Coach Steve’s new book guides parents through youth sports
USA TODAY Sports’ Steve Borelli (aka Coach Steve) has published a new book to help parents navigate the difficult moments they face when their kids play sports. Get your copy here: coachsteve.usatbook.com
WASHINGTON — What’s best for our children? What’s best for our families?
Sen. Chris Murphy (D-Conn.) says these should be central issues in youth sports.
“Instead, private equity owners ask, ‘What will make the most money?'” Murphy said.
Murphy spoke at the Capitol on Wednesday, May 13, with Representative Chris Deluzio (D-Pennsylvania) to introduce the Let Our Kids Play Act, a new federal bill targeting private equity firms active in the youth sports sector.
The bill defines what lawmakers call “predatory practices,” such as requiring families to stay in certain hotels for children’s sports tournaments, and provides impetus for a December congressional hearing to address what they call a “crisis” in the industry.
Lawmakers say these companies profit from families’ fears of not being able to attend their sons’ or daughters’ sports days.
The youth sports industry generates more than $40 billion in revenue annually and is often supported by parents who pay thousands of dollars per child to participate.
“I say it again and again: Youth sports should not be a luxury,” Delzio told USA TODAY Sports. “Where I live, I ask people, no matter the politics, are kids just allowed to play? It doesn’t matter if their parents are rich or poor, are they absolutely allowed to play? So I think we have to do something, because this is not just happening in Western Pennsylvania.”
“We’re seeing this happening all over America.”
Here’s what this bill means for young athletes and their parents.
What is the “Let Children Play Act” and what does it do?
The bill aims to hold private equity firms accountable for their activities in the youth sports field. It would ban “vulture investors”. According to the law, “predatory activity” refers to “any practice, period, condition, tactic, means, method, or action that harms the acquired entity or creates a risk of long-term harm to the acquired entity in order to extract profits, assets, or other value for the benefit of the target company or its affiliates.”
The literature provides further details on what the practice is.
The bill also requires these investors to fully refund “junk fees collected through predatory practices” to their families, terminate “predatory contracts,” and “clean up any outstanding debt, interest, and late fees charged by private equity firms.”
It also holds companies accountable for debts and safety violations and establishes a Youth Sports Fund for fines and collections paid by private equity firms. According to the bill, the funds would be used to “provide scholarships, reduce costs for families, and keep local fields free and available to the community.”
“The Let Our Kids Play Act is based on a very simple premise: Wall Street and private equity have nothing to do with children’s sports,” said Rep. Pramila Jayapal (D-Wash.), who co-sponsored the bill and helped launch the Monopoly Busters Caucus in the House.
What is private equity as it relates to youth sports?
Jay Adia, managing partner at Elysian Park Ventures, a platform that invests in sports and seeks out sports opportunities around the world, says that private equity, as opposed to early stage venture capital, is “much more late-stage investing in much more mature companies, and usually, but not always, we kind of control the position that we own.”
“We’re going to spend our time thinking about where and how capital is being used, for what purposes and what problems it solves,” he said at the Project Play Summit in Boston last week.
Katherine Van Dyke, a senior legal fellow at the American Economic Liberties Project, who is filing a lawsuit against Varsity Brands challenging its cheerleading monopoly, sat next to him as part of a panel discussion on private equity and youth sports.
“You hear a lot about these companies building ecosystems, but those ecosystems are really moats and walled gardens, as we like to call them in antitrust circles, designed to keep innovators out and keep families and children inside,” she said. “And then you end up having to stay to play or pay an admission fee to watch your child play. That’s why there’s vertical integration and roll-ups, and by controlling an entire sport or an entire industry, you need customers, in this case families and children, who have no choice but to use all of your products, services, and platforms.”
“That allows them to pile debt on businesses and strip them of their assets. And none of that is aimed at the development of children. It’s about exploitation.”
Is the “Let Your Kids Play” Act aimed at travel sports?
Not necessarily. It targets large companies like Black Bear Sports, which consolidates ice rinks and hockey teams in the Northeast and Midwest and uses that control to steer families into its own leagues, tournaments and high-fee systems.
“There’s a lot of them,” Delzio told USA TODAY Sports. “Varsity Brands, with its history of lawsuits and settlements, has rightly faced scrutiny for what it has done. I’m sure there are many others to list, but we’re here to practice. Here we are at our worst.”
Murphy, a Connecticut state senator, said his 14-year-old self plays in a youth hockey league managed by the Black Bears.
“I admit that I am one of those parents who has fallen victim to the lure of expensive travel sports,” he said. “I accept that I am partly responsible for our destiny. Not everything in the world has to be run for profit.
“What happens when profit is most important? Well, the initial price goes up, and a lot of kids go up in price. High-pressure travel leagues take precedence over low-pressure local leagues, and that’s often not good for kids. And youth sports start to mirror professional sports, where individual performance takes precedence over team performance.”
“We’re not just applying this bill to entities based on their corporate structure; we’re applying this bill based on the practices that companies use.”
Murphy and Delzio specifically point to stay-at-home tournaments that require families to stay in specific (and sometimes expensive) hotels, and organizations that charge a fee to stream games instead of allowing parents to stream the games themselves.
“I remember seeing one of my kids’ parents videotaping the game from a really bad angle from a corner of the arena. I asked why, and the reason was because they were worried that if they found out they were doing that, they would lose points in the standings,” Murphy said.
Delzio suggested that the bill targets not commercial travel organizations, but companies that engage in “practices that really hurt families,” such as “take-it-or-leave-it” multi-season contracts, non-refundable tuition, and mandatory tournaments that in some cases require travel.
“We’re seeing systems that mine kids’ data for profit, and we’re seeing apps and websites for league registration, but as any parent knows, without an app, you don’t even have a schedule,” Delzio said. “And those apps can be anything from data mining to physical metrics to financial data. All of that adds up to locking families up, driving up prices, and squeezing families.”
What are the long-term effects of this bill? Will it reduce youth sports costs?
The law would allow parents and state attorneys to sue companies that engage in “predatory behavior.” But it has to go through first. The bill has support from Democrats and will ultimately need to be signed by President Donald Trump.
But like the December hearing that said youth sports practices had reached “crisis” levels, the Let Kids Play Act continues to raise awareness of the inequities in the industry, even if it doesn’t pass.
As Van Dyck said at last month’s Project Play Summit, if there’s something you don’t like about the system, it’s up to parents to get involved and push back against the system.
“We’re going to fight to pass this bill, but the public relations here could have an embarrassing impact on an industry that would be helping children and families,” Delzio said.
Borrelli, also known as Coach Steve, has been an editor and writer for USA TODAY since 1999. He coached his two sons’ baseball and basketball teams for 10 years. He and his wife, Colleen, are now the sports parents of two high school students. His Coach Steve column appears weekly. Click here for past columns.
Have a question you’d like Coach Steve to answer in a column? Email him sborelli@usatoday.com
