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Price Tag of Losing the Browns is Hard to Decipher

Price Tag of Losing the Browns is Hard to Decipher

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Published by Brian Cummins
By Becky Yerak, Plain Dealer, Cleveland, Ohio, 1.14.96
By Becky Yerak, Plain Dealer, Cleveland, Ohio, 1.14.96

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Published by: Brian Cummins on Jan 23, 2013
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01/23/2013

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Price Tag of Losing the Browns is Hard to Decipher
By Becky Yerak, Plain Dealer, Cleveland, Ohio, 1.14.96In their fight to keep the Cleveland in the Cleveland Browns , city officials and civic boosters argue thateconomic activity would be greatly crimped if the team makes good on its threat to move to Baltimore. Butseveral economists punch more holes in that reasoning than the Browns' offensive blockers did all seasonagainst opposing defensive lines. They say civic leaders overstate the financial importance of professionalfootball to Cleveland.Last week, after a study was released that rocketed estimates of the Browns' annual economic impact from$47.9 million to at least $79 million, some economists suggested the figures had moved from overstatement togross exaggeration."The overall economic impact of the Browns' exit will be next to nil," James Coons, chief economist for Huntington National Bank in Columbus, wrote in a recent report about Cleveland's economy.To be sure, pro football brings immeasurable psychological pleasure to fans. During football season, theBrowns are a common topic of conversation, bonding area residents.Civic leaders, already touting Cleveland as a Fortune 500 colony, say the prestige of pro sports gives the city amajor-league image, helping to attract and keep businesses.And Browns majority owner Art Modell got his nomadic urges just as the Rock and Roll Hall of Fame andMuseum opened last summer and as the Indians regularly packed their new Jacobs Field digs.Coons and other economists acknowledge that businesses serving the Dawgs will suffer short-term pain. Cashregisters will be quieter at some hotels, parking lots, charter-bus operators, sporting goods retailers, travelagencies and cab service companies, among others."It will have a material impact, not just at the stadium but across the city," said Larry Lisy, general manager of Beverage Distributors Inc. The Cleveland distributor of such brands as Miller, Stroh's and Heineken beers might be forced to lay off some of its 150 workers if the Browns move, he said.While Beverage Distributors and other individual businesses figure their possible losses, the team's total impacthas been a moving target.In early 1995, the Greater Cleveland Growth Association estimated the Browns were worth $36.4 million a year to the local economy, making certain assumptions on its own and depending on previous studies by theConvention & Visitors Bureau of Greater Cleveland.In recent months, the Growth Association, factoring in higher ticket prices, boosted its estimate to $47.9 million- $28.6 million from local fans and $19.3 million from fans traveling from outside an eight-county metropolitanarea.And Thursday evening - six days before NFL owners begin meeting in Atlanta to consider the team's plannedmove - the Growth Association released a new estimate: $79 million. And that's just for non-local fans; theassociation hasn't finished analyzing local fans' spending data.By contrast, the rock hall is estimated to pump $85 million a year into the local economy.
 
"You're bringing in dollars from outside the region that wouldn't otherwise be here," said Jack Kleinhenz , theGrowth Association's chief economist.Kleinhenz is aware that many economists pan the inclusion of local spending because they say that's money thatlocal fans would just spend elsewhere even if football becomes kaput in Cleveland. After all, if fans buy hotdogs at the game, that means they might not buy them at the grocery store, the economists say.Still, several economists say the Growth Association's changing of economic impact figures is the sort of financial gymnastics making them skeptical about the true impact.The new $79 million figure was based on surveys of 437 fans - 54 percent of them non-local visitors - duringthe Browns' last three games at Cleveland Stadium, against the Green Bay Packers, the Pittsburgh Steelers andthe Cincinnati Bengals."It's a more complete way of making estimates associated with sport attractions," Kleinhenz said, adding thatinterviewing fans is a more accurate method. "The other figures were based on assumptions, and those werevery conservative assumptions."The $79 million also includes a "multiplier," an economic tool used to measure the ripple effect of spending by,say, a beer vendor who turns around and spends his tips in the area economy.Asked if the $79 million would hold true if the Houston Oilers, the Miami Dolphins and the San DiegoChargers had been the last three home opponents instead of three relatively close Midwest teams, Kleinhenzsaid, "I can't answer that question. But I don't have facts that would tell me otherwise. And if the Browns had aneven better-performing team, that would have increased the number of attendees."Dean Baim, a Pepperdine University economics professor in Malibu, Calif., is wary of economic impact figurestied to sports teams. "When you were growing up, your mom probably said `seeing is believing,' Baim said."This is one area where believing is seeing. If you want to show economic growth, you're going to come upwith the numbers to prove it." Non-local spending might not go away with the Browns, he said."How do you know that those fans wouldn't have come to the rock hall instead of a Browns game?" Baimasked. "If they're that mobile that they can come to Cleveland for the Browns, they may come to Cleveland for some other entertainment."Andrew Zimbalist, an economics professor at Smith College in Northampton, Mass., said the GrowthAssociation's estimates of spending by non-local fans should reflect only spending that stays in Cleveland.In its previous study, the Growth Association estimated that non-local fans each spend $16 in retail shops. Evenif that's true, Zimbalist said, that doesn't mean that, say, a Galleria merchant walks home with $16 in his or her  pocket. The retailer, after all, had to buy merchandise, and in fact might pocket only $2.Of the new $79 million estimate, Zimbalist said, "The idea that these figures changed is a product of howillusory these studies are."Rodney Fort, a Washington State University economics professor, questioned the Growth Association's latestestimate that 38,150 non-local fans attend Browns games - compared with the 4,780 estimated in the previousstudy. In the last three home games, the average attendance was 59,510.

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