How long can sports survive its business side?

The NFL’s last domino for the time being has fallen. After the Chargers and Rams left St Louis and San Diego in favor of sharing the nation’s second largest media market and with the City of Oakland having clearly moved on (Mount Davis’ ROI proved pathetic after its PSL financing mechanism fell apart), the Raiders are now moving to Las Vegas. Each of these franchises left countless passionate, loyal fans behind for the promised riches of a larger market and a new stadium.

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I have been a pretty big sports fan for most of my life, but today I worry about the next generation of sports fans and the games themselves. At the end of the day, what are we rooting for? The players increasingly come and go. The owners are just some random billionaires. What’s left? The laundry? Personally, I root for the teams that I root for (Oakland Athletics, Golden State Warriors & San Francisco 49ers) largely out of the nostalgic connection to my childhood. I cannot wait to take Henry to his first Sacramento Kings game and expect I will develop more of a connection to the team as they become a part of Henry’s childhood.

I never cared that the Coliseum was looked down on by the league or minded sitting in the nose bleed seats. I have fond memories of sitting huddled under a blanket at chilly April night games with my family. I never cared that the Run T-M-C and later 90s Warriors teams were terrible defensively, I just enjoyed how much fun it was to watch all those points being score. The first NBA game I ever went to saw the Warriors and Nuggets combine for 320 points . What kid wouldn’t love that?

I have struggled to maintain my connection over the years as the A’s have continuously threatened to move away (made worse by my childhood hero facing steroidal disgrace). Would I still root for them? Would the laundry’s connection to my childhood be enough, even if they were no longer from my hometown? Probably not. So should they stay there perpetually despite the MLB choosing to relegate them to small-market status because of favorable territorial rights bestowed on the Giants? That’s a harder question to answer. The Las Vegas Raiders answered that forcefully, breaking the hearts of many longtime, loyal Oakland fans. The The Los Angeles Chargers and Rams broke their San Diego and St. Louis fans’ hearts just as callously over the last year.

Should we blame them, given the economics of the situation?

That’s a tough question to answer. But I will answer it this way: Professional sports, as a business, has always been built on the loyalty and irrational exuberance of a prideful, local fan base. That was a good business for many, many decades. It made a lot of people a lot of money, while bringing pride, joy and sometimes the most beautiful kind of suffering to their communities. Over the last two decades, though, professional sports have gotten a major taste of national TV dollars. With that taste, they have become addicted and are shifting their business model to ensure they get more and more. Loyalty matters less because they are cashing in when you are tuning in, no matter which team you root for. But there are two problems with that model (aside from any ethical questions):

First, the centralized national TV model is dying and ESPN is a big part of what is driving consumers to cut the cord. The technology on this is accelerating and the current model is unlikely to survive to the end of the next decade — it might not even survive this decade. Once we’ve shifted to an a la carte system, the NFL, etc will either have to put up a serious financial barrier to entry for fans, in order to generate TV revenue, or else figure something else out.

Second, if you cut the relationship between communities and their sports teams, you are going to stunt the development of future fans. My friends in Oakland and San Diego are not likely to teach their kids to love the Raiders or Chargers. Most of them will probably largely just forget the NFL exists. If you live in San Diego and can go to the Beach in November, why would you spend that time in front of a TV? I love football, but I love football because of the 49ers. If you cut off that relationship, football is meaningless to me. I couldn’t care less about college football. Why? It’s the same sport, that doesn’t make sense. Simple, I went to non-BCS colleges, so I have never developed a connection to and really could not care less how it plays out. If the A’s move from Oakland, Henry will never watch their games or likely any others. He will never grow up with a relationship to Major League Baseball and he’ll find something else to do with his time and money. He may not even grow up with a relationship to Minor League Baseball, given the Rivercats own lack of loyalty. I’m not sure if he’ll be better or worse off because of it, but I’m pretty sure MLB will lose out just like I’m pretty sure the NFL is losing out by alienating the 17th and 20th largest metropolitan areas in the country. But hey, Mark Davis, Art Spanos, and every other NFL owner, just got a little richer, so I guess the economics work out in the short run.

At least one NFL owner, Stephen Ross of the Miami Dolphins, seems to get it, in casting the lone ‘No’ vote, he said:

My position today was that we, as owners, and as a League, owe it to the fans to do everything we can to stay in the communities that have supported us until all options have been exhausted. I want to wish Mark Davis and the Raiders organization the best in Las Vegas.

As he so often does, Jack Ohman succinctly cut to the heart of the issue:

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I have said it before and I will probably say it again, it is much too soon to meaningfully claim Sacramento’s new arena to be a financial success or failure. That said, I am glad that with the Kings’ new home locked in, my son will not have his little heart broken by the Kings leaving his hometown for at least the next several decades.

Of course, any readers now yearning for a simpler team in sports may wish to attend the State Library’s upcoming event, “Sacramento Baseball from the 1870s to the River Cats” on April 5th.

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Does Old Sacramento Need Saving?

You might have heard, the City of Sacramento built a new arena downtown. Some people are very excited about it. Others a bit less so. That divide may last for a while. It will take a number of years for either side to develop meaningful evidence of whether it was a good idea for spending a quarter billion dollars. In the mean time, everyone who cares about Sacramento’s future should be rooting for the arena’s success, but more importantly, looking to smooth out any problems that may arise.

One concern I have been hearing widely is that parking costs related to the arena are undercutting the public’s ability to patronize Old Sacramento’s businesses and cultural amenities. As one Old Sacramento business owner puts it, “We’re withering on the vine down here.” Speaking for myself, as a parent, when deciding where to take my child for a fun afternoon, paying a $15 parking tab would definitely be an impediment. That said, attendees of an arena event might stop by one of Old Sacramento’s businesses or be reminded of the fun times their family has had at the Railroad Museum.

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So is Old Sacramento in trouble?

Thanks to the good folks at State Parks and the City of Sacramento, I was able to quickly acquire the data to start to investigate the question, how did the arena impact attendance at the Railroad Museum and revenues for the local businesses?

Despite the concerns voiced by many, attendance at Sacramento’s venerable Railroad Museum has been steady through the first half of the Golden 1’s inaugural season. This may represent a small disappointment, after about two years of steady growth, but it is far from a catastrophe.

Railroad Attendance

How about the businesses? That data is a little less timely, only running through the third quarter of 2016, missing the Kings season, but it does show a small 2.4% decline over the prior year. It may have been impacted by the loss of parking at the mall or difficulties related to construction. It may also have just been a small correction after growth of 5.7% the prior year. The revenue has bounced around quite a bit, so we should avoid reading too much into a small change. I am told that revenue was down modestly this winter, but that could just as easily be explained by the extreme weather.

It is unclear to me if Old Sacramento needs saving from anything except the freeway, but there is nothing like a good controversy to drive progress. As a part of his “Destination Sacramento” campaign, the mayor and some business leaders are pushing to kick the area up a notch as well. Ideas include public art, water taxis, expanded dinner cruises, additional events, best of all, a terrace that would literally allow visitors to dip their toes in the river and, worst of all, a new name.

The terrace would be amazing. The challenge would be dealing with the numerous layers of bureaucracy involved with ensuring our region’s flood safety. Public art, as well, whether a series of tomato on a fork statues or a statue commemorating the sesquicentennial, would be fantastic. I suspect at some point one of my colleagues at Sacramentality will write on the economic benefits of public art. I wonder about the value of water taxis that do not really have anywhere to go, but I would not write it off.

Here is another idea. The City could use perceptions of difficulty on game days, whether real or imagined, as a marketing ploy the rest of the time. It could offer discounted parking on non-arena days and blast it out on social media, email lists and the morning shows as “family fun days.” Best yet, the program would cost virtually nothing.

Who We Are: A City of Trees

For too long, Sacramento has struggled to not just find, but to really celebrate, our identity. We have grappled with an identity crisis. Whether it is our Sac’o Tomatoes cow-town roots or perceptions that we are little more than a pit stop between San Francisco and Tahoe, too often we find ourselves with a chip on our shoulder, trying to keep up with the Joneses but distracting ourselves from the fantastic, unique, comfortable city that we all share. Throughout this series, I use data to explore different aspects of Sacramento to try to help us understand — and celebrate — Who We Are.

In seeking “to make sure that everyone on Interstate 5 knows that Sacramento is America’s Farm-to-Fork Capital,”Sacramento’s friendliest water tower has managed to stir up some controversy. It has riled up a number of this author’s neighbors in Nextdoor Pocket and received a thumbs down from at least one bicyclist. Not surprisingly, Ray Tretheway, the Executive Director of the Tree Foundation prefers the old version.
“It symbolizes why people think so highly of Sacramento – because of its glorious tree canopy. It’s the best (motto) for today and for the future.” – Ray Tretheway
OHMAN031217colorOur city’s Pulitzer Prize winning political cartoonist, Jack Ohman also offered a number of colorful alternatives (click the link to see all of them). The State Hornet even suggested the tower “can go fork itself.”
 Ironically, when the water tower was originally painted in 2003 (at the behest of then Councilman Robbie Waters), the city turned down ideas focused on agriculture to run with the “City of Trees” motto instead. Today, having come to embrace our agricultural heritage, proponents of the change point out that Sacramento is America’s only Farm-To-Fork Capital (most similar cities prefer the term ‘Farm-to-Table‘) but that it is one of many that claim the moniker City of Trees.
Sacramento’s urban forest has been recognized as among the best in the nation and even the world. With 23.6% covered in trees, Sacramento has it made in the shade with the Sacramento Tree Foundation and SMUD encouraging us to do the planting.. Our city was also among the original cities designated as a “Tree City USA” by the Arbor Day Foundation in 1976. Sacramento State was even named a “Tree Campus USA.” Clearly, while we are not the only City of Trees, Sacramento is among the very most deserving of the title.
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Trees are also very much worth celebrating. They cut pollution, increase land value and even make you feel younger. They offer incredible bang for the buck in dealing with modern infrastructure and environmental concerns, especially carbon dioxide and other air pollution. The name is also the inspiration for the City of Trees music festival, adding to the cool factor. They also make our city a particularly good destination for an urban hike.
tomato-345280_960_720One would hope that Sacramento could be both pro-tree and pro-fork. Celebrating our agricultural and culinary heritage should not have to come at the expense of our urban forest. One wonders if, with a bit more artistic/desktop publishing creativity, both of these identities couldn’t be celebrated side-by-side. Better yet, give the trees back their water tower and create something new to celebrate our beloved tomatoes. Perhaps our city could take inspiration from Chicago’s cows or Austin’s guitars and create a public art program celebrating both our love of forks and tomatoes?
SacramentoGISTreeMapWe should also take care to frame these conversations and subsequently policies in a way that works to the benefit of the community as a whole. Too often, the immense co-benefits of urban forestry tend to miss the most at-risk populations. Sacramento is no different. The cities more affluent neighborhoods in Council Districts 3 (22%), 4 (25%), 5 (19%) and 7 (21%) have high levels of canopy coverage, while more at-risk neighborhoods in District 2 (15%), 6 (14%) and 8 (12%) have more modest canopies. District 1 (5%) may cease to be such an outlier in a few years as its newly planted canopy has time to grow. (Similarly, I would tend to doubt that any more of the benefits of FtF trickle down to the residents who need them most — prove me wrong, advocates, prove me wrong!)

Opportunity for equality abounds in Sacramento’s universities

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They say that education is the great equalizer.

The Equality of Opportunity Project, led by Stanford economist Raj Chetty (cue Mugatu: That Raj Chetty’s so hot right now!) has provided a tremendous dataset to help us test this axiom. The team assembled data from 30 million college students, demonstrating how America’s colleges and universities contribute to income mobility.

The resulting report focuses on success as the frequency with which colleges move students from the bottom income quintile to the top. This combines a measure of access (share of students in the bottom quintile) with a measure of success (portion of those students starting in the bottom quintile who are able to reach the top). This is a reasonable approach, but not the only one or, necessarily the best one. Many elite universities (Ivy League and similar) score well on the success measure. They specialize in sending a narrow, already high-achieving group of students into the top income bracket. Those elite universities universally score quite low on the access measure. When the Chetty team combine those two score, the elite universities are graded middling or worse.

stc-logo-vert-2-lineBy contrast, some public colleges and universities have 30% or more of their students coming from low income families. Most of them, however, send a relatively small share of those students into the upper income brackets. South Texas College, for example, draws 52% of its students from the lowest income quintile. Not surprising for a small college in impoverished Hidalgo Texas. Of those low-income students, only 13% are able to advance to the top quintile.

While both measures have an important story to tell individually, I wonder about the value of conflating access with efficacy. Doing so is meant to allow for a meaningful comparison between highly selective schools and public colleges and universities that, by design, do not have admissions policies designed to weed out 90% or more of their applicants. Ultimately, the approach is rife with selection bias and is grading schools on a measure that few have much control over.  With the exception of the most selective universities, this measure of access is not primarily a function of policies, outreach strategies, or other administrative decisions. Rather, the makeup of the student body is defined by the community they serve as well as the ability of the local high schools to graduate students with the basic qualifications needed to proceed to college.

I also wonder about the value of focusing on whether colleges move students from the bottom quintile into the top. Has a college failed if it helps its graduate move from poverty as a child to the middle class? Is our goal affluence or bust? Perhaps those Ivys should consider it a failure, but most college should not. In fact, in terms of sheer arithmetic, doing so is effectively setting up a requirement that everyone be above average, which usually only works out in Lake Wobegon.

educationopportunity-columbia-sunyI prefer to focus on the share of low income students that are able to move into the middle class or higher (which I am defining as the top two quintiles) and make more narrow comparisons among comparable colleges and universities. Is it truly meaningful to compare Columbia University with State University of New York (SUNY) Stony Brook? Would a low income 18-year-old chose Stony Brook over Columbia? Should they? Despite SUNY scoring nearly three times as well by Chetty’s measure, the answer is no. If accepted, from a future earnings perspective, any student should jump at the opportunity to attend any of the elite universities. Columbia scores poorly on Chetty’s measure, though because they admit relatively few low income students. Instead, I would offer that it is more meaningful to compare Columbia to its Ivy League companions and Stony Brook to other SUNY campuses and perhaps other comparable state universities.

educationopportunity-csuchartSo how does Sacramento fare? Our flagship university, Sacramento State, excels, 22nd among the 375 comparably “selective” public universities in the country and second among the non-technical CSUs. Sixty-four percent of low income Sacramento State students were able to move up into at least the middle class, edging out San Diego, Fullerton and Long Beach and trailing only San Jose (69%). This ranks better than a number of elite universities, including Duke, Amherst and UNC Chapel Hill, as well as two UCs, an outcome that is particularly impressive given Sacramento’s moderate income levels. Overall the top of these rankings is dominated by technical schools, CSUs and SUNY campuses.

So would a low income student be better off attending Sacramento State than Duke? Individual experiences of course vary, but according to Chetty’s class mobility data, yes, the average low income student will earn more money after attending Sacramento State than Duke University, at a fraction of the cost.

Looking across the causeway, Davis also represents well. With 71% of low income students finding their way into the middle class or better, the Aggies are third among the UCs, but ahead of both the Bears and the Bruins.

What is most impressive, though, is that unlike Columbia, Duke or even UC Davis, Sacramento State (and the CSU system, overall) is lifting the prospects of low income students, regardless of SAT scores. Given that most of these students stay in the region, the success of Sacramento State is not just helping these indviduals, it is lifting the economy of the entire region.

Who We Are: A City of Choice

For too long, Sacramento has struggled to not just find, but to really celebrate, our identity. We have grappled with an identity crisis. Whether it is our Sac’o Tomatoes cow-town roots or perceptions that we are little more than a pit stop between San Francisco and Tahoe, too often we find ourselves with a chip on our shoulder, trying to keep up with the Joneses but distracting ourselves from the fantastic, unique, comfortable city that we all share. Throughout this series, I use data to explore different aspects of Sacramento to try to help us understand — and celebrate — Who We Are.

20170130_125659There are certain places in this country that people who are born there rarely leave. A seemingly astounding 40% of the country lives in the same place they were born. This phenomenon has been well documented by countless nostalgia-rock and country songs.


Not surprisingly, these folks cite connection to family, comfort, and a feeling of fitting in as their reasons for staying put. They tend to be less educated, but perhaps surprisingly, not lower income. They also tended to vote for Donald Trump.

Movers tend to be moving to opportunity. This includes higher educated professionals, who tend to move to higher cost urban areas. It also includes less educated folks, often leaving these same urban areas for lower cost regions with growing economies, especially in the sunbelt, or longer commutes in inland California.

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Census Migration Flows (Brown: Net Immigration to Sacramento; Blue: Net Emmigration)

Sacramento is not the top California destination of movers. Not surprisingly, dynamic Bay Area counties top the list (among larger counties). Los Angeles’ more affordable, inland neighbors, San Bernardino and Riverside have also been benefiting from the coastal housing crunch. We top other regions, though, and are above average as a destination, with 5.3% of our neighbors new to the region in the last year, compared to 4.9% across the state.

More notable, though, is the high level of immigration, combined with a relatively low rate of emigration. Other counties with a high share of movers also typically have a high share of leavers. San Francisco County averages a net domestic loss of nearly 14k per year, Alameda County nearly 2k, San Mateo County over 2k. In the Bay Area, only Contra Costa County (despite the lowest immigration rate) didn’t lose population to domestic migration. A lot of folks choose to move there – to try to make their fortune; for education; for the premium night life – but before long, many of them decide to leave, often in search of more affordable housing and a quieter place to raise a family.

Sacramento, by contrast, is a city where people choose to move and, subsequently, choose to stay (net domestic immigration of 4k per year). This author is a perfect example. Having grown up in the Bay Area and spent my college years in Los Angeles, I moved to Sacramento a bit over a decade ago. Honestly, I did not know what to expect. Aside from attending a couple of political events at the Capitol, one (perhaps) excessively enjoyable weekend with a college buddy and (naturally) driving past on my way up the mountains (as a rafter, rather than a skier), I had spent less time in our state’s capital than our nation’s. Less still in the neighborhoods beyond the domes.

No, Sacramento was never part of my plan, but life brought me here in 2006. A year later, those circumstances no longer offered any reason to stay, but Sacramento had started to grow on me. I still planned to return to the Bay Area at some point, but was in no need to hurry back. Within a few years, though, Sacramento had become home. With a good career going, I had no reason to leave. With my wife, many new friends, and involvement in a number of community organizations, I had many reasons to stay.

neighborhoods_eSacramento has the best of both worlds. With an unemployment rate that’s better than the state average and housing prices that are still reasonably affordable, it provides an affordable home for nearly everyone. With distinct, unique neighborhoods it provides a place where everyone can fit in and feel like part of the community. Sacramento offers a modern economy and a place we can really call home. It is no wonder people choose to move here – and no wonder people, like me, choose to stay.

Statistics based on ACS 5-year data.