When We Build It, Will They Come?

Sure, Indy’s new $500 million field of dreams will keep the Colts here. But there’s no guarantee the investment will deliver the ultimate payoff: a Super Bowl.

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Lucas Oil illustrationEditor’s Note: This article first appeared in IM‘s January 2006 issue.

 

Paul Tagliabue owned the room, and not just because he is the most powerful man in professional football. Surrounded by Hoosier lawmakers in a swanky Indianapolis steakhouse, he spoke their language, his lean 0-foot-5 physique communicating more basketball than football. Tagliabue even handed them a self-deprecating quip about his Georgetown University hoops days, joking that the school retired his number, 33. It just waited until Patrick Ewing was done using it.

Such camaraderie went a long way on that March 2005 evening in a private dining room at Mo’s A Place for Steaks. “He has credibility oozing out of his pores,” says attorney and downtown power broker Fred Glass. Other key politicians — House Speaker Brian Bosma and Ways and Means Chairman Jeff Espich among them — were buying in, too.

Tagliabue, commissioner of the NFL since 1989, was not in town to offer a hard sales pitch, but to preach the gospel of the modern NFL. Giant, luxurious stadiums were now the norm in his league, yet a few blocks from where the party dined sat the practically obsolete RCA Dome, a 57,890-seat stadium that is the league’s smallest in capacity and a poor revenue-generator for an owner trying to survive in a small market.

The Indianapolis Colts, a winning team on the field, would not be financially viable in the modern NFL if they had to spend another two decades in that building. Knowing that and not wanting to risk the team leaving — a tendency that is in its DNA already — the city put a $500 million new stadium on the table with legislators. Enter Tagliabue to close the deal. Build that stadium, the commissioner said, and the Colts will remain a fixture of your culture. Build it, and Indianapolis will continue to enjoy its share of the National Football League’s billion-dollar pie. Build it, he added in a postscript, and Indianapolis might even get a chance to host a Super Bowl.

A chance to host a Super Bowl. These were not the words of a car salesman sweetening the pot by throwing in satellite radio. Here was the commissioner of the most powerful sports league in the world telling Indianapolis, Indiana that it had a chance to be ground zero for the biggest annual event on Earth. Super Sunday. The High Holy Day of American sports. The same Indianapolis that, a generation ago, was thrilled just to have pro football; the same city that now desperately wants to be a world-class destination, not a pass-through for the rest of the Midwest.

Tagliabue said he could make no promises — Super Bowl sites are selected by a vote among the 32 team owners. But the seed had been planted, sparking a gleam in the eye of civic leaders. Keeping the team would be great — perhaps absolutely necessary for Indy’s sense of itself as a major-league destination. But a Super Bowl would provide a definitive statement, an exclamation point demonstrating that Indianapolis is at last on the national radar. No promise, sure. But a tempting, ego-satisfying dangle? Absolutely.

“It was,” says Mayor Bart Peterson, “as close to an assurance as you could get.”

 

The building boom in the NFL has benefited — or held hostage, depending on your view of mostly taxpayer-funded football palaces — 26 of the league’s 31 cities since 1992. All but extinct are the utilitarian, multipurpose stadiums, replaced by plusher, skyline-pleasing edifices replete with the revenue streams owners crave: club seats and luxury suites.

NFL owners covet those moneymakers because they don’t have to share one cent of home-generated revenue with their brethren. Teams divide income from the league’s television and licensing contracts, which helps small-market teams like the Green Bay Packers stay competitive. But money from luxury boxes, club seats, stadium naming-rights fees, parking and concessions stays with individual owners.

Without a new stadium, a city has no chance to host a Super Bowl — a prospect that’s often a strong card in the hands of owners who are seeking new state-of-the-art facilities. It is a sweetener in a deal that is often based on simple, yet powerful leverage: Buy me a new house, they say, or we’ll find someone else who will. Robert Irsay, the late owner of the Colts and father of current owner Jim Irsay, remains among the most notorious of the threat-droppers. He demanded improvements and luxury suites in Baltimore, and claimed the city guaranteed him a new stadium. City officials denied making such a promise. In 1984, of course, Irsay got the last word.

A decade later, having paid $192 million for the franchise, the new owners of the Tampa Bay Buccaneers were on the verge of moving their team, demanding a stadium with the amenities that could help them recoup their investment. Baltimore, Hartford, Los Angeles and Orlando were all rumored as possible homes for the Bucs until a last-ditch “Community Investment Tax” — a 30-year half-cent sales tax on Tampa-area residents — was proposed to help fund a new stadium. It passed on referendum by a 53-to-47 percent margin and later survived several legal challenges. Team owners never contributed a penny to their new stadium’s construction. When the tax was approved, Tagliabue recommended Tampa as a Super Bowl host city. The city got the game in 2001 and will host again in 2009.

That cycle is familiar, by now. When a proposed domed-stadium deal fell through in 1988, the St. Louis Cardinals moved to Arizona. Ten years later — the team had been playing in a college stadium in Tempe — the luster was long gone, and so the Arizona Sports & Tourism Authority was created. A stadium in Glendale followed, with a retractable roof and the first-ever retractable grass field. In 2003 the NFL announced that Glendale would host the Super Bowl in 2008.

Not that the leverage is foolproof. Last year, NFL owners passed a special resolution on behalf of New York that awarded the city a game in 2010, provided a new stadium for the Jets was approved by a state oversight board. It was not, a rare misstep in the NFL construction boom.

And this past November, the league dangled the game in front of Kansas City. The terms were simple, if costly: The 34-year-old Arrowhead Stadium would need a $400 million to $500 million renovation, including the addition of a roof. In 2004 a sales-tax proposal for stadium improvements failed in the Kansas City area; now officials think the Super Bowl proffer will put it over the top. “This gives us the sizzle to put together a package for voters,” Jackson County (Missouri) Sports Authority chairman Mike Smith said in The New York Times.

 

Under mayors Richard Lugar and William Hudnut, Indianapolis in the 1970s and ’80s made an aggressive push to reinvent itself as a destination city, a city that mattered on a national level. “We want people to sit up and say, ‘By God, that city has a lot going for it,'” Hudnut said in 1984. One of the quickest paths to that would be through sports, and in 1979 city leaders started soliciting NFL owners’ opinions on a domed stadium. The Hoosier Dome was built in 1983 for $77.5 million in hopes of landing an NFL expansion team, but with no guarantees in place. And less than a year later, in March 1984, Robert Irsay and his Colts franchise became a full-time tenant. The team signed a 20-year lease with the city and was guaranteed annual ticket and broadcast revenue money, plus a portion of luxury-suite revenue.

Fans will remember the woeful early days of the team — a combined 12-36 record its first three years. In 1991 the Colts bottomed out at 1-15, went 4-12 in ’93, and then saw the season-opening crowd in 1994 hit an all-time low of 47,372. In the late ’90s, with the team’s fortunes about to turn, Jim Irsay claimed his financial situation was worsening and that the stadium — never a flashy, state-of-the-art facility to start with — was in need of some $20 million in renovations. The city picked up that tab in 1998 and reworked the team’s lease, agreeing to give the team $8.9 million annually in stadium revenues that it had previously kept.

Still, Irsay said in 2002 that he remained in the red. Whether or not that was really true (citing his involvement on an NFL owners’ Super Bowl host committee, Irsay declined an interview for this story), Indianapolis had to listen. According to a 2004 Pricewaterhouse Coopers report, the Colts pump $75 million a year into the city’s economy, and the intrinsic value of the team to the city’s sense of self-worth can’t be measured. Look at the Colts’ former home: Baltimore floundered for 12 years without NFL football and so desperately wanted to fill the void that it hosted a Canadian Football League team for two years. Without the Colts, Baltimore had only the Orioles baseball club. If the Colts moved again, Indianapolis would be a one-horse pro-sports town, too.

City officials weren’t going to push the situation to the edge. Under terms hashed out in the 1998 renegotiation, starting in 2007 (and every year thereafter that the Colts still played in the Dome) the city would have had to pay the Colts the difference between their revenue and the median revenue of all NFL teams. The cash-strapped city had no source to fund this payment, which in 2003 would have been $12.6 million. And the Colts were free to leave if the city failed to pay. In other words, the city was handcuffed unless a new stadium went up.

Negotiations took time, and proposals on how to pay for the still-corporate-nameless Indiana Stadium ran the gamut from downtown casinos to myriad taxes. But getting the deal done was almost never in doubt, a certainty city officials linked to an expansion of the Indiana Convention Center. “The real driver in this whole thing, believe it or not, was to expand the convention center,” says Glass, president of the Marion County Capital Improvement Board of Managers. “1A was keeping the Colts here.”

Perhaps so, but the public — paying for this $900 million package via increased taxes in restaurants, hotels and car rentals in Marion County and a 1 percent restaurant tax in seven neighboring counties — doesn’t get emotional about convention centers. Major conventions bring more jobs and tourists than football teams, and Indianapolis does need the space to keep up with other cities in the increasingly competitive convention market, but those considerations pale in comparison to living with the stigma of your city letting its NFL franchise blow town.

“You’re not merely investing in a football team but in the larger image of the city as cosmopolitan and up-to-date,” says Michael MacCambridge, author of America’s Game: The Epic Story of How Pro Football Captured a Nation. “Only about 30 cities in the country can make that claim. By building a stadium, Indianapolis remains one of them.”

Plus, conventions don’t come with the pomp and circumstance of a Super Bowl. If reason “1A” in the stadium/convention-center deal was the Colts, the possibility of a Super Bowl was “1B.” That’s where Paul Tagliabue and the NFL stepped in with Indianapolis, dangling the carrot of The Big Game under legislators’ noses, in the event that they needed one last little boost to push the stadium paperwork through the political process. “We’ve been very clear about using the Super Bowl to help our efforts to get stadiums built,” says NFL spokesman Greg Aiello.

 

So when we build it, will they come? And if they do, will it build on the city’s long-running efforts to secure its spot on the national radar? And finally — will it pay for itself?

It is difficult to overstate the impact of the Super Bowl on American culture. “Super Sunday,” as MacCambridge notes in America’s Game, provides the most-watched TV program of the year not only for men, but also for women, children, senior citizens, blacks and Hispanics. It’s the biggest food day outside Thanksgiving, the biggest occasion for at-home parties and the least popular day of the year for weddings. It’s Christmas for the advertising world, as 30-second commercial time commanding upwards of $2 million often produces more entertainment than the actual game.

“The Super Bowl is a fantasy party that gets dropped on your doorstep,” says Gene Frenette, a sports columnist for The Florida Times-Union in Jacksonville. “I don’t know if ‘phony’ is the right word, but it’s different.”

The game generates the kind of marketing moments a city can only dream about, a worldwide stage that is beyond any price tag. “For many people, Indianapolis still maintains a very vanilla perception,” says Bob Schultz, director of communications for the Indianapolis Convention and Visitors Association. “We need external validation of what we are doing in order to attract more exposure for our city; a Super Bowl would bring that.”

It would undoubtedly deliver some dollars as well. “The continued growth of the Super Bowl and all the events around it has meant that the economic impact of having the game in a particular city is more pronounced than ever before,” MacCambridge says. The NFL claims a Super Bowl brings $300 to $400 million in economic value to the host city, The NFL Experience theme park alone requires nearly 850,000 square feet of convention space. It’s likely that every hotel room in the metropolitan area would be filled for at least a week, and every restaurant seat as well.

Still, there are no guarantees of success, economic or otherwise. Having concluded through market research that it had little name recognition with the public, 2005 host city Jacksonville rolled out a new slogan, “Jacksonville: Where Florida Begins.” Meanwhile, out-of-town sportswriters rolled out the Jacksonville-bashing columns. “What, Tuscaloosa was booked?” asked Washington Post columnist Tony Kornheiser. Indianapolis Star columnist Bob Kravitz, perhaps ironically, called Jacksonville “America’s Most Insecure City.”

The city spent $11 million in taxpayer money to prepare itself for the game, blowing away initial projections of $2 million to $3 million. But a survey conducted last spring by a Jacksonville bank and the University of North Florida reported that the economic impact touted by the NFL might be a myth; 77 percent of small-business owners in Jacksonville said the game had “no effect” on them. “Generally there was a positive effect, but what you cannot say is that it was a huge effect,” North Florida assistant professor of economics and geography Andres Gallo told The Times-Union.

Not surprisingly, Indianapolis politicians rush to discount the economists, especially when touting a $300 million boost to ease the sting of a $500 million construction project. “I don’t think anyone can make a legitimate argument that it doesn’t have a huge economic impact,” Mayor Peterson says. “You may quibble about the amount of that impact and certain multipliers that are used, but I don’t think anyone can doubt that it’s worth it.” If the payoff isn’t in cold cash, supposedly it’s in “exposure.” Yet economists like Philip Porter, professor of economics and director of the Center for Economic Policy Analysis at the University of South Florida, claim the exposure could just be bought with advertising dollars — say, a few dollars saved from not building half-billion-dollar football stadiums.

 

A host city pitches itself the NFL years in advance of the ate it hopes to hold the game, and it appears that Indianapolis is already prepared to make its case. The prospective host city must have a stadium (closed to the elements in northern cities) with a 70,000 capacity, and have 24,500 rooms within an hour of the stadium. The new stadium here will seat 63,000 with the capacity to expand to 70,000, and, according to the Indianapolis Convention and Visitors Association, the city boasts nearly 28,000 rooms.

However, the vote of the NFL owners can be fickle, or a snap, depending on the prevailing winds. A standard scenario would be the bidding for the 2009 game, where Tampa competed with Atlanta, Houston and Miami, and multiple votes were required to declare a winner. In the selection process, the league’s 32 owners listen to 15-minute presentations from host candidates, with five-minute appeals from the host city’s team owner. Voting then proceeds via secret ballot, with 75 percent of the votes required on the first or second ballot to win. If that majority isn’t reached, the city with the lowest vote total is eliminated. If the 75 percent majority is still not achieved after three ballots, simple majority rules. That was the case with the ’09 game, when Tampa edged Atlanta. On the other hand, Detroit got this year’s game behind the pull of longtime owner William Clay Ford and the automotive advertising dollars that fill NFL and broadcasting coffers.

Indianapolis is not an untested entity in the big-time sporting-event pantheon, which can’t hurt when it comes time to bid for a Super Bowl, presumably the 2012 or 2013 game. The Indianapolis 500, the Brickyard 400 and the Final Four in college basketball have shown that the city can handle big-game logistics. But the Super Bowl multiplies everything, and its clientele asks for the world from a host city. Final Four crowds are happy alumni and chicken wings. A Super Bowl’s clientele are jet setting corporate types and filet mignon.

Some of Indianapolis’ strongest attributes could backfire with that kind of crowd. The city prides itself on the compact, convenient downtown, but that also means some columnist might crack wise about not seeing much during his walk from the Courtyard to the Hard Rock Cafe to the stadium. And the city knows better than to trot out the state’s current slogan to this kind of audience: “Being the ‘Crossroads of America’ doesn’t say a lot other than you can drive through it or around us,” says Schultz.

The weather might not say a lot either, especially considering one reason some owners voted against Atlanta was a rare ice storm that struck when the city hosted the 2000 Super Bowl in, of course, a brand-new stadium. The average high temperature for February in Indianapolis is 38; the low is 21. And we average 7.8 inches of snow that month. In other words, corporate golf outings won’t be booked for Super Bowls here. “It’s very hard to overcome the weather issue,” says Marc Ganis, president of Chicago-based Sportscorp Ltd., a consulting firm that works closely with the NFL. “There are two questions for host cities: how and why. The NCAA’s experiences in Indy answer how — how the event is put on, how government entities help, how volunteers come together, how local media participate. Then you get to the why. In a place like Miami, the why is an easy answer: weather. Tampa Bay, the why’s an easy answer.”

“Why Indianapolis?” is a tougher question, especially with more warmweather cities staking claims to Super Bowls. Tampa and San Diego are establishing themselves as regular Super Bowl hosts alongside mainstay Miami, and if Glendale, Arizona puts on a good show in 2008, it’s likely in the loop for future games. (Longtime regular host New Orleans and its Superdome are out for the foreseeable future after Hurricane Katrina.) The NFL also continues to lay the foundation for returning a team to Los Angeles, where Super Bowls are almost certain to follow.

For Indy to squeeze in with those winter-friendly cities may take a better hook than a new stadium, but corporate clout like Detroit’s auto industry is nowhere to be found.

And Indy may not be on the level of other Super cities. “Being in the running is different than winning,” says Ganis. “I suspect that (Indianapolis) would be given every courtesy in a Super Bowl bid process, but reality at some point sets in.”

If the reality is that Indy is a longshot, it hasn’t hit home yet. A new stadium is on the way, and presumably a Super Bowl. The mayor promised Indianapolis has as close an assurance as you can get. He’s not considering any other possibility.

“We don’t need it to validate our status as a great American city or a great destination city, but it would help,” Peterson says. “But I haven’t thought about what if we didn’t get it, because I think we will.”

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