In early February of this year, the Governor of Wisconsin heralded a plan that would keep the Brewers in Milwaukee until 2043. The city/state simply needed to give the Brewers a “one-time investment of $290 million” so that they could “maintain and improve” their current ballpark. This is important because, according to the Governor, the Brewers are a part of the state’s economic success.
Then, the President of Operations for the Brewers noted that a 2020 study done by the Metropolitan Milwaukee Association of Commerce showed that the Brewers have “contributed $2.5 billion in direct statewide impact since opening its doors in 2001.”
$2.5 billion? Where exactly did we come up with this number?
“Miller Park has generated $2.5 billion for the economies of the city of Milwaukee and the state of Wisconsin, according to a new study commissioned by the Metropolitan Milwaukee Association of Commerce. The study, conducted by Conventions, Sports & Leisure International, was released Monday by the MMAC.”
– Milwaukee Journal Sentinel, 02-17-20
Ah, the Conventions, Sports & Leisure International (“CSLI”) group. No wonder the number is absurdly high. For those who don’t know, CSLI claims to “provide focused and independent research to the public.” Yet, they do nothing of the sorts. Unfortunately, this doesn’t stop just about everyone from passing on this absurd stat as if it were fact. Wisconsin Public Radio wrote a story on it. The Milwaukee Journal Sentinel wrote about it. Athletic Business discussed it. Wisconsin business blogs cited the stat. The list goes on and on.
So, why are reports from CSLI so bad?
First, let’s start with the fact that CSLI is owned by the New York Yankees and Dallas Cowboys. They are writing reports that they themselves benefit from. Nothing bias about that. But maybe they hit the pavement and did extensive research into the Brewers financial impact. Nah, that is too much work. Their “independent research” got their financial numbers from the Brewers themselves. Yes, CSLI asked them for financial figures and the Brewers happily gave them over what they believed the answers to be. Bias-Free.
Second, CSLI has a terrible history of inflating and misconstruing numbers. Field Of Schemes has done a fantastic job covering CSLI’s questionable history.
Two years ago, several local investors in Montreal needed good publicity to help their chances of getting an MLB team back to the city. So, they asked CSLI to do a study showing how great Montreal was as a “big-league market”. It worked and suddenly Montreal was placed “12th among the 27 existing baseball municipalities in TV market size, 15th in metro population, and 18th in median household income.”
Then a local Montreal newspaper read the study and found out that CSLI made a massive mistake. CSLI forget to adjust for U.S.-Canadian exchange rates. Oops. So, what happens when we fix the study with the correct exchange rates? Well, Montreal now is at the bottom of MLB cities in most stats. As the local newspaper wrote in their story, “According to three economists consulted … this is a basic error that changes the conclusions of the study.”
2) Washington DC
Or how about the time in 2014 when CSLI was forced to admit that their study on DC United wanting a new soccer stadium was unbelievably inaccurate. Specifically, two-thirds of the so-called benefits of a new stadium weren’t actually benefits at all. They were, and this is actually true….a typo.
So, what exactly did the District of Columbia get when they paid CSLI? A 400-page report that had inflated numbers and typo’s effecting the most important sections of the report?
3) San Diego
How about the time that San Diego asked for a glowing report on the Padres Petco Ballpark and its effect on the city? The report states that the city is getting a fantastic return on investment. Except, the report does not include several basic economic principles such as the “But-For” or the “Substitution Effect”.
The report also makes no separation between the ballpark being built and the convention center being expanded at the same time. As an author told the local newspaper, “This report is largely useless”. Well said.
We should build the Anaheim Angels a new ballpark because they bring close to $200 million a year in “economic impact” according to a CSLI report. But after talking to actual economists and city officials, the OC-Register wrote that the CSLI report was “so replete with unsubstantiated assumptions that it can’t be used as a reliable indicator of the team’s financial impact on the city”.
Yet even with all of this history, everyone still runs with stats that come from CSLI reports. I could give so many more examples of CSLI reporting garbage that was done just to get an arena, ballpark, or stadium built. Remember the CSLI report stating how fantastic the economics of Louisville’s KFC Yum Center were after being built? Now, the city is paying $20 million in annual debt service, while the overall debt peaked at around $800 million.