Pro Sports Teams and Urban Extortion.....paging Starman

The subject of this article is the Preds but it applies to any city who's emptying the coffers and fleecing taxpayers for the local pro sports team. One of the better articles on the subject.

http://www.nashvillescene.com/Stories/News/2007/10/11/Pred_Herring/index.shtml#


In a letter to fans last May announcing his plans to sell the team, Leipold wrote, “Success on the ice has not translated to success for me as business owner.” It’s hard to imagine a more disingenuous assessment. Thanks to the generosity of Nashville’s taxpayers, who coughed up a big chunk of the NHL’s original $80 million expansion fee, Leipold got in the game for around $55 million, and Predators spokesman Gerry Helper says losses for the franchise since inception total $70 million. By these numbers, the $193 million sale price will burden Leipold with the humiliation of a roughly $68 million capital gain.

and......

The bottom line here is that a group of well-heeled private individuals are spending $193 million on an asset that was first purchased a decade ago for $55 million, was valued by Forbes last year at $134 million, and has little to no chance of ever finding long-term operating success as a local franchise. The buying and selling of sports teams is a shell game in which excitement-hungry investors overpay for assets, extract fiscal welfare from municipal governments, and then later take profits when new overeager investors step in to overvalue the asset even further. One of these days an up-and-coming city with a lucid grip on reality and an optimistic future is going to pass on the Kool-Aid and simply refuse to play.

BTW, I saw this on James Mirtle's Hockey blog--best hockey blogger around.

 

I saw that the Nashville AFL team has folded. Did the Preds own that team too?

 

And it's not like hockey is a power player in this game. Football, basketball and baseball might get away with this in Tennessee.

Leipold does need a reality check.

 

And just think. He was offered $230 million from Mr. Research in Motion.

 

I love my BlackBerry.

 

http://ap.google.com/article/ALeqM5imOMeW4AuFvKSZrzWlWrlAOHKzFQD8S6LIKG2

http://www.forbes.com/markets/feeds/afx/2007/10/10/afx4206874.html


Of course, prohibiting the use of tax-free bonds isn't enough. What needs to be done is that the use of public money in any definition for the construction of professional sports facilities needs to be utterly outlawed.

 

The cities and states should be allowed to use money to build them only if they retain ownership and the teams rent the facilites.

 

OK, the use of public money for any private business should be outlawed? Why single out professional sports facilities, why not professional music theaters, museums, subsidized housing owned by for profit landlords?

Come on, some things are worth it and somethings aren't. No one put a literal gun to the head of governments and forced them to buy a stadium. They did it of their own free will. Pass a law to stop law makers from being foolish? That's the responsibility of the citizens in a democratic republic. No one forced Tom Hicks to sign Alex Rodriguez, it was a dumbass move, but it was legal and above board.

 

And, of course, a clause in the lease that the team can never, ever leave.

 

Not public extortion, but ...

My little bro has Yankee season tickets, at least for one more year. Not great seats, upper deck somewhere. He's heard there might be a $5K PSL for a similar seat in the new stadium in 2009.

He'd hate to give up his seats, and makes som emoney by selling some games he can't attend, but with one kid at Western New England and another soon to be at collge the seats might have to go.

 

And Tom Hicks probably wouldn't have had the money to shell out on Alex Rodriguez, had not 2/3 of the $191 million construction costs of The Ballpark been paid by public tax revenues.

(Actually he probably would have. But it always makes spending money easier if the taxpayers have just dumped $135 million in your pocket.)

 

Or 30-40 years, minimum.