Saskatchewan taxpayers subsidize junior hockey league, thanks to profit guarantee

Followers of the Memorial Cup may have been surprised to learn — what’s that? You know, the Memorial Cup. The championship of the Canadian Hockey League. What do you mean, you’ve never heard of … okay, I’ll start again.

So in Canada, there’s a separate set of hockey leagues for players 16 to 20 years old, and the champion is decided by something called the Memorial Cup. Like the Super Bowl and the NCAA tournament, it rotates among various venues each year, and like those other events, the league places demands on cities in order to be considered as host. Including, apparently, guaranteed profits:

Taxpayers in Saskatchewan are paying nearly $700,000 to cover a profit guarantee, promised to support the Memorial Cup in Saskatoon in 2013.

The guarantee was needed to secure the tournament from the Canadian Hockey League which was assured the event would net the organization $3.5 million.

In the grand scheme of things, this isn’t too horrible: $700,000 is a pittance compared to what some locales spend on sporting events, and when Saskatchewan hosted the world junior championships in 2010, it made its profit target, so amortized over all the guarantees the province hands out, it’s not a ton of money. Still, it’s sobering to realize that even in relatively subsidy-averse Canada, even for freakin’ junior hockey, leagues are able to extract guarantees that the public will subsidize their profit if it falls short of what they were expecting. Monopoly power is a bitch.

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