SBD/November 5, 2013/Franchises

Accuracy Of Report On Angels' Economic Impact In Anaheim Called Into Question

A report the city of Anaheim commissioned to find out the economic effect the Angels have on the area is "so replete with unsubstantiated assumptions that it can't be used as a reliable indicator of the team's financial impact on the city," according to interviews and public records cited by Martin Wisckol of the ORANGE COUNTY REGISTER. Texas-based Conventions, Sports & Leisure's 12-page report "makes generalized assumptions on consumer behaviors based on studies in other major league cities and uses formulas disputed by other economists." The report also "does not include millions in team-related city costs, some of which most City Council members were unfamiliar with until being informed." The Angels' economic impact on Anaheim is "important because the city is renegotiating the Angels' lease" at Angel Stadium, which runs through '29, at the request of the team. Although the team "has not publicly threatened to exercise its opt-out provision, at least three of the five City Council members have said they are concerned that the Angels might find more favorable circumstances and a new stadium elsewhere" in the greater L.A. area. Anaheim council member Lucille Kring said the economic impact is "probably the No. 1 factor" in wanting to keep the team. The report "credits the team" with generating $204M in new spending in the city and $4.7M in annual revenue for the city treasury. When using the consultant's "assumptions, net city revenue drops" to about $2.3M when the expenses are accounted for. But some economists are "skeptical of the consultant's numbers, taking issue with the report's methodology and data in determining the new spending and annual revenue figures." The report states that the biggest source of Angels-related funding to city coffers -- 58% -- "comes from hotel taxes." This is "one of numerous disputed estimates, with critics raising several challenges" (ORANGE COUNTY REGISTER, 11/2).
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Los Angeles Angels, Franchises

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