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Issue Date: September 2013


Turnover Prone

The federal probe into Jimmy Haslam's company reminds us how the Browns and the NFL have failed the fans.
Michael D. Roberts

When Jimmy Haslam sold the naming rights of Cleveland Browns Stadium to FirstEnergy for $100 million in January, I viewed it as a bad omen. The Illuminating Co., a subsidiary of FirstEnergy, played a major role in casting the city into financial default in 1978, branding the town a national joke.

In April, the omen hardened into a widening federal fraud investigation of Haslam's Pilot Flying J fuel company, which is accused of defrauding customers of rebates. Could corporate profits squeezed from clients have been used in the billion-dollar purchase of the Browns?

To sell the city-owned stadium's naming rights to FirstEnergy was a civic slap in the face. Pilot's fraud charges are worse. They're another blow to the prestige of the NFL, where crime statistics are becoming as much a part of the game as yards-per-carry (including 33 players arrested since the Super Bowl).

Since 1999, Cleveland fans have dwelled on the Browns' poor performance on the field. The greater story has been the dysfunctional front office, prone to public relations gaffes.

The Browns are hard-pressed to find Public Square, let alone gauge public sentiment. The team has created controversy with players by misspeaking about injuries, sown confusion among fans regarding player status and created a soap opera over Jim Brown's relationship with the organization.

Perhaps Browns officials simply didn't know that the Illuminating Co. lobbied Cleveland banks to call in loans in 1978 after then-mayor Dennis Kucinich refused to sell the municipal light plant. The Illuminating Co.'s thirst for a monopoly cast the city into default. The resulting struggle between city hall and the business community was devastating. The city lost taxes and jobs, and was subjected to national ridicule.

The problem is bigger than the Browns front office. For decades, the NFL has shown a lack of stewardship over the Cleveland franchise.

When Ted Stepien mismanaged the Cavaliers into another Cleveland joke in the early 1980s, the NBA altered rules to protect the franchise. When the Indians needed a new stadium in the late 1980s, MLB's warning was clear: The city builds a new stadium, or the team leaves. But in 1984, when voters soundly defeated a proposal to build a domed stadium, and Art Modell began to explore moving the Browns, the NFL failed to grasp the team's growing plight and allowed it to stagnate and move.

Even in the tumultuous aftermath of the move to Baltimore in 1995, the league seemed bewildered. Mayor Mike White intimidated the NFL into rushing an expansion team onto the field, which resulted in the hurried construction of a football stadium on valuable lakefront land. The facility cost $300 million and is used as few as 10 days a year for football. The location assured that heavy winds, rain and snow would mean high maintenance costs.

The NFL then watched Randy Lerner muddle unchecked through 10 years of failure, tossing a once-prized Cleveland institution into a cauldron of cynicism.

For all its martial music, buttoned-down façade and postgame posturing, the NFL forgets its fans. Its carelessness may allow for another crisis in Cleveland sports.

The NFL failed to thoroughly examine Jimmy Haslam's business practices, perhaps an example of the league's indulgent ownership. A review of Pilot Flying J's operations shows a pattern of corporate irregularity. For instance, in 2005, the U.S. Labor Department made the company pay $720,000 in back wages and damages to employees in an overtime dispute. In 2009, Pilot paid a $100,000 fine in Kentucky for price-gouging at fuel pumps during two hurricanes. It also was fined in two other states. Haslam said the price hikes came about because the company did not have technical controls over its many locations. The federal rebate probe appears to reveal similar practices as the other incidents.

Haslam and his legal problems came to Cleveland at the most inopportune time. In two years, Cuyahoga County's sin tax on alcohol and cigarettes comes up for renewal. This tax provided $25 million last year to maintain the football stadium, Progressive Field and Quicken Loans Arena. Given the recent play of the teams, voters could question whether the public subsidy is worth it.

Any tax to support Cleveland's sports teams should be regional. A study during the Modell era showed that half of the fans at Browns games came from outside of Cuyahoga County.

The original sin tax in 1990 barely passed with 52 percent of the vote. An extension that paid for a new football stadium passed in November 1995 with 71 percent — but that vote came right after Modell announced the Browns were moving to Baltimore.

Without the tax, there is no way the city can support the upkeep of the stadiums and arena, which will fall into rapid decline. While the Browns pay for some enhancements to the stadium, the team relies on the sin tax money for basic repairs. Defeating the tax would throw the Cleveland sports community into a quandary. Over time, some teams would surely leave.

Haslam insists he won't sell the Browns. But if the feds' allegations turn out to be true, it might not be his decision to make. After Edward J. DeBartolo Jr., then the head of the San Francisco 49ers, was implicated in a bribery plot, the league suspended him, and he voluntarily turned the franchise over to his sister. Reports indicate the NFL has contingency plans in the event of a worst-case scenario with Haslam. One possibility could be for Lerner, who still owns a sizeable percentage of the team, to return as temporary owner.

Regardless of Haslam's fate or the federal probe's outcome, the image of a corporate predator taking advantage of "little people" will play badly in a working-class town and hurt the chances of passing the sin tax.

On the other hand, a new owner would mean another makeover for a team that has suffered setback after setback in a league long on money and short on responsibility.

It is hard not to conclude that the NFL has failed Cleveland at every turn.


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