Fans don't matter in sports
MONDAY, 16 MAY 2011 14:43
http://www.newjerseynewsroom.com/professional/fans-dont-matter-in-sports
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
And so the National Football League lockout has become a version of the People's Court. The good guys, the National Football League Players Association, are fighting for workers' rights and are begging "fans" to help them lift the lockout. The owners, the bad guys, want to take away the players ability to make truckloads of money and are threatening their long term health care. Wait, the players have done such a great job in past collective bargaining agreements that former players lose health benefits five years after their playing careers are done and only if a player has three years in the league.
The "People's Court" is now playing in Minneapolis, Minnesota where United States District Judge David Doty is figuring out of the owners owe the players money over how the league managed to negotiate TV contracts to protect that side if in the event of a 2011 lockout. The players are seeking $707 million in damages. The fans will get ZERO if Judge Doty gives the players a monetary award even through a good chunk of that TV money comes from the cable TV subscriber-based ESPN and the satellite pay service DirecTV. In fact a good many people who never watch an NFL game on either ESPN or DirecTV are subsidizing the billions of dollars that ESPN and DirecTV pays the NFL.
The chances are that Judge David Doty will not address relief for subscribers are great. Fans are not a part of the lockout equation. Cable TV subscribers never received a rebate in 1994 and 1995 when Major League Baseball shutdown the 1994 season and the National Hockey League's lockout did not end until January leaving cable TV subscribers without a product from mid-September 1994 through January 1995. An awful lot of teams had local cable TV deals in 1994 and 1995 and subscribers were playing for something that they didn't get. Programming in terms of games which they were charged for. In 1998-99, the National Basketball Association locked out the league players for about 30 games. Not one cable TV subscriber received a penny back for missed games. Interestingly enough the owner of the Golden State Warriors, Chris Cohan, tried to stiff the Oakland Alameda Coliseum Authority and not pay rent at the Oakland Arena during the NBA lockout.
An arbitrator smacked down Cohan and forced him to pay rent for missed games.
No one has ever looked after cable TV or satellite TV subscribers and gotten consumers money back for missed games because of labor actions.
Judge Doty also should bring up the fitness of Rupert Murdoch (FOX owned and operated stations such as Channels 5 and 9 in New York and Channel 29 in Philadelphia), Sumner Redstone (Channel 2 in New York, Channel 3 in Philadelphia) and Comcast-GE's Channel 4 in New York and Channel 10 in Philadelphia for agreeing to deals with the NFL that would underwrite a lockout by supplying a full TV rights fee even if there was a lockout.
The question here that needs to be asked in court is how people who have public licenses to run TV stations nationally (and program networks and syndication arms—FOX is not a network but a syndication company) like Murdoch, Redstone and the NBC owners (General Electric when the contract was signed) could use monies generated by a business that is owned by the public---a television station---to provide a foundation for a lockout/strike war chest?
Television is one of the three essentials of the sports business. The trilogy is government (government builds stadiums, provides tax breaks for the business, creates cable TV rules and allows businesses to write off part of the expense of a luxury box, club seats, tickets and dining in a stadium or arena restaurant), cable TV (in the case of the NBA, NHL and Major League baseball through regional sports channels) and corporate support.
The fans don't count for much except undying loyalty to a team.
Despite all of the fans "concerns" no one is protecting them while the owners and players have an army of high priced lawyers taking care of their interests.
The other "People's Court" venue is in St. Louis where an Eight Court of Appeals panel has been reviewing Judge Susan Nelson's order to lift the lockout.
The battle between the NFL and the former players association has been defined as billionaires versus millions. That is not true at all. It is multi-faceted with elected officials having their hands all over this lockout. Here's why. Politicians pushed stadiums after the 1986 federal tax code revisions to become "big league." Canadian sportswriters have it all wrong when they blame National Hockey League Commissioner Gary Bettman for the league's "sunbelt strategy" and expansion into Atlanta, Nashville, Tampa, Miami, Anaheim and San Jose (although neither Anaheim nor San Jose are in the sunbelt) and franchise relocations into Raleigh, Dallas, Denver and Phoenix. New arenas came online with sweetheart leases and begged to get into the NHL. The same thing happened in the National Basketball Association, the NFL and Major League Baseball.
To those Canadians sportswriters who keep spewing the same nonsense about Bettman’s southern strategy and get it wrong constantly. The NHL decided to expand to 30 teams from 21 in 1990, four years after the revision in the tax code while Bettman was working at the NBA.
Cities bid against one another for teams and when the league would not expand into a city, an existing club owner picked up and moved to a city waiting with open arms. In the NFL, Baltimore, St. Louis, Nashville and Oakland got teams. As more cities built NFL facilities and handed out sweetheart leases, the ones left behind---Minnesota, Oakland and San Diego---could not maximize or match the revenues in their old stadiums. The new places in East Rutherford (for the Jets and Giants), Arlington (the Dallas Cowboys) and Indianapolis (where Jim Irsay hit the lottery in terms of what he has to pay in order to rent the new facility) pushed up league revenues and raised the salary cap for players. It also brought up the salary floor and the less revenue producing stadiums were not printing out the right amount of money for NFL owners. Literally some teams cannot keep up to the Joneses (okay Jerry and Stephen Jones and the Cowboys) and that is why the NFL wants to cut the slice of the revenues the players get from 59 to 48 percent and reduce salaries.
The players, of course, want no part of that seeing how TV monies are enormous and that NFL owners seem to be swimming in money. The players want the owners to show them the books. The owners won't give them the books the players are seeking. The majority of the players don’t make millions and have short careers.
It is all about "Money Now" on both sides of the argument.
Previous incarnations of the National Football Players Association (this version doesn't exist, wink-wink, as the players association officially decertified in March) have ignored the long time health needs of the players and have always stuck to the "Money Now" mantra, a slogan which appeared in 1982. A lot of people knew that playing surfaces in Philadelphia and Houston and other places were not good for the players. The players did nothing about the surfaces of stadiums that were built on the back of taxpayers.
The multi-purpose stadiums built in the 1960s, Houston, St. Louis, Pittsburgh, Philadelphia and other places had an artificial field which was separated from a concrete type surface by a piece of foam or other flimsy padded material. Players knew the fields were not safe yet the people who were watching out after their interests worried about "Money Now."
By the way, where are the municipal leaders who lead the rush to get stadiums built for NFL owners (and other sports)? President Barack Obama has washed his hands of the NFL lockout as has the Chairman of the House Judiciary Committee, Republican Lamar Smith of Texas. Apparently all elected officials want to stay clear of the NFL lockout despite the fact that the NFL clearly has been built by Congress (the Sports Broadcast Act of 1961, the 1966 AFL-NFL merger, the 1984 Cable TV bill that allowed cable operators to bundle channels on a basic tier and forced subscribers to pay for all channels on a basic tier -- the tier that became the home to sports -- whether the subscribers watch sports programming or not and the 1986 tax code revision which changed the way municipally funded stadiums and arenas were financed and placed the burden of paying off the debt on taxpayers) and helped along by local elected officials.
There is no bully pulpit pressure on either side. There is no Congressional pressure. Missing in action on the subject are Governors like Chris Christie, Andrew Cuomo, Tom Corbett, Rick Snyder, Scott Walker, Rick Scott, Jerry Brown, Rick Perry, Bobby Jindal, Jan Brewer. Minnesota's Mark Dayton is busy looking to get New Jersey's Zygi Wilf a stadium for his Minnesota Vikings despite the lockout. Tough guy politicians are beating up on municipal workers and teachers yet have not voiced an opinion on the NFL lockout which may close stadiums in the fall. The same stadiums politicians have claimed are economic engines for the community.
The fans are being hosed and yet they always come back although not necessarily in the stadiums or arenas. Fans have been priced out by NFL owners unless they want to pay a fortune of money for a seat. But fans can always sit in front of a TV and the owners will make money from rights fees and from cable TV, it doesn't matter if no one watches. The ESPNs and the regional sports channels of the world get their money from subscriber fees. That is part of the argument that has been redacted from the Judge David Doty's courtroom. No one, from NFL lawyers, to the people who are representing an organization that allegedly went out of business on March 11, the NFLPA, to the cable TV network executives want to touch. It would just bring unwanted trouble.
NFL beat writers for newspapers aren't going to report on that either and it would not be in the best interests of ESPN SportsCenter, ESPN's Outside the Lines, the fluff ESPN shows that feature sportswriters like Mike Lupica and a gang of know nothings talking about nonsense, or the CBS, NBC, FOX or Disney's ABC news to discuss that aspect of the lockout. The television executives have a big role in this lockout. They are not complaining about their partner's---NFL owners--business strategy. Corporate partners have also been very quiet about the NFL's tactics. The only ones complaining are the bottom feeders---the fans.
The NFL is just the first in the queue. NBA owners and players don't have a collective bargaining agreement after June 30. The Major League Baseball owners and players six-year collective bargaining agreement ends in December and the National Hockey League owners and players deal is done in September 2012.
It's all about money.
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.
Monday, May 16, 2011
Friday, May 6, 2011
The never-ending business of sports
FRIDAY, 06 MAY 2011 08:34
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/the-never-ending-business-of-sports
Two Saturdays ago, my son and I were at the Yonkers, N.Y. Planet Fitness working out. The 55-year-old man and the 25-year-old son were talking sports – but not anything about on-the-field action.
It was about the Mets ownership and Bernie Madoff and the Los Angeles Dodgers owners divorce with Jamie McCourt hiring David Boies (who tried Gore v. Bush in front of the Supreme Court after the 2000 Presidential Election on behalf of Al Gore) in her battle against Frank McCourt and how Boies was now also representing the National Football League in court in a proceeding against the remnants of the decertified National Football League Players Association.
My son is of the opinion that the sports bubble has burst, which it has, but it doesn't appear that way on the surface. Sure, National Football League owners have locked out the players because of finances and National Basketball Association Commissioner David Stern is ready to put the lock on the door on July 1, telling the players they are no longer welcomed until they give back some $800 million in revenue.
But more and more money is being poured into sports in the United States and elsewhere. In Australia, the Australian Football League signed a record four-year, $125 billion (in Australian dollars or about $137 billion in American currency) agreement with three networks including one partially owned by Rupert Murdoch. In the United States, NBC's new bosses, Comcast opened up their checkbook for a 10-year, $2 billion deal with the National Hockey League. The Pac 12 signed a 12-year, $3 billion contract with FOX and ESPN, which will give each member school $21 million annually over the life of the contract.
The bubble has not burst despite patches of empty seats at the new Yankee Stadium and a drop in Major League Baseball attendance early in the season. Television money is making up for the lack of revenue from unsold seats.
As we spoke in the locker room, a man decided to join in on the conversation saying that he agreed with my son. The explained that he had New Jersey Nets season tickets for the past 26 years and he would have to pay triple for his seats when the franchise moves to Brooklyn. He has to pay $385 per ticket for the same type of seats in Brooklyn as he had in the Meadowlands and at Newark. He was undecided about renewing his Nets tickets given that he could get Giants or Jets tickets at the Meadowlands as the wait list for season tickets for both teams has disappeared.
But the man was undecided about whether paying $385 per ticket starting in 2012 was the prudent thing to do.
This is the hold sports has on fans.
The late John McMullen, when he owed the New Jersey Devils, told me that sports is the only business where emotions – not rational thinking – guides the business for owners, executives, players and fans. How else can you explain the cheering in Sacramento when the NBA's Kings owners – the Maloof brothers – decided to stay in the city for another season with the hope someone will find $500 million to build an arena and then give virtually all of the revenues in a mostly taxpayer-funded facility to the Maloofs.
This even though Sacramento’s unemployment rate is around 12 percent and the city is letting go of municipal workers because Sacramento (along with California) is broke.
That happened on Monday. Sacramento kept the team for a year and while that was happening NFL lawyers and attorneys representing the defunct NFLPA were positioning themselves to beg the 8th Circuit Court of Appeals in St. Louis to either allow the NFL lockout to continue or lift it. Also this week, the Department of Justice wants to know more about the Bowl Championship Series in college football.
The DOJ is trying to figure out whether the Bowl Championship Series runs afoul of federal antitrust laws. The DOJ wants to know why there is no college football championship game. The DOJ is not asking any questions about the education of so-called "student-athletes" (a term invented so colleges could shield themselves from workers’ compensation claims) or the limit on how much money the so-called "student-athlete" can make from off-the-field jobs. Or why college programs have antitrust protection and college football teams appearing in bowl games don't pay taxes on the take home revenue from the games.
Sports fans endure a lot of nonsense but they never turn their back on the games. A lot of people have been priced out of MLB, NFL, NBA or NHL games but that's fine. They can watch games on television and buy all the overpriced jersey and hats and other things with team or league logos on it.
Owners and leagues care about the logo, not necessarily players. A logo is worth more than a great player. Sports fans like "our guys" no matter what city "our guys" play in – even though "our guys" are itinerate workers at best who sell themselves to the highest bidder after being "drafted," in an illegal act that is under labor law made legal through a collective bargaining agreement.
In Sacramento, the Kings, are "our guys" and we need "our guys" for some reason. It isn't because "our guys" are economic magnets who will propel the economy (that argument died in the 1990s) and bring new business to the California capital. But "our guys" bring some unexplainable something to any city or area. A small segment of the population feels good because their area is major league.
In Charlotte, after George Shinn moved his NBA Hornets franchise to New Orleans in 2002, one of the reasons that Charlotte Mayor Pat McCoury gave for wanting to build a new arena to replace the then 14-year old Charlotte Coliseum and get the NBA back in town was because Charlotte would get mention on ESPN's SportsCenter. McCoury got a new arena built and a replacement team -- which has been an economic disaster.
In Glendale, Arizona, the city gave the NHL $25 million to cover the financial losses incurred by the league-owned Phoenix Coyotes. The city hopes to get the NHL to sell the team to a Chicago businessman shortly and keep the franchise in Glendale. If the city fails, the team will go to Winnipeg and make Winnipeg a "major-league city" in North America, complete with that feel good feeling that sports is supposed to bring.
Since Monday, Sacramento has kept a basketball franchise and now will turn over every rock possible to find money to satisfy the NBA and the Maloofs that the city (and a six county area stretch out to Lake Tahoe and the California-Nevada border) can act like a major-league city and pay for an arena that will make the Maloofs feel good. Glendale has forked over $25 million to the NHL, the Department of Justice is looking into the Bowl Championship Series, the NFL is playing at a St. Louis courthouse, the International Olympic Committee put the word out to American TV networks that it is time to pay a king's ransom if they want a crack at the Sochi 2014 Winter Olympics and the Rio 2016 Summer Games.
The NFL is hoping someone in the Minneapolis-St. Paul area will build the NFL Vikings a new stadium while Toronto Mayor Rob Ford wants to go after the Jacksonville Jaguars or the heavily taxpayer-subsidized New Orleans Saints and bring one of those teams to his city.
The NBAPA is not happy with the latest NBA owners’ proposal for a new collective bargaining deal as the old one expires on June 30 and David Stern has already bought a padlock. Major League Baseball may have to pick up the tab and pay Los Angeles Dodgers players as the Dodgers ownership – allegedly – has no money to pay the players.
The Wilpon-Katz-Madoff saga continues with the Mets ownership still locked in a battle with Irving Picard, the trustee overseeing the Madoff victims claims, and there is no end in sight although Fred Wilpon and Saul Katz are looking to sell a piece of the franchise to cover debts.
Just another week in fantasyland.
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.
FRIDAY, 06 MAY 2011 08:34
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/the-never-ending-business-of-sports
Two Saturdays ago, my son and I were at the Yonkers, N.Y. Planet Fitness working out. The 55-year-old man and the 25-year-old son were talking sports – but not anything about on-the-field action.
It was about the Mets ownership and Bernie Madoff and the Los Angeles Dodgers owners divorce with Jamie McCourt hiring David Boies (who tried Gore v. Bush in front of the Supreme Court after the 2000 Presidential Election on behalf of Al Gore) in her battle against Frank McCourt and how Boies was now also representing the National Football League in court in a proceeding against the remnants of the decertified National Football League Players Association.
My son is of the opinion that the sports bubble has burst, which it has, but it doesn't appear that way on the surface. Sure, National Football League owners have locked out the players because of finances and National Basketball Association Commissioner David Stern is ready to put the lock on the door on July 1, telling the players they are no longer welcomed until they give back some $800 million in revenue.
But more and more money is being poured into sports in the United States and elsewhere. In Australia, the Australian Football League signed a record four-year, $125 billion (in Australian dollars or about $137 billion in American currency) agreement with three networks including one partially owned by Rupert Murdoch. In the United States, NBC's new bosses, Comcast opened up their checkbook for a 10-year, $2 billion deal with the National Hockey League. The Pac 12 signed a 12-year, $3 billion contract with FOX and ESPN, which will give each member school $21 million annually over the life of the contract.
The bubble has not burst despite patches of empty seats at the new Yankee Stadium and a drop in Major League Baseball attendance early in the season. Television money is making up for the lack of revenue from unsold seats.
As we spoke in the locker room, a man decided to join in on the conversation saying that he agreed with my son. The explained that he had New Jersey Nets season tickets for the past 26 years and he would have to pay triple for his seats when the franchise moves to Brooklyn. He has to pay $385 per ticket for the same type of seats in Brooklyn as he had in the Meadowlands and at Newark. He was undecided about renewing his Nets tickets given that he could get Giants or Jets tickets at the Meadowlands as the wait list for season tickets for both teams has disappeared.
But the man was undecided about whether paying $385 per ticket starting in 2012 was the prudent thing to do.
This is the hold sports has on fans.
The late John McMullen, when he owed the New Jersey Devils, told me that sports is the only business where emotions – not rational thinking – guides the business for owners, executives, players and fans. How else can you explain the cheering in Sacramento when the NBA's Kings owners – the Maloof brothers – decided to stay in the city for another season with the hope someone will find $500 million to build an arena and then give virtually all of the revenues in a mostly taxpayer-funded facility to the Maloofs.
This even though Sacramento’s unemployment rate is around 12 percent and the city is letting go of municipal workers because Sacramento (along with California) is broke.
That happened on Monday. Sacramento kept the team for a year and while that was happening NFL lawyers and attorneys representing the defunct NFLPA were positioning themselves to beg the 8th Circuit Court of Appeals in St. Louis to either allow the NFL lockout to continue or lift it. Also this week, the Department of Justice wants to know more about the Bowl Championship Series in college football.
The DOJ is trying to figure out whether the Bowl Championship Series runs afoul of federal antitrust laws. The DOJ wants to know why there is no college football championship game. The DOJ is not asking any questions about the education of so-called "student-athletes" (a term invented so colleges could shield themselves from workers’ compensation claims) or the limit on how much money the so-called "student-athlete" can make from off-the-field jobs. Or why college programs have antitrust protection and college football teams appearing in bowl games don't pay taxes on the take home revenue from the games.
Sports fans endure a lot of nonsense but they never turn their back on the games. A lot of people have been priced out of MLB, NFL, NBA or NHL games but that's fine. They can watch games on television and buy all the overpriced jersey and hats and other things with team or league logos on it.
Owners and leagues care about the logo, not necessarily players. A logo is worth more than a great player. Sports fans like "our guys" no matter what city "our guys" play in – even though "our guys" are itinerate workers at best who sell themselves to the highest bidder after being "drafted," in an illegal act that is under labor law made legal through a collective bargaining agreement.
In Sacramento, the Kings, are "our guys" and we need "our guys" for some reason. It isn't because "our guys" are economic magnets who will propel the economy (that argument died in the 1990s) and bring new business to the California capital. But "our guys" bring some unexplainable something to any city or area. A small segment of the population feels good because their area is major league.
In Charlotte, after George Shinn moved his NBA Hornets franchise to New Orleans in 2002, one of the reasons that Charlotte Mayor Pat McCoury gave for wanting to build a new arena to replace the then 14-year old Charlotte Coliseum and get the NBA back in town was because Charlotte would get mention on ESPN's SportsCenter. McCoury got a new arena built and a replacement team -- which has been an economic disaster.
In Glendale, Arizona, the city gave the NHL $25 million to cover the financial losses incurred by the league-owned Phoenix Coyotes. The city hopes to get the NHL to sell the team to a Chicago businessman shortly and keep the franchise in Glendale. If the city fails, the team will go to Winnipeg and make Winnipeg a "major-league city" in North America, complete with that feel good feeling that sports is supposed to bring.
Since Monday, Sacramento has kept a basketball franchise and now will turn over every rock possible to find money to satisfy the NBA and the Maloofs that the city (and a six county area stretch out to Lake Tahoe and the California-Nevada border) can act like a major-league city and pay for an arena that will make the Maloofs feel good. Glendale has forked over $25 million to the NHL, the Department of Justice is looking into the Bowl Championship Series, the NFL is playing at a St. Louis courthouse, the International Olympic Committee put the word out to American TV networks that it is time to pay a king's ransom if they want a crack at the Sochi 2014 Winter Olympics and the Rio 2016 Summer Games.
The NFL is hoping someone in the Minneapolis-St. Paul area will build the NFL Vikings a new stadium while Toronto Mayor Rob Ford wants to go after the Jacksonville Jaguars or the heavily taxpayer-subsidized New Orleans Saints and bring one of those teams to his city.
The NBAPA is not happy with the latest NBA owners’ proposal for a new collective bargaining deal as the old one expires on June 30 and David Stern has already bought a padlock. Major League Baseball may have to pick up the tab and pay Los Angeles Dodgers players as the Dodgers ownership – allegedly – has no money to pay the players.
The Wilpon-Katz-Madoff saga continues with the Mets ownership still locked in a battle with Irving Picard, the trustee overseeing the Madoff victims claims, and there is no end in sight although Fred Wilpon and Saul Katz are looking to sell a piece of the franchise to cover debts.
Just another week in fantasyland.
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.
Tuesday, May 3, 2011
Two decades later, sports is out of whack
TUESDAY, 03 MAY 2011 08:26
http://www.newjerseynewsroom.com/professional/two-decades-later-sports-is-out-of-whack
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
About two decades ago, a tall man with an identifiable nasal twang was holding court at Gallagher's Steak House one afternoon as he lifted a martini with a shaking hand to his mouth. The septuagenarian with a bad wig was standing near the slabs of meat that were hanging at the steak house and in a crescendo was complaining about the world of sports. The empty room began filling up as the man droned.
"Sports is out of whack," said the man with the familiar voice in a loudish way as he fumbled to take a sip of his martini. He was disgusted with the industry that he first entered in the 1950s as Willie Mays’ advisor.
Last week was yet another week of vindication for the man who was despised by sportswriters for telling it like it is.
The three -- make that about five -- events of the week of April 25-April 30, had nothing to do with actual games. There was the draft in a locked-out-then-open-for-business-then-locked-out National Football League.
There was Sacramento Mayor Kevin Johnson moving as much earth as he could to try and keep the city's National Basketball Association team in team in town despite the fact that the unemployment level had hit 12 percent in his region. At the same time he was rounding up $10 million in marketing partnership for the owners of the NBA Kings, the Maloof brothers, Johnson was cutting workers at the city's police and fire departments and school administrators were trying to figure out whether they can keep sports going in Sacramento public schools.
East of Sacramento on US 50, Lake Tahoe interests were beginning a plan to bring the 2022 Winter Olympics to the area and were beginning the campaign to try and sell the idea to locals as a job creator and a moneymaker like the 2010 Vancouver Winter Games, which cost Canadians a fortune in taxpayer subsidies.
Just another week in the toy store of life, as sportswriters like to refer to their little world.
The National Football League lockout is being played out in a various courtrooms and has political overtones whether people want to believe it or not. The players scored a big victory when Susan Richard Nelson, a federal judge for the United States District Court for the District of Minnesota, lifted the lockout last Monday.
Judge Nelson was nominated to the bench by President Barack Obama, a Democrat who is believed to be labor friendly. Judge Nelson, in her opinion, wrote that she was convinced of the players’ argument that the lockout was irreparably harming their collective careers.
The irony here is that Judge Nelson fell into line with National Football League Players Association thinking of 1982 -- Money Now -- and her ruling did the retired, discarded players no favors. The present players are the ones who have to help out the disabled former players -- the discarded ones -- who have no health benefits because the NFLPA never got around to getting players long-time health care and have to depend on social security and Medicare for health coverage. Judge Nelson worried about the present day players but nowhere is there a players association worry for retired players who are hurting.
The discarded players are wondering whether one of their own, former Giants defensive lineman George Martin, can lobby the NFLPA or whether they have to have a group to pressure the NFLPA to do something about their financial/health benefits problems.
The owners and players don't plan to get back to the bargaining table until May 16. More time has elapsed for the former players who need real help, not government assistance for their pre-existing medical conditions.
The NFL won Game 2 in this best-of-who-knows playoff series when the 8th U.S. Circuit Court of Appeals granted the league a temporary stay of Judge Nelson's order with two judges -- both Bush appointees -- agreeing with the league, while a Clinton appointee sided with the players. The 8th circuit in St. Louis is thought to be more business friendly.
The two lead negotiators in the talks are very political. NFL Commissioner Roger Goodell is the son of Charles Goodell, a Republican, who represented Western New York in the House of Representatives and replaced the slain Robert F. Kennedy in 1968 in the Senate. Goodell's father-in-law, Sam Skinner, was Chief of Staff for President George H. W. Bush.
NFLPA Executive Director DeMaurice Smith was a member of President Obama's transitional team.
In a sense it is the Democrats versus the Republicans. Labor versus business.
NFL owners have done a poor job of explaining the why behind their proposal of asking the players to take substantially less of the gross, from about 59 percent to 41 percent with 48 percent of that going to player salaries. The players don't believe there is a real financial problem in the NFL after the league got new large TV deals and a bunch of new stadiums with more revenue streams coming online.
The 1986 federal tax code update created the NFL labor dispute. Owners seized on a piece of the changes in the code that had major consequences. Municipalities could build new stadiums for teams and get as little as eight cents back on every dollar generated inside the facility. Depending on the deal an owner cut with the city officials, an owner could garner as much as 92 cents of every dollar.
But it is those taxpayer-funded new stadiums that have caused the problem. With every new stadium that has opened or has been renovated, more revenue does flow into the league -- which raises not only the salary cap ceiling but also hikes the salary cap floor.
The 1986 tax code revision was a double-edged sword. For some owners (like Art Modell) it was a lifesaver, while for others (like those in Minnesota), it has been a disaster.
Franchises playing in old facilities like the Oakland Raiders, the San Diego Chargers, the San Francisco 49ers, the Atlanta Falcons, the St. Louis Rams, the Minnesota Vikings and others cannot keep pace and are struggling to meet the salary cap floor. Additionally some owners have thrown a lot of money into new stadiums and have to pay down the stadium debt.
The 49ers owners, the York family, have not gone full throttle in getting financing for a proposed stadium in Santa Clara as of yet. The league wanted to show the players they need to contribute money for the Santa Clara facility.
Northern California's two football franchises are not alone in the need for a new facility in the region. The ongoing saga of the Sacramento Kings franchise continues apace with Mayor Johnson leading the charge to build a new arena. Johnson is a former NBA player who has some friends in high places over at the Olympic Tower in Manhattan at the NBA offices.
He wants to keep an NBA team in a city with major fiscal problems that a couple of years ago had tent cities for the homeless. Sacramento is a small market that has been a problem for NBA Commissioner David Stern and his owners for about a decade and a half. The city has been unable to get financing for a new arena for Kings basketball for about a decade. The Kings owners, the Maloofs, may see Anaheim as a financial savior.
Johnson has rounded up the business community and has gotten some economic promises but it may be far tougher to put together a wide coalition of the willing in Northern California to put up money for a new arena in very difficult economic times. But that isn't stopping people in the region from kicking the tires to find out if the 2022 Winter Games is a viable business.
The International Olympic Committee might like to go back to Lake Tahoe/Squaw Valley, a Winter Games venue in 1960, but the IOC also likes money and they really like taxpayers to pick up the tab for their two-week sports bazaar, which seems to be more than just a money loser. The IOC Games is a financial drag and California is not a place where taxpayers will be willing to put up big bucks for an event that is still 11 years away. Still the old “it will create jobs” mantra will be trotted out and it will bring attention to Lake Tahoe.
That was the week that was. It's over and sports will let it go for another week. That elderly tall gentleman who is constantly being validated for his simple statement was partly responsible for the success of the National Football League. He might have been bigger than the NFL during his prime years in the 1970s.
The man who two decades ago said “Sports is out of whack” was none other than Howard Cosell, who during the 1970s was one of the three men in the booth announcing Monday Night Football and was both the most popular and most hated man on TV.
You wonder what Howard would have said about the week that was.
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.
TUESDAY, 03 MAY 2011 08:26
http://www.newjerseynewsroom.com/professional/two-decades-later-sports-is-out-of-whack
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
About two decades ago, a tall man with an identifiable nasal twang was holding court at Gallagher's Steak House one afternoon as he lifted a martini with a shaking hand to his mouth. The septuagenarian with a bad wig was standing near the slabs of meat that were hanging at the steak house and in a crescendo was complaining about the world of sports. The empty room began filling up as the man droned.
"Sports is out of whack," said the man with the familiar voice in a loudish way as he fumbled to take a sip of his martini. He was disgusted with the industry that he first entered in the 1950s as Willie Mays’ advisor.
Last week was yet another week of vindication for the man who was despised by sportswriters for telling it like it is.
The three -- make that about five -- events of the week of April 25-April 30, had nothing to do with actual games. There was the draft in a locked-out-then-open-for-business-then-locked-out National Football League.
There was Sacramento Mayor Kevin Johnson moving as much earth as he could to try and keep the city's National Basketball Association team in team in town despite the fact that the unemployment level had hit 12 percent in his region. At the same time he was rounding up $10 million in marketing partnership for the owners of the NBA Kings, the Maloof brothers, Johnson was cutting workers at the city's police and fire departments and school administrators were trying to figure out whether they can keep sports going in Sacramento public schools.
East of Sacramento on US 50, Lake Tahoe interests were beginning a plan to bring the 2022 Winter Olympics to the area and were beginning the campaign to try and sell the idea to locals as a job creator and a moneymaker like the 2010 Vancouver Winter Games, which cost Canadians a fortune in taxpayer subsidies.
Just another week in the toy store of life, as sportswriters like to refer to their little world.
The National Football League lockout is being played out in a various courtrooms and has political overtones whether people want to believe it or not. The players scored a big victory when Susan Richard Nelson, a federal judge for the United States District Court for the District of Minnesota, lifted the lockout last Monday.
Judge Nelson was nominated to the bench by President Barack Obama, a Democrat who is believed to be labor friendly. Judge Nelson, in her opinion, wrote that she was convinced of the players’ argument that the lockout was irreparably harming their collective careers.
The irony here is that Judge Nelson fell into line with National Football League Players Association thinking of 1982 -- Money Now -- and her ruling did the retired, discarded players no favors. The present players are the ones who have to help out the disabled former players -- the discarded ones -- who have no health benefits because the NFLPA never got around to getting players long-time health care and have to depend on social security and Medicare for health coverage. Judge Nelson worried about the present day players but nowhere is there a players association worry for retired players who are hurting.
The discarded players are wondering whether one of their own, former Giants defensive lineman George Martin, can lobby the NFLPA or whether they have to have a group to pressure the NFLPA to do something about their financial/health benefits problems.
The owners and players don't plan to get back to the bargaining table until May 16. More time has elapsed for the former players who need real help, not government assistance for their pre-existing medical conditions.
The NFL won Game 2 in this best-of-who-knows playoff series when the 8th U.S. Circuit Court of Appeals granted the league a temporary stay of Judge Nelson's order with two judges -- both Bush appointees -- agreeing with the league, while a Clinton appointee sided with the players. The 8th circuit in St. Louis is thought to be more business friendly.
The two lead negotiators in the talks are very political. NFL Commissioner Roger Goodell is the son of Charles Goodell, a Republican, who represented Western New York in the House of Representatives and replaced the slain Robert F. Kennedy in 1968 in the Senate. Goodell's father-in-law, Sam Skinner, was Chief of Staff for President George H. W. Bush.
NFLPA Executive Director DeMaurice Smith was a member of President Obama's transitional team.
In a sense it is the Democrats versus the Republicans. Labor versus business.
NFL owners have done a poor job of explaining the why behind their proposal of asking the players to take substantially less of the gross, from about 59 percent to 41 percent with 48 percent of that going to player salaries. The players don't believe there is a real financial problem in the NFL after the league got new large TV deals and a bunch of new stadiums with more revenue streams coming online.
The 1986 federal tax code update created the NFL labor dispute. Owners seized on a piece of the changes in the code that had major consequences. Municipalities could build new stadiums for teams and get as little as eight cents back on every dollar generated inside the facility. Depending on the deal an owner cut with the city officials, an owner could garner as much as 92 cents of every dollar.
But it is those taxpayer-funded new stadiums that have caused the problem. With every new stadium that has opened or has been renovated, more revenue does flow into the league -- which raises not only the salary cap ceiling but also hikes the salary cap floor.
The 1986 tax code revision was a double-edged sword. For some owners (like Art Modell) it was a lifesaver, while for others (like those in Minnesota), it has been a disaster.
Franchises playing in old facilities like the Oakland Raiders, the San Diego Chargers, the San Francisco 49ers, the Atlanta Falcons, the St. Louis Rams, the Minnesota Vikings and others cannot keep pace and are struggling to meet the salary cap floor. Additionally some owners have thrown a lot of money into new stadiums and have to pay down the stadium debt.
The 49ers owners, the York family, have not gone full throttle in getting financing for a proposed stadium in Santa Clara as of yet. The league wanted to show the players they need to contribute money for the Santa Clara facility.
Northern California's two football franchises are not alone in the need for a new facility in the region. The ongoing saga of the Sacramento Kings franchise continues apace with Mayor Johnson leading the charge to build a new arena. Johnson is a former NBA player who has some friends in high places over at the Olympic Tower in Manhattan at the NBA offices.
He wants to keep an NBA team in a city with major fiscal problems that a couple of years ago had tent cities for the homeless. Sacramento is a small market that has been a problem for NBA Commissioner David Stern and his owners for about a decade and a half. The city has been unable to get financing for a new arena for Kings basketball for about a decade. The Kings owners, the Maloofs, may see Anaheim as a financial savior.
Johnson has rounded up the business community and has gotten some economic promises but it may be far tougher to put together a wide coalition of the willing in Northern California to put up money for a new arena in very difficult economic times. But that isn't stopping people in the region from kicking the tires to find out if the 2022 Winter Games is a viable business.
The International Olympic Committee might like to go back to Lake Tahoe/Squaw Valley, a Winter Games venue in 1960, but the IOC also likes money and they really like taxpayers to pick up the tab for their two-week sports bazaar, which seems to be more than just a money loser. The IOC Games is a financial drag and California is not a place where taxpayers will be willing to put up big bucks for an event that is still 11 years away. Still the old “it will create jobs” mantra will be trotted out and it will bring attention to Lake Tahoe.
That was the week that was. It's over and sports will let it go for another week. That elderly tall gentleman who is constantly being validated for his simple statement was partly responsible for the success of the National Football League. He might have been bigger than the NFL during his prime years in the 1970s.
The man who two decades ago said “Sports is out of whack” was none other than Howard Cosell, who during the 1970s was one of the three men in the booth announcing Monday Night Football and was both the most popular and most hated man on TV.
You wonder what Howard would have said about the week that was.
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.
Tuesday, April 26, 2011
Why are NFL owners really locking out the players?
TUESDAY, 26 APRIL 2011 08:10
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/why-are-nfl-owners-really-locking-out-the-players
The National Football League has been pretending that all is well in the land of the 32 franchises and the league's more than 1,600 employees. Teams are conducting cheerleader tryouts. The league released the 2011 pre-season schedule, then came the regular season schedule announcement and the exciting month of NFL football reaches a climax with three days worth of what is essentially a major restraint of trade, the college draft. That exercise, which starts on Thursday, is made legal thanks to the 2006 National Football League-National Football League Players Association collective bargaining agreement which gives the NFL the right to offer college players a chance to join the players ranks through that mechanism even though the college players have no say in the 2006 agreement.
So all is wonderful in the land of the NFL except for one minor detail. NFL owners have locked out the employees who perform on the field — the players and no new negotiations on the collective bargaining agreement are scheduled until May 16 after a flurry of court decisions will be made on the legality of the lockout and whether the owners can use TV monies from 2011 rights from FOX, NBC, CBS, Disney's ESPN and DirecTV for football operations even if there is no product.
The lockout was lifted by a Minnesota judge on Monday afternoon; the NFL will appeal the ruling which means both sides are back to the bargaining table with no rules for business for 2011. It could be that 2010 rules apply which is not necessarily good for either side. Players will have to wait six years, not four for free agency and the owners have no salary cap to control players costs.
A win for the players perhaps, a win for fans perhaps. A loss for the owners perhaps. But one thing is certain, a lot of the money problems, real or imaginary, that NFL owners are having come from municipalities building new stadiums for teams and that taxpayers dollars which went for palatial stadiums in 1990 are longer good because 21st stadiums are so much better.
The owners have contended that their side was forced into a lockout because the players cannot see that they are financially hurting or that the business model no longer works or that the stars aren't in the right place because the moon isn't in the seventh house and Jupiter hasn't aligned with Mars or something else.
There actually is a reason that the owners do have but for some reason the owners side has not spelled out the problem. Simply, every time a new stadium comes on line (in the most recent cycle, it has been Jerry Jones' Cowboys home in Arlington, Texas and the new Meadowlands facility), the stakes for lesser revenue teams become higher because the new stadiums raises league revenues (all those shiny luxury boxes, club seats, and personal seat licenses) because old facilities just don't have the whistles and gadgets the new places have. The salary cap ceiling goes up as well as the salary cap floor and spending to the minimum has caused owners with fewer revenues streams problems. Teams have to pay for players and probably debt service (for either buying a franchise or throwing money at a new stadium — Cowboys, Giants-Jets, New England Patriots to name some of the franchises that have kicked money into new facilities) and have to cut other areas and that may include the number of coaches on a staff, scouts and other front office personal including sales and marketing employees.
That seems to be the "broken economic model" that NFL owners through Commissioner Roger Goodell are talking about. The owners just have not spelled it out publicly. It goes back to owners versus owners and whether big market owners want to share revenues with smaller market owners.
Oakland, Minnesota, St. Louis, Atlanta, Charlotte (Carolina), Buffalo, Jacksonville, San Francisco and San Diego apparently in that leaky boat (old stadiums) with no upward ability to raise revenues. A little more than 15 years ago, Atlanta along with Jacksonville opened new stadiums and St. Louis officials built a domed stadium that satisfied Los Angeles (actually Anaheim) Rams owner Georgia Frontiere who moved her Rams from the second largest TV market (albeit Anaheim) to Missouri.
The present dispute between the owners and players has roots in the 1960s when Irving, Texas built Dallas Cowboys owner Clint Murchinson a stadium complete with luxury boxes which gave Murchinson extra revenue. In the early 1970s, New Jersey decided to become "big-league" and built the Meadowlands which also had luxury boxes which added to the Mara family's revenue stream.
By 1983, NFL Commissioner Pete Rozelle was complaining that the "luxury box" was the bane to his existence. NFL owners wanted new stadiums and started playing the field. Rams owner Carroll Rosenbloom began plotting the move of his franchise to Anaheim in 1978 although he didn't live to see the team play in a rebuilt Anaheim Stadium in 1980. The Minnesota Vikings ownership shopped around but eventually got a new stadium in Minneapolis. Al Davis ended up in Los Angeles in 1982 in a move that also was spurred by the possibility of more TV money. Even Leonard Tose thought about moving his Philadelphia Eagles to Phoenix although that was to get out of millions of dollars of legal gambling debts and get some money back into his coffers. The NFL didn't want to leave Philadelphia because of an owner's financial trouble caused by gambling at Atlantic City casinos.
Perhaps the NFL owners can explain their position which was caused by government subsidized stadiums being opened in select cities by using an example from New Orleans in 1999. In that year Saints owner Tom Benson started looking for either a rebuilt Superdome or a new New Orleans stadium. Benson was miffed when Louisiana officials did not follow the leads of Jacksonville, St. Louis, Baltimore, Nashville, Cleveland and Oakland which put up piles of cash to attract either an expansion or relocation team to their cities. Jacksonville got an expansion team in 1993, St. Louis wooed Frontiere and got married to the Rams in 1995, Davis took his Raiders back to Oakland in 1995. Houston Oilers owner Bud Adams grew tired of the Houston Astrodome (he first suffered Astrodome fatigue in the late 1980s) and took Nashville offer in 1996. Cleveland came up with funding for a new stadium after Art Modell announced his Cleveland Browns franchise would move to Baltimore in 1996. Cleveland came back online in 1999 in the NFL. Also in 1999, Los Angeles and Houston were bidding for an NFL expansion franchise which would start play in 2002. Houston voters approved a referendum and built a new facility which is what Adams wanted all along and didn't get.
Benson played the stadium game because his football revenues were failing as new taxpayers funded stadiums were opening around the country. In spring 1999, Benson began his attempt to renegotiate the team's lease with Louisiana Governor Mike Foster and the Louisiana legislature. The issue then was the naming rights to the Superdome. Benson did not want the structure named after former Governor John McKeithan who pushed to build the stadium in the 1970s. Benson said renaming the Superdome by calling it the McKeithan Dome would cost his team millions of dollars annually.
The legislature wanted to honor the former Governor while Benson wanted the naming rights to the facility so he could sell it to a business who would pay millions for the privilege.
By 1999, the New Orleans economy had slipped as businesses closed offices in the city and New Orleans population was on the decline. One Saints official said that the team once had the fourth best revenue generating lease in the business. However that official added that once St. Louis, Nashville and Baltimore started enticing team owners with virtual rent-free stadiums, the Saints franchise quickly plummeted to near the bottom of the league.
Benson could no longer keep up with the big boys in what was supposed to be a socialist society which is the NFL's business model.
On January 10, 2001, Benson and the Saints filed a "letter of default" alleging that the state and Superdome officials violated the Saints lease at the dome. Benson had other options which he used despite the fact he had a lease until 2017 with the state for his team to play football at the Superdome. Mississippi officials talked about building a multi-sports complex some 45 minutes from downtown along Interstate 10. Benson owned a car dealership in San Antonio, Texas and seemed to have an interest in the then eight-year-old Alamodome which seated 65,000 people. But the Alamodome was already outdated by 2001. San Antonio Mayor Howard Peak admitted that the Alamodome needed "more suites even though we have 65,000 seats, we have to have club seating and other types of seating."
San Antonio had a new building but the wrong type of seating.
Benson did play the game masterfully. He got an agreement with the state that gave him $186.5 million in state handouts between 2002-2010 and his recent agreement came with a Superdome revenue for more bells and whistles and up to $6 million in annual state handouts if certain benchmarks are not hit. Additionally Benson took control of a building near the dome and is renting offices to the state as part of the new Superdome agreement.
New Orleans may be a small and financially challenged market by Governor Bobby Jindal has no problems providing subsidies to a private business — an NFL team.
Benson can compete because of taxpayers dollars. Other owners aren’t as fortunate in getting a block grant from state or city governments although they do well in other government related tax break areas.
St. Louis has an interesting lease, the Rams-St. Louis agreement calls for the team to be in the top 25 percent of stadium generated revenues in the NFL. With newer stadiums opened, the revenues are probably not in the top 25 percent and an owner can opt out of the lease agreement which ends in 2014. Will Missouri follow Louisiana lead and throw money at Rams ownership?
Right now, Santa Clara, California officials are trying to figure out how to transfer money into an account to build a stadium for the York family's San Francisco 49ers. In Los Angeles, competing groups want an NFL team and in one case, AEG's downturn stadium proposal, the company looks to be trying to pull off a land grab.
The owners want to cut players salaries yet have not given a reason why. It seems hard to believe any NFL owner has financial difficulties with a team. In 1993, Jerry Richardson and Wayne Weaver paid about $140 million for expansion teams in Charlotte (Richardson's Panthers) and Jacksonville (Weaver's Jaguars). By the end of the decade, Houston's Robert McNair paid five times as much for an expansion team. TV monies exploded when Rupert Murdoch bid for NFL rights for his weak FOX syndication alliance of TV stations in late 1993. The owners have done a poor job of articulating their side of the story but apparently there is a side. The lesser markets cannot keep up with the big boys who drive the revenues and in a league that has prided itself with a "leaguethink" philosophy where the weakest link (or smallest market) is equal to New York, Dallas, New England, Washington, Houston and Philadelphia this has become a major problem.
The owners are financially hurting, so they say.
But all of these problems will be swept aside for the draft, just the same way the problems disappeared when the league announced the regular season schedule. It is Kafka-like, black is white, up is down, the NFL is operating as if it is business as usual.
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.
TUESDAY, 26 APRIL 2011 08:10
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
http://www.newjerseynewsroom.com/professional/why-are-nfl-owners-really-locking-out-the-players
The National Football League has been pretending that all is well in the land of the 32 franchises and the league's more than 1,600 employees. Teams are conducting cheerleader tryouts. The league released the 2011 pre-season schedule, then came the regular season schedule announcement and the exciting month of NFL football reaches a climax with three days worth of what is essentially a major restraint of trade, the college draft. That exercise, which starts on Thursday, is made legal thanks to the 2006 National Football League-National Football League Players Association collective bargaining agreement which gives the NFL the right to offer college players a chance to join the players ranks through that mechanism even though the college players have no say in the 2006 agreement.
So all is wonderful in the land of the NFL except for one minor detail. NFL owners have locked out the employees who perform on the field — the players and no new negotiations on the collective bargaining agreement are scheduled until May 16 after a flurry of court decisions will be made on the legality of the lockout and whether the owners can use TV monies from 2011 rights from FOX, NBC, CBS, Disney's ESPN and DirecTV for football operations even if there is no product.
The lockout was lifted by a Minnesota judge on Monday afternoon; the NFL will appeal the ruling which means both sides are back to the bargaining table with no rules for business for 2011. It could be that 2010 rules apply which is not necessarily good for either side. Players will have to wait six years, not four for free agency and the owners have no salary cap to control players costs.
A win for the players perhaps, a win for fans perhaps. A loss for the owners perhaps. But one thing is certain, a lot of the money problems, real or imaginary, that NFL owners are having come from municipalities building new stadiums for teams and that taxpayers dollars which went for palatial stadiums in 1990 are longer good because 21st stadiums are so much better.
The owners have contended that their side was forced into a lockout because the players cannot see that they are financially hurting or that the business model no longer works or that the stars aren't in the right place because the moon isn't in the seventh house and Jupiter hasn't aligned with Mars or something else.
There actually is a reason that the owners do have but for some reason the owners side has not spelled out the problem. Simply, every time a new stadium comes on line (in the most recent cycle, it has been Jerry Jones' Cowboys home in Arlington, Texas and the new Meadowlands facility), the stakes for lesser revenue teams become higher because the new stadiums raises league revenues (all those shiny luxury boxes, club seats, and personal seat licenses) because old facilities just don't have the whistles and gadgets the new places have. The salary cap ceiling goes up as well as the salary cap floor and spending to the minimum has caused owners with fewer revenues streams problems. Teams have to pay for players and probably debt service (for either buying a franchise or throwing money at a new stadium — Cowboys, Giants-Jets, New England Patriots to name some of the franchises that have kicked money into new facilities) and have to cut other areas and that may include the number of coaches on a staff, scouts and other front office personal including sales and marketing employees.
That seems to be the "broken economic model" that NFL owners through Commissioner Roger Goodell are talking about. The owners just have not spelled it out publicly. It goes back to owners versus owners and whether big market owners want to share revenues with smaller market owners.
Oakland, Minnesota, St. Louis, Atlanta, Charlotte (Carolina), Buffalo, Jacksonville, San Francisco and San Diego apparently in that leaky boat (old stadiums) with no upward ability to raise revenues. A little more than 15 years ago, Atlanta along with Jacksonville opened new stadiums and St. Louis officials built a domed stadium that satisfied Los Angeles (actually Anaheim) Rams owner Georgia Frontiere who moved her Rams from the second largest TV market (albeit Anaheim) to Missouri.
The present dispute between the owners and players has roots in the 1960s when Irving, Texas built Dallas Cowboys owner Clint Murchinson a stadium complete with luxury boxes which gave Murchinson extra revenue. In the early 1970s, New Jersey decided to become "big-league" and built the Meadowlands which also had luxury boxes which added to the Mara family's revenue stream.
By 1983, NFL Commissioner Pete Rozelle was complaining that the "luxury box" was the bane to his existence. NFL owners wanted new stadiums and started playing the field. Rams owner Carroll Rosenbloom began plotting the move of his franchise to Anaheim in 1978 although he didn't live to see the team play in a rebuilt Anaheim Stadium in 1980. The Minnesota Vikings ownership shopped around but eventually got a new stadium in Minneapolis. Al Davis ended up in Los Angeles in 1982 in a move that also was spurred by the possibility of more TV money. Even Leonard Tose thought about moving his Philadelphia Eagles to Phoenix although that was to get out of millions of dollars of legal gambling debts and get some money back into his coffers. The NFL didn't want to leave Philadelphia because of an owner's financial trouble caused by gambling at Atlantic City casinos.
Perhaps the NFL owners can explain their position which was caused by government subsidized stadiums being opened in select cities by using an example from New Orleans in 1999. In that year Saints owner Tom Benson started looking for either a rebuilt Superdome or a new New Orleans stadium. Benson was miffed when Louisiana officials did not follow the leads of Jacksonville, St. Louis, Baltimore, Nashville, Cleveland and Oakland which put up piles of cash to attract either an expansion or relocation team to their cities. Jacksonville got an expansion team in 1993, St. Louis wooed Frontiere and got married to the Rams in 1995, Davis took his Raiders back to Oakland in 1995. Houston Oilers owner Bud Adams grew tired of the Houston Astrodome (he first suffered Astrodome fatigue in the late 1980s) and took Nashville offer in 1996. Cleveland came up with funding for a new stadium after Art Modell announced his Cleveland Browns franchise would move to Baltimore in 1996. Cleveland came back online in 1999 in the NFL. Also in 1999, Los Angeles and Houston were bidding for an NFL expansion franchise which would start play in 2002. Houston voters approved a referendum and built a new facility which is what Adams wanted all along and didn't get.
Benson played the stadium game because his football revenues were failing as new taxpayers funded stadiums were opening around the country. In spring 1999, Benson began his attempt to renegotiate the team's lease with Louisiana Governor Mike Foster and the Louisiana legislature. The issue then was the naming rights to the Superdome. Benson did not want the structure named after former Governor John McKeithan who pushed to build the stadium in the 1970s. Benson said renaming the Superdome by calling it the McKeithan Dome would cost his team millions of dollars annually.
The legislature wanted to honor the former Governor while Benson wanted the naming rights to the facility so he could sell it to a business who would pay millions for the privilege.
By 1999, the New Orleans economy had slipped as businesses closed offices in the city and New Orleans population was on the decline. One Saints official said that the team once had the fourth best revenue generating lease in the business. However that official added that once St. Louis, Nashville and Baltimore started enticing team owners with virtual rent-free stadiums, the Saints franchise quickly plummeted to near the bottom of the league.
Benson could no longer keep up with the big boys in what was supposed to be a socialist society which is the NFL's business model.
On January 10, 2001, Benson and the Saints filed a "letter of default" alleging that the state and Superdome officials violated the Saints lease at the dome. Benson had other options which he used despite the fact he had a lease until 2017 with the state for his team to play football at the Superdome. Mississippi officials talked about building a multi-sports complex some 45 minutes from downtown along Interstate 10. Benson owned a car dealership in San Antonio, Texas and seemed to have an interest in the then eight-year-old Alamodome which seated 65,000 people. But the Alamodome was already outdated by 2001. San Antonio Mayor Howard Peak admitted that the Alamodome needed "more suites even though we have 65,000 seats, we have to have club seating and other types of seating."
San Antonio had a new building but the wrong type of seating.
Benson did play the game masterfully. He got an agreement with the state that gave him $186.5 million in state handouts between 2002-2010 and his recent agreement came with a Superdome revenue for more bells and whistles and up to $6 million in annual state handouts if certain benchmarks are not hit. Additionally Benson took control of a building near the dome and is renting offices to the state as part of the new Superdome agreement.
New Orleans may be a small and financially challenged market by Governor Bobby Jindal has no problems providing subsidies to a private business — an NFL team.
Benson can compete because of taxpayers dollars. Other owners aren’t as fortunate in getting a block grant from state or city governments although they do well in other government related tax break areas.
St. Louis has an interesting lease, the Rams-St. Louis agreement calls for the team to be in the top 25 percent of stadium generated revenues in the NFL. With newer stadiums opened, the revenues are probably not in the top 25 percent and an owner can opt out of the lease agreement which ends in 2014. Will Missouri follow Louisiana lead and throw money at Rams ownership?
Right now, Santa Clara, California officials are trying to figure out how to transfer money into an account to build a stadium for the York family's San Francisco 49ers. In Los Angeles, competing groups want an NFL team and in one case, AEG's downturn stadium proposal, the company looks to be trying to pull off a land grab.
The owners want to cut players salaries yet have not given a reason why. It seems hard to believe any NFL owner has financial difficulties with a team. In 1993, Jerry Richardson and Wayne Weaver paid about $140 million for expansion teams in Charlotte (Richardson's Panthers) and Jacksonville (Weaver's Jaguars). By the end of the decade, Houston's Robert McNair paid five times as much for an expansion team. TV monies exploded when Rupert Murdoch bid for NFL rights for his weak FOX syndication alliance of TV stations in late 1993. The owners have done a poor job of articulating their side of the story but apparently there is a side. The lesser markets cannot keep up with the big boys who drive the revenues and in a league that has prided itself with a "leaguethink" philosophy where the weakest link (or smallest market) is equal to New York, Dallas, New England, Washington, Houston and Philadelphia this has become a major problem.
The owners are financially hurting, so they say.
But all of these problems will be swept aside for the draft, just the same way the problems disappeared when the league announced the regular season schedule. It is Kafka-like, black is white, up is down, the NFL is operating as if it is business as usual.
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, 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, April 14, 2011
Fiesta Bowl scandal could put BCS game in play
THURSDAY, 14 APRIL 2011 11:26
http://www.newjerseynewsroom.com/professional/fiesta-bowl-scandal-could-put-bcs-game-in-play
New Jersey would be viable location for one of college football’s biggest games
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
College football media partners, marketing partners, boosters, and politicians should be circling the date of April 28 for a meeting near the site of the Sugar Bowl in New Orleans. That's the day when a subcommittee of the National Collegiate Athletic Association reviews the license that the group has given to Fiesta Bowl operators to run the annual game in Glendale, Arizona.
The Fiesta Bowl is part of the Bowl Championship Series with Glendale hosting a national championship game every four years. The Fiesta Bowl, South Florida's Orange Bowl, Pasadena, California's Rose Bowl and New Orleans' Sugar Bowl are college football's big events and are worth a lot of money. Each bowl is a fiefdom and one of the reasons that there isn't a college football championship is that none of the powers to be behind those particularly bowls wants to cede one iota of importance that those bowls have.
Until the NCAA gets all of the fiefdoms to agree that a college football championship game that makes (financial) sense, the system will not change. That is unless Congress decides to remove the NCAA’s tax exemption status and the part of the Sports Broadcast Act of 1961 that applies to the group.
Neither action seems to be very likely.
The sacking of Fiesta Bowl chief executive John Junker along with two other top officials could open a Pandora’s Box of problems for Glendale, the Fiesta Bowl and the (college football's) Bowl Championship Series for Arizona politicians who allegedly accepted gifts from Junker.
Arizona elected officials have to abide by state laws, which included an “entertainment ban” that prohibits, state employees and elected officials from accepting tickets or "admission to any sporting or cultural event" for free.
The Fiesta Bowl organizers have been summoned to New Orleans to meet with NCAA members and will be given a day in the NCAA courtroom to explain away a 276 page report by a Fiesta Bowl Special Committee that provided unique details of "excessive" spending on employees and the relationship between Arizona politicians and bowl officials. Apparently Arizona elected officials had no problems accepting gifts from Fiesta Bowl organizers which is a violation of Arizona laws if the gifts bestowed on the elected officials were more than $500.
The Fiesta Bowl organizers seem to have thought the best way to keep their fiefdom going was to have Arizona’s elected officials at their side.
Some Arizona lawmakers are "amending" their campaign financing reports to reflect that they suddenly remembered they took money from Fiesta Bowl officials or got tickets for the game or went on Fiesta Bowl related trips or received campaign contributions from Fiesta Bowl employees.
The Fiesta Bowl officials apparently knew which palms to grease. Among the politicians that got some benefits from the Bowl hierarchy include Arizona Governor Jan Brewer, Senators John McCain and John Kyl, Congressmen J. D. Hayworth and Shadegg. McCain's Political Action Committee — Straight Talk Express — also got some money from bowl officials. Additionally, there were Fiesta Bowl employees who gave $46,000 to 23 political candidates who were reimbursed for their campaign contributions by the Fiesta Bowl.
Interestingly enough, The Goldwater Institute is not involved in any complaining against the Fiesta Bowl which seems to be a contradictory stance for the conservative fiscal watchdog group. The Goldwater Institute doesn't want Glendale to sell bonds to help complete the sale of the NHL's Phoenix Coyotes to a Chicago businessman, Matthew Hulsizer, nor do they seem to care that things didn't work out attendance wise for the Los Angeles Dodgers and the Chicago White Sox during the 2011 Cactus League Spring Training part of the baseball season at the new Glendale baseball park.
Glendale had an open checkbook for the NFL's Arizona Cardinals owner Bill Bidwill (a new stadium), former Phoenix Coyotes owner Richard Burke (a new arena), Jerry Reinsdorf's White Sox, the McCourt family's Dodgers (a new spring training facility) and the city is attempting to work with Jerry Colangelo to build the headquarters for USA Basketball in Glendale.
The Goldwater Institute is nowhere to be found on this issue. Meanwhile, another watchdog group — the not for profit Citizens for Responsibility and Ethics of Washington, D. C. — has filed a complaint with the Federal Election Commission and asking the agency to investigate whether any laws were broken in the Fiesta Bowl's campaign contribution acts.
It will be interesting to see how the NCAA will put together the investigation. Will the NCAA consult cable TV partner, the Walt Disney Company, on this matter? Does the NCAA really want to go after the Fiesta Bowl and pull the license or will they slap someone on the wrist and say don't do that again knowing that every bowl committee does what is best for them not the "game" of college football?
A question that should be directed to NCAA delegates deciding the weighty matter of bowl licensing is this. Do they want a championship game in Glendale or can they line the coffers with another organizer in a bigger market?
Will the NCAA revoke the license and then put the fourth game of the Bowl Championship Series up for bid? If the Super Bowl can be played in East Rutherford in February in 2014, why not a Bowl Championship Series game at the Meadowlands in January? Think of the money that could pour into the BCS if New Jersey, Jerry Jones and his Cowboys Stadium in Arlington, Texas or Dan Snyder's and Washington Redskins stadium in Maryland outside of the District were involved in a bidding war for that spot in the Bowl Championship Series?
The NCAA more than likely should not be trusted with a real investigation of a bowl and corruption. After all this is a body that created the term "student-athlete" to get out of paying disability benefits in the 1950s after a Colorado football player could not work because of an injury suffered on the football field. This is an organization that pockets billions in television money yet limits players' off field, off court, off ice, off diamond earnings to be $2,000. This is an organization that receives a tax exemption from Congress and colleges whose football teams appear at say the Fiesta Bowl don't have to pay taxes on their take from the game.
School presidents and chancellors shop around looking for conferences that will further exposure (big money TV contacts).
This is an organization that has somehow convinced people and politicians that "student-athletes" should be lucky to get a scholarship and feel fortunate that they can play for good old whatever university and entertain stadium or arena audiences, boosters, advertisers, politicians and have their talents used by coaches who earn millions annually from schools, marketing partners and TV partners.
In New Jersey, the state's highest paid employees are the Rutgers football coach and the men's and women's basketball coaches. Go around the country and you will find that college football or basketball coaches are the highest paid employee in a good number of states.
College sports is nothing more than a business.
Congress holds hearings on college sports every so often and generally these hearings go something like this. Congressmen genuflect in front of NCAA honchos then complain about the unfairness of the Bowl Championship Series in that only BCS members have a real shot at a title and that outsiders are just that outsiders with a limited chance of ever winning a NCAA football championship.
Never once do these hearings ever produce anything worthwhile for the "student-athlete" who has to prove to a coach annually that he (or she) is worth the scholarship and if a marginal player gets hurt and is unable to return to sports, that athlete loses their scholarship. The myth of the student-athlete is just that.
A myth.
In Arizona, politicians are scrambling for cover. In New Orleans, Fiesta Bowl officials might be scrambling for the cover of Bourbon Street if indeed the NCAA pulls the bowl game license. The NCAA doesn't seem to be too concerned ever with "moral" problems. The group has pulled two bowl licenses, the Seattle Bowl and the Silicon Valley Football Classic, because the games were poorly attended.
The NCAA is acting because people were caught with their hands in the cookie jar and dispensing money to court politicians. The whole college sports industry needs a review but as long as there is money to be made and college presidents and chancellors looking for the yellow brick road for that pot of sports gold, nothing will change. The Marx Brothers lampooned college football in 1932 in “Horse Feathers,” a remarkable movie that hit on corruption in college football and nothing has changed in 79 years since that Bert Kalmar, Harry Ruby, S. J. Perelman, and Will B. Johnstone came up with a screenplay that had Professor Quincy Adams Wagstaff (Groucho Marx) recruiting players for Huxley for their big game against Darwin. The plot and the jokes of "amateurism" in 1931-32 could easily be used today.
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, 14 APRIL 2011 11:26
http://www.newjerseynewsroom.com/professional/fiesta-bowl-scandal-could-put-bcs-game-in-play
New Jersey would be viable location for one of college football’s biggest games
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
College football media partners, marketing partners, boosters, and politicians should be circling the date of April 28 for a meeting near the site of the Sugar Bowl in New Orleans. That's the day when a subcommittee of the National Collegiate Athletic Association reviews the license that the group has given to Fiesta Bowl operators to run the annual game in Glendale, Arizona.
The Fiesta Bowl is part of the Bowl Championship Series with Glendale hosting a national championship game every four years. The Fiesta Bowl, South Florida's Orange Bowl, Pasadena, California's Rose Bowl and New Orleans' Sugar Bowl are college football's big events and are worth a lot of money. Each bowl is a fiefdom and one of the reasons that there isn't a college football championship is that none of the powers to be behind those particularly bowls wants to cede one iota of importance that those bowls have.
Until the NCAA gets all of the fiefdoms to agree that a college football championship game that makes (financial) sense, the system will not change. That is unless Congress decides to remove the NCAA’s tax exemption status and the part of the Sports Broadcast Act of 1961 that applies to the group.
Neither action seems to be very likely.
The sacking of Fiesta Bowl chief executive John Junker along with two other top officials could open a Pandora’s Box of problems for Glendale, the Fiesta Bowl and the (college football's) Bowl Championship Series for Arizona politicians who allegedly accepted gifts from Junker.
Arizona elected officials have to abide by state laws, which included an “entertainment ban” that prohibits, state employees and elected officials from accepting tickets or "admission to any sporting or cultural event" for free.
The Fiesta Bowl organizers have been summoned to New Orleans to meet with NCAA members and will be given a day in the NCAA courtroom to explain away a 276 page report by a Fiesta Bowl Special Committee that provided unique details of "excessive" spending on employees and the relationship between Arizona politicians and bowl officials. Apparently Arizona elected officials had no problems accepting gifts from Fiesta Bowl organizers which is a violation of Arizona laws if the gifts bestowed on the elected officials were more than $500.
The Fiesta Bowl organizers seem to have thought the best way to keep their fiefdom going was to have Arizona’s elected officials at their side.
Some Arizona lawmakers are "amending" their campaign financing reports to reflect that they suddenly remembered they took money from Fiesta Bowl officials or got tickets for the game or went on Fiesta Bowl related trips or received campaign contributions from Fiesta Bowl employees.
The Fiesta Bowl officials apparently knew which palms to grease. Among the politicians that got some benefits from the Bowl hierarchy include Arizona Governor Jan Brewer, Senators John McCain and John Kyl, Congressmen J. D. Hayworth and Shadegg. McCain's Political Action Committee — Straight Talk Express — also got some money from bowl officials. Additionally, there were Fiesta Bowl employees who gave $46,000 to 23 political candidates who were reimbursed for their campaign contributions by the Fiesta Bowl.
Interestingly enough, The Goldwater Institute is not involved in any complaining against the Fiesta Bowl which seems to be a contradictory stance for the conservative fiscal watchdog group. The Goldwater Institute doesn't want Glendale to sell bonds to help complete the sale of the NHL's Phoenix Coyotes to a Chicago businessman, Matthew Hulsizer, nor do they seem to care that things didn't work out attendance wise for the Los Angeles Dodgers and the Chicago White Sox during the 2011 Cactus League Spring Training part of the baseball season at the new Glendale baseball park.
Glendale had an open checkbook for the NFL's Arizona Cardinals owner Bill Bidwill (a new stadium), former Phoenix Coyotes owner Richard Burke (a new arena), Jerry Reinsdorf's White Sox, the McCourt family's Dodgers (a new spring training facility) and the city is attempting to work with Jerry Colangelo to build the headquarters for USA Basketball in Glendale.
The Goldwater Institute is nowhere to be found on this issue. Meanwhile, another watchdog group — the not for profit Citizens for Responsibility and Ethics of Washington, D. C. — has filed a complaint with the Federal Election Commission and asking the agency to investigate whether any laws were broken in the Fiesta Bowl's campaign contribution acts.
It will be interesting to see how the NCAA will put together the investigation. Will the NCAA consult cable TV partner, the Walt Disney Company, on this matter? Does the NCAA really want to go after the Fiesta Bowl and pull the license or will they slap someone on the wrist and say don't do that again knowing that every bowl committee does what is best for them not the "game" of college football?
A question that should be directed to NCAA delegates deciding the weighty matter of bowl licensing is this. Do they want a championship game in Glendale or can they line the coffers with another organizer in a bigger market?
Will the NCAA revoke the license and then put the fourth game of the Bowl Championship Series up for bid? If the Super Bowl can be played in East Rutherford in February in 2014, why not a Bowl Championship Series game at the Meadowlands in January? Think of the money that could pour into the BCS if New Jersey, Jerry Jones and his Cowboys Stadium in Arlington, Texas or Dan Snyder's and Washington Redskins stadium in Maryland outside of the District were involved in a bidding war for that spot in the Bowl Championship Series?
The NCAA more than likely should not be trusted with a real investigation of a bowl and corruption. After all this is a body that created the term "student-athlete" to get out of paying disability benefits in the 1950s after a Colorado football player could not work because of an injury suffered on the football field. This is an organization that pockets billions in television money yet limits players' off field, off court, off ice, off diamond earnings to be $2,000. This is an organization that receives a tax exemption from Congress and colleges whose football teams appear at say the Fiesta Bowl don't have to pay taxes on their take from the game.
School presidents and chancellors shop around looking for conferences that will further exposure (big money TV contacts).
This is an organization that has somehow convinced people and politicians that "student-athletes" should be lucky to get a scholarship and feel fortunate that they can play for good old whatever university and entertain stadium or arena audiences, boosters, advertisers, politicians and have their talents used by coaches who earn millions annually from schools, marketing partners and TV partners.
In New Jersey, the state's highest paid employees are the Rutgers football coach and the men's and women's basketball coaches. Go around the country and you will find that college football or basketball coaches are the highest paid employee in a good number of states.
College sports is nothing more than a business.
Congress holds hearings on college sports every so often and generally these hearings go something like this. Congressmen genuflect in front of NCAA honchos then complain about the unfairness of the Bowl Championship Series in that only BCS members have a real shot at a title and that outsiders are just that outsiders with a limited chance of ever winning a NCAA football championship.
Never once do these hearings ever produce anything worthwhile for the "student-athlete" who has to prove to a coach annually that he (or she) is worth the scholarship and if a marginal player gets hurt and is unable to return to sports, that athlete loses their scholarship. The myth of the student-athlete is just that.
A myth.
In Arizona, politicians are scrambling for cover. In New Orleans, Fiesta Bowl officials might be scrambling for the cover of Bourbon Street if indeed the NCAA pulls the bowl game license. The NCAA doesn't seem to be too concerned ever with "moral" problems. The group has pulled two bowl licenses, the Seattle Bowl and the Silicon Valley Football Classic, because the games were poorly attended.
The NCAA is acting because people were caught with their hands in the cookie jar and dispensing money to court politicians. The whole college sports industry needs a review but as long as there is money to be made and college presidents and chancellors looking for the yellow brick road for that pot of sports gold, nothing will change. The Marx Brothers lampooned college football in 1932 in “Horse Feathers,” a remarkable movie that hit on corruption in college football and nothing has changed in 79 years since that Bert Kalmar, Harry Ruby, S. J. Perelman, and Will B. Johnstone came up with a screenplay that had Professor Quincy Adams Wagstaff (Groucho Marx) recruiting players for Huxley for their big game against Darwin. The plot and the jokes of "amateurism" in 1931-32 could easily be used today.
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.
Wednesday, April 6, 2011
Could New Jersey get the Tampa Bay Rays?
WEDNESDAY, 06 APRIL 2011 11:03
http://www.newjerseynewsroom.com/professional/could-new-jersey-get-the-tampa-bay-rays
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
The drumbeats have been sounding about the need for a new Tampa Bay Rays baseball park for a while. The Rays franchise ownership group wants a new stadium because the American League East team needs extra revenues to keep up with the New York Yankees and the Boston Red Sox in the division and sign players to long term big money contracts.
With no new Tampa or St. Petersburg stadium plan on the horizon, there has been a suggestion that Major League Baseball will eliminate the Rays and possibly the Oakland A's (a franchise that has wandered across the country from Philadelphia to Kansas City to Oakland and never has found financial success). The contraction threat seems to coincide with the ending of the 2006 Collective Bargaining Agreement, which will happen in December. There is nothing like using contraction as a negotiating tactic to gain some leverage over the players although there is a little problem baseball will need to overcome.
The Rays iron clad stadium lease.
The Rays ownership is saddled with a lease that former owner Vince Naimoli signed prior to the team's first season in 1998. It was a 30-year-deal with St. Petersburg and the contract ends in 2027. Major League Baseball Commissioner Peter Uerberroth told St. Petersburg and Florida officials in the late 1980s don't bother building the stadium as MLB was not interested in St. Petersburg. MLB expanded to St. Petersburg and Phoenix in 1995
The latest salvo about the Rays dire financial situation comes from a writer and a magazine that Major League Baseball has constantly discredited over the years. Mike Ozanian in his Forbes Sportsmoney blog of April 4 contends there will be no baseball or Tampa Bay Rays in 2015 although it isn't clear from Ozanian's blog just how that is going to happen. MLB has always been rather condescending towards Forbes' annual market evaluation of Major League Baseball teams.
There is one thing for certain. Major League Baseball needs an even amount of franchises so cutting ties with Stu Sternberg and his Rays without knocking out another franchise is not going to happen. Only two MLB franchises need new stadiums, Tampa Bay and Oakland. It appears San Jose would like the opportunity to build a baseball park for Lew Wolff's A's but a funny thing has happened on the way to San Jose.
The former New York Giants baseball franchise, whose owner Horace Stoneham fled to San Francisco in 1957, seems to think they have control over the San Jose territory even though voters twice turned down referendums for Giants baseball parks in the area. Major League Baseball Commissioner Bud Selig appointed a committee two years ago to study the San Jose situation. That committee is still fact finder although it seems an engine search on the Internet would produce whatever results Selig wants inside of 12 seconds. San Jose is farther away from San Francisco than Oakland (San Francisco and Oakland are connected by a bridge and the Bay Area Rapid Transit) and San Jose is part of the Bay Area media market.
The only reason San Jose cannot go after Wolff is the 1922 Supreme Court of the United States decision that gave the National and American Leagues of baseball an antitrust exemption because the court ruled baseball was a game and not an interstate business. The exemption gave baseball owners the right to do whatever they wanted to do. Most of the exemption has eroded over the years but the owners still control territories, which is why San Jose and New Jersey have been shut out of Major League Baseball.
There is no proposal at the present time to attract a Major League team to New Jersey although when then Baseball Commissioner Peter Ueberroth opened the door to possible expansion in 1987, New Jersey had a presentation ready. New Jersey also tried to attract George Steinbrenner's interest and get him to move the Yankees across the Hudson in the 1990s.
Wolff has failed in getting a "stadium-village" for his A's and real estate in Oakland and in Fremont, which is about 20 miles south on the I-880 of the team's present home at the Oakland Coliseum. In St. Petersburg, Tampa Rays ownership, which includes Managing General Partner Stuart Sternberg of Rye, New York, is looking for a new stadium in either St. Petersburg or Tampa.
There was a rumor, which was just a rumor, that the Rays ownership thought about moving the Rays to Connecticut.
Wolff can get out of his lease within a few years in Oakland as he signed a short-term agreement to keep his team at the Coliseum through 2013.
The San Francisco Giants ownership has the San Jose/Santa Clara County territory which is more than 40 miles south of the Giants China Basin ballpark. The Oakland Coliseum is considerably closer to San Francisco and is accessible by the Bay Area Rapid Transit and is not far down the I-880 from the Bay Area Bridge. San Jose became Giants territory in the 1990s when the team attempted to get a stadium built in the South Bay's most populous city. Neither San Jose nor Santa Clara voters had any interest in paying for a Giants stadium and turned down ballpark referendums. Despite the no votes, MLB has not changed the Giants' territorial claim.
Major League Baseball does not live by the same antitrust laws as normal businesses. Wolff is blocked from even thinking about crossing the Santa Clara County line because that would be crossing his baseball brothers. Wolff tried to get as close as he could to San Jose and Santa Clara and not upsetting the Giants ownership by trying to relocate to Fremont.
Oakland does not have the corporate crowd that fills the Giants China Basin stadium. San Jose is the Silicone Valley and somehow both MLB and the Giants are convinced that money headed up the 101 Freeway to San Francisco will shift to a San Jose baseball team, which would have a crippling affect on the Giants. The San Francisco baseball team is one hour away from San Jose; Oakland is across the Bay and is accessible by mass transit.
Wolff doesn't seem to want to sue Major League Baseball and challenge the antitrust exemption. Wolff shares the Oakland Coliseum with the NFL's Raiders and Raiders owner Al Davis did sue the NFL in the 1980s when the league interfered with his negotiations with the Coliseum for a lease extension and then tried to block the Raiders' move to Los Angeles.
Davis won.
In 1984, San Diego Clippers owner Donald Sterling thumbed his nose at NBA officials and moved his franchise to Los Angeles without league consent. He was fined $100 million for the move. Sterling sued the league. The two parties settled. Sterling stayed in LA and paid the NBA a $6 million fine.
That settlement may come back to bite Sterling later this month should the NBA Sacramento Kings owners, the Maloofs brothers, pick up and move into the Los Angeles market in Anaheim and share the area with the Los Angeles Lakers and Sterling's Clippers. The Maloofs, using the Sterling precedent, could end up paying no compensation for entering the LA market.
Major League Baseball did not move a team between 1971 and 2004. The Washington Senators left the nation's capital for Arlington, Texas in 1972. A number of attempted franchise shifts failed for various reasons including San Diego going to Washington in 1974, the Giants to Toronto in 1976, Oakland to Denver in 1979. A number of teams looked at moving to Tampa including the Giants, Seattle Mariners, George W. Bush's Texas Rangers and the Minnesota Twins. Minnesota ownership nearly sold the team to Greensboro, North Carolina interests in the late 1990s if a stadium became available in that North Carolina city. Voters turned down a Greensboro stadium in 1998.
It is not easy to move a team to open markets like Tampa was before 1995, like Denver before 1991, like Washington between 1972 and 2004. What chance does San Jose have? What chance does New Jersey or Connecticut have?
New Jersey may have the right stuff for a Major League Baseball team. In 2000, Major League Baseball had big names like Paul Volcker, the former Chairman of the Federal Reserve, Richard C. Levin, the Yale University President, the former Senate Majority Leader George Mitchell and media personality George Will, a former political operative and college professor who won a Pulitzer Prize for commentary in 1977, analyze baseball's financial condition.
The "Blue Ribbon Panel" on baseball economics left the door open for franchise relocation to places like northern New Jersey and Washington despite the presence of teams in the vicinity. New Jersey or Connecticut have a major revenue stream that is currently untapped. Cablevision's Madison Square Garden network has little summer programming of note that would draw in potential viewers since the Yankees formed the YES Network and the Mets, along with Time Warner and Comcast, started SNY. There probably is more than $60 million on the table waiting for a third New York City area team.
New York City is still the financial capital of the United States. The city once had three baseball teams — the Yankees, the Giants and the Brooklyn Dodgers. Walter O'Malley took his Dodgers to Los Angeles in 1957 although he kicked the tires and his Dodgers played seven games at Roosevelt Stadium in Jersey City, N.J. in 1956 and 1957. O'Malley used Jersey City as leverage in his bid to get New York to spring for a new stadium for his Dodgers. Giants owner Horace Stoneham seemed more determined to move his team from upper Manhattan out of the New York area than O'Malley ... with Minneapolis one of his choices.
With the population, the corporate wealth and television monies available, New York City or northern New Jersey would be ripe for a failing franchise. But New Jersey is blocked (as Connecticut would be) because both the Yankees and Mets would nix any move into their territories and the Philadelphia Phillies ownership would probably object to a third New York area team if it was placed in New Jersey. (The Philadelphia Flyers got a million dollars from John McMullen when he bought the Colorado Rockies NHL team and move his newly acquired team into the Meadowlands in 1982).
In Oakland, Wolff has Comcast's TV money, but he lacks corporate support. San Jose wants to build a stadium and Oakland is back in the game.
There are three essentials to running a successful franchise whether it is in Major League Baseball, the National Hockey League or the National Basketball Association or even Major League Soccer. Government support is an absolute necessity in terms of building a facility. Government can build the place with taxpayers' dollars or give substantial tax breaks and incentives (as the Giants/Jets stadium entity is receiving at the Meadowlands) to owners to build their own plants. The federal government regulates Cable TV where billions are made by sports franchises and separates the Yankees, Mets, Angels, Red Sox, Phillies and Mariners from the rest of baseball and corporate support. Corporates can take 50 cents off the dollar in buying luxury boxes, club seats for business purposes.
Wolff already shares the market with the Giants in the Bay Area and cannot get his foot in the door in San Jose. If Sternberg was looking at the New York City area, he would get a door slammed in his face. Sternberg is not seeking a New York area facility and is concentrating on getting a place built in Tampa. The lease in St. Pete has a long way to go but as the late John McMullen once said, a contract is just a piece of paper.
Major League Baseball moved the financially troubled and ownerless Montreal Expos into Washington after the 2004 season once MLB secured a commitment from the city that it would build a state-of-the-art baseball facility. Remember McMullen's comment.
A contract is just a piece of paper.
Washington is about 40 miles from Baltimore and was a part of the Peter Angelos' Baltimore Orioles territory. MLB worked out a deal with Angelos, which gave him a regional cable TV network, the Mid Atlantic Sports Network, as a partial payment for the Washington team which "invaded" his territory. That agreement might work in Wolff's favor and could be used by someone in New Jersey if that someone decided that New Jersey and Major League Baseball are perfect together.
The owners of the Seattle SuperSonics took their NBA team to Oklahoma City with two years left on their contract in Seattle to use the publicly financed and refinanced facility for their basketball team. Clayton Bennett reached a financial agreement with Seattle and left. But Bennett had the NBA Commissioner David Stern's blessing. Bruce Ratner (when he still owned the majority of the New Jersey Nets) took the Nets from the Meadowlands to Newark for two years with New Jersey's approval along with Stern.
New Jersey had the "right stuff" for Major League Baseball in 2000 according to Volcker, Levin, Mitchell and Will. The state could not go after the Montreal Expos franchise when it was up for sale in 2002, 2003 and 2004 because of the antitrust exemption.
There are 30 Major League Baseball teams. New York City has two teams, Los Angeles has two teams, Chicago has two teams and San Francisco-Oakland has two teams. It is hard to imagine California Senators Diane Feinstein and Barbara Boxer sitting by idly if MLB pulls the plug on the Oakland A’s. The same would probably hold true in Florida after all it was Florida Senator Connie Mack III (the grandson of the Philadelphia A’s manager-owner Connie Mack) that threatened MLB’s antitrust exemption (along with Colorado’s Tim Wirth) in the late 1980s and 1990s and forced MLB to consider expanding to either Miami or the Tampa Bay market or both.
Congress is pretty good at saber rattling and persuasion in the sports industry.
There have been some rumors that have appeared that MLB would mollify Sternberg by giving him a crack at owning the Mets after the Wilpon's fall from grace and that Wolff could take over the Los Angeles Dodgers once the McCourt divorce becomes final. Both seem scenarios seem farfetched. Contracting means the elimination of 50 players which will not please the Major League Baseball Players Association particularly when there are alternatives available — San Jose and maybe New Jersey or Tampa-St. Petersburg — but there is more than just the contraction of two teams. There are minor league cities who will lose clubs and that is sure to draw the attention of Congress. The last thing Selig and company want to do is go to Congress and risk losing the remaining portions of the 1922 SCOTUS decision because that could impact business operations.
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.
WEDNESDAY, 06 APRIL 2011 11:03
http://www.newjerseynewsroom.com/professional/could-new-jersey-get-the-tampa-bay-rays
BY EVAN WEINER
NEWJERSEYNEWSROOM.COM
THE BUSINESS AND POLITICS OF SPORTS
The drumbeats have been sounding about the need for a new Tampa Bay Rays baseball park for a while. The Rays franchise ownership group wants a new stadium because the American League East team needs extra revenues to keep up with the New York Yankees and the Boston Red Sox in the division and sign players to long term big money contracts.
With no new Tampa or St. Petersburg stadium plan on the horizon, there has been a suggestion that Major League Baseball will eliminate the Rays and possibly the Oakland A's (a franchise that has wandered across the country from Philadelphia to Kansas City to Oakland and never has found financial success). The contraction threat seems to coincide with the ending of the 2006 Collective Bargaining Agreement, which will happen in December. There is nothing like using contraction as a negotiating tactic to gain some leverage over the players although there is a little problem baseball will need to overcome.
The Rays iron clad stadium lease.
The Rays ownership is saddled with a lease that former owner Vince Naimoli signed prior to the team's first season in 1998. It was a 30-year-deal with St. Petersburg and the contract ends in 2027. Major League Baseball Commissioner Peter Uerberroth told St. Petersburg and Florida officials in the late 1980s don't bother building the stadium as MLB was not interested in St. Petersburg. MLB expanded to St. Petersburg and Phoenix in 1995
The latest salvo about the Rays dire financial situation comes from a writer and a magazine that Major League Baseball has constantly discredited over the years. Mike Ozanian in his Forbes Sportsmoney blog of April 4 contends there will be no baseball or Tampa Bay Rays in 2015 although it isn't clear from Ozanian's blog just how that is going to happen. MLB has always been rather condescending towards Forbes' annual market evaluation of Major League Baseball teams.
There is one thing for certain. Major League Baseball needs an even amount of franchises so cutting ties with Stu Sternberg and his Rays without knocking out another franchise is not going to happen. Only two MLB franchises need new stadiums, Tampa Bay and Oakland. It appears San Jose would like the opportunity to build a baseball park for Lew Wolff's A's but a funny thing has happened on the way to San Jose.
The former New York Giants baseball franchise, whose owner Horace Stoneham fled to San Francisco in 1957, seems to think they have control over the San Jose territory even though voters twice turned down referendums for Giants baseball parks in the area. Major League Baseball Commissioner Bud Selig appointed a committee two years ago to study the San Jose situation. That committee is still fact finder although it seems an engine search on the Internet would produce whatever results Selig wants inside of 12 seconds. San Jose is farther away from San Francisco than Oakland (San Francisco and Oakland are connected by a bridge and the Bay Area Rapid Transit) and San Jose is part of the Bay Area media market.
The only reason San Jose cannot go after Wolff is the 1922 Supreme Court of the United States decision that gave the National and American Leagues of baseball an antitrust exemption because the court ruled baseball was a game and not an interstate business. The exemption gave baseball owners the right to do whatever they wanted to do. Most of the exemption has eroded over the years but the owners still control territories, which is why San Jose and New Jersey have been shut out of Major League Baseball.
There is no proposal at the present time to attract a Major League team to New Jersey although when then Baseball Commissioner Peter Ueberroth opened the door to possible expansion in 1987, New Jersey had a presentation ready. New Jersey also tried to attract George Steinbrenner's interest and get him to move the Yankees across the Hudson in the 1990s.
Wolff has failed in getting a "stadium-village" for his A's and real estate in Oakland and in Fremont, which is about 20 miles south on the I-880 of the team's present home at the Oakland Coliseum. In St. Petersburg, Tampa Rays ownership, which includes Managing General Partner Stuart Sternberg of Rye, New York, is looking for a new stadium in either St. Petersburg or Tampa.
There was a rumor, which was just a rumor, that the Rays ownership thought about moving the Rays to Connecticut.
Wolff can get out of his lease within a few years in Oakland as he signed a short-term agreement to keep his team at the Coliseum through 2013.
The San Francisco Giants ownership has the San Jose/Santa Clara County territory which is more than 40 miles south of the Giants China Basin ballpark. The Oakland Coliseum is considerably closer to San Francisco and is accessible by the Bay Area Rapid Transit and is not far down the I-880 from the Bay Area Bridge. San Jose became Giants territory in the 1990s when the team attempted to get a stadium built in the South Bay's most populous city. Neither San Jose nor Santa Clara voters had any interest in paying for a Giants stadium and turned down ballpark referendums. Despite the no votes, MLB has not changed the Giants' territorial claim.
Major League Baseball does not live by the same antitrust laws as normal businesses. Wolff is blocked from even thinking about crossing the Santa Clara County line because that would be crossing his baseball brothers. Wolff tried to get as close as he could to San Jose and Santa Clara and not upsetting the Giants ownership by trying to relocate to Fremont.
Oakland does not have the corporate crowd that fills the Giants China Basin stadium. San Jose is the Silicone Valley and somehow both MLB and the Giants are convinced that money headed up the 101 Freeway to San Francisco will shift to a San Jose baseball team, which would have a crippling affect on the Giants. The San Francisco baseball team is one hour away from San Jose; Oakland is across the Bay and is accessible by mass transit.
Wolff doesn't seem to want to sue Major League Baseball and challenge the antitrust exemption. Wolff shares the Oakland Coliseum with the NFL's Raiders and Raiders owner Al Davis did sue the NFL in the 1980s when the league interfered with his negotiations with the Coliseum for a lease extension and then tried to block the Raiders' move to Los Angeles.
Davis won.
In 1984, San Diego Clippers owner Donald Sterling thumbed his nose at NBA officials and moved his franchise to Los Angeles without league consent. He was fined $100 million for the move. Sterling sued the league. The two parties settled. Sterling stayed in LA and paid the NBA a $6 million fine.
That settlement may come back to bite Sterling later this month should the NBA Sacramento Kings owners, the Maloofs brothers, pick up and move into the Los Angeles market in Anaheim and share the area with the Los Angeles Lakers and Sterling's Clippers. The Maloofs, using the Sterling precedent, could end up paying no compensation for entering the LA market.
Major League Baseball did not move a team between 1971 and 2004. The Washington Senators left the nation's capital for Arlington, Texas in 1972. A number of attempted franchise shifts failed for various reasons including San Diego going to Washington in 1974, the Giants to Toronto in 1976, Oakland to Denver in 1979. A number of teams looked at moving to Tampa including the Giants, Seattle Mariners, George W. Bush's Texas Rangers and the Minnesota Twins. Minnesota ownership nearly sold the team to Greensboro, North Carolina interests in the late 1990s if a stadium became available in that North Carolina city. Voters turned down a Greensboro stadium in 1998.
It is not easy to move a team to open markets like Tampa was before 1995, like Denver before 1991, like Washington between 1972 and 2004. What chance does San Jose have? What chance does New Jersey or Connecticut have?
New Jersey may have the right stuff for a Major League Baseball team. In 2000, Major League Baseball had big names like Paul Volcker, the former Chairman of the Federal Reserve, Richard C. Levin, the Yale University President, the former Senate Majority Leader George Mitchell and media personality George Will, a former political operative and college professor who won a Pulitzer Prize for commentary in 1977, analyze baseball's financial condition.
The "Blue Ribbon Panel" on baseball economics left the door open for franchise relocation to places like northern New Jersey and Washington despite the presence of teams in the vicinity. New Jersey or Connecticut have a major revenue stream that is currently untapped. Cablevision's Madison Square Garden network has little summer programming of note that would draw in potential viewers since the Yankees formed the YES Network and the Mets, along with Time Warner and Comcast, started SNY. There probably is more than $60 million on the table waiting for a third New York City area team.
New York City is still the financial capital of the United States. The city once had three baseball teams — the Yankees, the Giants and the Brooklyn Dodgers. Walter O'Malley took his Dodgers to Los Angeles in 1957 although he kicked the tires and his Dodgers played seven games at Roosevelt Stadium in Jersey City, N.J. in 1956 and 1957. O'Malley used Jersey City as leverage in his bid to get New York to spring for a new stadium for his Dodgers. Giants owner Horace Stoneham seemed more determined to move his team from upper Manhattan out of the New York area than O'Malley ... with Minneapolis one of his choices.
With the population, the corporate wealth and television monies available, New York City or northern New Jersey would be ripe for a failing franchise. But New Jersey is blocked (as Connecticut would be) because both the Yankees and Mets would nix any move into their territories and the Philadelphia Phillies ownership would probably object to a third New York area team if it was placed in New Jersey. (The Philadelphia Flyers got a million dollars from John McMullen when he bought the Colorado Rockies NHL team and move his newly acquired team into the Meadowlands in 1982).
In Oakland, Wolff has Comcast's TV money, but he lacks corporate support. San Jose wants to build a stadium and Oakland is back in the game.
There are three essentials to running a successful franchise whether it is in Major League Baseball, the National Hockey League or the National Basketball Association or even Major League Soccer. Government support is an absolute necessity in terms of building a facility. Government can build the place with taxpayers' dollars or give substantial tax breaks and incentives (as the Giants/Jets stadium entity is receiving at the Meadowlands) to owners to build their own plants. The federal government regulates Cable TV where billions are made by sports franchises and separates the Yankees, Mets, Angels, Red Sox, Phillies and Mariners from the rest of baseball and corporate support. Corporates can take 50 cents off the dollar in buying luxury boxes, club seats for business purposes.
Wolff already shares the market with the Giants in the Bay Area and cannot get his foot in the door in San Jose. If Sternberg was looking at the New York City area, he would get a door slammed in his face. Sternberg is not seeking a New York area facility and is concentrating on getting a place built in Tampa. The lease in St. Pete has a long way to go but as the late John McMullen once said, a contract is just a piece of paper.
Major League Baseball moved the financially troubled and ownerless Montreal Expos into Washington after the 2004 season once MLB secured a commitment from the city that it would build a state-of-the-art baseball facility. Remember McMullen's comment.
A contract is just a piece of paper.
Washington is about 40 miles from Baltimore and was a part of the Peter Angelos' Baltimore Orioles territory. MLB worked out a deal with Angelos, which gave him a regional cable TV network, the Mid Atlantic Sports Network, as a partial payment for the Washington team which "invaded" his territory. That agreement might work in Wolff's favor and could be used by someone in New Jersey if that someone decided that New Jersey and Major League Baseball are perfect together.
The owners of the Seattle SuperSonics took their NBA team to Oklahoma City with two years left on their contract in Seattle to use the publicly financed and refinanced facility for their basketball team. Clayton Bennett reached a financial agreement with Seattle and left. But Bennett had the NBA Commissioner David Stern's blessing. Bruce Ratner (when he still owned the majority of the New Jersey Nets) took the Nets from the Meadowlands to Newark for two years with New Jersey's approval along with Stern.
New Jersey had the "right stuff" for Major League Baseball in 2000 according to Volcker, Levin, Mitchell and Will. The state could not go after the Montreal Expos franchise when it was up for sale in 2002, 2003 and 2004 because of the antitrust exemption.
There are 30 Major League Baseball teams. New York City has two teams, Los Angeles has two teams, Chicago has two teams and San Francisco-Oakland has two teams. It is hard to imagine California Senators Diane Feinstein and Barbara Boxer sitting by idly if MLB pulls the plug on the Oakland A’s. The same would probably hold true in Florida after all it was Florida Senator Connie Mack III (the grandson of the Philadelphia A’s manager-owner Connie Mack) that threatened MLB’s antitrust exemption (along with Colorado’s Tim Wirth) in the late 1980s and 1990s and forced MLB to consider expanding to either Miami or the Tampa Bay market or both.
Congress is pretty good at saber rattling and persuasion in the sports industry.
There have been some rumors that have appeared that MLB would mollify Sternberg by giving him a crack at owning the Mets after the Wilpon's fall from grace and that Wolff could take over the Los Angeles Dodgers once the McCourt divorce becomes final. Both seem scenarios seem farfetched. Contracting means the elimination of 50 players which will not please the Major League Baseball Players Association particularly when there are alternatives available — San Jose and maybe New Jersey or Tampa-St. Petersburg — but there is more than just the contraction of two teams. There are minor league cities who will lose clubs and that is sure to draw the attention of Congress. The last thing Selig and company want to do is go to Congress and risk losing the remaining portions of the 1922 SCOTUS decision because that could impact business operations.
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.
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