Washblog

The Packers, even though they're a for profit corporation the same as any for profit corporation, are unique in professionals sports because they offer stock to anyone who wants to come along. The sort of person who is most interested in buying Packers stock, is of course, a fan of the Packers. This model has kept a highly successful sports franchise in a community, that frankly, doesn't deserve one from the truly economic way of looking at the sport.

Even Green Bay's Wisconsin Big Brother, Milwaukee, has had trouble holding onto sports teams: the Hawks of the NBA and the Braves of MLB have all passed through and left Milwaukee in the time that the Packers have played. Turns out though that every other community interested in keeping an NBA, MLB, NFL or NHL team in town through some kind of corporate stock arrangement or non-profit ownership is pretty much out of luck. All four leagues outlaw non-profit ownership, with the NFL going as far as to ban any sort of corporate ownership, to prevent another Packers.

The New Rules Project points to several other non-traditional ownership models (in minor league baseball) and there are several non-profit examples in Canadian football (here, here and here).

New Rules also points to several legislative fixes that never actually came through during the high times of community ownership discussion in the late 90s. They go as far as condemning a sports franchise (in Minnsesota and New York) to simply building and running stadiums as a public agency, rather than handing them over to the teams (in Pennsylvania).

There are also examples of national legislation to rebalance the playing fields for locals: Sen. Paul Wellstone suggested removing baseball's anti-trust exemption in 2001 and Oregon's Rep. Earl Blumenauer sponsored the Give Fans a Chance Act, which would have opened the door for community's to bid on their teams. Rep. Adam Smith was one of the original co-sponsors of the bill.

Simply that the four major sports don't allow for ownership (that would tie a team to their community) is the most maddening part of this. Each league is exempt from anti-trust laws because their industry is not considered "commerce" by the courts, so they have the ability to ban non-profit ownership.

What I haven't pointed out yet is that the NBA does not ban corporate ownership, just non-profit ownership.

So, a Packers solution, a for profit company that sells stock on an individual basis, is technically possible here.

The problem is history. Green Bay has always been an individual stock company, from its origins. Its been when the team needed to raise money that they sold more stock.

Huh, that gives one me a thought. How would the Sonics feel if we told them that they could have all the money they wanted for a new arena if that money was raised by selling stock in a new ownership interest in the Sonics? We wouldn't buy the Sonics outright, just a portion. Just to get something back for our investment. The people would finance this particular improvement in the Sonics, but for every dollar we put into a new arena, we would also get a dollar in the ownership of the franchise.

I don't know why this wouldn't work.