Some Cities Now Charge A "Jock Tax"

First, there was "Play ball!" Then came the cry of "Work ball!" as professional athletes leveraged their unionized status in the cause of better pay and benefits.

"Tax ball!" is only the next logical step in this progression, and for a growing number of cities and states, it's sweet revenge.

It's called the "jock tax," and although it has been in place in some locales for nearly two decades, it is enjoying a surge in popularity of such proportions that visiting athletes - who are employed and reside elsewhere - now easily bear the largest tax burden, per capita, associated with sport.

The theory is simple: A professional baseball player from Chicago, say, plays in Cleveland 10 times a year. Since states and cities can tax nonresidents who perform a service within their boundaries, that ballplayer can be charged a percentage of the money he has earned in Ohio - even if his checks are signed in Illinois. Roughly 30 states and municipalities have approved jock taxes, and the amounts being collected are, in some cases, staggering. Some states are pulling down an estimated $8 million to $10 million annually from visiting athletes, and that number can only rise as athletes' salaries grow and as states and cities become more aggressive in tracking down players appearing on visiting teams' rosters.

Last year saw Arizona jump on the jock tax bandwagon as part of Proposition 302, a taxpayer-supported bill that funded the construction of a new stadium for the NFL's Arizona Cardinals. Also passing a jock tax was Columbus, Ohio, a large metropolitan area with only two big-league franchises (the Crew of MLS and the NHL expansion Blue Jackets). This year, Ohio began collecting taxes from athletes visiting its three major cities, Louisiana legislators passed a resolution encouraging the state Department of Revenue to do the same, and Cincinnati debated a jock-tax measure of its own in the city council (where it appeared to be winning at press time).

Players and their agents say the taxes are unwieldy (players must file tax returns in every state in which they compete) and unfair (does the phrase "taxation without representation" ring a bell?), but they're having trouble provoking much sympathy. It's clear that jock taxes are becoming more popular not only because professional athletes' salaries are soaring, but because of citizens' growing resentment toward athletes.

That said, a few editorials have been written in support of athletes. In Dallas, jock taxes of NFL players (up to $5,000 per player, per game) have been prominently mentioned by a number of suburban cities vying to build a stadium and entertainment complex recently demanded by Cowboys owner Jerry Jones. (Jones, who has been known to pace the sidelines of home and away Cowboys games, presumably would not be subject to such taxes for his onfield excursions.) That visiting "affluent corporate executives or well-paid politicians" are exempt from such taxation has led Jack Z. Smith, staff writer for The Fort Worth Star-Telegram, to label the jock tax as both "un-Texan" and "highway robbery."

In addition, athletes did score one legal victory earlier this year, when Steve Kidder, general counsel for the National Hockey League Players Association (he also represents the Major League Baseball Players Association), convinced the Columbus (Ohio) City Council that visiting athletes were being overcharged. Columbus' 2 percent tax, which passed Dec. 11, 2000, was based on salary divided by the total number of regular-season and preseason games. However, Kidder got the council to see the logic of charging athletes based on the number of days they actually work with their teams, not the number of games they play. Players visiting Columbus are now taxed based on games plus "duty days," which in the case of pro hockey players totals more than 200 per year.

Kidder's success in Columbus might open up Cleveland's jock tax, which is based on games played, to future legal challenges. Other cities (among them Pittsburgh, Philadelphia and St. Louis), in consultations with attorneys from the various pro sports leagues and their players associations, have gone the duty-day route, which is quickly making it the industry standard. But the road to fairness is a long one; Kidder's compromise with Philadelphia tax assessors that led to a duty-day system (as well as the taxing of out-of-town reporters in town to cover games) dates all the way back to 1993. "At least it's a fairer system," Kidder told reporters at the time.

Taxing authorities, meanwhile, remain unapologetic.

"Last year, the state of Ohio earned $9.3 million from visitors playing our six professional sports teams," Gary Gudmundson, spokesman for the Ohio Department of Taxation, told The Times-Picayune of New Orleans. "Ohio has statutory authority to tax these team athletes. Ohio has a responsibility to its residents to do so."