THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, November 26, 1995 TAG: 9511270188
SECTION: COMMENTARY PAGE: J1 EDITION: FINAL
LENGTH: Long : 238 lines
When it comes to professional sports, Hampton Roads has an inferiority complex.
It has AAA baseball - the Norfolk Tides - and an East Coast Hockey League team, the Hampton Roads Admirals. Now the Shreveport (La.) Pirates of the Canadian Football League say they're coming to town. But for many sports fans, that's not enough. They wonder why an area this big can't attract a major league team.
In this month's Hampton Roads Roundtable, The Virginian-Pilot and public radio station WHRV put that question to four local experts: an economist, the president of the Admirals, Norfolk State University's football coach and the chairman of the Sports Authority of Hampton Roads.
Their consensus: Canadian football may or may not be a stepping stone to the big leagues, but in any event local officials should take a hard look before putting public funds at risk. Ultimately, the panelists were optimistic about the prospects for major league sports in the area - particularly hockey and basketball. But they agreed that it won't happen unless the sometimes fractious Hampton Roads cities are willing to join together, step up to the plate and make a public investment.
The discussion was moderated by staff writer Bill Sizemore.
CFL: A STEP ON THE WAY?
Hampton Roads is the largest metropolitan area in the country without a major league sports team. Why do you think that is?
Morton V. Whitlow: I think it's partly a late-blooming market. I think it's partly a function of business. We really don't have very many big businesses, and big businesses tend to support major league sports. We're a growing area as a region, but that's a fairly recent phenomenon. If you think back over the last 20 years, we've come a long way and so we're a new, emerging kid on the block. It's our turn to jump into the game, as it were.
What about Canadian football? Is a CFL franchise the logical next step for this area?
Blake Cullen: I'm not sure. It depends how they do. It's not major league. It seems to be the presumption that this is finally the major league sport that's coming here, and I would question that.
Is it a step toward that, though?
Cullen: We have AAA baseball and we're two steps away in hockey. I don't see why it would be considered the next step, no.
Whitlow: I think the CFL, as Blake described it, is not major league. Certainly it's not the NFL and never will be. But I see it as being a natural progression for us. I think it will be another great asset. . . .
The CFL will do very, very well here when you look at the numbers: 1.6 million people. At a moderately priced ticket, you can certainly put 15,000 or 18,000 people in the stands.
Darnell Moore: I agree with Mo Whitlow on one point: that it's not minor league and it's not major league. It's somewhere in between, and it may be the next logical step.
I don't know if the team would realistically put 15,000 to 18,000 in the bleachers. . . . If you're winning, fine. They're going to come out and watch you. If they're extremely excited, they're going to come out and watch you. But if you're not winning, I just don't think this area is going to support a team, especially an in-between, minor-major league team. . . .
I think that with CFL football being new - they're not just new to this area but new to a lot of people - a lot of people wouldn't even be able to tell you some of the rules.
John Whaley: I'm very excited about the notion of a football team coming to town. First of all, there's not a whole lot of risk to the region. We're not fronting a lot of money. . . .
We may have somewhere between 150,000 and 200,000 tourists here in the summer that might enjoy Canadian football. Some of those people, in fact, come from Canada. So I think there's a real opportunity to tap into that market.
Is it possible to reach a saturation point with sports, where fans just don't have any more money to spend?
Whaley: Oh, I think it's clearly a possibility. . . .
Something that complicates this whole issue, it seems to me, is that our incomes in Hampton Roads aren't very high, to be perfectly honest. Our per capita incomes are 89 percent of the U.S. average. Our earnings per worker are at 87 percent of the U.S. average, and our private-sector earnings per worker are just 80 percent of the U.S. average. And yet the cost of living here in Hampton Roads is at the national average. . . .
We don't have a lot of discretionary income in this marketplace.
Cullen: That's the key, that it's affordable. We've never gotten to a $7 ticket yet. We have been able to draw, but I think it's a very price-sensitive area, and when you're talking major-league sports, you're talking some pretty serious individual ticket prices.
How does Canadian football rank on the affordability scale?
Whitlow: The ticket prices are $10 or $15 for end-zone, non-reserved seats, all the way up to $25. . . .
I think it can work in terms of affordability.
THE ECONOMICS OF PRO SPORTS
Beyond the question of Foreman Field, presumably a CFL franchise would eventually want a new stadium built. It's been estimated that this might cost $50 million. What are the chances that the Hampton Roads cities are going to be able to foot the bill, and how would something like that be financed?
Whitlow: Well, the financing of it, there's a lot of vehicles for that. The cities have built new arenas, new coliseums, using all forms of taxes. It could be one-tenth of 1 percent of the sales tax or it could be what they call sin taxes on tobacco and alcohol.
What are the economics of a professional sports team?
Whaley: Basically, you have two kinds of effects. There's a quantitative effect that you can measure and put numbers to and a nonquantitative effect - things like community spirit, pride and what have you.
Among the quantitative impacts, there are basically two types. There's the direct effect. That's when people come to the stadium and they buy the tickets, the hot dogs, spend money on programs, the parking and so forth. Those are all first-round injections of money into a community, and it's from that base that everything else happens. When that money gets spent and respent later on, that sets up what people have called the indirect effect. . . .
It's the visitors that make the difference. In the case of the Carolina Panthers, for example, they estimate that 38 percent of the people who show up and buy tickets there are visitors. . . .
They figured that a dollar that was spent would ultimately generate $4.19. would be spent in the city as a result. . . .
If it doesn't cost a great deal, it can be a huge benefit to the community.
What about the point that this is a risk-free or virtually risk-free proposition for Hampton Roads? This team wants to come in and they're willing to use Foreman Field with relatively minor renovations, and we can then have a chance to see how the team does before the communities think of undertaking any major expenditures for a new stadium. Is that a reasonable scenario?
Whitlow: Well, if there's no risk, it's sort of hard to say no. But I think even if there's minor risks that we ought to seriously consider it, assuming that the CFL is viable. That's my biggest concern at the moment. . . .
There certainly is a risk to failure. If we are thinking of bringing a hockey league team or we're thinking about bringing an NBA team, even dreaming of a National Football League team, then if the CFL comes and fails, we're again branded as a poor sports market. That's a big risk to take.
USING PUBLIC MONEY
You referred to a possibility in the future of the NBA or the National Hockey League. According to a study that the Sports Authority just had done, this would require a new arena, and we're talking about a price tag in the range of $130 million. This is another big investment of public funds. Is it feasible to even think in terms of doing both - an arena and a stadium, both built with public funds?
Whitlow: Well, I think it's not practical to consider doing both speculatively. If we had a viable football operation that required a stadium, that might be something to consider. I think everyone here locally has been focusing on the big arena, the 20,000-seat-plus arena, because that seemed more achievable. The National Football League is just perhaps out of our reach. . . . The NBA and National Hockey League - we perhaps could support them.
Cullen: We play in a league, the East Coast Hockey League, with Nashville, and Nashville doesn't draw half of what we do. And yet Nashville is now being courted by both the New Jersey Devils and probably Winnipeg. . . .
They built an arena. That's what you've got to do. There's no sense in talking about anything else. Until you make the commitment to build an arena, you're not going to get somebody in a major-league ownership to say, ``OK, I'll come there and play for a couple of years and hope that you'll build me something.''
Moore: There's a lot to be said for a large arena as far as basketball or hockey is concerned. And I think that this area would support that.
Cullen: I think it would be a great way to put Hampton Roads on the map.
Who will foot the bill?
Whitlow: Well, we all would. . . .
I think we perhaps could build some significant support for it and have a referendum and get a very small tax. We're talking about a very insignificant tax to build this arena. As little as one-tenth of 1 percent on a sales tax across Hampton Roads could build this arena.
I don't think there's any question, we've got to build the arena if we're going to lure any kind of major league team here.
Cullen: There really is little risk there, because if we had an arena, we would fill it with other events. You'd have something in there to start with. It wouldn't be just like building it and hope something goes in there, because there'd be a lot of nights where the lights would be on until a major league team came in.
CAN THE CITIES GET TOGETHER?
How much of an obstacle is the split nature of Hampton Roads, the fact that we have all these different cities? Wouldn't they all have to get together and unite behind this common goal for something like this occur? And what is the likelihood of that?
Moore: Personally, I think that might be the toughest thing to do. You look at so many things that happen in this area, and people don't want to relinquish any power.
Whaley: It seems to me that it's virtually guaranteed that if we are to build a large facility it's going to have to be publicly financed. For example, I could cite this statistic: Since 1960, there have been 29 stadiums built in this country and 25 of the 29 have been publicly financed.
It's very risky to build these things. The returns are not guaranteed. The private sector really can't foot the bill. It has to be the public sector that comes up with this money.
We in Hampton Roads have a long tradition, it seems to me, of cooperation.
Depending upon what the cost would be, there's a real good chance that the various communities of Hampton Roads would line up behind it and this thing could work.
Whitlow: Well, it needs a leader. We really need business leaders, we need political leaders, and they've got to get into the bully pulpit and send this message out.
Moore: I agree with all that. I think that whole thing is going to have to transcend city boundaries.
Cullen: One thing. . . : Hampton Roads is not an accepted name. . . . We've got to get it out there somehow.
Aren't the Tides at odds with you on this? They're the Norfolk Tides.
Cullen: Norfolk built them a $20 million stadium. That was part of the deal. Build me a $20 million stadium, I'll change, too.
But isn't there something to the point that people from other parts of the country don't know where Hampton Roads is?
Cullen: I wish it was just Greater Norfolk. It would be a lot easier for everybody. But it's not. It's Hampton Roads, and I think if you change the name now, you're going to get a whole other set of problems.
Whaley: I agree entirely that we have a name recognition problem here. In fact, the cities of New Orleans, Las Vegas, Louisville, Nashville, Orlando and Honolulu are all smaller than Hampton Roads and all have name recognition substantially more. . . .
But with a sports team we can get the name Hampton Roads out. MEMO: A full text of the discussion is available on the News page of Pilot
Online at the Internet address http://www.infi.net/pilot/
ILLUSTRATION: Graphics
WHAT'S THE PRICE TAG?
At any level of pro sports, some investment of public money is
likely to be sought up front for the team's venue. Here are three
possible scenarios:
The Canadian Football League Pirates have asked the city of
Norfolk to fund up to $400,000 worth of improvements to Foreman
Field, the stadium at Old Dominion University. The team has pledged
to repay the investment within two years through taxes on ticket
sales, concessions and novelties.
A new stadium suitable for pro football would cost in the range
of $50 million. It could be financed by bonds, which could be paid
off by an increase in the local sales tax.
An arena large enough for major-league hockey or basketball could
cost as much as $130 million. It, too, could be financed by bonds
and a tax increase.
Map/Graphic
John Earle/The Virginian-Pilot
KEYWORDS: ROUNDTABLE DISCUSSION FOOTBALL by CNB