Tuesday, November 30, 2010

Social Media Becoming Important Negotiating Tool

If one needs any evidence of how social media can spread rumors of imminent signings, look no further than the Jon Gruden-to-University of Miami incident from Sunday night. It's broken down well here by Sports by Brooks.

Teams, players, coaches, and agents have always negotiated through the media. (See Yankees vs. Jeter) And none of those parties is afraid to drop a bad tip, either, to create leverage.

But now, with the growth of social media, the significance of these tactics have grown exponentially. The second a middling reporter (myself included) posts something remotely controversial or surprising, Pandora's Box has been opened and there's no turning back.

It goes to show that nowadays, when there is smoke, there may not necessarily be fire.

Saturday, November 27, 2010

Report: City is Not Turning Profit on Rays

After posting a Tampa Tribune article that indicates the Rays are able to turn profits at Tropicana Field if they work hard enough, Stephen Nohlgren from The St. Petersburg Times writes that - no matter how hard it has worked - the City of St. Pete has not turned an operating profit on Rays baseball:
Though city officials originally hoped the monetary benefits of putting on baseball games might defray the $6 million in annual payments for Tropicana Field, the opposite has occurred.

Operational costs have outpaced revenue, forcing the city to shell out more than $1 million a year on top of debt payments.
Unexpected insurance increases after Sept. 11 and the 2004-05 hurricane seasons were largely to blame (all Florida property owners felt that pain).

Nohlgren's article shows that the Rays' disappointing attendance costs the city just as much as it costs the team. However, by focusing exclusively on operating losses, it does not address the payback the city gets on its investment: an increase in visitors, spending, and national notoriety.

We should remember that governments routinely subsidize everything from roadways to sewer lines to other utilities. But St. Petersburg is paying the price for a poor contract negotiation in the 1990s, where the Rays got a large share of stadium revenue.

After all, "a contract is a contract."

Report: Rays Can Turn Modest Profits in Tampa Bay

You could debate the headline for hours:

"Can the Tampa Bay area sustain baseball?"

Michael Sasso from The Tampa Tribune explores the financial challenges facing the Rays and then proceeds to knock his conclusion out of the park:
"To be sure, none of this means the Rays can't turn a profit. The team may just need to work harder than most."
Stu Sternberg knew when he bought the Rays five years ago it was a reliable source of revenue...but it may never be a cash cow like the Yankees or Red Sox. He would have to work. And he has.

The Rays have made (almost) all of the right moves in the front office. They've made (almost) all of the right moves on the field. And while they haven't been perfect in the court of public opinion, they're still as popular as ever in Tampa Bay.

Sure, the Rays aren't making overnight billionares out of Sternberg & co. (although indications are the franchise has climbed in value by more than $100 million if - and when - they want to sell). But they had to have known that coming in. They had to have known it would be a harder challenge than if they had simply taken over the Yankees or Red Sox.

Sasso makes some great points about the unique obstacles the Rays face in drumming up revenue, but it's hard to sympathize with the claim that Metro Tampa/St. Pete has the fewest fans within 30 minutes of any MLB team. Stu Sternberg - and Vince Naimoli before him - had to have known that when they bought the franchise.

They had to have known teams like the Yankees and Red Sox draw fans from way outside their metro regions. Some travel great distances to go to a game; others contribute by buying merchendise and watching games on TV (as Rays fans did in great numbers this past season).

Sternberg told me last week he wants Tampa Bay to think regionally in order to best support the team. But the team also needs to think regionally. Spring Training in Port Charlotte was a great move. But ownership needs to continue to cultivate its fans in places like New Port Richey, Lakeland, Sarasota, Fort Myers, and Orlando.

It will take time to grow the fan base and passion of MLB in Florida. While fans in New York or Boston think nothing of traveling over an hour for a game, it hasn't always been that way.

It isn't impossible to change the mentality of Floridians...but as Sasso said, the Rays will just have to work harder than most.

Friday, November 19, 2010

Land isn't Problem in Stadium Saga; Funding is

Despite the rhetoric that plays out on message boards, talk radio airwaves, and newspaper columns, the decision on the long-term home of the Rays has very little to do with location and everything to do with financing.

As Pinellas County officials take baby steps toward a possible funding structure for a new stadium, Hillsborough County can do nothing but sit back and watch. Since Raymond James Stadium and the St. Pete Times Forum are sucking up the bed taxes until Jan. 1, 2027, most commissioners acknowledge there just isn't any public funding available for a new baseball park.

Sure, a Tampa ballpark would be more easily-accessible for the majority of Rays fans.

Sure, there's land available in Downtown Tampa. And at the Florida State Fairgrounds. And sure, the land would likely be given away for free for a MLB stadium. (For what it's worth, land would also essentially be free at the current Trop site and a Toytown/North St. Pete site.)

But $70 million in land is a drop in the bucket for a $500-600 stadium and no developer is going to start paying for a stadium structure on top of a land giveaway.

Two stadiums have been built in the last 40-plus years without public funds. How'd those turn out? The owner of the Columbus Blue Jackets admitted it was a terrible idea and he's going broke. While the owners of the San Francisco Giants admitted soon after opening Pac Bell Park that they caught lightning in a bottle and a privately-funded stadium is now impossible.

So where does that leave the Rays, who would - in theory - put more butts in seats if they got a new stadium in Tampa? Stuck in a contract that isn't ideal for their business.

One-time St. Pete mayoral hopeful Larry Williams hit the nail on the head last year on the campaign trail when he said, "what's best for the Rays isn't necessarily what's best for St. Petersburg."

Most lawyers see the team's "use agreement" as a more binding contract than a lease. And, as Marlins' owner David Samson said, "a contract is a contract!" Heck, Conan O'Brien got a $34 million parting gift from NBC when those two sides decided the contract was standing in their way.

So it would seem the Rays need to work with St. Pete in breaking the current lease if they don't want to play at Tropicana Field until 2027. Which means the price tag on a new ballpark could rise. Which means Pinellas County has another advantage over Hillsborough since a Gateway/Toytown stadium wouldn't require a St. Pete buyout.

Rays' owner Stu Sternberg told me this week that he's looking for a regional approach to solve the financial issues. And although he didn't cite examples, one has to look toward collaborations like Tampa Bay Water and a potential three-county light-rail partnership as evidence that Tampa Bay is coming together as a single region. Previously, it's been city vs. city and county vs. county.

St. Pete officials maintain they aren't holding the team hostage, but merely looking out for the return on investment promised to the community years ago. Since they're taking a hard line this offseason and not even Pinellas County can come close to putting together $30 million/year for a new ballpark right now, it doesn't appear a quick resolution is on the horizon.

Thursday, November 18, 2010

Selig, Sternberg Keep Meeting Details Quiet

Bud Selig and Rays' owner Stuart Sternberg had an opportunity to catch up Thursday at the MLB Owners' Meetings... but the rest of the world may never know if they did.

When asked how much face time Sternberg got with specific individuals during the meetings, he quickly answered, "whatever's needed."

But in October, Selig indicated a conversation with Stu was most definitely needed because of concerns for "clubs that are winning whose (attendance) is consistently below (the league average)."

Reports also surfaced that he advised the Rays to play hardball with Tampa Bay.

Continue reading story here.

Wednesday, November 17, 2010

A Chat with Stu Sternberg

In his first television interview since the Stadium Saga really kicked up, Stu Sternberg didn't want to talk much today about what's next in the search for a stadium. He did acknowledge he was hoping for a regional discussion sometime soon on the topic.

But he also admitted his approach to the debate may lead some Rays fans to form misconceptions about his loyalty to Tampa Bay.

See our story here.

Sternberg, Rays Hoping MLB Provides Some Relief

With all 30 owners and all 30 general managers all in the same building, the Rays' front office is hopeful for some good news on their future.

While Rays' majority owner Stu Sternberg didn't want to push the stadium issue, he said he was hopeful the next Major League Baseball Collective Bargaining Agreement would provide relief to teams constantly outspent by division opponents.

Commissioner Bud Selig is expected to address competition issues this week, including possibly expanding the playoffs by another wild-card team in each league. Changes would likely take place in 2012 or possibly even 2011.

Continue reading here.

Another Baby Step Toward a Pinellas Stadium

On Tuesday, a new Board of County Commissioners in Pinellas discussed extending the bed tax available to stadium projects past its current expiration date of 2015. While they didn't even mention replacing Tropicana Field, the extension is seen as a vital step in protecting the county's funding infrastructure for a new stadium.

It's infrastructure that Hillsborough County and Tampa don't have, as the bonds on Raymond James Stadium and the St. Pete Times Forum don't expire until 2027.

However, from the tone of the anti-tax emails Pinellas commissioners have received, you'd think they'd already broken ground on The Trop 2. Read the emails and more on this story here.

Tuesday, November 16, 2010

Report: Glazers Pay Down Huge Debt

If a 6-3 record wasn't enough to get Buccaneers fans excited, how about this sign that the team's owners may be doing better financially than previously indicated?
A person familiar with the situation says Manchester United's American owners have agreed to pay off more than a third of the club's debts.

The person says payment-in-kind (PIK) loans of around 220 million pounds (S$460.8 million) will be paid off by the Glazer family, which owns the club. The person spoke on condition of anonymity because an official announcement is yet to be made.

United is set to confirm the repayment of the loan in the latest set of accounts for Red Football Joint Venture on Tuesday.

The loans carry an interest rate of 16.25 per cent and fueled fans' protests against the Glazers.

After repaying the PIK loans, the club would still have debts of around 520 million pounds.

United had no debts before Tampa Bay Buccaneers owner Malcolm Glazer took control in 2005.

Saturday, November 13, 2010

"Replace the Georgia Dome" Talk Troublesome

This past Thursday, NFL Commissioner Roger Goodell dropped a non-threat threat on the City of Atlanta: build a new stadium or you're not getting another Super Bowl.

If you thought Tropicana Field was obsolete quickly, how do you think Falcons fans feel about their 18-year-old dome being called inadequate? Taxpayers in Georgia will be paying for the stadium through 2020, but Goodell and the Falcons have made it clear they'd prefer to have a new open-air stadium before that:
"The bar has been raised because you're getting great facilities around the country in great communities," Goodell said during a reception before (Thursday's) game, held on a rooftop overlooking Centennial Olympic Park. "(Super Bowl) games are a tremendous value to the communities, so there's a lot of competition for it. So I think a new stadium with this great community would be beneficial to bringing another Super Bowl to this community."

The Falcons have been pushing for a new facility to replace their longtime home, contending the Georgia Dome no longer produces sufficient revenues to keep up with newer stadiums around the league. The state, which owns the downtown stadium along with a massive convention center next door, has proposed a major renovation and even discussed the idea of installing a retractable roof to meet the team's desire to have an open-air facility.
It seems from the arguments put forth that the Falcons aren't worried about losing money on their billion-dollar franchise, but simply think they deserve to make more because other teams in the league are making more.

The price for the team to make a few more million in annual revenues and the NFL to make a few more million on a Super Bowl game? Approximately $750 million, a large portion of which would presumably come from public funds. We can only assume tickets in a new stadium would cost fans more, too. (Might just be wiser for the City of Atlanta to deal the Falcons a bigger cut of Georgia Dome proceeds!)

Furthermore, one can only wonder if Goodell will imply Tampa needs a new stadium down the road if it wants to host another Super Bowl. Raymond James Stadium, after all, has 7,000 fewer seats than the Georgia Dome. It opened in 1998, six years after the Georgia Dome, and it will be paid off on Jan. 1, 2027, also six years after the Georgia Dome.

Want other Atlanta/Tampa Bay similarities? Just substitute the word "Rays" in for "Falcons" in this Atlanta Journal-Constitution story.

FSU Comes to Agreement with Florida High School

It's a scenario that will have copywright lawyers debating for years: do high schools have the right to "borrow" logos from college teams?

One brouhaha that recently brewed over in Bradenton, Fla. came to a peaceful end Friday when Southeast High School and Florida St. came to terms on a five-year agreement that allows the high school Seminoles to continue to use the FSU-like logo for free. In August, FSU and the Collegiate Licensing Company threatened legal action if Southeast didn't change its logo, uniforms, scoreboards, etc.

The deal wasn't unexpected, but the last few months haven't been kind to FSU on the playing field of public opinion. I expect this episode to blow over quickly, but what about all the other teams with similar logos, color schemes, uniform templates, and fight songs to colleges? Will the Collegiate Licensing Company and/or NCAA force thousands of high schools across the country to sign similar contracts? Surely, they won't all be as peaceful as the Southeast/FSU deal.

Tougher question: if you're a superintendent of a district with some of these possible copyright conflicts, do you make plans now to phase out the "borrowed" logos to avoid problems down the road?

Wednesday, November 3, 2010

Naples voters celebrate Rick Scott, mourn Cubs

While many Floridians in and around Naples are celebrating the gubernatorial win of hometown boy Rick Scott, there was another election Tuesday - 3,000 miles away - that was also of great significant to the area.

Voters in Mesa, Ariz. approved Prop 420 by an overwhelming margin, allowing the city to spend up to $99 million for a new Cubs spring training facility. The team already has the largest park in spring training and its only 13 years old, but when investors in Naples started making a move for the team, Mesa officials agreed to build a new spring training complex, bigger and more expensive than any other ever seen. The Tuesday vote all but finalized the project.