ESPN, a company that takes in more than $6 billion annually in subscriber fees alone, has received some pretty plush tax credits over the years, according to the New York Times. In the past 12 years, the sports network — whose parent company, Disney, isn’t exactly starving for cash either — has received about $260 million in tax breaks and credits in Connecticut, where the company is headquartered.
Much like sports teams looking for handouts, ESPN made hollow threats to leave Bristol, its home since 1979. In March 2000, Edwin M. Durso, a senior executive at the network, testified before lawmakers to have the tax formula changed for broadcasters. (Connecticut had done the same for financial companies three years prior.) From the Times:
Asked by a lawmaker if ESPN would consider putting the development in another state, Mr. Durso referred to the corporate connection to Disney: “They have facilities in many different states.”
The tax code was changed, reducing ESPN’s taxes by roughly $15 million a year. Meanwhile, there was no way the Worldwide Leader in Sports would have packed up and left its 123-acre compound in Bristol.
The Times has all the details on various credits sought by ESPN, from $6.2 million for a TV miniseries to $54 million for creating ESPN.com. (Because, surely, the company would never have invested in the rapidly developing Internet without tax breaks.)
As we have argued here many times, the United States has a subsidies problem. Why, for instance, does Nike, a company that made $25.3 billion in revenue during fiscal year 2013, get tax breaks from the state of Oregon? There’s a recurring theme: Threatening lawmakers with the prospect of leaving.
“Nike put an economic gun to the governor’s head and said you either guarantee the law won’t change or we’ll go elsewhere,” Chuck Sheketoff, executive director of the Oregon Center for Public Policy, told the Wall Street Journal last December.
You can’t really blame ESPN or Nike. They’re just playing the game, and the rink is tilted in favor of big corporations who need tax breaks the least.
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Bill Bradley is a writer and reporter living in Brooklyn. His work has appeared in Deadspin, GQ, and Vanity Fair, among others.