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Former Philadelphia Mayor Addresses SPORTS AND THE CITY
by Ejim Achi

 

Ed Rendell finally made his way into Penn Law School – as the featured speaker in the Institute for Law & Economics’ Law and Entrepreneurship Lecture Series delivering “The Economics of Sports Franchises in Cities.” Now a partner at the Philadelphia law firm of Ballard, Spahr & Ingersoll, and running for the Democratic party nomination for governor of Pennsylvania, the former Philadelphia Mayor joked, “Isn’t it great to come speak at a [law] school that rejected me?” Joking aside, Rendell has enjoyed a rich relationship with Penn Law School over the years, most recently speaking at Commencement ceremonies and at the opening of the Journal of Constitutional Law offices in the late 1990s.

A 1965 graduate of the College, Rendell was introduced by Dean Fitts as a “quintessential political entrepreneur; a quintessential Philadelphian and urban sports fan.” An audience of over a hundred law students and faculty were in attendance at his lecture. Rendell asserted that “the direct economic benefit of sports franchises in the City of Philadelphia is considerable.” The value of a franchise, its size in terms of how many workers it employs, and the amount of tax revenue it supplies to the city’s coffers demonstrate the value of a given franchise in any major city. Using the Philadelphia Eagles as an example, Rendell reasoned that every Eagle earning about $1.6 million pays the wage tax paid by about 50 city factory workers, each of whom earns an annual salary of about $33,000. Sports franchises also produce new revenue streams: as Mayor, he tried to increase revenue without raising taxes, so his administration constructed a plan wherein opposing teams would pay taxes for money earned in the games they played in Philadelphia. “The city reaped about $2.1 million a year from the plan.”

Rendell also pointed out that the impact of sports franchises on almost every aspect of the hospitality industry demonstrates the pervasive economic benefits for city businesses. “For example,” he said, “People buy food before and during games. The sales tax on food and liquor alone is a small part of the tremendous multiplier from economic benefits of franchises.”

 
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