IMG Academy projects big economic numbers from expansion, but doesn’t say how
A $2 million earmark for a private, for-profit sports academy in this year’s state budget may help the school expand its economic impact, but breaking down the specific benefits of the complex has proven to be a bit opaque.
After lawmakers slipped the seven-figure sum for IMG Academy near Bradenton into the budget without public discussion, officials defended the move by pointing to how the school is helping Manatee County and the state.
IMG’s budget request to the Legislature -- originally $7.5 million -- says a planned expansion announced a couple of years ago "is estimated to cost close to $197 million and will support a total of 2,642 jobs, earnings of approximately $90.3 million and total economic output of over $321 million."
Breaking down just what those jobs are, who will have them and how long they will exist is hard to determine, however, because PolitiFact Florida hasn’t been able to obtain whatever economic impact report IMG Academy is using. We can’t put the claim on the Truth-O-Meter without those specifics. But experts we talked to were skeptical.
IMG Academy did not return multiple phone calls and emails asking for a closer look at the estimate. We also couldn’t get those numbers from the Manatee County Chamber of Commerce or the Bradenton Area Economic Development Corporation. But the claim of more jobs and more money is repeated by officials again and again.
The math is pretty simple to a point. The 584-acre sports training complex, which trains international athletes and runs a boarding school that fetches upward of $80,000 per student annually, is in the middle of a massive expansion that will add a multi-sports complex. The additions include a weight room, a 40,000 square-foot athletic center, practice fields, a 5,000-seat stadium and classrooms and dorms.
IMG has already gotten more than $7 million over the last two years to help with the expansion. That cash reimbursed the academy for sports field construction and other work that was going to be done anyway. The state gave the money to the school with the caveat that IMG must show they’ve generated more in state sales taxes than grants they’ve received. For the last two years, IMG signed a contract that said the school had to produce $5.75 million in sales taxes by 2018 to get millions from the Legislature, or risk having to pay the money back. The school said they met that goal this year.
Those sales taxes can also come indirectly, such as from hotel stays, restaurant meals and other expenses. It’s unclear how IMG calculates these indirect sales taxes.
The jobs IMG "supports" are harder to pick out.
But the construction jobs involved are a big part of what we are looking at here. Both architect Fawley Bryant and Lakewood Ranch contractor Tandem Construction have already hired some employees to complete the work, though there’s no indication of numbers.
What we wanted to know is whether the projection of 2,642 jobs and other numbers were fair or not. Sports economists we talked to were mixed on that topic.
"The figures do look very odd. Even if one includes the construction phase, I am hard-pressed to see over 2,500 new jobs created," Temple University economics professor Michael Leeds told us after reviewing the IMG request. "That seems more than a major league sports franchise's economic footprint. ... It would be interesting to see what lies behind the numbers."
Victor Matheson, an economics professor from Holy Cross, said he also was wary about whether the jobs would be permanent, or largely related to the expansion during the buildout phase. He said $197 million in construction costs alone could easily generate 1,000 job-year equivalents.
But as we’ve noted in the past, a job year doesn’t mean one full-time job, but rather the equivalent of a full week’s worth of work for an entire year. That could include multiple people sharing those hours, not just one full-time, permanent job.
The University of South Florida’s Philip Porter, long a critic of government spending on professional sports, said IMG is helping the Bradenton-area economy at least some, no matter what estimate is used.
"Every business that expands has an economic impact, as does every dollar you spend in the local economy," he said. "If IMG spends $197 million, the state gets the entire economic impact."
But by giving the school $2 million in this year’s budget, Florida is actually removing about $6 million in economic impact, Porter said. That’s because IMG no longer has to pay taxes on the money or spend its own cash.
Georgia State University economics professor Bruce Seaman said that without knowing how IMG’s study was calculated, it’s tough to assume how the $197 million in construction costs would otherwise be spent, what source would finance the work and what impact it would have on the economy. The work also diverts state money from other projects, as well as reassigning workers involved in the expansion from building other structures.
Without knowing whether those concerns are addressed, Seaman said, "it is likely that the hoped for impacts, even if short run only, are somewhat overstated."