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Bills at risk of being moved to larger market

I am all for stadium commissions, studies and a no-stone-unturned search for a local owner who will annually turn his back on tens of millions of dollars to keep the Bills in Buffalo.

I am also all for understanding reality, acknowledging likely outcomes and preparing for a probable eventuality.

In other words, enjoy the Bills here while you can.

I like a long shot as much as the next guy. But let’s not kid ourselves. The economics of the NFL long ago whizzed past our smaller-market, economically stagnant burg. Such metropolises as Los Angeles, Toronto and even London are NFL-covetous – and vice-versa. With the team presumably getting sold to the highest bidder after Ralph Wilson’s estate is settled, the Bills’ future in Buffalo will likely not extend past the 2022 expiration of the 10-year lease. If it makes it past the one-time, 2019, cheap-buyout exit for the next owner.

“Long term, it’s fair to say the team is at risk of being moved,” said Ted Fay, a sports management professor at SUNY Cortland. “Buffalo doesn’t make common sense as a business model.”

The notion was seconded by David Carter, a sports business professor at USC and consultant for several NFL-seeking cities and a prospective NFL owner in Southern California.

“Ultimately, I think the money does talk,” Carter told me by phone Friday. “You have such a small corporate presence in the region. If you are not in a market that generates added revenue (for an owner), you’re really hamstrung. So I think greener pastures will be explored.”

I’m not trying to ruin anybody’s Sunday brunch. But odds are the team is not here for the long run. Granted, long shots sometimes pay off. And we have at least another six years to figure things out. Keeping the Bills here beyond this lease would likely involve a local owner who pays in full (to avoid massive debt payments), and will take tens of millions of dollars less in annual profit to stay here.

Let the search for that secular saint begin.

Our region doesn’t have a single Fortune 500 company or an abundance of private wealth. Owners in larger cities – Dallas’ Jerry Jones springs to mind – pocket vastly more dollars than an owner here in sponsorships, local advertising, luxury suites, club seating, season tickets, seat licenses (entry fees for season tickets) and other profit-churners. Making more money is obviously its own incentive. But maximizing dollars becomes imperative for the next Bills owner if he or she takes on debt to buy the team, worth an estimated $870 million. Facing annual loan payments of tens of millions of dollars – something Wilson never had – is a huge incentive to be in a market where you can rake it in.

That isn’t Buffalo.

A team in Los Angeles would be worth “well in excess” of $20 million more a year to an owner than a team in Buffalo, Fay said.

“It’s not just corporations buying luxury boxes, you have private citizens who can afford them” in L.A., Fay told me by phone. “They don’t even sell seat licenses at The Ralph.”

USC’s Carter concurred. “Any team in Los Angeles would be at least in the top quartile of NFL revenue-generation, based on sponsorships, luxury seats and the like.” Indeed, he added, the purchase price of the Bills may be inflated by a relocation expectation.

“The team will be valued not on what it’s worth in Buffalo,” Carter said, “but on what it’s worth in a market with a larger corporate base and presence.”

A new stadium might generate more revenue for an owner. But sports economists say it won’t squeeze nearly the numbers from our wealth-challenged region as a big-city crib.

“The margins of return aren’t there (for a new stadium),” Fay said. “You don’t have the corporate or private wealth in Buffalo to make it work.”

None of which sounds promising. But nothing is certain, Hail Mary passes sometimes connect. There are scenarios by which the Bills linger here longer. They include, said Fay, a benevolent local buyer; the NFL’s “brand” interest in keeping a team in a gritty, traditional market; heavy taxpayer subsidies; erosion of the league’s popularity; movement of other at-risk teams, or the failure of larger cities to get their stadium act together.

“The NFL, as a brand and image, likes those iconic, cold-weather, visceral places like Buffalo,” Fay said. “The league has to weigh the benefits and the costs – not just monetary – of extracting Buffalo from its equation.”

Time is running out, and it’s fourth-and-long. Time to rear back and fling it.