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Do professional sport franchise owners overpromise and underdeliver the public? Lessons from Brooklyn’s Barclays Center

Do professional sport franchise owners overpromise and underdeliver the public? Lessons from... PurposeThe purpose of this paper is to evaluate a number of promises typically made by owners of professional sports franchises in the USA that are also typically ignored or underevaluated by public bureaus and their elected principals using the Barclays Center in Brooklyn, New York as a case study. Ex post subsidy outcomes are evaluated against ex ante subsidy promises in order to draw lessons that can inform and improve subsidy debates elsewhere.Design/methodology/approachThe case study adopts a pre-post strategy drawing on data from multiple sources over a period of up to ten years in order to triangulate the narrative and build credibility. The franchise owner’s ex ante promises and financial projections were obtained from various media including newspaper, video and interviews between December 2003, when the arena was publicly announced, and September 2012, when the arena opened. Data on ex post outputs were obtained from financial documents and government records covering periods from September 2011 through June 2016.FindingsThe franchise owner is found to have exaggerated the arena’s financial condition, under-delivered on its employment promises, and exaggerated the scope and timeliness of ancillary real estate development. Only promises of event frequency and attendance levels, measures of the public’s demand for the facility, have been met during the first three years.Research limitations/implicationsBecause the evaluation is a case study, causal conclusions cannot be drawn and some aspects of the Barclays Center context may not be applicable in other jurisdictions or subsidy debates. In addition, the case study does not evaluate an exhaustive list of the promises franchise owners make.Practical implicationsFranchise owners have a financial incentive to overpromise public benefits, since subsidy levels are tied to what the public is perceived to receive in return. This case study demonstrates that the public sector should not take owners’ promises and projections of public benefits at face value. Moreover, the case study reveals that the public sector should put more effort into ensuring ex post policy and data transparency in order to facilitate benefit-cost analyses of such subsidies.Originality/valueThe data required to evaluate promises, other than economic development ones, made by franchise owners are not systematically collected across state and local governments in the USA, making large-n studies impossible. Case studies are underutilized approaches in this area of public affairs, and this paper illustrates their usefulness. By focusing on a single facility, an evaluation of the franchise owner’s less acknowledged and arguably more important promises about the facility and its local impact is possible. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Public Sector Management Emerald Publishing

Do professional sport franchise owners overpromise and underdeliver the public? Lessons from Brooklyn’s Barclays Center

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References (57)

Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0951-3558
DOI
10.1108/IJPSM-01-2018-0002
Publisher site
See Article on Publisher Site

Abstract

PurposeThe purpose of this paper is to evaluate a number of promises typically made by owners of professional sports franchises in the USA that are also typically ignored or underevaluated by public bureaus and their elected principals using the Barclays Center in Brooklyn, New York as a case study. Ex post subsidy outcomes are evaluated against ex ante subsidy promises in order to draw lessons that can inform and improve subsidy debates elsewhere.Design/methodology/approachThe case study adopts a pre-post strategy drawing on data from multiple sources over a period of up to ten years in order to triangulate the narrative and build credibility. The franchise owner’s ex ante promises and financial projections were obtained from various media including newspaper, video and interviews between December 2003, when the arena was publicly announced, and September 2012, when the arena opened. Data on ex post outputs were obtained from financial documents and government records covering periods from September 2011 through June 2016.FindingsThe franchise owner is found to have exaggerated the arena’s financial condition, under-delivered on its employment promises, and exaggerated the scope and timeliness of ancillary real estate development. Only promises of event frequency and attendance levels, measures of the public’s demand for the facility, have been met during the first three years.Research limitations/implicationsBecause the evaluation is a case study, causal conclusions cannot be drawn and some aspects of the Barclays Center context may not be applicable in other jurisdictions or subsidy debates. In addition, the case study does not evaluate an exhaustive list of the promises franchise owners make.Practical implicationsFranchise owners have a financial incentive to overpromise public benefits, since subsidy levels are tied to what the public is perceived to receive in return. This case study demonstrates that the public sector should not take owners’ promises and projections of public benefits at face value. Moreover, the case study reveals that the public sector should put more effort into ensuring ex post policy and data transparency in order to facilitate benefit-cost analyses of such subsidies.Originality/valueThe data required to evaluate promises, other than economic development ones, made by franchise owners are not systematically collected across state and local governments in the USA, making large-n studies impossible. Case studies are underutilized approaches in this area of public affairs, and this paper illustrates their usefulness. By focusing on a single facility, an evaluation of the franchise owner’s less acknowledged and arguably more important promises about the facility and its local impact is possible.

Journal

International Journal of Public Sector Management – Emerald Publishing

Published: Jan 14, 2019

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