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ESPN: The Worldwide Leader In Hypocrisy?

Steve Eder and the New York Times take ESPN to task for receiving "about $260 million in state tax breaks and credits over the past 12 years," including $84.7 million in development tax credits and another $15 million thanks to simple tax code lobbying.

This is of note considering recent coverage questioning the tax status of the NFL and the PGA Tour. Just recently the excellent Outside the Lines took the tour to task for its charitable giving. You may recall thee primary takeaway involved over $200 million in federal and state tax breaks the PGA Tour had received over the last decade or so. An amount was actually less than what the mothership was mooching off of one state in the union. Granted, I've never been to Bristol and this all may be perfectly justified to get anyone to set up shop there. However, the sweetheart status does not help the net's credibility when reporting on the very same topic.

Bloomberg's Kathiva Davidson noted the problems with this dichotomy.

And just two weeks ago, ESPN made waves with an in-depth “Outside the Lines” report on the PGA Tour’s nonprofit business model, which has resulted in nearly $200 million in federal tax exemptions over the last two decades.

The most recent piece acknowledged the group’s charitable contributions but questioned how much of it actually serves needy groups and whether those benefits outweigh the cost to taxpayers. Bristol residents should probably start to question their local politicians the next time they want to further shift the tax burden away from the Worldwide Leader.

While we're on ESPN analysis, a recent Deadspin post by Patrick Burns reported his findings from 23,000 minutes of Sportscenter viewing and found that if you are a partner of the network, you get coverage. If not...

In reality as defined by SportsCenter, there is no such thing as "the four major leagues." Add coverage of golf, NASCAR, club and international soccer, the Olympics, and tennis to what the NHL got, and you still don't reach half the time spent on the NFL. Football and basketball, in both professional and nominally amateur flavors, took up well over half of SportsCenter's time between them. Add in baseball and you've accounted for about three-quarters. Tennis—all of it, the entire sport—got about half as much coverage as Mark Sanchez did all by himself, and he sucks.

Granted, this doesn't come as a surprise but it was nice to see someone quantify the ESPN bias toward business partners. Certainly they are well within their right to emphasis home-programming, which is another reason golf bodies talking to them about rights deals should think twice about clean breaks.

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Reader Comments (27)

Sorry Geoff, that's apples and oranges. A company getting tax breaks for investing is something the lawmakers intended. A for-profit-company like the PGA Tour gettting tax breaks for non-profits is not
12.28.2013 | Unregistered CommenterRyan
Why are we always looking at how to tax more. Why can't we look at how to spend less. The government makes way more than any company. Why can't they be profitable? We need people who can run a company in charge of running the government. When you have 2.5 trillion coming in, you should be able to be profitable. It's not a revenue problem.
12.28.2013 | Unregistered CommenterRobbie
The tax code should be so simple...... however politicians have the keys to the system.
12.28.2013 | Unregistered CommenterNo Longer
@ Robbie: Government's role is not to be profitable. Its role is to make laws, govern, and provide the services that the private sector either can't - or won't.
12.28.2013 | Unregistered CommenterTed Ray's Pipe
Severe campaign finance reform, terms limits, simplified tax code. Being elected shouldn't be an industry unto itself. Perhaps then the influence peddling and donation "payback" will at least mitigate and force corporations of all types to stand on their own.
12.28.2013 | Unregistered CommenterAG
And this is a surprise? The tax burden always lands on the middle class. But the gret thing for ESPN is that they are able to keep the minions preoccupied with the butt fumbles of the world while the average family gets fleeced by their cable bill and the tax bill. Stadiums being built on the publics money and risk without the profit sharing is another crime that the average jersey wearing drunk gets the shaft also. If it was not for beer, Pringles and corn syrupy drinks and distraction like ESPN , FOX NEws, I swear there might be a middle class uprising!
12.28.2013 | Unregistered CommenterVwgolfer
Ted rays pipe
That would be great!
12.28.2013 | Unregistered CommenterRobbie
Robbie: And it will happen as soon as all federal elections and most state elections are publicly funded, which will be much cheaper in the long run for all concerned except the funders and their handmaidens in the advertising world. Make tv and radio provide free time as part of their license renewals. Our president and congress critters will then have to answer to those who provide the votes instead of those who provide the money. Term limits, other than elections, will not be needed. Money is not speech. What a concept! No secret which side I am on and I'll gladly take my chances. I won't hold my breath waiting, though.
12.28.2013 | Unregistered CommenterKLG
Washington has a Koch problem.
12.28.2013 | Unregistered Commentertlavin
It's absurd how much football there is on ESPN and other sports stations, given that it's a basic, barbaric sport that doesn't lend itself much to analysis. Golf only turns up when it's Tiger or a spectacular hole-out. Hockey is frozen out on ESPN for the most part now that it's a NBC property exclusively. Very poor programming mix, with annoying announcers.
12.28.2013 | Unregistered CommenterMedia driven
Most of the time, my home state screws things up. In this case, ESPN provides a lot of good jobs in a state with no growth. Essentially, CT agreed to forego the excessive taxes that we impose on our businesses.
12.28.2013 | Unregistered CommenterBrad Ford
i'm no fan of espn either but that analysis doesn't say or imply anywhere that only business partners get coverage. unless i'm missing something? it's just saying nfl/mlb/nba get 75% of all airtime.

the analysis is goofy in the first place because it isn't compared to the total revenue / market cap of the sports in question. if 25% the sports pie in america is taken by football and espn devotes 25% of airtime to the NFL, then coverage is proportional to popularity. the only thing the analysis is saying is that popular sports and popular sports figures get alot of coverage. duh?

actually if you compare golf coverage (3.3%) to the average sunday rating share (usually between .5 and 6), it's probably about in line with national popularity.
12.28.2013 | Unregistered CommenterMatt Cambro
Matt makes sense. If I'm selling ads on my network I'm covering the NFL. Golf? Crickets.
12.28.2013 | Unregistered CommenterAG
...hence the creation of the GOLF channel all those years ago...y'know to showcase the sport with it's own dedicated channel? Has TGC not received a single dime from uncle sam?

It really doesn't make sense for ESPN to cover any golf at all IMO except for reading off the score(s) at the end of the day. For those who want golf coverage while SPortscenter is on the AM loop.. simply change the channel.
12.29.2013 | Unregistered Commenterjohnnnycz
Ryan is right. Incentives in the form of tax breaks for economic expansion helps to grow jobs and ultimately, the tax basis. That's sound fiscal policy and it doesn't come close to "hypocrisy". PGA Tour events are "staffed" by a massive volunteer force. If they were a for-profit entity, the cost to employ thousands of part-time workers for each event would be astronomical. The Tour's deal has a bit of a smell to it, but ESPN's comes across as the media reacting negatively (shocking lack of balance in it's reporting) to a progressive program of economic growth.

As for SportsCenter weighing coverage to "partners"? Are you kidding me? Does it shock anyone that half of the coverage is the NFL and NBA? They all do that. What about Golf Channel? Does anyone believe that their coverage of events, business or equipment is not based on who their "partners" are? They are owned by ComCast, who also owns NBC. NBC just built a huge complex in Stamford, CT for the NBC Sportsnet. How much tax incentive were they given (which is right thing to do, otherwise, they could have based their network anywhere)? But if we're going to cast a white-hot light on ESPN, shouldn't we strive for journalist balance?
12.29.2013 | Unregistered CommenterWondering
Creating good legislation is hard, so people who are professionals are a bad idea? I think we should have term limits on Dr's, how dare they keep advancing as they get more experience, or like their job #dumbstuffpeoplesay

You use (or should use) tax breaks as a way to get greater return for the community. Taxes exist because we all use shared services, that road you take to the business isn't being paid for by the business even though they'd have a hard time existing without it. Governments role is also to correct market inefficiencies (markets work under certain assumptions, those assumptions don't actually hold true in real life). And finally to enforce certain social norms: children should all be entitled to an education for instance (and if you truly believe in merit then you believe in public education and some other programs).
12.29.2013 | Unregistered Commenterelf
Comcast (NBCUniversal, then) did receive tax breaks for NBC Sports Group to locate in Stamford. It was a $20 million loan and undisclosed tax credits from the state, according to the New York Times.

There'a a disconnect, however, between the corporate side of ESPN/Disney going after tax breaks and the news side of ESPN reporting on tax breaks by others. I'd think the reporters were told nothing of their own company's deals, nor to not report them if they did know. At my shop, we never had a clue what the front office was up to, or if it was up to anything at all. All we knew is there weren't many ads in the paper.
12.29.2013 | Unregistered CommenterGolden Bell
In 2010 and 2011 the Carolina Panthers were profitable to the tune of $112,000,000... 2012 their owner demanded the city give them $150,000,000 for stadium renovations (a stadium owned 100% privately owned by the team) or he'd take the team to LA.

What's wrong with this picture?
12.29.2013 | Unregistered CommenterDTF
@ DTF, I agree. It is fubar.
Charlotte should have told Jerry Richardson et al., "Move 'em. See if you can make that much in LA."
LA has multiple pro baseball and basketball teams, but there's a reason La doesn't have an NFL franchise - too much competition for things to do.
12.29.2013 | Unregistered Commentergov. lepetomane
gov,you nailed it. City council afraid to call his bluff -- buncha morons!
12.29.2013 | Unregistered CommenterDTF
I would direct some of you back to the original post on the OTL report, where I noted the oddity of ESPN focusing on the PGA Tour's over $200 million in tax breaks. Had the stuck with the general premise of the percentage of charity dollars going to the actual charity, or questioning the executive compensation at the PGA Tour instead of the tax breaks which are pretty incidental compared to the economic impact the tour has, I would agree there is no hypocrisy. But they made that $200 million or so of tour tax breaks over the last ten years the centerpiece of the report.
12.29.2013 | Registered CommenterGeoff
Geoff - I take your point.

In my opinion, the biggest problem with the tour is their rediculous pension program. Under that plan, they shield millions of dollars per year from taxation. Even if the Tour deserved non-profit status (which I think is questionable), there is zero reason to allow its employees (or "independant contractors") a pension plan that is better than anything normal taxpayers receive.
12.30.2013 | Unregistered CommenterBrad Ford
"pensions that normal taxpayers receive"... what does that mean? "Normal taxpayers" receive (actually they earn) pensions from the company they choose to work for and pensions vary greatly between all companies. Should the PGA Tour be forced to changed their pension program by the government? - no way in my opinion

Non-profit status is a different argument, and is one that is worth having, but the target should be the government's laws, not the companies that use those laws to their advantage.
12.30.2013 | Unregistered CommenterTy's Ties
I believe Rustic Canyon is getting a good water deal. And is on park land>?

Basically, Rustic brings a pretty nice recreation venue to Moorpark/Ventura.
But would it be what it is if land/water prices were at full values?
12.30.2013 | Unregistered Commenteron the other hand
Please note - I am not some lefty looking to stick it to the rich. I am a Republican and a fiscal conservative.

Ty's Ties - with the exception of government workers (a different argument), most people in the US are allowed to shelter income for retirement based upon similar rules (IRA, Roth, 401K, etc) and limits. While there are certainly creative ways to maximize tax deferred savings, most people are forced to play by the same rules.

With respect to the PGA Tour "pension," the Tour was allowed to create a special "pension" that shields ENORMOUS amounts of income from taxation. Essentially, Tour members have been allowed to contribute unlimited amounts of money to an ENORMOUS 401k-type "pension."
12.31.2013 | Unregistered CommenterBrad Ford

So why complain about the PGA Tour using this exception? Shouldn't the blame be on the ones that "allowed" them to create a special pension program?
12.31.2013 | Unregistered CommenterTy's Ties
Ty's Ties - I blame both the PGA Tour and the politicians who have allowed it to happen. BTW - it is not like they are using an "exemption" that is available to other companies. The exemption was placed in legistlations b/c the Tour's lobbyists got them a special deal.

Hopefully, both issues will be addressed by better laws.
12.31.2013 | Unregistered CommenterBrad Ford

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