Image credit: Seth Wenig/Associated Press

NBA franchise cities across the country are struggling big time as the league’s owners and players continue to battle over billions of dollars in New York.

On Monday, the NBA Players Association rejected a new labor proposal, prolonging the five-month-long formal lockout, and announced that it would disband in order to file an antitrust suit against the league.

The news, which threatens the 2011-12 basketball season, was not only sobering to fans; local officials say they are having a tough time drumming up the revenues usually brought in by the games.

“It’s a residual effect,” said Peter Auger, city manager of Auburn Hills, Mich. “It’s all in the mom-and-pops [stores] and the little places that are hurting.”

The Palace in Auburn Hills is usually packed with about 22,000 people ready to watch the Detroit Pistons. Auger told ABC News Radio that events like concerts and the circus did not bring in the same volume of people night after night. He said bars and restaurants in the area also were suffering.

“Those places are down 40 [percent] to 60 percent,” he said. “We’re still hopeful that they can have a season, number one. People around here love their basketball but those businesses too could use a shot in the arm around now.”

Tom Penn, an ESPN basketball analyst and former vice president of basketball operations for the Portland Trail Blazers, said the league, players and other entities stood to lose a combined $4 billion if the season was canceled. He said the postponed NBA season was being felt by everyone, from the league’s bigwigs to the part-time arena workers.

According to the Greater Oklahoma City Chamber of Commerce, each Oklahoma City Thunder game brings $1.3 million to the local economy. The Atlantic reported that the San Antonio Spurs generated $95 million and the Greater Memphis Chamber of Commerce says the Grizzlies and its arena generated $223 million in 2010. Cleveland Cavalier ticketholders reportedly spend more than $3.7 million per home game.

In October, 14 U.S. mayors signed a letter to the league asking for an end to the lockout. Penn said that he’d even heard rumblings that some cities — having built arenas for teams and now faced with finance payments — were considering filing a lawsuit against the league to recoup the funds they were losing.

“Security, ticket takers, ancillary businesses,” Penn said. “A lot of really good people are not able to work right because of this unfortunate dispute. This is real for them.”

ABC News affiliates WEWS-TV in Cleveland and KOCO-TV in Oklahoma City contributed to this story.