Reference no: EM133035182
CASE STUDY: THE NAME GAME PAYS OFF
Over the past 15 years there has been a steady decrease in federal education funding to states. When the federal monies are cut, the states have to either find a way to make up the funds or pass the cuts along to the state department of education. In lean times, it is customary to turn to a pay-to-play plan to help fund the various sports teams. But following the precedent set by college and professional teams, high schools looked to sponsorship deals, specifically naming rights, to raise the necessary operating funds.
In 2006, Noblesville High School (Indiana) was struggling to find the funds they needed to complete some renovations to their football stadium. Athletic director Steve Hurst decided to seek corporate funding to help pay for the installation of the new $575,000 turf field.
Hurst approached Dave Cox, owner of Hare Chevrolet, a local car dealership with strong ties to the community. Cox and Hurst came to an agreement on the terms of a 10-year deal; for the sum of $125,000, Hare Chevrolet, secured the naming rights deal for the football stadium. This agreement was the first of its kind in Central Indiana, but it would not be the last. A one-year, $12,000 extension was awarded for 2017. In August 2018, it was announced that another local company, Beaver Materials, has secured a 5-year, $83,000 deal to put their name on the stadium.
In 2008, the Hamilton Southeastern School District (HSE), the district just south of Noblesville, struck a deal with a local farm supply company, Reynolds Farm Equipment, to provide funding for their turf campaign. The $400,000 deal would place the Reynolds name on the stadiums of both HSE high schools, Hamilton Southeastern High School and Fishers High School. Westfield Washington Schools, the neighboring system to the west of Noblesville, landed a 10-year, 1.2-million-dollar naming rights deal with Riverview Health in 2014, which allowed them to build a new stadium.
It is becoming the norm for high schools to seek naming rights deals as a means for making improvements across all campuses and for all programs, not just for sports. Jerry Thacker, superintendent of Penn-Harris-Madison School Corporation in Mishawaka, Indiana, commented: "We have a parking lot we could name, the middle school gymnasiums, every single classroom could be supported by some organization."
1. Every time there is an event in one of these stadiums or the media covers a football game, those corporate names are mentioned, and the sponsorship investment pays off. Some might say that these schools were selling out to the highest bidder just to make sure sports were adequately funded. How would you defend striking a deal with a local company for naming rights to a local high school?
2. Is this idea a positive one for all involved? Or is this a disaster waiting to happen?
3. What types of conditions would you place upon a naming rights deal if you were to negotiate one?