The NFL Draft is officially coming to Philadelphia in 2017, with a big press conference at City Hall Thursday laying the groundwork for the next eight months of preparations. Despite the Eagles not having a first round pick in next year’s draft (guaranteeing that the crowd for the first round next year will be nowhere near as hot as it would have been, say, this year) Philly is still a great football town and, as we wrote earlier this month, is becoming a great big-event city. We will be ready.
Everyone agrees that hosting a big event like the DNC or the Pope visit takes a lot out of a city (emotionally, financially, and otherwise), but an event like the NFL Draft should be a boon for Philadelphia’s economy, logistical concerns notwithstanding.
Heck, the security for an NFL Draft on the Parkway will be far less than what the city has to pay for Made in America. And while the city claims Made in America, underwritten by Live Nation and sponsored by Budweiser, doesn’t cost the taxpayers any money, that same claim will be made for the NFL Draft.
If the last two drafts are any indication, not only will the city not lose money, it could be in line for a huge windfall.
“The Draft is great,” former Governor Ed Rendell, a huge Eagles fan and football pundit, told Billy Penn in early August. “It’s all plusses. You don’t have to raise a ton of money for the draft. And it’s fun.
“The only thing is,” Rendell warned, “I’m not sure I’d want it next year because the Eagles don’t have a first round pick!”
Rendell’s comment came during a conversation we had about Philadelphia hosting other big events, like a potential Olympic Games. While we all agree Philly hosting the Olympics would be nightmare (picture something the size of a thousand DNCs where the Pope was a keynote speaker every night — FYI, greatest event ever), hosting the NFL Draft will be relatively easy for the region. And, if the success of Chicago is any indication, the city should feel the economic impact in a big way.
Chicago hosted the NFL Draft for two years, in 2015 and 2016. The event was held jointly in Grant Park for its Draft Town and the Auditorium Theatre of Roosevelt University for the actual draft.
Following the city’s first draft in 2015, Choose Chicago — the city’s nonprofit tourism body — commissioned a report lauding the success of the event in the city. In that report, with data provided in part by the Sport Industry Research Center at Temple University, Chicago claims that 200,000 visitors came to Draft Town in Grant Park during the three-day event.
Moreover, the Choose Chicago report states that the Draft was able to create 2,095 temporary construction and labor jobs and 846 new jobs.
The total economic impact of the 2015 draft, again the first of two events held in Chicago, was reportedly $81.6 million.
Now, to be perfectly clear, the Choose Chicago report does not indicate the city made $81.6 million. Rather, the impact of hosting the draft could provide that level of residual benefit.
Chicago’s tourism group estimated an uptick in annual visitation to the city based on hosting the NFL Draft, with a goal for Chicago of 55 million viewers by 2020. By comparison, Philadelphia hosted 41 million visitors in 2015.
Economic impact is one thing, but what about hard numbers and actual dollars?
Choose Chicago reported the city collected $456,000 in hotel tax revenue from hosting the NFL Draft, and a total of $6.5 million in state and local taxes during the event the first year. The draft alone generated more than 36,500 hotel room nights, which makes sense not just because of the people coming down for the event as fans, but because two television stations cover the event — ESPN and the NFL Network — and neither seems to spare any expense on draft coverage.
Yet even with that, the numbers don’t add up even close to $81.6 million.
Per Choose Chicago, 83 percent of attendees “would recommend Chicago” as a travel destination and 65 percent of attendees “plan to return to Chicago for vacation in the next 12 months.”
Now, to be fair, that second number may have been correct, given Chicago hosted the NFL Draft the following year as well. But to expect that kind of return on tourism from one NFL-related event for Philadelphia would be foolhardy. And yet, the event is another great opportunity to showcase the city, to those who show up for the draft and to more than 20 million people watching on television.
Choose Chicago estimated $114.7 million in TV and digital media ad value for the city, all of which comes without the protests and giant fences and Bernie Bros like we had this summer.
In advance of this year’s draft, the Chicago Tribune reported the organizers had used the success of the first Chicago draft to expand Draft Town in its second year, making the 2016 event even bigger. That story reported the 2015 draft “brought nearly $44 million in direct economic impact to Chicago” in 2015, again, according to Choose Chicago.
For what it’s worth, Crain’s reported in May that six top executives at Choose Chicago, including the CEO, left the group between January 2016 and the 2016 draft in late April, citing a dip in citywide tourism revenue and huge layoffs of staff; though some of that came as a result of a tug-of-war between the city and state on more than $7 million in hotel taxes. Spend five minutes covering local Philly politics and tell us the same thing couldn’t happen here.
In addition, a Chicago Tribune story published in February 2015 — some two months before their first event — said the tourism board had to raise as much as $4 million to cover the costs of putting on the event. Plus, in addition to the use of Grant Park, the NFL requested the Auditorium Theatre for three weeks…for free.
This is what the league does. Were the NFL a country, its $13.3 billion in revenue would rank 123rd in the world in gross domestic product. It didn’t get that way by paying for things it can get for free.
What Philly gives to the NFL for free remains to be seen, but don’t expect it to be nothing.
Six months after the NFL Draft in Chicago, the city was still on the hook for $350,000 of police overtime and other government services. That bill was to be paid by Choose Chicago. But that’s where things got murky in the Windy City.
Choose Chicago was created several years ago with Mayor Rahm Emanuel‘s blessing, and it is funded largely by government grants. About a quarter of its budget last year came from the city of Chicago.
Roughly 40 percent of Choose Chicago’s budget came from the state of Illinois. This Tribune report states that Choose Chicago claimed the money to put on the draft — roughly $4.5 million, including $2.5 million in marketing and $1.6 million toward infrastructure — came from privately-raised money. However…
[T]he organization’s budget comes mostly from taxpayers. In fact, nearly $24 million of its $26 million in revenue is from government grants, according to Choose Chicago’s most recent tax filing.
In Philly, already Congressman Bob Brady told Wendy Ruderman at Philly.com back in early July that the Building Trades Union would put in more than $1 million toward building the necessary “temporary stage and arena” on the Ben Franklin Parkway.
“I think it’s going to be great for the city,” Brady said. “We are going to showcase the city for the whole country again, and we’ll have thousands of visitors coming in here and all the players, all the sports teams, and all the coaches and managers will all be around. It will be great. It’s a big deal. It’s astounding. Just like with the [Democratic] convention, all the hotels will be booked, all the restaurants will be filled, for a three-day event.”
The NFL Draft is the type of event Philadelphia needs to host to continue its growth as a big event city, not just in the United States, but around the world. And yet, it’s difficult for a city like Philly to play the long game on the economic return of hosting an event like the NFL Draft when many city and government services are being cut or underfunded each year, where the only viable way to properly fund childhood education seems to be a tax on sugary drinks.
This is a great football town and a quick train ride from Washington and New York, so the city is going to be packed. Combine that with the incredible television coverage of the city for three days on two networks, and surely the NFL Draft will be a success for the area. But how much money the city pays to support the event, and how much of a return on that investment Philadelphia actually sees, will be key in determining how big a success the NFL Draft in Philly will be, first round pick or not.
