Economic and Policy Implications of Hosting Sports Franchises

Abstract

The acquisition and/or retention of professional sports franchises is a significant element in the economic development plans for many cities. With few exceptions, sports franchise owners demand public subsidies under the threat of relocating their teams during lease negotiations. Despite these escalating demands and apparent franchise instability, many cities continue to pursue sports franchises. This article, using Baltimore as a case study, seeks to determine whether a sports team is "worth it," and provides a discussion of the types of public policy issues local officials confront as they negotiate with franchise owners. The analysis concludes that if team owners continue to abuse their monopoly advantage at the bargaining table, cities will have no choice but to seek legislative or judicial means of altering that balance of power.