1 Running Header: THE RISE AND FALL OF THE CHARLOTTE HORNETS

The Rise and Fall of the Charlotte Hornets: The Move that sent the Hornets Packing Miles Kerbein Queens University of Charlotte

The Charlotte Bobcats may not be playing this year due to the current National Basketball Association (NBA) lockout that has frozen the process of preparing for the 2011-2012 NBA season. If that is the case, the city of Charlotte will be reliving their times when they had no basketball after the collapse of their former franchise, the Charlotte Hornets. The Hornets, who moved to Charlotte during the 1988-1989 season, were greatly welcomed by the local community. With the rich history of basketball in the Carolinas, new owner George Shinn felt that a basketball team would have a tremendous opportunity for success. The city of Charlotte that acquired the nickname the gateway to the south, was a location the NBA felt would succeed. This paper will discuss how the decision to build a new stadium in Uptown Charlotte along with the other economic and financial decisions that resulted in an NBA expansion team being forced to leave Charlotte. It seems truly amazing how a professional basketball team would fold in a city and state that has so much basketball enthusiasm. North Carolina as a state is home to some of the most competitive basketball in the country. Duke University, University of North Carolina, North Carolina State University, Winthrop, Davidson and University of North Carolina at Charlotte all have prominent basketball programs. Three of those have one at least one national championship. It is easy to see how George Shinn believed that the acquisition of a professional basketball team would do wonders for the city and be a complete success here in Charlotte. George Shinn was born on May 11th, 1941 in Kannapolis, North Carolina (19992000 Charlotte Hornets Yearbook, 1999, p. 4). As he grew up, he had a wide

3 variety of occupations ranging from working in a textile mill to being a school janitor (1999-2000 Charlotte Hornets Yearbook, 1999, p .4). Shinn, made his fortune by creating a company by the name of Rutledge Education System. These education systems were designed to offer 18 month to two-year programs. (Businessweek.com, 2007). During his venture, he owned nearly 30 schools. Shinn sold these schools for a total of $30 million (Businessweek.com, 2007). Throughout his career, Shinn was your stereotypical businessman. He used a method of buying and selling potential money making companies and corporations in order to earn his own profit. His most high profile project was the purchase of the NBA expansion team the Charlotte Hornets in 1987 for a whopping $32.5 million (1999-2000 Charlotte Hornets Yearbook, 1999, p. 4). With Charlotte being the NBAs first choice in the 1987 expansion decision, the Hornets were on their way to their new home (Shinn, 1997, p. 10). With the Hornets moving to town, University of North Carolina at Charlotte professor John Connaughton estimated the positive economic impact of the Hornets would be nearly $135 million per year (Shinn, 1997, p. 10). Although the Hornets promised prosperity for the community of Charlotte, there was a looming issue of the teams arrival- playing in the Charlotte Coliseum. Shinn wanted his stadium uptown from the get-go. The Coliseum however was a fitting home. The coliseum was built in 1988, the year that the Hornets moved into it. This stadium at the time it was operating was the largest in the NBA. It held more than 24,000 people for Hornet games (basketball.ballparks.com, 1996). The construction of this stadium cost approximately $52 million dollars and was 100% publicly funded (Basketball.ballparks.com, 1996). However this stadium did not suit Shinns desire. Though his team played there from 1988-2002, Shinn wanted his team to play in uptown

4 Charlotte, a costly venture which would put the Hornets in unstable waters. With the Hornets now up and running in Charlotte, their team was an exciting expansion team and home to many superstars who have gone on to become champions and all-stars throughout the league. For instance, Baron Davis, Hersey Hawkins and Jamal Mashburn are all notable Hornets (2000-2001 Charlotte Hornets Yearbook, 2000). The basketball scene in Charlotte was beginning to decline as the Hornets struggled to win as the years went on. Eventually George Shinn felt that in order to revamp the team and more importantly the community it was now time to propose the move for a new stadium built in Uptown Charlotte. Shinn was determined to move his Hornets to the comfort and popularity of Uptown charlotte however he needed a place for them to reside. He is quoted as saying I assure you that I was- and continue to be- totally committed to the construction of this new Uptown Arena because I believed- and continue to believe- that for the long term is the right option for the City and for the Hornets. Unfortunately, the structure of the financial aspects of this option could place our franchise in serious financial jeopardy. (Shinn, 1997, p. 10). Shinn was not happy with the potential cost of the arena and as stated above felt as though this could damage his newly acquired business financial stability. Shinn in his letter to Ms. Pam Syfert who was City Manager of Charlotte, also explains how franchises are extremely costly to operate successfully. (Shinn, 1997, p. 11). In the details of the letter we learn that if they agree to sell the original Charlotte Coliseum and put that money towards building a new arena in uptown, Shinn would promise to keep the franchise in Charlotte for at least ten years. Also, assume and honor all legally binding engagement contracts booked by the Auditorium- Coliseum-

5 Convention Center Authority for the Coliseum prior to the execution of the final purchase. (Shinn, 1997, p. 13). Though Shinn did not have the money to build his new dream home, in a letter from First Union Senior Vice President, William W. Tyson, Tyson is quoted as saying We therefore wish to assure the City that First Union stands ready to lend the Charlotte Hornets funds as required to accommodate purchase of the facility under terms outlined in the purchase proposal. (Tyson, 1997, p. 1). Shinn accepted the loan that along with poor attendance and multiple losing seasons- would drive the Charlotte Hornets from their original home. However, Charlotte at the time did not understand how directly the Hornets departure would affect the economic stability of the city as a whole. Gene Williams of the group Im a Beekeeper put together a very persuading document that discusses many economic cases for keeping the Hornets in town and how moving the Hornets from the Charlotte Coliseum would in turn be the first step in sending the team on their way. In this document, Williams rattles off many facts that would open the eyes of any Charlotte resident. The first being, that if the team were to move to a new stadium, the Charlotte Coliseum authority would lose nearly $1.25 million in parking revenue alone (G. Williams, Personal Communication, November 5, 2001, p. 1). City, County and State would lose an estimated $3.7 million in revenue from taxes (G. Williams, Personal Communication, November 5, 2001, p. 1). Another interesting point is that if the Hornets decided to leave for another city, and Charlotte was interested in a replacement team, the NBA would require a new arena that would cost the city and its residents an estimated $220 million (G. Williams, Personal Communication, November 5, 2001, p. 2). In studies that he examines, he reports that between the Charlotte Hornets (NBA) and the

6 Charlotte Sting (WNBA), these teams contribute nearly $100 million annually for the Charlotte economy (G. Williams, Personal Communication, November 5, 2001, p. 2). The Hornets were also very involved in local non-profit charities. The year before the move, they donated nearly a quarter million dollars to charities around Charlotte (G. Williams, Personal Communication, November 5, 2001, p. 3). Williams does a wonderful job in explaining how much the community needs the Hornets, and how much the Hornets need Charlotte. George Shinn, in his last years before the move in 2002. Encountered some personal problems that I am sure helped contribute to his decision to move the team to New Orleans. Shinn was involved in a sex scandal which landed him on the televisions of millions tuned in to Court TV. In regards to the scandal- which was eventually settled without punishment- he is quoted as saying, I was so humiliated and taken back by the bad judgment I made in my lifeI was so embarrassed. (Bonnell, 2010). Overall, the decision to move the Hornets Uptown is one that will haunt George Shinn for the rest of his life. He made a choice that he could not support financially and in turn ruined the chances of Charlotte maintaining a professional sports franchise. With the Hornets now in New Orleans, the Charlotte community has obtained their new NBA team; the Charlotte Bobcats. The Bobcats are currently owned by basketball legend Michael Jordan. The team, although attendance is not stellar, is financially stable and continues to remain directly connected to the Charlotte community, an aspect of ownership that George Shinn was familiar with.

Works Cited

7 Primary: (1999). 1999-2000 charlotte hornets yearbook. Elmont, NY: University Sports Publication Co.

(2001). 2001-2002 charlotte hornets yearbook. Elmont, NY: University Sports Publication Co.

Williams, Gene. (2001) Personal Communication: Email. Hornets Economic Impact Charlotte Mecklenburg Library, Carolina Room. October 3, 2011.

Shinn, George. (1997) Personal Communication: Letter to Pam Syfert. Charlotte Mecklenburg Library, Carolina Room. October 3, 2011.

Tyson, W. William. (1997). Personal Communication: Letter to George Shinn. Charlotte Mecklenburg Library, Carolina Room. October 3, 2011.

Secondary: Bio: george shinn. (2005, November 21). Retrieved from http://www.businessweek.com/magazine/content/05_47/b3960119.htm

Bonnell, R. (2010, December 09). Shinn finds there are no moves left. Charlotte Observer, Retrieved from http://www.charlotteobserver.com/2010/12/09/1897392/shinnfinds-there-are-no-moves.html

Munsey. , & Suppes (1996). The charlotte coliseum. Retrieved from http://basketball.ballparks.com/NBA/CharlotteHornets/index.htm