By Leigh Howe
It seems my last article about economic development and sports hit home with some of our readers. I have decided to share some responses that I received because I think they explore the topic well and give some terrific examples of the impact that sports have on communities. Here are a few viewpoints to consider:
“The economists possibly have it right that stadiums and arenas do not generate net new spending in a community and maybe they don’t. I think you would be hard pressed to convince Cleveland, Baltimore, Denver, Cincinnati and others that the location of their baseball stadiums do not make their cities more livable, their restaurants and other retail establishments more profitable and bring in thousands of tourists from miles around to their central cities.
Washington, DC has done very well with the opening of the Hockey/Basketball arena in the city. Columbus, Ohio, has created a number of development opportunities as a result of their hockey arena, Phoenix has been able to revitalize quite a bit of downtown with the investment in both the basketball facility for the Suns and the relatively new baseball stadium. But these downtown turnarounds have not been limited to the largest cities. Ask Dayton, Toledo, Buffalo or Indianapolis what minor league baseball has meant to their communities.
No, net spending may not be up, but spending in the heart of the city and maximization of infrastructure investment may be the key for many of these investments. And if you think this does not hurt, ask Baltimore what it meant to lose the Colts or Cleveland their football team or St. Louis when the Cardinals left, these teams say a lot about civic pride and identity.”
The International Economic Development Council (IEDC)
“Living in the epicenter of motorsports, I would suggest that the venues that host sporting events may have the capacity to be economic drivers. Lowe’s Motor Speedway located in Concord, NC, has anchored an economic development engine that continues to profit the regional economy. Three times each year the Speedway hosts NASCAR events that reallocates millions of dollars of entertainment spending; from Ohio, Pennsylvania, Indiana, New York, Boston, Maryland, South Carolina, Georgia…
Within a 30-mile radius of the Cabarrus Regional Chamber you will find over 90% of NASCAR teams. These motorsports teams are great corporate citizens that provide well paying jobs. The average salary of a motorsports team employee is over $50,000. While that in itself is noteworthy, the race teams are just the surface of the motorsports industry in the Cabarrus Region. Populated within this region are numerous motorsports manufactures, suppliers, service providers, tour companies, motorsports publishers and media concerns, NASCAR R&D, and many other businesses that rely significantly on the motorsports industry. Sam Bass, the renowned motorsports artist, has his gallery within a stone’s throw of the Speedway. The local university, UNC-Charlotte, has one of the preeminent automotive engineering programs in the country.
Various studies have debated the impact of sports team and venues on local communities. Many of those studies discount the economic impact of sports on a region. That may be true of typical sport franchisees such as baseball, football, and basketball. However, the presence of Lowe’s Motor Speedway and the resulting motorsports industry associated with its presence has had a positive impact on the economic engine of the Cabarrus region.”
Jerry K. Saunders
Senior Executive for Business and Community Development
Cabarrus Regional Chamber of Commerce
“As a frequent author of economic impact reports regarding professional sports, I must concur with you and the various other studies. The real impacts are psychic. I think we all know this, but we don’t know how to measure it so well. It also depends on whether teams are winning or losing and how consistent they are.
That said, one of my peeves is that people claim professional sports have no economic impact. Obviously, that can’t be true. They have a tremendous economic impact—look at all those people spending money. But they may cause no net increase in economic activity just because they build a new stadium with public money, for instance—at least as measured quantitatively. I think that’s what people really mean.
Still, it is easy to measure some of the net gains caused by some, maybe all, teams. People arrive from many miles away to watch games—buses come from 200 miles away into St. Louis, for example, to watch the St. Louis Cardinals. This is real “gain.” What people forget, however, is that the local fans frequently take their money to other cities to watch their Redbirds elsewhere. This, obviously, takes money out of the local economy. The net effect is probably a “wash.”
What we need is a definitive study of the effects of having teams or not having them. The psychic effects, anyway. Is there a method for measuring local and economic growth before and after teams are established, controlling for other factors? My sense is that growth happens first, then professional teams show up (new franchises, relocations, etc.) when the teams realize that there is enough market to support them. Witness Phoenix. Rapid growth without professional sports for many, many years. Then professional franchises show up. Hmm…., it seems it wasn’t the sports that created the growth. By the way, the same thing happens with the arts. How many symphonies or art museums were there first? In real life, population and economic growth has to occur first.
But do teams (or the arts) have the ability to sustain the scale of a local economy? Without them, would the economy decline? Or if they are very successful, do they help the economy grow faster (or slower, if they lose all the time)? That is, once we have our professional teams, is it too costly to give them up even though we didn’t need them in the first place?”
Robert M. Lewis, AICP, CEcD
Principal and President
Thanks to all who responded to the article. As always, we welcome feedback on the topics we write about. Please feel free to email me (email@example.com) or my colleagues directly.