happens to be the second most watched sports event in the world behind the World Cup.
There is nothing about cricket or boxing on the list. The National Hockey League Commissioner is rated just 27th on the list even though the NHL has lots of eyeballs watching its product in Europe far more eyeballs than the NFL on that continent.
The list also was too United States-centric. The oddity here is that NFL Commissioner Roger Goodell heads a highly successfully United States business that is attempting to catch up with Soccer, Major League Baseball, the National Basketball Association and yes even the downtrodden National Hockey League in the global community. The list places Los Angeles Kings, Los Angeles Galaxy and AEG owner Phillip Anschutz at number 21. Anschutz may be the most powerful man in sports globally. Anschutz's LA Kings opened the 2007-08 National Hockey League season in London in the London arena he owns against the Anaheim Ducks. .
Anschutz controlled most of the franchises in Major League Soccer and brought David Beckham to America. National Basketball Association Commissioner David Stern will tell you that London, England is the most ready city in Europe for an NBA franchise thanks to Anschutz.
Anschutz is also a major force behind the 2012 London Olympics.
The list has International Olympic Committee President Jacques Rogge but absent was the heads of the 2008 Beijing Summer Games, the 2010 Vancouver Winter Games, the 2012 London Summer Games and the 2014 Sochi Winter Games. That is worth noting because US Presidential candidate Mitt Romney launched his political career by running the 2002 Salt Lake City Winter Games. From there he ran for Governor of Massachusetts and may be attempting to get the Republican nomination for President in 2012.
Of course sports can be a great stepping stone. United States President George W. Bush was a two percent owner of the Texas Rangers baseball team and its general managing partner but he was never considered a Top 100 performer in sports during his days as a minority owner of a baseball team.
Texas Rangers and Dallas Stars owner Thomas O. Hicks, a major financial support of George W. Bush's 1994 and 1998 gubernatorial races in Texas and 2000 and 2004 Presidential bids is not on the list. Hicks and Montreal Canadiens owner George N. Gillett, Jr. purchased Liverpool P. C. in the English Premiere League and are building a football stadium in the English city that is more known for being the home of the Beatles John Lennon, Paul Mc Cartney, George Harrison and Ringo Starr to Americans but Liverpool football has a long history. Tampa Bay Buccaneers owner Malcolm Glazier isn't on the BusinessWeek 100 Power list either. Glazier owns the most recognizable sports brand internationally, Manchester United. Manchester United football is a lot better known globally than the Tampa Bay Buccaneers.
Hicks and Gillett recently sold Liverpool to Boston Red Sox owner John Henry.
Two glaring omissions in the 2007 list came from the world of the original cable TV investors, Ted Rogers in Canada and Chuck Dolan in New York . Rogers owns the Toronto Blue Jays and Sportsnet, which carries Blue Jays baseball, five NHL teams telecasts and has the rights to the 2010 Vancouver Winter Olympics and the 2012 London Summer Olympics. Dolan, who helped found HBO, owns Madison Square Garden, the New York Knicks, New York Rangers, New York Liberty, the Madison Square Garden Network (which has Knicks basketball and the three New York City area hockey teams, the Rangers, Islanders and New Jersey Devils hockey as part of its programming along with the Liberty and other sports) and Radio City Music Hall.
Another cable TV guy, Altitude Sports and Entertainment Network-Colorado Avalanche-Denver Nuggets-St. Louis Rams-Colorado Crush-Colorado Rapids and Arsenal FC owner Stan Kroenke is also not highly thought of by BusinessWeek either. Nor is New York Islanders owner Charles Wang who is trying to raise hockey interest in China, nor are the Toronto Maple Leafs Sports and Entertainment Chairman of the Board Larry Tannebaum a player on BusinessWeek's 100. Tannenbaum runs the NHL Maple Leafs, the NBA Raptors, the MLS Toronto FC, two Toronto arenas Leafs TV, Raptors TV and Maple Leaf Square which includes office space and residential living.
Why is Arnold Palmer on this list? Palmer was a great golfer in his day and businessman but if you include Palmer how do you leave off Jack Nicklaus and Greg Norman who are major figures in golf course development?
There is something else that is puzzling on the BusinessWeek 100 when it comes to NFL owners. Jerry Jones, Daniel Snyder, Robert Kraft, Robert Mc Nair and Jeffrey Lurie are the five most powerful NFL owners in that they stuck together and tried to break the NFL's "Leaguethink" philosophy during the last owners squabble over revenue sharing but neither Mc Nair nor Lurie are on the list. Denver owner Pat Bowlen was on the NFL TV committee, a group that helped negotiation the league's huge TV deals with Rupert Murdoch's FOX, General Electric's NBC, Disney's ESPN and Sumner Redstone's CBS along with DirecTV but he isn't on the list.
Where are politicians on this list? Without Anthony Williams, the former Washington mayor, there is no new baseball park in Washington; there is no Major League Baseball in the city period. Russian President Vladimir Putin belongs on this list. Putin lobbied the International Olympic Committee to get the 2014 Winter Olympics for Sochi and Putin was behind that the formation of a state corporation, which will supervise the infrastructural development of Sochi and the construction of the Olympic facilities.
Can BusinessWeek explain Vladislav Tretaik's 2007 exclusion on the list? Tretiak, the President of the Russian Ice Hockey Federation, refused to sign off on the International Ice Hockey Federation-National Hockey League transfer deal that allows young Russian players to play on an NHL in exchange for financial considerations.
Business Week also enlisted ESPN: The Magazine for data. Another mistake. ESPN may own TSN in Canada and ESPN International may carry North American sports around the world but you would never know it from the Power 100 list. Depending on ESPN reporters for business information is risky because ESPN reporters are clueless when it comes to business. What do Shane Battier, Amanda Beard, Bill Cowher, Carl Edwards, Brad Faxson, Martina Hingis, Mark Kreigel, Tommy Lasorda, Lisa Leslie and Mark Spitz know about dealing with politicians to secure taxpayers dollars for the Olympics, World Cup, Super Bowl and other major sports events globally for stadiums and arenas? What do they know about the difficulties in getting tax abatements, payment in lieu of taxes, tax increment financing in the United States, getting dollars from provincial hockey lotteries in Alberta, converting US dollars into pounds, Euros and Yuans?
If BusinessWeek did an honest list of the real power figures about 50 percent of the Top 100 would be gone. BusinessWeek failed to identify the real power behind sports, particularly in the United States. It's a fun list to scan but its little more than that. It is sort of like the Forbes list of what North American sports franchises are worth. Interesting reading but in reality a franchise is worth want someone is willing to pay for the business.
BusinessWeek's 2007 list was filled with glaring holes. In 2009, BusinessWeek had Tiger Woods as its most powerful sports player followed by Goodell and Stern. As always, no government people were on the 2009 BusinessWeek list. The S. I. M. 2010 list will be no better. BusinessWeek had Goodell ranked too high. Goodell is powerful in the US but is pretty feeble internationally compared to MLB Commissioner Bud Selig, NBA boss David Stern, NHL Commissioner Gary Bettman and FIFA President Blatter.
That will tell you a lot about that list.
Evan Weiner is an award winning author, radio and TV commentator and speaker on the "Business and Politics of Sports. He can be reached at evanjweiner@yahoo.com
TUESDAY, 12 OCTOBER 2010 16:22
http://www.newjerseynewsroom.com/professional/should-chris-christie-be-considered-one-of-the-most-powerful-people-in-sports
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
It is silly season again as a S. I. M. magazine "the only global sport business magazine targeting a dual readership that focuses exclusively on influence and affluence in today's ever-changing world" is polling readership and asking readers to name the most influential people in the world of sports. For the record, this United Kingdom-based publication has Joseph Blatter, the President of FIFA (Soccer) out in front in the voting followed by the President of the International Olympic Committee, Dr. Jacques Rogge and Herbert Hainer, the Chairman and CEO of adidas in the top three slots. The first American on the list and coming in at number four is Heidi Ueberroth, which is a head turner. Ueberroth's father Peter, of course, ran the 1984 Los Angeles Olympic Committee and was the Commissioner of Major League Baseball but his daughter simply doesn't belong as high on this list as President of NBA International. Her boss David Stern as the Commissioner of the National Basketball Association has more power.
Stern is ninth on the list well ahead of NHL Commissioner Gary Bettman who is at 50. NFL Commissioner Roger Goodell, who cannot get his league market attention and traction outside the North American continent unlike Stern, Bettman and Major League Baseball Commissioner Bud Selig, who is 11th. Selig is 32nd, one spot ahead of CBS Sports President Sean McManus, which makes no sense. McManus just gave the NCAA billions of dollars in a partnership with Turner Sports for the NCAA Men's Basketball Tournament. McManus' Turner Sports Partner David Levy is ranked 54th.
For some reason, S. I. M. magazine has San Francisco 49ers owner Denise DeBartolo York in the Top 100. York doesn't run the football team, her 29-year-old son Jed with a rather thin business resume does.
Stern, the former Teaneck resident, understands where the real power in sports is located. Stern's three legged stool formula for success always starts with government. In the United States and in a great many countries, elected officials either directly give money to sports (as in Malaysia) or set up laws that funnel money into sports whether it is through tax breaks, tax incentives, the building of facilities at taxpayers' expense and in America, the federal government changed the cable TV laws which allowed owners like the Yankees George Steinbrenner, the Mets Fred Wilpon and the Dolan-family owned New York Knicks, New York Rangers and New York Liberty to make enormous sums of money from cable TV. The feds also give tax breaks to corporations buying high item sports event seats for "business purposes."
In New Jersey, Chris Christie as Governor is more important to the sports world than the state's highest paid employees, the Rutgers football coach and the Rutgers men's and women's basketball coach. Christie has to decide the fate of the Meadowlands at some point soon along with the horse racing industry in the state. Horse racing is a sport even though none of the top 100 on S. I. M.'s list represent horse racing.
Governors, mayors, state elected officials are major players in sports as they control the purse strings. The Meadowlands complex never would have opened without government support.
When publications and websites put out lists of the Top 100 this, the Top 100 that, they are should always to be taken with a grain of salt. In 2007, BusinessWeek posted a list of the Top 100 Power People in sports with National Football League Commissioner Roger Goodell on the top of the list. BusinessWeek should have asked me to be part of their panel because their list is filled with questionable choices and omissions.
BusinessWeek asked the wrong people — players, agents, sports gadflies, for their opinions and didn't know that there is a formula for sports success — government support, a large local cable TV deal and corporate support, the latter two made possible by government assistance.
It's too bad because that Power 100 list might be far more accurate with real sports business experts than the BusinessWeek 100 that was presented. There really is nothing on the list that indicates that the panelists thought about the UEFA 2008 football tournament. That happens to be the second most watched sports event in the world behind the World Cup.
There is nothing about cricket or boxing on the list. The National Hockey League Commissioner is rated just 27th on the list even though the NHL has lots of eyeballs watching its product in Europe far more eyeballs than the NFL on that continent.
The list also was too United States-centric. The oddity here is that NFL Commissioner Roger Goodell heads a highly successfully United States business that is attempting to catch up with Soccer, Major League Baseball, the National Basketball Association and yes even the downtrodden National Hockey League in the global community. The list places Los Angeles Kings, Los Angeles Galaxy and AEG owner Phillip Anschutz at number 21. Anschutz may be the most powerful man in sports globally. Anschutz's LA Kings opened the 2007-08 National Hockey League season in London in the London arena he owns against the Anaheim Ducks. .
Anschutz controlled most of the franchises in Major League Soccer and brought David Beckham to America. National Basketball Association Commissioner David Stern will tell you that London, England is the most ready city in Europe for an NBA franchise thanks to Anschutz.
Anschutz is also a major force behind the 2012 London Olympics.
The list has International Olympic Committee President Jacques Rogge but absent was the heads of the 2008 Beijing Summer Games, the 2010 Vancouver Winter Games, the 2012 London Summer Games and the 2014 Sochi Winter Games. That is worth noting because US Presidential candidate Mitt Romney launched his political career by running the 2002 Salt Lake City Winter Games. From there he ran for Governor of Massachusetts and may be attempting to get the Republican nomination for President in 2012.
Of course sports can be a great stepping stone. United States President George W. Bush was a two percent owner of the Texas Rangers baseball team and its general managing partner but he was never considered a Top 100 performer in sports during his days as a minority owner of a baseball team.
Texas Rangers and Dallas Stars owner Thomas O. Hicks, a major financial support of George W. Bush's 1994 and 1998 gubernatorial races in Texas and 2000 and 2004 Presidential bids is not on the list. Hicks and Montreal Canadiens owner George N. Gillett, Jr. purchased Liverpool P. C. in the English Premiere League and are building a football stadium in the English city that is more known for being the home of the Beatles John Lennon, Paul Mc Cartney, George Harrison and Ringo Starr to Americans but Liverpool football has a long history. Tampa Bay Buccaneers owner Malcolm Glazier isn't on the BusinessWeek 100 Power list either. Glazier owns the most recognizable sports brand internationally, Manchester United. Manchester United football is a lot better known globally than the Tampa Bay Buccaneers.
Hicks and Gillett recently sold Liverpool to Boston Red Sox owner John Henry.
Two glaring omissions in the 2007 list came from the world of the original cable TV investors, Ted Rogers in Canada and Chuck Dolan in New York . Rogers owns the Toronto Blue Jays and Sportsnet, which carries Blue Jays baseball, five NHL teams telecasts and has the rights to the 2010 Vancouver Winter Olympics and the 2012 London Summer Olympics. Dolan, who helped found HBO, owns Madison Square Garden, the New York Knicks, New York Rangers, New York Liberty, the Madison Square Garden Network (which has Knicks basketball and the three New York City area hockey teams, the Rangers, Islanders and New Jersey Devils hockey as part of its programming along with the Liberty and other sports) and Radio City Music Hall.
Another cable TV guy, Altitude Sports and Entertainment Network-Colorado Avalanche-Denver Nuggets-St. Louis Rams-Colorado Crush-Colorado Rapids and Arsenal FC owner Stan Kroenke is also not highly thought of by BusinessWeek either. Nor is New York Islanders owner Charles Wang who is trying to raise hockey interest in China, nor are the Toronto Maple Leafs Sports and Entertainment Chairman of the Board Larry Tannebaum a player on BusinessWeek's 100. Tannenbaum runs the NHL Maple Leafs, the NBA Raptors, the MLS Toronto FC, two Toronto arenas Leafs TV, Raptors TV and Maple Leaf Square which includes office space and residential living.
Why is Arnold Palmer on this list? Palmer was a great golfer in his day and businessman but if you include Palmer how do you leave off Jack Nicklaus and Greg Norman who are major figures in golf course development?
There is something else that is puzzling on the BusinessWeek 100 when it comes to NFL owners. Jerry Jones, Daniel Snyder, Robert Kraft, Robert Mc Nair and Jeffrey Lurie are the five most powerful NFL owners in that they stuck together and tried to break the NFL's "Leaguethink" philosophy during the last owners squabble over revenue sharing but neither Mc Nair nor Lurie are on the list. Denver owner Pat Bowlen was on the NFL TV committee, a group that helped negotiation the league's huge TV deals with Rupert Murdoch's FOX, General Electric's NBC, Disney's ESPN and Sumner Redstone's CBS along with DirecTV but he isn't on the list.
Where are politicians on this list? Without Anthony Williams, the former Washington mayor, there is no new baseball park in Washington; there is no Major League Baseball in the city period. Russian President Vladimir Putin belongs on this list. Putin lobbied the International Olympic Committee to get the 2014 Winter Olympics for Sochi and Putin was behind that the formation of a state corporation, which will supervise the infrastructural development of Sochi and the construction of the Olympic facilities.
Can BusinessWeek explain Vladislav Tretaik's 2007 exclusion on the list? Tretiak, the President of the Russian Ice Hockey Federation, refused to sign off on the International Ice Hockey Federation-National Hockey League transfer deal that allows young Russian players to play on an NHL in exchange for financial considerations.
Business Week also enlisted ESPN: The Magazine for data. Another mistake. ESPN may own TSN in Canada and ESPN International may carry North American sports around the world but you would never know it from the Power 100 list. Depending on ESPN reporters for business information is risky because ESPN reporters are clueless when it comes to business. What do Shane Battier, Amanda Beard, Bill Cowher, Carl Edwards, Brad Faxson, Martina Hingis, Mark Kreigel, Tommy Lasorda, Lisa Leslie and Mark Spitz know about dealing with politicians to secure taxpayers dollars for the Olympics, World Cup, Super Bowl and other major sports events globally for stadiums and arenas? What do they know about the difficulties in getting tax abatements, payment in lieu of taxes, tax increment financing in the United States, getting dollars from provincial hockey lotteries in Alberta, converting US dollars into pounds, Euros and Yuans?
If BusinessWeek did an honest list of the real power figures about 50 percent of the Top 100 would be gone. BusinessWeek failed to identify the real power behind sports, particularly in the United States. It's a fun list to scan but its little more than that. It is sort of like the Forbes list of what North American sports franchises are worth. Interesting reading but in reality a franchise is worth want someone is willing to pay for the business.
BusinessWeek's 2007 list was filled with glaring holes. In 2009, BusinessWeek had Tiger Woods as its most powerful sports player followed by Goodell and Stern. As always, no government people were on the 2009 BusinessWeek list. The S. I. M. 2010 list will be no better. BusinessWeek had Goodell ranked too high. Goodell is powerful in the US but is pretty feeble internationally compared to MLB Commissioner Bud Selig, NBA boss David Stern, NHL Commissioner Gary Bettman and FIFA President Blatter.
That will tell you a lot about that list.
Evan Weiner is an award winning author, radio and TV commentator and speaker on the "Business and Politics of Sports. He can be reached at evanjweiner@yahoo.com
Monday, August 16, 2010
Do states get a return on sports facilities investments?
Do states get a return on sports facilities investments?
MONDAY, 16 AUGUST 2010 07:30
http://www.newjerseynewsroom.com/professional/do-states-get-a-return-on-sports-facilities-investments
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
POLITICS OF SPORTS BUSINESS
A little less than 34 years after the New York Giants played the Dallas Cowboys in the opening game of new stadium off of Exit 16W of the New Jersey Turnpike in the Meadowlands, the Giants and the New York Jets will play the first football game in the new stadium off of Exit 16W of the New Jersey Turnpike in the Meadowlands. The new stadium has hosted concerts and the international kind of football but this place was built for the Giants and Jets.
The new place has a price tag of an estimated $1.6 billion which was to be split between the Giants and Jets ownership. But the state of New Jersey is on the hook for a lot of cash too, an estimated $300 million in infrastructure costs. The new stadium was built in a decaying sports complex. The race track, which was once the crown jewel of the Meadowlands and counted upon to pump money into the complex is dying and the three decades old arena no longer has either a National Basketball Association or a National Hockey League team. The Xanadu project has not been the panacea that Meadowlands backers had hoped.
New Jersey is saddled with the debt of Giants Stadium 34 years after it was opened and months after it was demolished. New Jersey joins places like King County (the Kingdome in Seattle) and Pittsburgh (Three Rivers Stadium) in paying off the debt of a place that no longer exists except on the ledger sheet.
The New Jersey Sports and Exposition Authority could be as much as $830 million in debt. The Meadowlands Racetrack cannot help pay down the debt anymore. It is no longer 1971, a time when horse racing was still popular and a few years before it began a slow decline.
The New Jersey Sports Authority is in charge of the Meadowlands sports complex. The properties include the Xanadu retail and entertainment project, and also oversees the football stadium and the arena. Monmouth Park Racetrack in Oceanport, and Atlantic City Convention Centers is under the authority's aegis.
The Meadowlands has become unwanted and unloved and a money drain except for the area around the new stadium. New Jersey is not only pumping money into the football facility but is also providing all sorts of tax breaks which has not made elected officials in East Rutherford too happy. The municipality is losing much needed revenue from property in the area.
The question that should be asked in this time when all municipalities are struggling with revenues and balancing budgets, is any municipality getting a return on stadium and arena investments?
On Friday, the State Comptroller of New York, Thomas P. DiNapoli said he didn't know whether New York was getting any kind of return on the state's investments in stadium and arena projects in Buffalo, Rochester and especially the Bronx with the Yankees and Queens with the Mets. New York State also has hundreds of millions of dollars slated to go into the Brooklyn arena project construction that when finished will become the home of the Newark-based New Jersey Nets National Basketball Association franchise.
DiNapoli was quick and seemed very honest when saying that he had no idea if his state was getting any kind of benefit from a minor league baseball park in Buffalo or a hockey arena in Buffalo or a minor league stadium in Rochester. New York is a State spending hundreds of millions of dollars for infrastructure in the Bronx and Queens as is New York City for the Yankees and Mets stadiums.
DiNapoli said New York State has never done a survey and figured out if spending what is probably a billion dollars for sports venues in Albany, Binghamton, the Bronx. Buffalo, Elmira, Queens. Staten Island, Syracuse and other locales in the state was worth the effort.
The state money for facilities was started when Governor Mario Cuomo decided to go along with Major League Baseball's Player Development Contract with Minor League Baseball which required Minor League Baseball franchises to play in facilities that had to meet a standard created by Major League Baseball by 1994. Virtually every minor league team needed some form of upgrade or new stadium and that forced a realigment of minor league baseball teams. The New York Penn League Glens Falls (N. Y.) team relocated for a while in Augusta, New Jersey. Cuomo pitched hard for a Major League expansion team, in Buffalo by building a minor league stadium that could have been expanded into a 40,000-seat stadium.
The MLB/MiLB PDC agreement gave birth to independent baseball leagues and teams in New Jersey in the Atlantic and Northeast League-Northern League which is now the CanAm League.
The stadium/arena building in Buffalo has not been an elixir that has brought the Buffalo economy back to the late 1950s boom years when the city was a major port and there were vibrant steel, flour and shipping industries in the city. Rochester is still reeling from the loss of Eastman Kodak; Syracuse has lost Carrier air conditioners. Binghamton has not replaced IBM and clothing industries yet stadiums and arenas were sold as economic engines.
New York is not alone in the assessment. Has New Jersey benefited from building the Meadowlands Racetrack, Giants Stadium, the Meadowlands Arena, the Trenton arena and other sports venues? The latest proposals to fix the Meadowlands problems of a dying race track and an empty arena include selling the properties to private investors or shutting down racing at the track and make the building a glorified racing studio or Off Track Betting parlor with no horse racing.
The Meadowlands as an OTB parlor may not work all that well without slot machines. The Meadowlands is only about 13 miles away from Yonkers Raceway in New York where there a video slot machines and one of these days, there will be video terminals at Aqueduct Raceway in Queens.
Politicians have spent, spent and spent on sports facilities nationally for six decades and there seems to be no end in sight. The 1986 Tax Act did local municipalities any favors when it came to municipal funding of stadiums. The federal tax code limited cities, villages, towns, counties and states to collect just eight percent of the revenues generated in a sports arena or stadium to go to pay down the debt in the venue.
Since 1986, municipalities have been pitted against one another in attempting to get a team, whether it was an expansion franchise or a team looking to relocate for a better locale. The worst deal that was signed was between Louisiana Governor Mike Foster and New Orleans Saints owner Tom Benson. Louisiana gave Benson $186.5 million in checks as a thank you for keeping the team in New Orleans between 2002 and 2010. The city of San Diego was buying unsold San Diego Chargers tickets as part of a lease arrangement in the late 1990s. This summer, the giveaways kept coming despite belt tightening around the country. Jacksonville politicians gave up the city's right to collect 25 percent of the revenue for naming rights of the city owned football stadium to the National Football League's Jaguars or about $4 million over the next five years.
Some of that four million dollars could have been used to pay municipal workers to keep social and needed services going. Instead Jacksonville Jaguars ownership can spend the $800,000 or so annually on players.
The National Hockey League's Columbus Blue Jackets franchise is crying the financial blues so in the middle of July, the team president Mike Priest came up with a "most viable solution" asking the city to turnover over revenues from a proposed tax on new downtown casinos to the team. Columbus is getting a casino soon. A portion of the construction costs of the new Pittsburgh arena was paid by a new casino in the city.
Indianapolis elected officials decided earlier this summer to give Herb Simon, the Pacers owner, $10 million a year for the next three years along with $3.5 million for a new ribbon ad board inside the Indianapolis arena in an attempt to keep Simon happy and his team playing at the arena. Simon's team has been playing at the city's taxpayer-funded arena since 1999, a building that he uses for free as in no rent and the kicker is that Simon keeps all revenues from his team's home games. The Indianapolis Capital Improvement Board which runs the arena and the one-year-old Colts-NFL stadium has to come up with the money. But there is a problem, the board is broke and had to borrow $27 million from Indiana last year to continue operating. Simon's team will play in Indianapolis for at least three more years.
San Diego officials are planning to spend $500,000 (in cash strapped California where state workers may have their salaries reduced to minimum wage if Governor Arnold Schwarzenegger and the state houses cannot get a budget done) to study the viability of a new football stadium for the Spanos family's NFL Chargers. Hamilton County and Cincinnati are having financial problems and don't have money to pay off the debt load on the NFL's Cincinnati Bengals stadium.
So it goes and that is all the news in the past 60 days or so. In Major League Baseball, the Tampa Bay Rays and the Oakland A's continue to look across the bays, Tampa Bay and the San Francisco Bay, for new homes. Rays ownership would like to play in Tampa while A's owner Lewis Wolff is waiting for Godot or Major League Baseball Commissioner Bud Selig or Dionne Warwick or Burt Bacharach or Hal David to ask him "Do You Know the Way to San Jose?" Wolff would pack up the A's in a moving van and drive south on the I-880 in a New York minute to play in San Jose. Of course there is a question of stadium funding in Tampa and San Jose that needs to be answered.
The Giants ownership almost accepted a renovated Giants Stadium in the mid-2000s, while the Jets ownership planned to move to Manhattan's Westside near the Javits Center between 30th and 34th Street surrounded by 11th and 12th Avenues. Both ownership groups watched other municipalities build stadiums or create incentive packages such as the Foster-Benson agreement in New Orleans. New York Assemblyman Sheldon Silver blew up the Manhattan stadium which forced Jets owner Woody Johnson to look elsewhere and eventually Johnson along with the Giants Mara/Tisch families came up with the New Meadowlands Stadium deal which involved land swaps, tax breaks and infrastructure money for a stadium and other retail development.
Back in 1971, New Jersey officials decided to get in the game. What they didn't realize then is that once you start playing, you better bring your money to the table and be prepared to spend, spend and spend. Was it worth it? In New York the state comptroller DiNapoli couldn't answer the question with an affirmative or negative response since he didn't have the data because no one in the state ever decided to give it a close inspection.
The answer is pretty obvious.
It is no.
Stadium and arena building has not been an economic engine (in Baltimore, the baseball stadium came after the Maryland Science Museum, the Harborplace and the National Aquarium opened. the baseball and football stadiums were an add on and not an anchor for the project). Stadiums have not rebuilt city's downtowns in Cleveland or Phoenix. Governor Chris Christie ought to appoint someone to do that survey that no one has done in New York as to whether a state or a city really gets a return on a sports venue investment like the New Meadowlands Stadium.
Of course politicians may not want to really know that answer.
Evan Weiner is an award winning author, radio-TV commentator and a speaker on "The Politics of Sports Business.' He can be reached at evanjweiner@yahoo.com
MONDAY, 16 AUGUST 2010 07:30
http://www.newjerseynewsroom.com/professional/do-states-get-a-return-on-sports-facilities-investments
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
POLITICS OF SPORTS BUSINESS
A little less than 34 years after the New York Giants played the Dallas Cowboys in the opening game of new stadium off of Exit 16W of the New Jersey Turnpike in the Meadowlands, the Giants and the New York Jets will play the first football game in the new stadium off of Exit 16W of the New Jersey Turnpike in the Meadowlands. The new stadium has hosted concerts and the international kind of football but this place was built for the Giants and Jets.
The new place has a price tag of an estimated $1.6 billion which was to be split between the Giants and Jets ownership. But the state of New Jersey is on the hook for a lot of cash too, an estimated $300 million in infrastructure costs. The new stadium was built in a decaying sports complex. The race track, which was once the crown jewel of the Meadowlands and counted upon to pump money into the complex is dying and the three decades old arena no longer has either a National Basketball Association or a National Hockey League team. The Xanadu project has not been the panacea that Meadowlands backers had hoped.
New Jersey is saddled with the debt of Giants Stadium 34 years after it was opened and months after it was demolished. New Jersey joins places like King County (the Kingdome in Seattle) and Pittsburgh (Three Rivers Stadium) in paying off the debt of a place that no longer exists except on the ledger sheet.
The New Jersey Sports and Exposition Authority could be as much as $830 million in debt. The Meadowlands Racetrack cannot help pay down the debt anymore. It is no longer 1971, a time when horse racing was still popular and a few years before it began a slow decline.
The New Jersey Sports Authority is in charge of the Meadowlands sports complex. The properties include the Xanadu retail and entertainment project, and also oversees the football stadium and the arena. Monmouth Park Racetrack in Oceanport, and Atlantic City Convention Centers is under the authority's aegis.
The Meadowlands has become unwanted and unloved and a money drain except for the area around the new stadium. New Jersey is not only pumping money into the football facility but is also providing all sorts of tax breaks which has not made elected officials in East Rutherford too happy. The municipality is losing much needed revenue from property in the area.
The question that should be asked in this time when all municipalities are struggling with revenues and balancing budgets, is any municipality getting a return on stadium and arena investments?
On Friday, the State Comptroller of New York, Thomas P. DiNapoli said he didn't know whether New York was getting any kind of return on the state's investments in stadium and arena projects in Buffalo, Rochester and especially the Bronx with the Yankees and Queens with the Mets. New York State also has hundreds of millions of dollars slated to go into the Brooklyn arena project construction that when finished will become the home of the Newark-based New Jersey Nets National Basketball Association franchise.
DiNapoli was quick and seemed very honest when saying that he had no idea if his state was getting any kind of benefit from a minor league baseball park in Buffalo or a hockey arena in Buffalo or a minor league stadium in Rochester. New York is a State spending hundreds of millions of dollars for infrastructure in the Bronx and Queens as is New York City for the Yankees and Mets stadiums.
DiNapoli said New York State has never done a survey and figured out if spending what is probably a billion dollars for sports venues in Albany, Binghamton, the Bronx. Buffalo, Elmira, Queens. Staten Island, Syracuse and other locales in the state was worth the effort.
The state money for facilities was started when Governor Mario Cuomo decided to go along with Major League Baseball's Player Development Contract with Minor League Baseball which required Minor League Baseball franchises to play in facilities that had to meet a standard created by Major League Baseball by 1994. Virtually every minor league team needed some form of upgrade or new stadium and that forced a realigment of minor league baseball teams. The New York Penn League Glens Falls (N. Y.) team relocated for a while in Augusta, New Jersey. Cuomo pitched hard for a Major League expansion team, in Buffalo by building a minor league stadium that could have been expanded into a 40,000-seat stadium.
The MLB/MiLB PDC agreement gave birth to independent baseball leagues and teams in New Jersey in the Atlantic and Northeast League-Northern League which is now the CanAm League.
The stadium/arena building in Buffalo has not been an elixir that has brought the Buffalo economy back to the late 1950s boom years when the city was a major port and there were vibrant steel, flour and shipping industries in the city. Rochester is still reeling from the loss of Eastman Kodak; Syracuse has lost Carrier air conditioners. Binghamton has not replaced IBM and clothing industries yet stadiums and arenas were sold as economic engines.
New York is not alone in the assessment. Has New Jersey benefited from building the Meadowlands Racetrack, Giants Stadium, the Meadowlands Arena, the Trenton arena and other sports venues? The latest proposals to fix the Meadowlands problems of a dying race track and an empty arena include selling the properties to private investors or shutting down racing at the track and make the building a glorified racing studio or Off Track Betting parlor with no horse racing.
The Meadowlands as an OTB parlor may not work all that well without slot machines. The Meadowlands is only about 13 miles away from Yonkers Raceway in New York where there a video slot machines and one of these days, there will be video terminals at Aqueduct Raceway in Queens.
Politicians have spent, spent and spent on sports facilities nationally for six decades and there seems to be no end in sight. The 1986 Tax Act did local municipalities any favors when it came to municipal funding of stadiums. The federal tax code limited cities, villages, towns, counties and states to collect just eight percent of the revenues generated in a sports arena or stadium to go to pay down the debt in the venue.
Since 1986, municipalities have been pitted against one another in attempting to get a team, whether it was an expansion franchise or a team looking to relocate for a better locale. The worst deal that was signed was between Louisiana Governor Mike Foster and New Orleans Saints owner Tom Benson. Louisiana gave Benson $186.5 million in checks as a thank you for keeping the team in New Orleans between 2002 and 2010. The city of San Diego was buying unsold San Diego Chargers tickets as part of a lease arrangement in the late 1990s. This summer, the giveaways kept coming despite belt tightening around the country. Jacksonville politicians gave up the city's right to collect 25 percent of the revenue for naming rights of the city owned football stadium to the National Football League's Jaguars or about $4 million over the next five years.
Some of that four million dollars could have been used to pay municipal workers to keep social and needed services going. Instead Jacksonville Jaguars ownership can spend the $800,000 or so annually on players.
The National Hockey League's Columbus Blue Jackets franchise is crying the financial blues so in the middle of July, the team president Mike Priest came up with a "most viable solution" asking the city to turnover over revenues from a proposed tax on new downtown casinos to the team. Columbus is getting a casino soon. A portion of the construction costs of the new Pittsburgh arena was paid by a new casino in the city.
Indianapolis elected officials decided earlier this summer to give Herb Simon, the Pacers owner, $10 million a year for the next three years along with $3.5 million for a new ribbon ad board inside the Indianapolis arena in an attempt to keep Simon happy and his team playing at the arena. Simon's team has been playing at the city's taxpayer-funded arena since 1999, a building that he uses for free as in no rent and the kicker is that Simon keeps all revenues from his team's home games. The Indianapolis Capital Improvement Board which runs the arena and the one-year-old Colts-NFL stadium has to come up with the money. But there is a problem, the board is broke and had to borrow $27 million from Indiana last year to continue operating. Simon's team will play in Indianapolis for at least three more years.
San Diego officials are planning to spend $500,000 (in cash strapped California where state workers may have their salaries reduced to minimum wage if Governor Arnold Schwarzenegger and the state houses cannot get a budget done) to study the viability of a new football stadium for the Spanos family's NFL Chargers. Hamilton County and Cincinnati are having financial problems and don't have money to pay off the debt load on the NFL's Cincinnati Bengals stadium.
So it goes and that is all the news in the past 60 days or so. In Major League Baseball, the Tampa Bay Rays and the Oakland A's continue to look across the bays, Tampa Bay and the San Francisco Bay, for new homes. Rays ownership would like to play in Tampa while A's owner Lewis Wolff is waiting for Godot or Major League Baseball Commissioner Bud Selig or Dionne Warwick or Burt Bacharach or Hal David to ask him "Do You Know the Way to San Jose?" Wolff would pack up the A's in a moving van and drive south on the I-880 in a New York minute to play in San Jose. Of course there is a question of stadium funding in Tampa and San Jose that needs to be answered.
The Giants ownership almost accepted a renovated Giants Stadium in the mid-2000s, while the Jets ownership planned to move to Manhattan's Westside near the Javits Center between 30th and 34th Street surrounded by 11th and 12th Avenues. Both ownership groups watched other municipalities build stadiums or create incentive packages such as the Foster-Benson agreement in New Orleans. New York Assemblyman Sheldon Silver blew up the Manhattan stadium which forced Jets owner Woody Johnson to look elsewhere and eventually Johnson along with the Giants Mara/Tisch families came up with the New Meadowlands Stadium deal which involved land swaps, tax breaks and infrastructure money for a stadium and other retail development.
Back in 1971, New Jersey officials decided to get in the game. What they didn't realize then is that once you start playing, you better bring your money to the table and be prepared to spend, spend and spend. Was it worth it? In New York the state comptroller DiNapoli couldn't answer the question with an affirmative or negative response since he didn't have the data because no one in the state ever decided to give it a close inspection.
The answer is pretty obvious.
It is no.
Stadium and arena building has not been an economic engine (in Baltimore, the baseball stadium came after the Maryland Science Museum, the Harborplace and the National Aquarium opened. the baseball and football stadiums were an add on and not an anchor for the project). Stadiums have not rebuilt city's downtowns in Cleveland or Phoenix. Governor Chris Christie ought to appoint someone to do that survey that no one has done in New York as to whether a state or a city really gets a return on a sports venue investment like the New Meadowlands Stadium.
Of course politicians may not want to really know that answer.
Evan Weiner is an award winning author, radio-TV commentator and a speaker on "The Politics of Sports Business.' He can be reached at evanjweiner@yahoo.com
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