If you’re a sports fan, you’re probably familiar with the annual “lease and buy” deals between the NFL and its teams.
Those deals are a form of corporate welfare, where teams give away millions of dollars in guaranteed cash, and the teams get to keep the money if they don’t win a championship in the next year.
It’s a great system, but sometimes it doesn’t work out as well as advertised.
Now, a new study by the non-profit National Football League Players Association shows that in some of the most popular franchises, the deal is often a complete waste of money.
The study, titled “The NFL and the Lease and Buy Problem,” analyzed the contracts that have been handed out to the league’s 30 teams over the past five years and found that some teams’ leases are worth far more than what they would have paid under the old system.
“A lot of the leases that are being offered to teams are actually worthless,” said NFLPA President Ray Barrow.
In some cases, teams have given up the right to sell their stadium lease at a discounted rate to new owners.
When you consider that many of these leases are in a prime location, including in the heart of a city, these teams can make money off of the deal without actually having to win the title.
Among the biggest winners in this trend is the Philadelphia Eagles, which have been able to lease their stadium for more than 40 years at a discount rate.
The Eagles had the second-highest percentage of team-controlled properties, after the Houston Texans, at 20.5 percent, according to the study.
The Philadelphia Eagles lease was valued at $1.4 billion, or $917,000 per year.
The Houston Texans lease was worth $1,854,000, according the study, and that was on a 20-year lease with a $200 million discount.
Other teams that have benefitted from the new lease-and-buy model are the Green Bay Packers, Baltimore Ravens, Atlanta Falcons, Pittsburgh Steelers, Dallas Cowboys, Miami Dolphins, and Carolina Panthers.
The New York Giants have leased their stadium since 2010, while the Philadelphia Phillies lease is for just under two years.
While it’s not perfect, these are some of a handful of franchises that have made the transition to a new lease and buy.
To find out which franchises are the biggest losers in these deals, the NFLPA teamed up with Inside Higher Ed, a sports data company, to track the leases handed out by each team.
They looked at the average value of the teams’ stadiums, including the stadium-tax rate, the rent for the stadium, and other variables.
Here are the ten franchises that are most at risk of having their lease and purchase deals turned into cash:1.
Philadelphia Eagles – $1 billion2.
Houston Texans – $200,000per year3.
Pittsburgh Steelers – $6,600per year4.
Dallas Cowboys – $9,500per year5.
Baltimore Ravens – $11,200per year6.
Green Bay Packers – $14,000Per year7.
New York Jets – $15,400per year8.
Atlanta Falcons – $18,000PER year9.
Dallas Mavericks – $20,000 Per year10.
Carolina Panthers – $24,600Per yearAccording to the NFL, the teams with the biggest losses are the Cleveland Browns ($7 million), Jacksonville Jaguars ($9 million), Denver Broncos ($15 million), and Indianapolis Colts ($15.5 million).
For every $1 million in NFL stadium revenue, the Philadelphia, Pittsburgh, and Houston teams would save $1 in rent and/or tax revenue, according Toe Blake, executive director of the National Football Team Owners Association.
“The Philadelphia Eagles are taking advantage of a very, very strong market and they are putting a team in a very bad situation,” he said.