Field of Fees: Private Equity’s Role in the Commercialization of American Youth Sports

The subcommittee on early childhood, elementary, and secondary education will come to order. I note that a quorum is present. Without objection, the chair is authorized to call recess at any time. As this subcommittee discussed last December, youth sports remain one of the best investments we can make in the next generation. They help young people develop physical health, mental resilience, discipline, and essential life skills. And there's encouraging news. New data from Project Play shows youth sports participation has rebounded from COVID-era lows, with fifty-eight percent of children now playing sports. While that represents meaningful progress, too many families still face unnecessary barriers to participation. Over the past decade, youth sports have become increasingly commercialized. What was once an experience made possible through little leagues, volunteer coaches, and community recreation has, in many places, evolved into a business model that asks families to spend more every year. Average family spending on a child's primary sport increased forty-six percent between two thousand nineteen and two thousand twenty-four, and is likely even higher today.

Yeah.

Recent investigative reporting has highlighted certain practices that deserve closer examination. In some markets, consolidation is driving up costs for families while limiting access to more affordable community-based options. In many cases, families face a pay more or quit dynamic if they want their kids to continue playing. Some operators have used strategies that prioritize revenue over participation. Families report higher fees, mandatory add-on costs, stay-to-play requirements that force them to book hotels and lodging through affiliated partners. Vertical integration that requires participation in the same operators' leagues, tournaments, camps, and streaming services. These practices can limit consumer choice while making used sports more expensive. The consequences are clear. a widening participation gap. In twenty twelve there was a thirteen point six percent p percentage point difference in regular sports participation between children from homes earning under twenty five thousand and those from homes earning a hundred thousand, or more. A thirteen point six percent difference in participation between those two income brackets. That had grown by twenty twenty four to a twenty point two percentage point gap. The simple reality is that too many children are being priced out. It's not that they lack talent or determination, it's that their families simply cannot afford the rising costs. Parents recognize this trend. A recent survey found that seventy-three percent believe youth sports have lost sight of the core mission of fostering fun and developing teamwork, while sixty-one percent believe organizations now put profits ahead of that mission. At the same time, too many young athletes are led to believe that sports only matter if they result in a s- college scholarship or professional career. That of course misses their true value, healthier kids, stronger families. Now, it's important to recognize that commercialization in and of itself is not always the problem. Private investment has helped address real gaps created by declining local investments in parks and recreation. Many responsible operators have expanded access, improved facilities, and created more opportunities for yo- young athletes. capital, when invested responsibly, can broaden access and participation. Our concern today is with particular practices that reduce competition, drive up costs, and limit access for families. Simply put, we should encourage models that expand opportunity while discouraging practices that leave parents with fewer choices and higher bills. Today's hearing will examine both sides of this dynamic. We'll hear about practices that have driven up costs and reduced access to affordable community-based options. We'll also hear about successful examples involving private investment, traditional nonprofits, and community-based models that are expanding participation while keeping costs manageable. I look forward to the testimony of our witnesses and to a constructive discussion about how youth sports can remain affordable, accessible, and focused on what matters most, giving every child the opportunity to play. With that, I yield to the ranking member for an opening statement.

Uh, thank you, Mister Chairman, and and thank you to the witnesses for being here with your expertise, but also your experience in this important issue. And and thank you, Mister Chairman, for your statement this morning. Uh, I expect we can all agree that families across the country are feeling squeezed. The cost of groceries, housing, child care, health care and more is outpacing wages and too many parents are being asked to do more with less. Children are experiencing pressures too in many ways, including what we're discussing here today. Uh, helping families gain access to rewarding and enriching extracurricular and intramural activities is not a partisan issue, and it should be a shared priority, and that's why today's hearing is so important and timely. Youth sports are about more than wins and losses. They improve children's physical and mental health. They teach teamwork and leadership. They foster social skills, build confidence, resilience, and self-esteem. and they're linked to stronger academic outcomes. Youth sports bring communities together and can give kids from all backgrounds the opportunity to learn, grow and belong. More than sixty million children participate in youth sports in the United States annually, but today that opportunity has become a luxury for too many. The average family now spends more than fifteen hundred dollars a year for one child to participate in sports and those costs have risen dramatically, in just the past five years. registration fees, travel, equipment, lodging, exclusive streaming services, tournaments, camps, they've all turned what was once a community activity into an expensive industry that far too many families simply cannot afford. A major region reason for this shift, in addition to the underfunding of schools' parks and recreation programs is the growing role of private equity and market consolidation in the youth sports landscape. This subcommittee's last hearing on youth sports where Miss Van Duyn testified on the harmful effects of private equity in the youth sports sector, uh began this conversation and we are pleased to welcome her back today to discuss more important research in this area. We know private equity firms are buying up youth leagues, training facilities, sports venues, camps and tournaments, consolidating control over the market and driving up costs for families. When fewer companies control more of an industry, competition prices rise, and families are left with fewer affordable choices, and too often the priority is not the well-being of children, it's profit. This isn't just happening in youth sports. We've seen similar patterns across the economy, including in health care, child care, and housing, where consolidation leaves consumers paying more but getting less. And the Trump administration is not taking any action to rein in private equity, curb corporate greed or protect consumers. In fact, the private equity industry owns more businesses than all of those listed on the U S stock exchanges combined. Youth sports are simply the latest example of how unchecked market power can make everyday opportunities less accessible for families. And in addition to private equity firms wreaking havoc on the youth sports industry, the Trump administration is hurting rather than helping with youth access. Their fiscal year twenty twenty seven budget proposes cutting two point three billion dollars from the Department of Education and more than one point one, billion with national parks and recreation areas. These reductions directly contribute to the lack of accessible sports and outdoor programs. But fortunately, there are solutions. Our Democratic witness, Miss Van Dyke, will discuss some reforms Congress and the administration should consider, including greater transparency around fees and business practices, robust antitrust enforcement, and increased public investment in community recreation and school-based sports programs, So every child has access to affordable opportunities close to home. And speaking of close to home and the district I represent, we have a very active and well-funded um parks and rec district, Walletton Hills Parks and Rec district. They partner with our local public schools. It's a great partnership to expand access to parks and fields. And I also wanna make clear that there is a role for the private sector when the focus is on the well-being of youth. For example, the Nike World Headquarters, which is down the street from my office. Their um uh their programs like the Nike Community Impact Fund provides grants for local nonprofits and schools and programs that offer coaching skills. Oh finally, this hearing's about more than sports. It's about protecting families from being priced out of the opportunities that help them thrive. And not forcing parents to choose between paying their bills and allowing their child to participate in activities that keep them healthy, and lead to success. So I look forward to hearing from the witnesses about how we can

Pursuant to Committee Rule eight C,

Mm.

all members who wish to insert written statements into the record may do so by submitting them to the committee clerk electronically in Microsoft Word format by five p m fourteen days after this hearing. And without objection, the hearing record will remain open for fourteen days to allow such statements and other extraneous material noted during the hearing to be submitted for the official hearing record. I'll now introduce our witnesses. Our first witness is Ms. Linda Flanagan, an author from Selma, New Jersey. Our second witness is Mr. Mat Kekebeek, Executive Director of the Kalamazoo Optimist Hockey Association in Portage, Michigan. Our third witness is Ms. Catherine Van Dyke, Senior Fellow at the American Economic Liberties Project in Washington, DC. And our fourth witness is Mr. Brian Finnerty, founder of High Velocity Sports in Wolverine Lake, Michigan. We thank the witnesses for being here today, and we look forward to your testimony. Pursuant to committee rules, I ask that you limit your oral presentation to a three-minute summary of your written statement. The clock will count down from three minutes, as committee members do have many questions for you. However, pursuant to committee rule eight D and committee practice, we will not cut off your testimony until you reach the five-minute mark. I'd also like to remind the witnesses to be aware of their responsibility to provide accurate information to the subcommittee. I'll first recognize Ms. Flanagan for your testimony.

Chairman Kiley and ranking member Bonamici, thank you for inviting me to testify today. My name is Linda Flanagan and I'm the author of the book, Take Back the Game. Over the years, I've spoken to parents, coaches, school administrators, athletic directors, sports medicine doctors, and many, many young people about the state of play. What I hear from them is anxiety about the pressure parents, families are feeling, worry about the future of school sports programs, an alarm over the surge in preventable injuries among kids at ev- at ever younger ages. What I've witnessed with investors on the other hand is giddiness about the growth opportunities in the youth sports industry. One leading executive said in March of twenty twenty four, quote, "there is almost an insatiable demand for youth sports experiences. What exists today is a fraction of what we think the potential is." Here's how kids' athletics have changed over the last few decades. They've moved from a participation model that's cheap child-driven and focused on enjoyment to a performance model that's costly, managed by adults, highly structured, and devoted to sport-specific skill development. Less than thirty years ago, kids often started participating in sports at age eight. Today, it's not uncommon for eight-year-olds to compete for national titles. Consider that this is all taking place in a fragmented, largely ungoverned space. While governing policies and parenting culture play a role in how we got here, this morning I'll focus on commercialization. Business has always been involved in kids' athletics, but the nature and extent of it has changed. In middle and upper income areas, youth sports are dominated by private clubs, travel teams, extravagant sports facilities, and now high-tech gear and specialized sports academies. Adults depend on these jobs for their livelihood. kids' play is their source of income. More recently, private investment firms and other sophisticated investors have entered the marketplace which insiders claim is valued at sixty billion dollars. Private equity involvement is especially worrisome because it introduces sophisticated financial engineers with generally short horizons into children's activities that are best served by a long-term approach. And as with all investment firms, priority is investor return, not child welfare or development. At the same time, some companies provide vital services that benefit families and expand access to children. Anchored, league apps, and RCX sports come to mind. As with most complex issues, nuance is called for. The greatest impact of today's commercialized environment has been a widening of the gap between the haves and have-nots. In low income communities, participation rates have dropped from thirty five percent in twenty twelve to twenty four point nine percent in twenty twenty four. In wealthier areas, children feel competitive pressure to pick one sport and specialize in it at younger and younger ages. In my community, for example, the area soccer club offers a junior pre-academy program for U threes. That would be two year olds. The intensity has led to an epidemic of overuse injuries, a jump in the number of hours kids play, and the hijacking of family life. Sports matter because an avalanche of evidence reveals that age-appropriate exercise spurs good health and thwarts anxiety and depression. We should be doing all we can to encourage regular, moderate exercise and movement among children of all ages. As for solutions, legal scholar Dion Kohler said it best. "We've been hashing out these problems for decades, it's time to think about law and policy, not to micromanage, but to create real system change. I would start by requiring all youth sports organizations to register with US Safe Sport, expand athletic options in sports-starved areas, prohibit predatory business practices, and establish safety and training standards for coaches. Thank you for inviting me here to testify today and for your interest in this subject. I implore you to confront the problems in youth sports, to create solutions that best serve the children who play them.

Thank you very much. I'll next r- recognize Mister, uh, Kuekebieg for your testimony. You turn on your microphone, please.

Yes. Chairman Keeley, Ranking Member Bonamici, and members of the committee, thank you for the opportunity to testify before the committee today regarding our experience as a community-based youth sports program. For nearly fifty years I've been involved with the Kalamazoo Optimist Hockey Association as a player a coach a parent hockey director, and now as its executive director. Five years ago I assumed the role of executive director and I took this role because of my long-standing commitment to public service and to serving the families and young people in my community. As Koaha prepared for, as Koaha prepared to begin its sixteenth anniversary season and as I entered my fifth year as executive director our organization was focused on building upon decades of providing affordable and accessible youth hockey opportunities in the Kalamazoo community. However, on September one, the very first day of that milestone season, we were informed that during a meeting that during a meeting with rink management that Wings West, our long-time home rink and the foundation of youth hockey in our community for decades had experienced a significant mechanical failure and the ownership group would not make the necessary investments to repair the facility. On October seventh, Twenty twenty five, Wings West was acquired by Black Bear Sports Group. Our organization remained optimistic that we might eventually return to our long-time home at Wings West under the ownership and management of Black Bear Sports Group. However, the change in ownership marked the beginning of a series of events that would fundamentally alter our organization and create significant challenges for our non-profit youth hockey association association in the families that we serve. For decades, our recreational teams have proudly represented our local businesses and community partners, allowing young athletes to skate under the names of neighborhood tire stores, dental practices and restaurants, and other local sponsors that have invested heavy heavily in the Kalamazoo hockey community. This not this model not only helped offset costs for families but also strengthened the connection between our players and local business community. During our negotiations with Black Bear Sports Group, we were met with uh coercive and heavy-handed demands that demonstrated how they would like to control the essential ice hockey facilities and how they can be weaponized against the long-standing non-profit organizations to abandon their identity surrender community-based programming and conform to vertically integrated for-profit model that prioritizes corporate objectives over the families they served these these issues are not isolated to a single community rather we believe they reflect a broader pattern in which the acquisition of community sports facilities by a single operator is often followed by pressure on long-standing non-profit organization conform to a vertically integrated profit extraction model or risk losing access to the facility as youth sports become more consolidated long-standing community-based organizations face the prospect of losing facility access, organizational autonomy and historic identities on march third twenty twenty six black bear sports group evicted kalamazoo optimist hockey association from wings west leaving us without a home I believe this community has a unique opportunity to bring attention to these issues and to ensure that the youth sports remain centered on the development of children rather than the maximization of profits. The work on this committee can help protect community-based organizations preserve affordable access to sports and safeguard the local institutions that have served generations of families. Thank you again for the opportunity to testify.

Thanks very much. I'll next recognize Ms. Van Dyke for your testimony.

Thank you. Chairman Kiley, Ranking Member Bonamici, and members of the subcommittee, I'm Catherine Van Dyke, a senior fellow at the American Economic Liberties Project, and a former attorney advisor at the FTC. I've represented consumers, small businesses and workers against powerful corporations, and a lot of my advocacy has focused on how corporate interests in sports harm families, fans and athletes. I'm honored to be back here before you today. In December, I testified about how private equity has captured much of youth sports, raising costs and erasing opportunities for kids. Today, I will focus on why private equity's profit mot- motives conflict with the public goals of youth sports, why guardrails to protect communities are failing, and how Congress can fix what isn't working. Going back decades through Title Nine, the Amateur Sports Act, and executive orders from Presidents Eisenhower to Trump, We have never we have always called youth sports and fitness a national priority, but we have never funded it. The US Olympic and Paralympic Committee, tasked with developing grassroots youth sports programs, gets most of its money from NBC broadcasts and spends under one percent of that on youth sports. Communities are left to fend for themselves, cobbling together state and local funding and donations. And when those sources were depleted in recent years, Private equity filled the void. Private investors capture youth sports by rolling up competitors through dozens of acquisitions, then vertically integrating to capture the entire ecosystem. Varsity monopolized the cheerleading market by controlling events, apparel and the governing body. Black Bear Sports Group appears to be doing the same in youth hockey with ice rinks leagues and tournaments.

Mm.

thousands of leagues and tournaments, including seventy percent of elite soccer tournaments and showcases in New Jersey. We call this model a flywheel, trapping families inside and locking competitors out. The extraction it allows is bad enough, but in in in an industry meant to serve kids, it is worse. A business built to maximize short-term returns does not focus on kids' developmental needs, It focuses instead on keeping kids in their leagues, at their tournaments, and in their preferred hotels year-round. These conflicts create several barriers to access. First, cost. Youth sports particip- participation is up overall, but parents are spending thousands of dollars a year to make that happen. As a result, the participation gap between poorer and wealthier households is widening as parents struggle to make ends meet. Second, logistics. The current model replaces local games with endless travel and hotel stays. That is unachievable for a one-car family with parents working unpredictable, low-wage hourly jobs. Children are shut out by time, distance, and transportation. Third, geography. The availability of school sports and local clubs is the greatest determiner of whether a child will play sports. Basically, towns build public facilities that put a ball in every kid's hand, and private equity builds where the money is. No amount of scholarships can tear these barriers down. Private operators say parents sign up because it's what they want, but their profit motive can lead to deception about what their travel team can deliver. Parents are sold on promises of scholarships when only two percent of high school athletes actually get them. They also say year-round specialization is the best path to success, But uh it actually leads to alarming rates of ACL injuries and Tommy John surgeries. As retired star NFL star J. J. Watt put it, specialization benefits the adults who profit at the expense of the child. Congress can fix this. We can you can ban extractive practices like vertical integration, state of play, and junk fees, as the Let Kids Play Act does. Second, you can make the private investors behind the leagues liable for deaths and safety violations. Third, we can treat youth sports as a real national priority and fund it. Youth sports at their best can unify communities. Parents can share a sideline with their neighbors. Kids can play with their classmates and try new things. So, as we celebrate our nation's founding this week, let's remember that it is possible in this great democracy to change course and get back to that model. Congress can legislate to give kids opportunities they deserve and make youth sports about fitness and joy. Thank you. I look forward to your questions.

Thank you very much, and I'll last recognize Mister Finnerty for your testimony.

Chairman Keiley, Ranking Member Bonamici, and members of the subcommittee, thank you for the opportunity to testify today. I'm Brian Finnerty from Wolverine Lake, Michigan, and uh owner of High Velocity Sports in Canton, Michigan. I spent nearly fifty years in as a young athlete, as an eleven year professional soccer player, a coach, a parent, an entrepreneur, and an investor. And for the past twenty-five years as the founder and CEO of High Velocity Sports, I've experienced youth sports from nearly every perspective. And that experience is what brings me here today. My purpose today isn't to defend private capital, nor is it to criticize it. My purpose is simply to share what I've learned over nearly fifty years in youth sports. My perspective didn't begin with facility ownership. or private investment. It began with a coach who believed in me. As a young boy, I struggled to keep up on a soccer field because I was overweight. One day, while I was standing on the sidelines, soccer balls kept getting kicked out of play. My coach, Mario Cuevas, noticed I seemed to catch every one of them. While everyone else saw a kid who couldn't run very well, Mario saw a goalkeeper. And more importantly, he saw potential where others saw limitations. That moment changed the direction of my life. sports weren't just about developing better athletes, they were about helping young people discover what they are capable of. That lesson has guided every major decision I've made since. Years later, after my professional soccer career ended, I had the opportunity to build high velocity. And like many entrepreneurs, I couldn't do it alone. My wife and I leveraged our house, cashed in our savings, and private investors stood with us to take a chance on me. Their investment helped create a community sports center focused first and foremost on serving local families. Today, more than eighty percent of young people who come through our doors participate in the local recreation or youth sports leagues. We've also provided thousands of scholarships over the years, because we've always believed that a family's financial circumstances should never determine whether a child has the opportunity to play. I've also learned something important over the last twenty-five years. Not all capital behaves the same. I've seen responsible investment strengthened communities by expanding access, improving facilities, and creating opportunities for children. I've also seen business models that prioritize financial extraction over child development. In my experience, the difference isn't whether private capital is involved, it's whether the mission remains centered on children. I don't believe the question is whether private capital belongs in youth sports. I believe the question is whether it remains accountable to the mission of youth sports. In my experience, responsible investment and access are not opposing forces. When investment remains aligned with the right mission, it expands opportunities It builds facilities communities need, it supports coaches in programming, and it creates more places where children can play. But investment also carries responsibility. When financial objectives begin to outweigh the needs of children and families, we should ask difficult questions. Every decision should be measured against one simple standard. Will it create more opportunities for children and families in our communities? After nearly fifty years in youth sports, I've come to believe that the success of capital should ultimately be judged not by the returns it creates for investors, by the opportunities it creates for children. Thank you and I look forward to your questions.

Thank you very much. Under committee rule nine, we will now question witnesses under the five minute rule, and uh I'll recognize myself for five minutes. Uh, Ms. uh Flanagan, thanks so much for uh for your testimony and your work in this area. I just wanted to emphasize off the top uh again your understanding of the benefits for kids of youths' sports participation, uh and particularly in the context of how concerning it is we're seeing this decline uh among access in lower income communities and in the context of the the issues that we're all so familiar with related to um phones and screen time uh and everything else going on in in our modern world.

Well, yeah, I think one of the um most compelling reasons to in to support sports, to encourage them at every level is that they uh keep kids off their phones in every, I don't know, of a setting in athletics where kids uh are encouraged to run around with their phones. And this is Jonathan Haidt, Lenore Skenazy, many others have spoken about this, is how important it is obviously to get kids off their technology and sports allow for that. Um in in fact enforce that. So to the extent that lower income kids are denied that opportunity, it's gonna be more harmful for them. Because, you know, more screens, the worse it is for them.

That's right. And, you know, uh, as well as when you look at rates of childhood obesity and, uh, and, and some of the mental health, uh, trends that are very concerning in the country, I think youth sports are a tremendous antidote to, to all of these issues. Uh, and so, uh, that's why I think this widening gap is, is particularly concerning and the reality that we see more and more families facing these financial barriers. So it seems to me there's a couple of related issues here. You know, on the one hand, uh, we want to assure that every child has the opportunity to play, and so we have access, broad access to recreational youth sports. Uh, but then on the other hand, you know, there are gonna be some, uh, kids who wanna play at a more competitive level, uh, and, uh, you know, who will excel and who wanna seek out those opportunities, uh, but you're seeing, uh, you know, a lot of barriers for that as well. So how do we kinda balance those two things? How do we assure that every child has the opportunity to to play well uh those who want to play at a more competitive level have that opportunity as well.

Well I think uh the the issue of competition and when is it appropriate, it all comes down to what's age appropriate. And our because our system encourages early sports specialization um young kids are playing too much of a sport at younger younger ages and getting hurt, as I spoke of, um we have an epidemic of overuse injuries. At the same time we need to keep everyone wants our kids to develop, those who have the ability and the potential to develop as well as they can. It's really a matter of when is it age appropriate to start ramping up the intense competition, the tournaments, the year-round play. All of that in this country has been pressed to l- younger ages, when developmentally it oughta be older. There's virtual unanimity among sports medicine doctors that that's the case. So In a perfect world, we would just encourage a lot of participation among children. Again, as mentioned, we moved from the participation model to the performance model. The most, one of the most successful countries w- w- in youth sports is Norway, and that's - it's came up a lot during the Olympics because they did so well. And their model is kind of the opposite of ours. They have encouraged - encouraged multi- years of participation. Ninety-three percent of the population plays. It's very cheap. it's not super competitive they don't keep score they don't have rankings which i think are a scourge in our system um young children are encouraged to play for as long as possible and then when they reach an appropriate age it's early teenage years that's when they pour on the resources to the extent that we could emulate their model our kids would be a lot better off.

That's very interesting and I guess the flip side of that is that I think for you know we maybe cut off the opportunity to play in a recreational way too early for students who can't make the the competitive teams in high school or even junior high, then suddenly they have no opportunity to play soccer or whatever their sport might be. Uh so uh Mister uh Finnerty um could you tell us a little bit more about this uh, you know, the role of of private investment here because when we were talking about kind of the first category I was just referring to broad-based access, you know, there's of course uh this should primarily be driven by uh our school system, P E classes, uh non-profits, uh state and local governments, maybe there's a federal role. Um, but I think you rightly point out that there's a role for private investment as well. So how do you keep that investment aligned with the goals that you talked about, about child welfare? And I think actually, uh, one example that we've seen is the professional sports leagues, uh, that have an economic incentive, cuz the more peopl- young people who are playing their sport, that sparks interest. Uh, but they can, you know, and so the incentives are kind of aligned there. Is that, how do you keep the incentives aligned in other types of investment?

Yeah, I think, um, I From my experience it's been it's a both-and. I think we've looked at these as polarizing things, it's either or. Either there's money in the sport or it's completely community-based. And over my twenty-five years and I'd say fifty in sports, um they don't exist without each other. So I think it's when we put community first, and I'm saying this as an investor and a facility owner that uh is not supported financially by our community but yet in tandem with our community in Canton, Michigan, we do community programming we do senior programming uh we help manage outdoor fields when we're an indoor sports facility because we know what's good for us as an indoor sports facility in our community is also good for us from a sustainability perspective and I think at the end of the day if whatever we're doing is not sustainable whether it's an ice rink or a soccer field or a baseball diamond it's not gonna be around for long if you can't sustain it so you've gotta have the capital to do that and if you haven't put the community at the heart of what it needs first Uh, I I I don't think it's very sustainable.

Thanks very much. I'll now recognize ranking member Bonamici for five minutes.

Uh, thank you, Mister Chairman, and thank you again to the witnesses. Um, I'm uh uh encouraged that there's a vast amount of agreement on both sides of the aisle with what we're talking about today. Uh, Miss Van Dyke, you've written about how heightened scrutiny of all youth sports acquisitions can help rein in the practices of a private equity in youth sports. In your testimony you recommend uh that the Department of Justice and the Federal Trade Commission and state attorneys general can scrutinize consolidation. I know the Wall Street Journal recently reported that senior leadership at the DOJ under the Trump administration has been sort of steering the antitrust um division toward settlements over litigation it's just not clear whether they will make this issue a priority but I wanna ask you um what can Congress do and I know there's the uh Let Kids Play Act uh is a s- uh I think a good starting point for discussion. Um what can Congress and State Attorneys General do if federal antitrust enforcement isn't happening.

Thank you for that question. Unfortunately, yes, our federal antitrust enforcement mechanism right now is pretty anemic. DOJ has only filed, I think, one lawsuit in the la in in the first year of its administration and staff are reportedly being encouraged to avoid long investigations and trials. Youth sports, I think, is a really good example of why that sort of approach imp is so dangerous. when we aren't focused on what's happening today, it becomes very hard to unwind down the road. In terms of what Congress can do, I I think that we really need legislation that focuses on the serial acquisition strategy, that these types of investors use, such that reporting acquisitions isn't triggered only by one large acquisition, it is triggered by the cumulative effect of smaller acquisitions. That and that sort of reporting requirement enables our enforcers and our State Attorney General's Attorneys General to identify anti-competitive acquisitions sooner and stop them before they're set in stone.

Thank you. And, you know, as a a member of this committee and uh particularly this subcommittee, I've always submitted that supporting the health and well-being of our nation's children is the best investment we can make. And we know, we know that youth sports help kids learn and grow mentally, physically, emotionally. academically. We also know from our hearing in December that there's a, this is a quote from earlier testimony, great demand for kids to play sports and parents will spend money they don't have. And that's really concerning right now when people are struggling uh to pay their bills and we're having this conversation at a time when affordability is at the for forefront you know when parents express concerns about affordability in in youth sports, they're not just talking about enrollment's costs, it's all of the extras, equipment. costs, um, hidden fees, transportation, gas prices, state of play, hotel policies, gate fees to watch their own kids play. You heard the story about uh Senator Murphy being told he had to pay to actually film his kids um playing sports. Um, and and you talk in your testimony about a false promise, and and I I wanna ask you about this. I I actually used to work at the FTC and one of the positions I had was regulating deceptive advertising. So when you have this statement that there's this false promise that's giving to given to parents that this will increase their opportunities to earn an athletic scholarship, um and that they will be watched by colleges, but in fact only two percent of high school athletes receive an athletic scholarship. So can you talk about what we can do to bring transparency to parents,

Okay.

about the the real and true costs of programs? I think that's a step and obviously um stopping the practices are important, but we really need to give that information out to parents as well. What what are some thoughts on that?

I absolutely agree that some parent education there would be really helpful to really highlight the slim number of kids that actually not only get scholarships, but even play in h- play in college, a a very, very tiny amount do play in college, even without scholarships. Uh, beyond that, I think a focus on an on an by enforcers on these sort of deceptive statements, and digging into h- what promises are being made and what's being delivered and what is a- what they're actually capi- capable of delivering is incredibly important to sort of dispel this myth that the athletic scholarship is the gateway. But of course that's what parents view, you know, the cost of higher education is astronomical and people are desperate to find ways in the door and to pay for it.

Right. But if they knew only two percent actually get the scholarships I I wanna go back to what Miss Flanagan talked about with the Norway's approach. I recently heard from Doctor Rebecca Winthrop at Brookings Estonia, which is a very tech-forward country, about twenty percent of their day is with technology and the other eighty percent is more hands-on interactive learning which is, analogous to active learning and activity. Um, we're more flipped in this country where kids spend more time with with technology and less time in that hands-on i- i- i- interactive learning that will keep them active so w- I think we could have a conversation about that but real briefly as I yield back um, mister, I might mispronounce it, Kake- Kakebeki.

Cakey beak.

Uh, cakey beak, um, my um, a family went to Western so I know Kalamazoo really well. But you brought up a really interesting point too about the corporate branding when these companies come in and say now you have to be branded by our companies. That's that also, it doesn't just harm students and families, it harms the local businesses that had an investment in in a relationship with uh, and I just wanna make that point. Thank you, Mr. Chairman, I yield back.

Representative Rooley of Ohio is recognized.

Thank you, Chairman. Mister Finity, I'd like to take a slightly different approach. The focus for me today is on my biggest city in my district, Youngstown, Ohio. There are communities all around the country that need outside investments like poor rural towns throughout this USA. The Covelli Center, owned by the city of Youngstown, had an old ice rink that was in dire need of replacement. Repair just wasn't gonna be enough, and they didn't have the money. They needed money for backup to make this happen. Black Bear Sports Group supported upgrades to the facility, roughly exceeding one point two million dollars, and continued supporting the Youngstown Phantoms, which is the minor league hockey team of Youngstown, and also the youth sports groups with a Give Hockey a Shot program. Within the Give Shockey a Hot program, it offers boys and girls the opportunity to try the sport of hockey free of charge, free skates, equipment included. So my question to you today, mister Finnerty, is do you think small communities would be able to renovate their facilities and support great programs like Give Hockey a Shot program without the possibility of private investments getting involved?

Uh, I I don't think it's an absolute question, but I do believe that it affords multiple communities the opportunity when they have access to that capital. Uh, but I'll go back to my beginning statement, which is the stewardship in the community if they're not present, cuz I don't believe it's present everywhere, but where it is present in Give Kids a Shot program enables them to have a chance and access to play. Then I think without that, there would be no hockey in that town. And I think we could name fifty towns like that across the country. But if first and foremost, it's not about the youth players in that city having a chance and access, then everything else doesn't really matter. So I think when they put that first, that sounds like a win to me.

I I think these are fascinating conversations. I know in the Mahoney County area, uh, you know, I was a product of late eighties and the nineties, and there was no hockey. And, uh, we had the Pittsburgh, uh, Penguins, who was owned by the DeBartolo family from Youngstown. So that was the first introduction to hockey within the area. And then all of a sudden this Covelli program happened. And I thought they did a good job, and maybe you could just take a second uh with the communication when you have hockey organizations like this, and smaller off-market uh you know B and C cities, where you could actually have an interaction with the high schools or the junior highs, to get kids uh interested in in something like hockey. I know one of the people testimony today says we wanna get them off their phones, we wanna give them an environment where they could actually experience life. Any comments on that?

Uh I'd say to give those kids access and it the city is regardless of where the city is, if we can build a sustainable financial model, then that gives more kids access without having to ask those parents to pay for it directly. Right? And without it, if you don't have a sustainable financial model, the parents are gonna have to foot the bill. And so again, I I keep talking about this harmony and balance between the two. I think if you've got a supporting organization that could go from a professional sport like the NFL which is doing their flag football programs and the NFL play program, and the play sixty and play ninety programs, which we've seen at our facility, that give access to hundreds of kids that wouldn't have it otherwise, that's a really good harmony. We get to do outreach because there's a larger organization wanting to do more in our community. So I think whether it's football, soccer, hockey, whatever it might be, you need those two to coexist.

I really appreciate that, and with that, sure, I yield my time.

Representative Lee of Pennsylvania is recognized.

Thank you, Mr. Chairman. Um, if private equity, monopolizing youth sports is what it takes to get Republicans on board with enforcing antitrust laws, then I welcome that. I will happily work uh with you to get private equity out of youth sports. But I would love if we could apply this same level of urgency to protecting all children, families and workers. You can't keep passing bills that make it easier for corporations to exploit people, but then be surprised when they exploit people. Whether it's children in sports, or seniors in nursing homes, uh or when we prioritize corporate interests, people suffer. If we want more children to reap the benefits of sports, we have to invest in our communities. We need solutions that actually level the playing field instead of ones that will only improve things for the wealthy parents who are suddenly inconvenienced by private equity's outsized role in their kids' elite sports leagues. We need real antitrust enforcement because just like we've seen in so many other sectors, Corporate giants are the ones who are benefiting from the extraction of wealth in youth sports at the expense of children and their families. Miss Van Dyke, have how has the consolidation and and market share's trends uh in youth sports mirrored a playbook we've seen in other sectors like hospitals, uh or nursing homes?

So, I think those are really good examples to use up against youth sports, because they're both industries that involve really vulnerable populations who are easy to take advantage of. we there are private equity firms that are rolling up nursing homes and rolling up hospitals and rolling up all kinds of aspects of our health care. And when those firms do that in a in a vulnerable population, they are rolling up services and programs that the population they serve has to have that are critical to their well-being and so they're going to stay inside that flywheel that is built.

Thank you. And what happens to the quality of public goods when private equity gets involved in this case? Is it lowering the quality of U sports? Is it strengthening it?

Yes, it is. So in U sports we see when you have a private organization that maybe doesn't fall under safe sports jurisdiction, they aren't required to follow safe sports rules and reporting uh reporting requirements and they aren't subject to safe sport invest investigations. If there is some sort of reported abuse, uh when I was working on the varsity case, There were reports of serious safety issues, for instance, holding competitions in venues that didn't have ceilings high enough for the stunts that they were doing and where there wasn't proper flooring varsity itself has had its own sex abuse. Um, scandals, so you're absolutely right that quality is a very serious issue when a monopolist uh when somebody monopolizes an industry because they don't have any sort of incentive to make their services better.

And really quickly, your testimony also mentions how these profit extraction models promote year-round single sport specializations

Specialization, it is well known, is not good for children. It causes increased injuries, um burnout, all mental health problems, and so multi-sport play really is the best way to do that. It's Miss Flanagan reference, that's what how they do it in Norway, that's how they do it in a lot of other countries. But here, because the pressure to compete is so high, this is what children are doing. At early on earlier ages so that if you don't specialize you're gonna be locked out forever. My son, when he we missed the window for um baseball when he was nine years old, we learned oops, we were supposed to try out for a club team last year and now it's too late. That's how it works.

Thank you so much for your for your testimony and and for each of yours. Uh it's clear that our livelihoods are at stake when everything from youth sports to health care is a luxury good controlled by profit driven monopolies. I'll say it, end-stage capitalism is indeed crushing Americans. This is the inevitable result of private equity in every single sector. I cosponsor the Let Kids Play Act, a bill that would prohibit private equity and other predatory for-profit companies from investing in youth sports. If committee Republicans are serious about this issue, uh, let's mark that bill up. And let's mark up bills that get private equity out of every sector where it's causing harm because, just like Families shouldn't have to go broke so that their kid can play soccer or hockey. Um, they should be able to afford health care and housing and child care and elder care in the richest nation in the world. We need to start putting people before profits. And this, I think, is a wonderful start, but hopefully it will actually lead us to some action across the board on private equity's takeover of all of our industries and sectors. Thank you so much, and I yield back.

Representative Harris of North Carolina is recognized.

Thank you, Mister Chairman, and uh thank you to all of you on the panel today for uh being here and your expertise. It's obvious today we've come a long ways from the days I grew up in Winston-Salem, North Carolina and Northwest Versailles Little League and um and Pop Warner football and all of the things that we did in our community but it's no secret that uh participation in youth sports plays a significant role in the development of children across the country. We all know that over the years participation in sports has provided those critical opportunities for children to stay active, build character, develop lifelong skills, such as perseverance, leadership, and teamwork. And while many of these youth sports organizations continue to serve children and families exceptionally well, as we're hearing here today, the shift away from community-based programs, along with rising fees, increased travel, and other factors have left many parents dissatisfied with the current state. of youth sports. In fact, I read recently a twenty twenty five USA Today poll found that seventy-three percent of parents believe youth sports have lost sight of their core mission of fostering fun and developing teamwork while sixty-one percent of parents reported that youth organizations now prioritize profit over purpose. So, Mister, uh, Kekabee, based on your experience, what's the value of having youth sports organizations that are deeply rooted in their communities and accountable to local families rather than being controlled by outside operators who may be less connected to the communities they serve.

Yes, Mister Harris, I that's that's a fantastic question, and it's passion. It it's the passion that it's local leadership, administrating, local programming that's invested in that particular community to ensure that these young children have the opportunity to enjoy whether it's soccer, hockey, lacrosse. Um, so I I think it comes down to the passion of the local volunteer driven uh, board of directors or the the administrative staff of that particular club.

Well, that's a, that's an important statement you make there because another Finding the USA Today poll that I found particularly interesting was that sixty-three percent of parents said their children's sports teams travel more than necessary and nearly eighty percent supported reducing travel. So, Miss Flanagan, let me ask you, you mentioned that encouraging multi-sport participation, increasing feed transparency and reducing unnecessary travel are ways to better align youth sports with what keep kids engaged. How effective do you think these approaches could be in reversing some of the negative trends and concerns that we're discussing here today?

I think if we could address those issues, it would fix a lot of the problems. Part because if you if we were able to cut back on the travel, that's the biggest expense for families. So if it were sports were more local, if if if there was no air travel involved or hotel stays, that would cut that would be a enormous um enormously important solution. Also um multi-sport play, you know, as we've all spoken of, all the sports medicine doctors, medical associations, former professional athletes, everyone talks about the need for multi-sport play, and yet kids aren't doing it. Obviously some are, but a significant chunk are not. If we could switch that and to penetrate parents' brains,

Mm.

who are unfortunately flamboyantly irrational about their kids,

Yeah.

it would be it would go a long way to fixing some of these problems.

Thank you. Mister Finity, as I read your written testimony in preparation for today's hearing, appreciated the way you highlighted how quickly the short-term financial goals of investment in youth sports have become more important than the children and families those investments are intended to serve. You concluded your testimony by saying that the capital should ultimately be judged by the opportunities it creates for children, not the returns it generates for investors. What would it look like in practice for more operators and investors to embrace that standard if you will in the last forty seconds.

Uh sure, thank you. I think it it would look more like a result than it would be a mandate. Are more kids playing sports? Are they getting involved and are the parents able to afford it? I think that's the goal at the end. So when we put that at its high velocity, first and foremost, uh most businesses aren't profitable in their first five years, we made it there in year two. and have done so ever since because we put our community first and we reinvest in our community. So we have to be profitably s- to be civic, but at the end of the day, without those profits we don't get to reinvest, and without our community we don't have any of that. So I think at the end of the day, by I sound like a broken record, but by putting them first in what their desires and needs are,

Sure.

we can talk to the parents and educate them a little bit on not uh every eight year old's gonna get a college scholarship or turn pro. And at the same time, uh, if they're happy and healthy and ultimately wanna play club, hockey, or soccer, or baseball when they get to college, I think we've done our job.

Great. Well, thank you all for your thoughtful answers. Mister Chairman, I yield back.

Representative Adams of North Carolina is recognized.

Thank you, Mister Chairman, and uh thank you to our witnesses for being here. Uh, Miss Van Dyke, youth sports should be about children. Uh, they should be um, eh, they should be about health, teamwork, confidence, and giving every child a place But what we're seeing now is a youth sports market where families are paying paying more, community programs are getting squeezed, and a few large actors can control facilities, the leagues, the tournaments, the uniforms, the hotels, and even the streaming access. That is is not just a youth sports problem, that that's a competition problem. And we talk a lot uh on this committee about the impact of corporate consolidation o- on consumers. But it's harder to see the businesses that - that never started, the - the small providers that never got off the ground, or - or the community programs that were pushed out before families even knew they existed. So - so let me ask you this. Uh, if there were fewer private equity, uh, interests in youth sports, what types of providers would be able to enter the market that are currently being blocked or - or priced out?

Thank you for that question. I think that if we got back to a model that the model that we used to have and that it was funded that there was government money coming into it that it would allow these programs to get off the ground as you said because the way the model works now when you have one large company controlling an an entire ecosystem part of that ecosystem is the players on the teams and so when they control

Okay, let me ask you also about what happens when one

Yeah.

company controls too much of the youth sports experience. When a single company owns the r- the rinks, the leagues and the tournaments in a region, families and small clubs do not have many places to go. If they push back on costs, scheduling, hotel requirements, or unfair terms, uh they may risk losing ice time, tournament invitations, or access altogether. Now that's a lot of power over children, over families and coaches and community-based organizations. So when a single company controls the facilities and and the programming, what happens to a family or a small club that pushes back?

Well that's the I think that's exactly what Mister has talked about with his experience, is that when you have one large who controls every part of the youth sports ecosystem. They exert enormous power over the community. They control who gets to be on the ice or who gets to be on the field. They control which apparel company you're gonna buy your uniforms from. They control which teams get to be in the league. And a lot of times those league owners also own teams, and they get to write the rules to favor their own team.

Okay. Okay.

So you're right.

And so so do you believe uh fear of retaliation is keeping families and coaches and small providers from from coming forward.

Absolutely. Fear of retaliation is a very serious p- um problem. Doing the work that I'm doing, it's very hard to find parents who are even willing to talk because they don't want their kid to get cut from the team.

Okay. Well, finally, let me ask you about public-private partnerships. I understand that private investment can play a role in building facilities and expanding access. But but public-private partnerships are not magic words. If they are not structured carefully, they can leave local governments and families wide open to opportunities by the private partner. And when antitrust laws are not enforced, the public can end up subsidizing a system where private actors control access and raise costs. So can you speak briefly to why public-private partnerships must be paired with real guardrails transparency and antitrust enforcement? And and what should Congress be looking for to make sure that these partnerships expand access for children instead of simply creating another

I really appreciate that question, and I wanna make clear that I'm not arguing against any private money in youth sports. There certainly is a place for it. It always has had a place for it. Organizations like yours are doing a great job. Corporate sponsorships for facilities and teams are incredibly important. But there do have to be guardrails, because otherwa it becau- and when we talk about guardrails, we're rea- really talking about structural and behavioral remedies that we're dealing with in antitrust. We want, if if you are going to partner with a private company to operate your facility, you wanna make sure they don't have a conflict of interest that's going to make them give their teams and their leagues all the ice time s- and lock others out. So it's those sorts of structural problems where we don't want conflicts

So

of interest in our pup- in our private partners that are going to harm the community.

Certainly, I agree. Mr. Chairman, youth sports should not become another place where working families are told that they have to pay more just for their children uh to participate. And we should be protecting community programs, enforcing competition laws, and making sure that every child, not just the wealthy few, h- has a chance to play. And with that, I yield back.

Representative Owens of Utah is recognized.

Thank you, uh, Mr. Chairman, and I'll say first of all, uh, it's great to see this bipartisan concern we have, it's great about our kids. Um, playing sports as a student was foundational for my development and personal growth. I learned the importance of strong work ethic teamwork and loyalty. Decades of sports from Pop Warner, sixth grade to NFL gave me the confidence to grow from a young man who was a very quiet introvert to a US Congressman representing hundreds of thousands of Utahns. One of the greatest lessons learned from sports is now exemplified on my congressional team. We cannot control the school board, but we can control the hustle. Youth sports continue today to play an important role in our physical and mental health development for our children. We unfortunately, though, are seeing a growth of an industry of bad actors. who create a system that is pricing parents and their children out of the growth opportunity. We're seeing the growth of the system is making it harder to access youth sports, depriving our youth from opportunities for self-improvement and important character-building life lessons. Yeah, I'm grateful for this opportunity to have this conversation. Um, Miss, I find again you you s- you s- you start off with your statement too with two things that are kind of got my attention. One is predatory and the other one is corporate return on investment. uh, which has nothing to do with our kids has to do with the investors' return. Uh, we need to keep both of those away from our kids. And I think this is the kind of conversation we need to have to start that process. Um, Mr. Flanagan, in your testimony you noted that name, image and likeness NIL NIL deals are now a- available to high school students in many states which increase the pressure on families to invest heavily in, uh, youth sports at younger ages. Given that many parents see early and expensive sports participation as a path to college sco- scholarships, or future NIL opportunities, how is this dynamic affecting the culture of our youth sports and the values such as teamwork loyalty humbleness and respectful authority, all that can be learned through sports.

Thank you for that question. Um I'm what comes to mind is a a quote from the sports medicine doctor Nero Gionti who has said the more money the more problems. And I think um what also comes to mind is something called the commercialization effect, which you may already be aware of, but it's a it's a con- an economic concept developed by Fred Hirsch, the late uh British economist. And the theory is that whenever a good or service is supplied mainly on commercial terms rather than on some other basis like obligation, love, or feelings of service, that it changes the character of the good or service. It all commerce also crowds out those other values that might make someone do something. And I think we see this in youth sports in that the the appeal of perhaps getting an NIL deal as um and when I wrote my book it was really about I think parents felt an obligation or felt compelled to um launch into this because they hoped for a college scholarship or um access to a better college But now with the specter of NIL, that's also changing sports, and I would argue that the commercial, we're seeing the commercialization effect in youth sports. So that the values that, what you gained when you played, the teamwork, maybe the, the leadership skills, um, maybe some c- c- confidence, that those kinds of v- v- values are being crowded out by market values. And, um, for parents it makes sense in a way, their if you're paying a lot of money, you know, I think the fifteen hundred dollar number that's tossed around is probably low for many, many families, um, they're gonna wanna return on investment. And so that, then the the issues of loyalty, will you stay with your team, will you um

I I I'm I'm I'm I'm

That that becomes less important.

Thank you, I I just wanna make sure I ask couple of quick other quick questions. Um, mister Cockerby, a black bear says this. Saving rings and growing the game, I'd like to give you a chance to respond to a characterization of how would you describe Black Rock's impact on your hockey?

Black Bear Sports Group's impact on the County of the Miss hockey association could simply be described as predatory. Um, within thirty seconds of meeting Scott Branavan, the director of operations in Michigan, he'd unraveled sixty years of co-op history, demanding we change our name, our logo, Um, all of our programming, um, uh, was advised that the - the participant fees will be increasing, why we would have to cut back services at the same time. So, I - I think h- the heavy-handedness of those conversations and the fact that we pushed back made us, um, uncomfortable to Black Bear Sports Group, which ultimately resulted in our eviction. Um, it was easy for us to be removed from the f- the landscape and and the Kalamazoo community.

I I just wanna say one quick uh comment to uh to like uh Miss Fennery Fenner Fennery. First of all thank you. Uh I think the importance to understand that investment's important, but it's one of the mission, our kids, not investors. And we're seeing too much of this, we're gonna lose our our our soul, our nation if we don't get this right. So I wanna thank you first of all, all the entrepreneurs out there that's doing it for the communities that care about their kids, investing, we're doing it the right way, we just have to make sure we keep these bad actors out. So thank you so much and I'll be right back.

Mister Mannion of New York is recognized.

Thank you, Mister Chairman, thank you to the ranking member, uh thank you to the witnesses, this is uh, you know, such a critical issue and it's great to uh be able to dive deep into it today in a bipartisan way. Uh, you know, for too many families, youth sports is unaffordable, and we're hearing that today, private equity and uh for-profits are consolidating. our leagues, our facilities, and our tournaments, and at the same time we're not seeing the necessary investment in recreational programs. Um, that's part of the reason why I support Congressman Delisio's " Let's Let Kids Play" uh bill, which directly addresses ownership and the unfair practices that exist. I coached and refereed high school, youth, college sports for decades, And as was stated by many of you and, uh, many of the people on the dais here, that, um, what youth sports builds as it relates to character, leadership, teamwork, uh, loyalty to fellow teams, sportsmanship, um, is simply immeasurable. And, um, we cannot limit participation of our youth in these sports because of the cost. I wanna reference an organization that has met this head-on in my district called Tilley's Touch. Uh, the name Tilley was named after the founder's mother, who was fully dedicated to youth in the neighborhood. Um, this organization acknowledged and saw that there was a problem as it relates to poor s- children being able, not being able to participate in tournaments, traveling tournaments. because they didn't have the resources. Many of these children are refugees that come to Syracuse and Utica from around the world something we're very good at in upstate New York is that resettlement of people who are seeking opportunity seeking the American dream and fleeing oppression. One critical piece to what they do is making sure that education and tutoring is a critical part of their participation in Tilley's Touch. Also, uh, what is of assistance in that organization is connecting them to a variety of different community groups to make sure that themselves and their families have the opportunity to succeed you know and a lot of these organizations talk about how um they wanna make sure that they have the the youth's best interest at heart and that education is a key part of that. But I've watched firsthand that no kid gets on that field without participating in the education and tutoring piece. So, I just wanted to acknowledge their good work. And it's unfortunate to hear how, uh, greed is getting in the way of organizations like that. So, I have a question for Miss Van Dyke and then another follow-up question for anyone. Um, the incentives for large for-profit providers are clearly uh winning the game at this point and when a local non-profit or public school runs an athletic program the money that's spent often goes into the infrastructure to perpetuate those programs but we know that the incentives uh or the financial incentives for those private entities don't necessarily go there where do those dollars go

well i think that gets back to the importance of having public funding for youth sports because the large vertically integrated private equity firm is interested their first priority is paying their investors in a short amount of time whereas local locally owned community-based programs are going to re- reinvest those dollars back towards the kids

this is for anybody you know i watched this with my own children and i was a volunteer coach the coaches that are in these programs are community members. So they're put in a very difficult position. But do you have any instances where those coaches themselves, in an effort to help recruit additional players to grow the program, are benefiting themselves financially, that are just our neighbors?

Do you have an answer to that?

I I would I'd be hard-pressed to give you a yes answer on that. I'd I I I I still believe people like you and and I do this to invest in kids.

Yeah.

Um, and and there's no capital agreement beyond that.

Yeah.

I appreciate that response. That's what I've seen as well, but I've also seen uh what was laid out here today, which is people being put in very difficult situations and having to uh sell a bill of goods that many are not asking for. Thank you so much and I yield back.

Representative Messmer of Indiana is recognized.

Uh, thank you, Mister Chairman, and thank you to our witnesses for being here today. Mister Kekobe, youth sports organizations like yours rely heavily on a network of local volunteers, parents and alumni. In your in your view, how does shifting from a community-rooted model to a corporate-run model affect volunteer engagement and the broader sense of community ownership around youth sports?

Yes, I I I believe that as we move more to a corporate-based structure um we will lose those volunteers, things that Mister Owens had spoke about and the fact that we want mentors and mentorship in our communities. If w- if we're completely focused on profit and profit extraction and maximizing your return on your investment um by exploiting youth sports or a non-profit youth organization like ourselves um we we lose that ability to recruit volunteers. Um as a sixty year old non-profit we're built on the back of volunteers. Um, and I think the more local engagement we can have with our community, um, and - and the adults that are willing to give back to the next generation, just strengthens our community and our position in it.

Thank you. Uh, Miss Flanagan, uh, you described a growing divide between low-income communities where youth sports opportunities have declined and higher-income communities where families have the flexibility to spend on travel and specialized training. This disparity leaves the next generation of kids out of opportunities that could uh change their lives for the, for the better. Uh what is the impact on kids when they miss out on development uh and health benefits that come with participating in youth youth sports?

You know, if you read the New York Times uh this this science section every Tuesday, I s- every week there's another article about the advantages of exercise, and that it pertains to youth as well. Um it Sports, playing sports, and I wanna add also that sometimes we conflate sports with exercise. Kids play, we want them to play sports cuz they're fun and they're more apt to do that than go to the gym. But sports lower the uh growth of the body mass index, they help with brain processing, um they uh self-regulation and obviously emotional problems of depression and anxiety, so this is why we want sports, kids to play sports at all levels. There's also um some evidence that the most active adults are those who played sports, varsity sports in high school. So it bec- it kind of carries on once you start it when you're young and you develop an interest in it and it's fun, then you're more apt to keep doing that as an adult, which we also know is tied to health. I also wanted to um just the former question about the number of coaches, the Aspen Institute found that there was a a drop of I think it was one point two million fewer volunteer coaches in the last couple of years, you know, related to the issues we're talking about today.

Well. Uh also in your te- your testimony you mentioned

That's awesome.

the importance of injury prevention. Uh are you familiar with a program called Coaching Safely that provides on-line evidence-based uh training platform for youth coaches and helps them recognize and manage and prevent youth injuries?

I certainly am.

Um what what what in your recommendation what would be a recommendation on how to best get those tools you know, to coaches across the country.

Well, I think Jack Crow, who runs that program, is doing heroic work to get that out there. Um, and and it's been that coach safely model has been adopted by I think about six states now it may be it has to be a state-by-state kind of um approach where uh organizations are the state mandates coach training for children under the age who are not in school. Because we already have um protections for high school and college kids, it's only the younger kids we don't. So I think if if other states can look to the model that we see in Alabama and elsewhere, um that may not be the best way, but I think it may be the the quickest way at this point.

Thank you. Uh, Mister Finnerty, we heard today examples of how public or how private investment in U sports has created barriers to opportunity. Thankfully not all capital businesses operate the same way. We've also seen examples across the country where private organizations have partnered with local communities schools and mon and nonprofits, through initiatives like uh coach training programs, facility upgrades in public schools, and community-based access efforts to expand participation and reduce barriers for families. Uh from your experience, uh building and and operating high velocity sports, uh how can private investment be used responsibly, including through partnerships with public entities to expand access, strengthen local programs and c- and create sustainable youth

Uh, good question. Uh, I think first and foremost, based on my experience with the public-private partnerships, it's uh, and my example at High Velocity, we're work we're working with our township of Canton to find the inefficiencies that may exist in their current processes. So they may not be doing things efficiently and therefore they're more expensive, where we can come in and help them with those efficiencies. And with that savings, pour a hundred percent of that back into kids who need more access or can't families that can't afford to play. So I think we have some infrastructure on things like organization efficiency, managing volunteer organizations, as Mat talked about, where we can actually create a better environment for those volunteers to get them more engaged, not less, which lowers the cost and gets more kids to play. So we bring that structure. I'm giving you just our example, but we tend to look inside first. And if we can't help, then our community would say thanks but no thanks, but where we have been able to help, they've taken our uh our assistance.

Thank you, and I yield back.

Representative Grijalva of Arizona is recognized.

Thank you, Mister Chairman, every parent wants the best for their kids, um but sadly every parent can't afford it, and more and more uh families with lower socioeconomic status are not able to let their children participate in a lot of these. opportunities. I have three kids at home, so whenever I'm home, I, if I'm not here, I'm watching a play or at a school event or at a mariachi performance. I'm fortunate that my kids fell in love with activities that were offered at their school, that were provided by school, but for many families, youth sports are becoming a luxury that public schools can no longer afford to provide and families can no longer reach. Um What used to be a local recreational activity has been transformed into a forty billion dollar semi-professional industry twice the size of the NFL. We are in the midst of a true affordability crisis in twenty twenty four. The average family spent over fifteen hundred, and I agree, that is probably a lot more than that, um, just so a child could play. A staggering forty six percent increase since twenty nineteen. Where parents see an opportunity to provide the best for their kids, corporations see an opportunity for profit. These corporations aren't just participating, they're dominating. They are wringing out working class families by buying up rinks and leagues, then charging predatory fees for things as simple as recording a child's game. That's unacceptable. The affordability crisis has bled into every axis of our lives, and now it means our kids won't even have the chance to even try out a new sport, let alone play the sports they love, while massive corporations make profit hand over fist. We need to end the commercialization of children's sports and bring sports back to public schools and it starts with understanding how we got to this point and leading change from the top down um Miss Van Dyck while the focus of today's hearing is obviously with youth sports changes in sports world at the college and professional levels, obviously trickle to have trickle-down effects um how talent is scouted, how players are paid, and how athletes are able to train. What trends at the college level or even professional levels of sports in recent years have influenced how youth sports industry is structured today?

Thank you for that question. Um, uh, first of all, as I said earlier, certainly the higher cost of education is driving a lot of parents' motivation to and willingness to pay the high prices that these

Yeah.

commercial monoliths are charging um second of all the commercialization of college sports I think is um Tom Ferry asked with Aspen Institute often says anything that happens in college trickles down to youth sports programs.

Mm-hmm.

So the commercialization of sports in college until very recently drove most of those profits toward coaches' salaries and outrageous facility spending. Yeah, LSU just signed a contract with Lane Kiffin um at the end of last year for over ninety million dollars. My alma mater, TCU, had just built a snow room at a big new fancy um facility um third we are looking at a model where we are still not offering funding so for instance the protect college sports sports act that just made it out of committee in the senate in the senate that that goes after athlete pay it doesn't go after coaches pay it doesn't go after facility spending and it doesn't provide funding for the olympic in women's sports, that it claims it wants to save

mmm Yeah. Um, is there anything Congress can do to require that um, facility owners, especially those operating on public land or with public subsidies, keep their facilities open and affordable to the whole community, not just to the families who can pay the most?

Absolutely. I think if Congress is providing funding and facilities are being built on public land, that funding can be provided with conditions, such as prohibiting any sort of private operator that has a conflict um making sure that they're um requiring equal access, laws requiring equal access and equal um terms is not something new, and there's no reason that can't be applied to youth sports.

Yeah, I think that um the one quote that you you uh said earlier is making youth sports about like fitness and joy, and we really need to focus more and more on that, unless, you know, it should be a positive physical activity, you know, working as a team, raising well-rounded uh young people that are gonna be super successful in our communities, and less about like a cut throat environment. And we were talking like middle and high school, but this is happening in younger grades as well. And it's really scary for those kids who are like, I just wanted to see if I, you know, to learn how to play the game, um are getting pushed out. So I appreciate uh the time today and I yield back. Thank you.

Thank you.

Representative Moylan of Guam Guam is recognized.

Thank you, Mister Chairman, uh thanks for this field of fees, private equity role and commercialization of America Youth Sports uh committee hearing today. I thank the panel also for your testimonies and just have a few questions, uh first starting with Mister Furnity. Uh, how can private investment expand youth sports facilities? and programming without pricing families out, particularly in the rural, especially mine, like Guam, and low and middle income communities, please.

Uh, well, I think that many people on the panel have talked about that, which is the combination of both public and private work together. Uh, I don't think that if if we're only putting the uh, onus on the public sector to do it, uh, that will base everything from the size of your community to the tax base that may may exist. to uh the philanthropic people that live in communities like Kalamazoo, and it will ebb and flow. I think when those things are done in tandem then you do have a requirement, speaking from the private side, that when on public uh land or uh working in combination with a public entity, you have a check balance that obviously you're serving that community first, and therefore uh being able to be in the profitability side to support that I don't think those things are in conflict with each other.

Excellent. If done right, it will work.

That's right.

Thank you. Uh, Mister Kekabek, um, what safeguards help preserve affordable local youth recreation programs?

What safeguards help protect? Um, I I guess for for our club, uh, those safeguard would be the appropriate public-private partnership. For example, in our community, uh, we were very fortunate, for s- for six decades we had two families that owned the ice rinks in Kalamazoo, um, and they were heavily investing in the community and subsidized the fees and the ice rental of our community for, for generations. Um, and, and now moving forward it, it does, it looks different. Um, and the safeguard is to keep black bear sports and private equity that come in and make these demands on these local nonprofits that have been there for generations to to conform to their vertical integration to extract the profit um from from our families, which make sports much more expensive than it needs to be.

Uh, thank you. That's really very true, and I see that as as well. Appreciate it. Uh, also, sir, uh, how can all local organizations remain competitive as commercial operators expand?

By providing a world-class experience. Um, we strive to do that at our club every day, um, and we would make ourselves more attractive by having the community involvement, our former pro players, our college players, um, having a large volume of volunteers with community investment to host try hockey for free events, to to host an eight-year jamboree with a chili challenge cook-off, um, to make it a festival atmosphere, carnival-like every time you step on the ice, um, that's how nonprofits are gonna survive in this marketplace.

They make it really fun and affordable for everybody to attend. Very, very good. You make me excited to come and see your games and stuff. Thank you. Thank you for that. How about Miss,

You're welcome any time.

I appreciate it. Miss Van Dyke, would you like to add on to that, please?

Yeah, I think in terms of being able to compete, I think it's really important to make sure that we don't have these flywheels and these vertically integrated companies because that's really hard to penetrate. Um, if we have facilities where a um, private operator owns the facilities, owns the leagues and owns the teams, mister Kakabek's experience is going to be um repeated for other organizations. If we ha- if we enforce our existing laws and pass laws that prohibit these types of conflicts of interest, we will have competition.

Thank you so much. Thank you to the panel. Mr. Chairman, thank you. The ranking member of the full committee, Mr. Scott, is recognized.

Thank you. Thank you, Mr. Chairman. Uh, let me follow up on that. Um, Ms. Van Dyke, you talked about vertical monopolies who one company can own this rank, the controls the teams, the leagues. runs the tournaments, um, even live streams the events and gets revenue from that, uh, how are these vertical monopolies even legal under antitrust laws?

That's a great question. So our anti our existing antitrust laws do actually address vertical monopolies. And pr- and when a vertically integrated company is harming competition, that's unlawful under the antitrust laws that we have. Unfortunately, they have been. deluded a little a little bit by some of the judicial interpretation and also by the lack of antitrust enforcement under the current administration and the lack of um i i would say the lack of attention to the consolidation that has happened in youth sports over the last ten or fifteen years but there are laws that exist that prohibit this they just have not been enforced sufficiently.

And what portion of this whole problem is due to the absence of other opportunities uh provided by local public schools and parks and recreations? It seems to me that for-profit entities would have trouble making much money if there were free or affordable options for families.

I think that's absolutely right. You know, a lot of people that I talk to, friends, people that I talk to in my professional life talk about they say they've been sucked into it, they feel like they have no other choice. But if there is funding and there are programs at schools, that eliminates a lot of these access problems we are talking about. If there is a school run team, it is most likely that your child's practice is going to be there, their home games are going to be there, when they have an away game they're probably gonna take the school bus there. And so all these barriers that we're talking about in terms of cost and time and travel and um facilities go away very quickly when you or when kids have a place to play, and when there are not just varsity programs, there are junior varsity programs for kids who are newer to a sport or still developing. So, yes, I completely agree.

And these for-profit companies, um, how much of their revenue is provided by fees paid for by the families? Um, and is there any ev- evidence of financial arrangements with hotels or restaurants? they may use how do they make their money

so when people um cite that forty that forty billion dollar figure i think almost all of that money is coming from parents paying enrollment fees and management fees and and paying for equipment and uniforms um as far as state of play that is a enormous problem it is the one that when parents will talk complain about the most they i The arrangements mean that, what stay to play means is that a youth sports tournament requires any team participating to book their travel through their preferred travel agent and stay at their preferred hotel they are told we got you the best rate, that is rarely true, true in today's age it is very easy to look online and see on Expedia that you're paying a lot more and that there's a cheaper hotel down the road um even USA hockey has a stay-to-play policy for their junior hockey tournaments, and if anybody on a team violates that stay-to-play policy, the team is fined five thousand dollars. So it's a serious problem.

Now, the gentleman from Utah, Mister Burgess, talked about the value of sports. I don't think we need to debate that question, um, around here. But, um Y- you mentioned that part of the problem is is public schools aren't doing all they can how much money are we spending, how much money are public schools or federal governments spending on sports? I know title four under the um elementary and secondary education act, it's uh we spend about three or four billion dollars a year. Um there about fifty million students at two thousand apiece, that would be a hundred billion dollars. It doesn't s- it seems like affordable numbers when you consider that we ran up four trillion dollars in additional debt and that big um um ugly bill that they are gonna celebrate later this week. Um, it seems like we have the money if we wanna if we will just make the effort. Uh, do you have any comment about whether or not we can afford to solve this problem?

I think that you make some good points about where we're spending our money. I can't speak to title four, but I can say that the US Olympic Committee, or US OPC, receive zero dollars of federal funding despite this being our an alleged national interest and so when you look at what people's priorities are I think it makes sense to look at where the money is going and none of it is going to our US OPC that's tasked with developing these grassroots programs.

Thank you, Mister Chairman.

Uh I will now recognize uh thank you to uh our witnesses for your excellent testimony and now to recog recognize the ranking member bottom chief for a closing statement.

Uh, thank you, Mister Chairman, and thank you again to all the witnesses, uh, for being here today and for your compelling testimony. What we've heard today reinforces what families are already experiencing. Youth sports have become harder and sometimes impossible for families to afford, and we know that choices have been made that contribute to this hardship, under investment in public facilities and K-twelve programs, and in an environment that's increasingly shaped by consolidation and private equity where decisions are driven by returns for investors rather than outcomes for kids. Many exploitive firms are experts at insulating themselves from the consequences of their harmful practices, as is the case with black bear sports, for example. Uh, it's also very concerning that many of these private equity firms and their subsidiaries have been known to target, uh, businesses that serve lower income populations. These consumers have little to no recourse, uh, or resources when quality falls and prices rise. And as Miss Van Dyck's uh research makes clear, this is not an isolated problem, it's a pattern that we recognize from other sectors of the economy, where fewer companies are controlling more of a market, and that leads to higher prices and fewer choices for everyday families. And when that happens in housing, in child care, or health care, families suffer. And when it happens in youth sports, kids pay the price, through lost opportunities to play, to belong, to grow, and to benefit from sports. This isn't a partisan fight. I expect that every member of this committee has watched a child light up after scoring a goal or learning to resolve their differences and be part of a team. We should all want that experience to be in reach for every student, not just those whose families can afford the travel, the coach, the premium turn tournament package. Our constituents want and deserve fairness, and what we have heard today is anything but fair, uh, what's happening. So the path forward?

uh without objection uh i'll submit for the record statements from mister kyle scott founder and president of buying sandlot and mister Liberman, founder and CEO of Anchored. Uh, both statements emphasize that the challenges in youth sports are more complex than private investment alone. You know, thinking back on, uh, my own upbringing, it's, uh, really hard to imagine it without youth sports. Uh, youth sports are really part and parcel of childhood, and, uh, it's, uh, tragic and alarming, uh, that those opportunities, uh, are being uh lost for many kids in our country because uh of financial barriers. Um you know we all we've discussed today the uh the countless good and healthy habits that are formed through youth sports participation where kids are getting exercise, they're often getting outdoors, uh they're interacting with their peers, uh they're working with their peers towards goals, in other words teamwork, uh they're learning determination and resilience, uh and grit uh all qualities that pay enormous dividends uh in all facets of life. And so uh when we see this widening opportunity gap in access to youth sports, uh I think it's a terrible thing for those kids who lose these opportunities. It's also a terrible thing uh for our country if those benefits are not able uh to compound uh down the road uh for for everyone. Uh so I think today's hearing is an opportunity for us to really try to call for uh a renewed commitment to uh broadening access to youth sports for all kids which means uh, you know, investing uh at all levels of government in creating those opportunities and the facilities and infrastructure necessary to make them possible. I think there's a role as well in our schools for uh in some cases more meaningful uh PE offerings in order to uh foster participation. uh for for kids at all at all age levels uh and then we've also looked at uh and and and it should say by the way that uh when you have budget decisions that have to be made when hard choices have to be made for some reason it's always sort of kids who are the lowest priority and so i think that that's something we need to change as well but we've also heard about how uh there's a constructive role uh for public private partnerships in sorta in trying to catalyze uh this uh this broadening in facilities and we've heard a few examples like the national recreation and parks association grants uh the nfl flag in school and play sixty initiative uh sixty three by thirty golf alliance under arm in our project rampart rampart uh az the az plays initiative uh the dick sporting goods foundation has done great things uh up to us sports these are all really good examples uh of how you see uh the private sector uh and the public sector working together for the benefits of kids. So today's hearing has been about uh youth sports. It's also been about the cost of living. Uh when you have families who are paying so much in many parts of the country, uh for gas, for electricity, uh for housing, uh for water, uh for groceries, and then you say, well, you have to pay a thousand dollars or maybe much more, uh just for your uh your kid to be able to play sports, that's a cost that far too many families uh can't afford right now. And so uh we need to uh have a renewed commitment to broadening participation and access and use sports for all kids and to lowering the cost of living uh for all Americans. Uh with that, without objection, there being

Mr. Chair- Mr. Chairman?

Yes, sir.

I'd like to clarify the record. I'd I'd use two figures. I used the figure a hundred billion dollars, uh two thousand apiece for every um public school student. It was a hundred billion and that's an annual number The four trillion in additional debt was a ten year figure. So just wanna make sure the record is clear.

All right. Thank you very much. Without objection, there being now no further business, the subcommittee stands adjourned.