[Strutz]

http://www.ctv.ca/generic/generated/static/business/article2247559.html

New CFL teams: Civic pride or economic fumble?

$1:

Chris Hannay - The Globe and Mail

As Canada’s football season prepares to wrap up this weekend with a Grey Cup contest between Winnipeg and Vancouver, fans may feel like they’ve seen this cross-divisional match before.

In fact, they have -- twice already this season. Compared to other major sports, the Canadian Football League is tiny.

Only six cities -- including Ottawa, London and Moncton -- have economic bases strong enough to expand the CFL’s eight-team league, according to a Conference Board of Canada report by Glen Hodgson and Mario Lefebvre.

The Conference Board based its analysis on three main factors: population, disposable income and corporate presence. To host a big sports team, a region must have enough people with enough cash to make the entertainment venture worthwhile, as well as a base of corporations that would pitch in on sponsorship and high-end tickets.

Of the contenders, Quebec City has all the right market conditions to host a CFL team. The province is known for strong support for university-level football.

Unfortunately, Quebec City is probably too fixated on getting back an NHL team, and the Conference Board considers the city a strong candidate only in the long term.

Atlantic Canada certainly has the appetite for football. In the last two years, the CFL has set up one game a season in the Atlantic provinces, and a match in September drew a crowd of more than 20,000 to a Moncton stadium.

But both Halifax and Moncton suffer from low populations. The cities could only succeed, the Conference Board says, if they follow the Saskatchewan Roughriders’ model and become a regional team. Neither Saskatchewan nor Atlantic Canada have other major-league sports teams, so there is less competition for drawing fans.

Southern Ontario has a relatively dense and high-income population. About an hour’s drive apart, London and the Kitchener-Waterloo-Cambridge region each boast about 490,000 people with per capita disposable incomes in the high 20,000s.

This puts the economic conditions right for a football franchise, but for one problem: market saturation. Two CFL franchises in Toronto and Hamilton are already within driving distance, and two NFL teams lie just across the border in Detroit and Buffalo.

That leaves Ottawa-Gatineau as the top choice for an expansion. Our nation’s capital is home to 1.2 million people and an NHL team, the Ottawa Senators, which posts fairly strong attendance levels.

Ottawa is already slated to get a team in 2013, a deal that’s been held up by the municipal quagmire around Lansdowne Park, where the team would play. Local residents opposed the public-private partnership, but city council eventually approved the deal.

This isn’t the first time Ottawa has had a CFL team. While the region has sound economic conditions for hosting sports teams, two previous franchises have collapsed under poor management.

The storied Rough Riders, in the city from 1876 to 1996, had a rough ride in their last 20 years. Poor on-the-field performance led to ownership and management changes, which beget worse performance and small ticket-buying crowds. The downward spiral saw ownership change hands six times in the team’s last nine years, according to a separate Conference Board report.

The Renegades briefly returned football to Ottawa from 2002 to 2006, but were suspended by the league due to bad finances.

There are other obstacles. Few cities have CFL-ready stadiums, so multimillion-dollar projects would be needed before a team could hit the field. And whether these investments makes sense financially is up for debate.

Much scholarship on the subject find teams rarely contribute positively to the local economy, as owners and players often spend the bulk of their earnings elsewhere.

“One should not anticipate that a team or a facility by itself will either increase employment or raise per capita income in a metropolitan area,” sports economist Andrew Zimbalist told Freakonomics.

So, sure Quebec, London or Moncton could support a CFL team -- but would they want to?

[raydan]

This is a Canadian league and there are NO teams East of Montreal.
I've always thought that Atlantic Canada should have a CFL team and the CFL needs a team in Atlantic Canada.

[Mowich]

I understand the economics in the article and agree that you need a steady base of fans supporting the team. That said, we really do need more teams in the CFL. Would love to see the Atlantic provinces get together to support a team.

[Hyack]

Aside from that insanely idiotic move back in the early '90's when the CFL tried to expand by bringing in some American teams to try and eventually make the CFL a 20 team league, 10 US and 10 Canadian teams the CFL had always been composed of 9 teams, 5 in the West and 4 in the East. With the loss of the Ottawa Rough Riders in 1996, the Winnipeg Blue Bombers were forced to move into the Eastern division to even things out at 4 teams per division. In 2002, the league expanded back to nine teams with the creation of the Ottawa Renegades which then folded after 4 years. There are still negotiations going on to bring back an Ottawa team for the 2014 season, but only time will tell if the new team, the Ottawa 67's ever becomes a reality. It would be great if the Ottawa team made it back into the league along with another Eastern team based in Atlantic Canada. That would then make it a 10 team league evenly divided East and West which in my opinion would be the best thing that could happen for the CFL.

[sandorski]

All the more reason to increase Immigration!

[Freakinoldguy]

I'd love to see the CFL in a couple of those cities but I really don't think there's a strong enough desire or political will to build the 24k seat stadiums needed to break even.

I doubt that any of these cities could model their business plan on the Saskatchewan or Winnipeg plan making them community owned so without someone with big pockets we likely won't see this happen anytime soon.