If The Price Is Right

Continuing with the lecture from Chapter 14 in the Rader textbook, ethical decisions arose as a main theme in Post-1950s sport. Population shifts were taking place in America, as cities and there surrounding neighborhoods were becoming larger and larger. Some sport franchises relocated in an effort to capitalize on the new metropolises.

Dr. Spencer formulated a topic for discussion, asking if it is ethical for cities to offer “perks” to uproot a franchise from one city to another?

My response is simple, yes. While I do believe that it is illegal to entice a franchise to breach an existing contract between a team – city – and stadium, it is permissible to “sweeten up” a bid to a free agent franchise in order to land a city/county/state revenue producing monster that is a professional sports team. As a part of the “franchise free agency” movement, the Dodgers were one of the first teams to relocate, moving from Brooklyn to Los Angeles (Rader, 2009).

Team owners are commonly seen as heartless or cold-blooded when a decision to make such a move takes place. To me, it is business as usual. In the current sports environment, a team typically begins to explore all of its options when a stadium or arena deal nears its end. Depending upon the antiquated (vocabulary word meaning ‘out of date’) nature of their current venue and decreasing fan support, a team has the right to pursue funding for a new facility within the same city or to take the franchise to a town that is willing to erect a state-of-the-art structure to call home. Of course, in each North American sports league there are rules and regulations in place and certain criteria – often attendance related – have to be met in order to facilitate such a move. An owner cannot simply move a franchise in the middle of the night because he/she feels the urge to do so. (Although, this may have been the case when the Colts moved from Baltimore to Indianapolis, but not really. It’s quite a long story and the words “eminent domain” are important to the plot. A link is provided here.)

Sure, anger runs high when a sports franchise decides to leave town because of the emotional investment made by fans and players alike. And it is true that a team can take on the identity of its town, embodying what that region is all about. I’m sure some of my classmates lived through this when Art Model chose to move the Browns of the NFL from Cleveland to Baltimore, subsequently renaming them the Ravens. Which returned football to the same place that lost its NFL franchise over a decade earlier, and when the DeLorean reached 88 miles per hour, the flux capacitor was activated, sending us back in time, thus causing a gap in the space-time continuum. (Anyone? … Anyone??)

But, I digress.

I nearly went through a similar situation when the Pittsburgh Penguins were in serious discussions with cities like Las Vegas, Houston, and Kansas City as their arena deal neared its expiration date in June of 2007. Playing in one of the oldest venues in all of professional sports, Mellon Arena, and without a new arena deal in place, my hometown was in jeopardy of losing its NHL franchise. I can honestly say that I would have been beyond repair if this happened. At the time, I was telling everyone I knew that I would never spend another cent in Pittsburgh if the city let the Penguins go so easily. I did not fault team Owner, and NHL great, Mario Lemieux for wanting to protect his investment by searching for the best business deal possible. He was lobbying for at least 8 years to have a new building built in this region, not only for the Penguins, but for concerts, and other events that draw revenue for the city of Pittsburgh. Fortunately for myself and other Penguins fans, a deal was struck between the state of Pennsylvania, city of Pittsburgh and the Penguins to build a new facility in March of 2007 (ESPN.COM). Lemieux later revealed that it never was his intent to leave the city of Pittsburgh, and that his meetings with officials from other cities amounted to nothing more than “a few good dinners.” In the end, Lemieux was able to parlay those meetings into a respectable pact for a new arena that is scheduled to open in the fall of 2010. It will be named the Consol Energy Center, and she will be a beauty.

(Taking a quick break to exhale.)

So, while other towns may try to lure a franchise away from another city, a savvy business owner can also use another town as leverage when renegotiating the lease on its current venue or when discussing the terms of agreement for a new stadium. I consider both to be acceptable strategies for operating a business. Decisions that are similar in nature, but not magnitude, are made everyday in the non-sporting business world.

A thought-provoking example to further illustrate my point:
Does a restaurant owner continue to buy napkins from company A at $.08 each, or begin to purchase napkins from rival company B at $.05 each? Should the restaurant owner bargain with company A or accept the terms offered to him by company B?

In closing, I would not categorize offering perks to a sports franchise in an effort to bring the organization to a new city as unethical because sport is a business.

If you’ve made it this far, I invite you to make appropriate use of the comments section by submitting your thoughts and opinions.

Good day.