How the NFL Robs You (and Me)

I love the NFL. Even though it robs me.

It robs me of my time.

And it robs me of my money.

It even robs me of my self-esteem. (Well, indirectly, thanks to my chronically suboptimal performance in fantasy football.)

Now, your sympathy level may not be particularly high, as I’m clearly making the choice to let this happen.

But what if I told you that even if I completely disengaged from this nonsense, the robbery would continue?

Because it will.

Just take a look at the city next door.

 

Buffalo

The humble city of Buffalo, located in the western reaches of New York State, where the Northeast gives way to the Midwest and the United States gives way to Canada, has been the proud home of an NFL franchise—the Buffalo Bills—since 1970. (The Bills were founded in 1960 as a member of the American Football League (AFL) and joined the NFL upon the merger of the two leagues.)

Known for an immensely passionate fan base—one that can be counted on through rough times, both for the city and the team—the Bills have become the gold standard for all that can be good about the NFL. Debauchery, yes, but also community—in other words, a fan base whose love for its team is not unrequited, matched with equal fervor by a franchise eager to acknowledge its special bond with the devotion that surrounds it.

Buffalo is the second smallest metropolitan area in the NFL, and given a half century of economic malaise, is not known for producing corporate powerhouses. This absence of corporate excess translates into an average ticket price that is among the lowest in the NFL, one that leaves a community’s cherished possession accessible to its most ardent (if not necessarily prosperous) fans.

There’s only one problem with this veritable fairy tale—the NFL doesn’t care. It does, however, care about the following:

• One of the 32 teams in its league (which generates more annual revenue than any other sports league in the world) is stuck in the 49th-largest metropolitan area in the US.
• This microscopic metropolitan area and its anemic economy/dirt-cheap tickets are a drag on the league. Forty percent of gross ticket sales, after all, goes to the NFL. Not to mention that the Bills end up being one of the league’s least valuable franchises.

 

The resultant angst leaves a couple possible solutions:

• The franchise leaves Buffalo for greener pastures.
• The not-so-lush pastures of Buffalo are forced to become greener.

 

If the latter scenario is chosen, that can mean only one thing—a sparkling new stadium, one that offers novel methods of revenue generation and warrants higher ticket prices, translating into both a more valuable franchise and, of course, a wealthier league.

 

The Funding

Flashy new stadiums do not materialize on their own—a little something called funding is required to make it all work. One might imagine that NFL owners—whose wealth often hangs out in the range of many billion dollars—would be quite capable of securing such funding. And it turns out that they are.

In a rather unique take on the public-private partnership, NFL owners team up with local governmental entities to share costs.

Here’s a look at the deal that the Bills struck with Erie County (in which are located Buffalo and the relevant suburb of Orchard Park) and the state of New York to bring a new stadium to fruition around 2026.

• The stadium will cost about $1.4 billion.
• It will be built adjacent to the old stadium in the uninspiring suburb mentioned above.
• Of the $1.4 billion, $850 million will be provided via public funding—$600 million from New York and an additional $250 million from Erie County.
• Of the $600 million from the state, $418 million will come from casino revenue in western New York.
• New York will also provide several million dollars per year for maintenance as well as a capital improvement fund.

 

All told, the amount of public money being provided for the stadium—which the state will own and the Bills (and related entities) will lease and operate—is the most ever for any similar stadium project. The constant threat of relocation from piddling Buffalo to a larger market undoubtedly contributed to the successful extortion.

Additional revenue generated by private operation of the new stadium will not be shared, a standard that explains why stadium deals are not felt to spur economic activity in any meaningful way. What would spur such activity is if the public money were used instead to cut property taxes in one of the most heavily taxed states in the country. Oh, and don’t expect the state to be able to use the open-air stadium for things like concerts during the endless winters in Buffalo.

(In all fairness, a reasonable counterargument exists to the above, outlined in an article in The Buffalo News. To paraphrase, the $600 million provided by New York amounts to about 0.27 percent of the state’s annual budget, meaning we care far more about sports than their economic value warrants, also meaning you should probably be reading about something else right now.)

 

Who cares about Buffalo?

On a larger scale, the answer to that question is basically no one. But as it pertains to the NFL, what goes on in Buffalo can have far-reaching consequences.

Why?

Because close to half of all Americans live in a metropolitan area that is home to at least one NFL team. That number serves as a reminder that unless you have the good fortune of living in Wyoming or Alaska, you have a decent chance of being on the hook the next time the NFL decides that one of its franchises needs a new stadium.

It’s possible that when the time comes, the stadium will be built using solely private funds, leaving the relevant city, county, and/or state out of the equation.

It’s far more likely, however, that a governmental entity near you will issue bonds and pay them off by increasing some tax you barely know exists (but pay somewhat regularly). And that means that just like many Buffalonians (and New Yorkers who live nowhere near Buffalo), you’ll be chipping in, whether you like it or not.

 

Using pooled money to optimize the profits of a select few. It’s questionable. So much so that I might truly consider stepping away from this racket once and for all. But until then, when’s the next game?