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WASHINGTON — Members of a U.S. House education and workforce subcommittee found occasional common ground when examining private equity involvement in youth sports at a hearing Tuesday.
Members of both parties on the House Subcommittee on Early Childhood, Elementary and Secondary Education emphasized the importance of making sport accessible to all children and discussed ways to prevent immense corporations from buying up facilities and increasing costs for families.
Financing by private companies could have advantages for youth sports, but could also make participation more exorbitant, it was said.
“Our concern today is with certain practices that reduce competition, drive up costs and limit access for families,” said subcommittee Chairman Kevin Kiley, a California independent who caucuses with Republicans. “We should promote models that expand options while discouraging practices that leave parents with fewer choices and higher bills.”
Linda Flanagan, a New Jersey journalist, former cross country and track coach and author of a book on the subject, testified Tuesday. Although she spoke mostly about the harmful effects of the commercialization of youth sports, she also pointed out that private companies can “provide vital services that benefit families and expand access to children” when local funding is not accessible.
The problem, she said, is that private investment firms’ top priority is generating returns for their investors, not the well-being and development of children. Such companies have increasingly made inroads into the world of youth sports in recent years, she said.
“Private equity exposure is particularly concerning because it involves experienced financial engineers with generally short horizons in the activities of children who are best served by a long-term approach,” Flanagan said.
A multi-billion dollar business
According to data, more than 27 million children ages 6 to 17 participate in organized sports, about 55% of the U.S. population in that age group Data collected by the Aspen Institute in 2023.
To finance a child’s participation in their primary sport, families spend an average of $1,016 per year on expenses such as equipment, uniforms, travel and tournament fees, the study found.
The money adds upand the youth sports industry generates about $40 billion in annual revenue, according to estimates by the Aspen Institute.
American families have begun specializing their children in a sport in hopes of getting them into a prestigious school or a scholarship as the cost of higher education has skyrocketed, Katherine Van Dyck, senior counsel at the American Economic Liberties Project, told the jury.
Beginning of JuneFormer professional quarterback Eli Manning’s private equity firm Brand Velocity Group acquired RCX Sports, which manages licenses for NFL, NBA, WNBA, MLS, NHL and MLB youth sports programs.
Matt Kakabeeke, the executive director of the Kalamazoo Optimist Hockey Association in Michigan, told the story of what happened after private company Black Bear Sports Group purchased the facility that housed its youth hockey organization.
Flanagan was initially hopeful that Black Bear Sports would make the necessary repairs to the rink, but he quickly became discouraged when the company began pushing out community-based programs and long-time neighborhood sponsors, eventually evicting his club from the facility when it refused to comply with the changes.
“With the increasing consolidation of youth sports, longstanding community-based organizations are at risk of losing access to facilities, their organizational autonomy and their historic identity,” he said.
Income sharing gap
Van Dyck also discussed the financial and health costs of private equity’s influence on youth sports.
Private companies can drive up the cost of participating in children’s athletics programs when they own the facilities where games, tournaments and practices take place, making it tough for low-income families to afford the experience, she said.
According to the Aspen Institute45.1% of children from higher-income households participated in youth sports in 2024, compared to just 24.9% in lower-income households. The gap has widened since 2012, when the difference in youth sports participation between income levels was just 13.6 percentage points.
Additionally, Van Dyck said, many parents choose to put money into youth sports because they are “sold with the promise of scholarships, while only 2% of high school athletes actually receive them.”
Today’s youth athletics culture also encourages children to specialize in one sport with the goal of playing in college, which can raise the risk of injury or lead to burnout in children, she added.
To combat private equity’s influence in youth sports, Van Dyck called on Congress to enact legislation that would ban vertical integration practices and unnecessary fees, hold companies liable for safety violations, and require the federal government to fund local programs.
“As we celebrate the founding of our nation this week, let us remember that in this great democracy it is possible to change course and return to this model,” she told MPs. “Congress can legislate to give kids the opportunities they deserve and make youth sports fitness and fun.”
Some Democrats on the subcommittee supported a The invoice sponsored by Rep. Chris DeLuzio, a Democrat from Pennsylvania, and Sen. Chris Murphy, a Democrat from Connecticut, that would ban private equity from youth sports and repay families who have invested heavily in privately funded programs.
Bipartisan support
Subcommittee members from both parties discussed a range of topics, and a common theme was interest in increasing participation in youth sports.
Republican Rep. Michael Rulli of Ohio asked Bryan Finnerty, founder of Michigan indoor sports facility High Velocity Sports, whether he thought compact communities would be able to renovate their facilities and support athletics programs without the facilitate of private investment.
In response, Finnerty said private companies and communities have the potential to raise opportunities for children who want to play youth sports through partnerships.
But he added: “If it’s not about these youth players in this city having a chance of access, then nothing else matters… If they put that first, that sounds like a victory to me.”
The subcommittee’s ranking Democrat, Suzanne Bonamici of Oregon, said in her closing remarks that sports can transcend politics.
“This is not a partisan fight,” she said. “I trust that every member of this committee has witnessed a child light up after scoring a goal or learning to resolve their differences and be part of a team. We should all want this experience to be within every student’s reach.”
