Why the NBA Should Be Important to Louisville

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This entry was composed before the release of the article discussing an independent economic analysis that was done to judge the potential impact an NBA team would have on the city.  This analysis stated that the city would see only a $2.4 million increase to the local economy.  Not only is that embarrassingly low, it stinks of being incorrect.  With a salary cap of $58 million plus salaries of executives and other workers, the local payroll tax revenue alone would equate to nearly $5 million annually.  And this doesn't even begin to include increases in revenue from merchandise sales, taxes on lease revenues to the Yum Center, and increases in spending in the Special Tax District which surrounds the arena downtown.

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I've written in the past that I thought the NBA in Louisville might be far-fetched, slightly off-based, and a stretch for the city to truly pursue.  But the day I wrote the post "Oklahoma City vs Louisville: A Basketball Case Study" I must have been drunk or high, or both.  I was being a moron.

When I met with the city's Director of Economic Growth and Innovation last winter he stressed to me that the city's main focus was trying to attract as much outside investment as possible that made sense for it to pursue.  Things where infrastructure might already be in place, but more development was needed.  Businesses that Louisville already participated in on some level, but might need a slight kick-start to improve upon.  When considering all of these facts, and the economic impact various industries might have, why an NBA franchise would ever be overlooked is beyond me.  We already have the infrastructure: a great NBA-ready arena (the Yum! Center), a plethora of 5-star hotels and restaurants for NBA opponents to stay at and chose from, and a concentrated amount of nightlife options within walking distance of both said hotels and the arena for players and coaches to frequent (because we know that Ballers gon' Ball).  And we have a huge fan base of basketball lovers within a 100-mile radius; one might even argue that it's the biggest basketball fan base in the country.  Sure the population of Louisville might not be big enough in-and-of itself to support a franchise, but when you consider the basketball lovers in Southern Indiana and the entire state of Kentucky you now have a population of followers that would be as big as any large market team in the League.  And we have capital.  With Papa Johns, Yum, Humana, Anthem, and UPS all headquartered within Jefferson County we have the start of a sponsorship base that would be as good as any around the country.  And what we lack in that area could easily be made up through partnerships with national firms that have a presence here such as Northwestern Mutual, United Healthcare, Kindred, and PNC Bank.  We aren't far off.

The arguments against a team are numbered and poignant: people who would support the NBA franchise aren't likely to also buy their season tickets to UL, UK, or IU games - hurting the already established college teams.  Attendance would be so low that the team would quickly be delegated to the annual conversation of contraction.  Local media outlets wouldn't have the capital to adequately support and market the team's games.  The Yum Center would need major renovations to house a team.  The University of Louisville, specifically, would be murdered by having to split dates with the team, and for having to share sponsorship dollars.  So on and so on.

Listen, these are all small items that, if people would really work together for the greater good of the city, would easily work themselves out in a positive way over time.  Starting with season tickets and attendance.  I am a UK fan.  I do not have UL or IU season tickets, and, while I'd love to have the opportunity to go to all of Kentucky's home games, I do not own those either.  But if an NBA team came to Louisville I would jump at the chance to support them because of the talent that would come through the arena, and the quality of basketball that would be played.  Fluff games like those that occur with the Long Beach States, Quinnipiacs, and Monmouths of the world would never take place.  Each of the 41 games played would be competitive, and would matter.  And even if the team were bad, how excited would people be to watch Kobe, Lebron, or Kevin Durant perform in our fair town?  Thousands of people would be interested in this spectacle!  And what if one of those guys were to say "Hey, Louisville is really cool!" wouldn't that just make our day?  On a pure numbers basis, the Yum! Center holds 22,090 folks (per their website).  Most nights there might only be 12,000-14,000 people in the stands depending on the opponent.  However, if the team is successful or the game is big this number could easily climb to 20,000+, allowing the team to average somewhere around 16,000 fans a game - and the average NBA game attendance last season was 17,273.  Not too far off.

Oklahoma City cited a statistic that attendance to nearby Oklahoma Sooner basketball games fell by 15% or so after the Thunder came to town, however this is in a state that is extremely football crazed and whose population isn't nearly as dense as ours in the immediate outlying areas of the city.  If UL were to see any drop in attendance after a franchise entered the picture I believe it would be minuscule as it is much more likely that the NBA team would suffer the loss of a patron if that person was given a choice between their longstanding favorite team or the new thing in town.  And while TV rights could be an issue, as there might not be many big dollar contracts available between a team and any of the local stations, I would guess that a regional institution like Fox Sports could be an option.  Or if the team wanted they could start their own station, keeping all the revenue from ads and television buys from Insight (Time Warner) that would ensue.

That leaves us with the issue of how they would fit with the University of Louisville.  And this really is the weakest argument in my opinion.  In my previous blog I did an analysis of the game schedules between UL's Men's and Women's programs and that of the Oklahoma City Thunder in order to see what the possibilities are for conflict.  And while there would be some, the reality is that only a few games a year (less than 10 total between all three teams) would really have to be moved around.  Something that is more than easily doable, to the point that that is really a non-argument.  And besides, with all that has come out on how little the University pays to rent the arena for a game, they should be more than willing to be flexible on dates when given the choice of that or paying a higher cost to put on their contests in the Yum Center.  Beyond that, imagine the synergies that could take place with a franchise and UL as students in their Sports Marketing, MBA, Sports Medicine, and Design programs might all have the opportunity of internships, temporary jobs, and other learning opportunities.  For students looking to gain a foot in the door to the ultra-competitive job market that exists within Professional Sports Franchises, this would be huge boon!  It would be a win for the University without a doubt.

At the end of the day, if the city wants to look for a way to increase payroll tax, increase its brand, and continue to push interest in a Downtown area that needs more consistent traffic, then an NBA franchise is the instant fix for all of this.  Millions of dollars would pour into city coffers through ticket sales, increases in tax revenues (from the added $58 million+ in salaries that the team would bring in), and increased foot traffic downtown.  This is something that would bring instant credibility to our city, and would go a long way towards re-establishing ourselves as the preeminent town in the South.  We'd have the best 2-minutes in sports, the best 2-week festival in America, the best college sports, and (potentially) the best NBA franchise in the country, to go along with all the other new and spectacular developments that have already begun coming to fruition throughout the past five years.  While it could take years and years to acquire, it's time for our city's leaders to stop being divided, to stop saying why we can't, and start realizing why we should.  In the 1960's and 1970's Louisville had two opportunities for Major League Sports teams, and has admittedly paid the price for ignoring them.  Please, for the sake of our town and the momentum we've developed, lets not do that again.