Charlotte's fumble buoys Baltimore's expansion bid Stadium situation may prove decisive

August 16, 1992|By Jon Morgan | Jon Morgan,Staff Writer

CHARLOTTE, NORTH CAROLINA — CHARLOTTE, N.C. -- For the past 12 months, the boosters in this city of glass towers and blue-suited bankers appeared to be on the verge of their greatest victory: Pro football, in all its network glory, was as good as here.

All the pieces were in place. Rich investors. Powerful bankers. Twenty-five acres of downtown were cleared, a jail and a nursing home moved, and 110,000 cubic yards of dirt piled into the oval shape of a stadium.

But, like a wobbly touchdown pass, football might be slipping from Charlotte's grip -- and into the reach of Baltimore.

Last-minute questions have emerged, boosting Baltimore in the competition for one of two expansion teams the National Football League is scheduled to award in October. Five cities are competing: Baltimore, Charlotte, St. Louis, Memphis, Tenn., and Jacksonville, Fla.

St. Louis -- the biggest television market without a team -- seems to be the most likely winner. Baltimore, with the next-largest market and a new stadium to offer, has seemed to many to be in competition with Charlotte for the second team.

But now even the officials behind Charlotte's bid say their initial plan to privately finance the team and the stadium can't compete with Baltimore, which has the state funding approved to build a stadium adjacent to Oriole Park at Camden Yards. Charlotte has a new plan in the works that could take another month or two to finalize, pushing it perilously close to October, when the NFL is expected to announce the winning cities.

"It seems like there have been questions raised about the Charlotte bid that weren't there before, and that puts Baltimore in a better light," said Allison Hawk, a spokeswoman for St. Louis' football bid.

In fact, a number of national commentators have begun to rank Baltimore ahead of Charlotte, a reversal of just a few months ago. Insiders generally scoff at such rankings, but one NFL official, who spoke on the condition of anonymity, said, "Baltimore has everybody's attention."

The private option

When Charlotte entered the expansion fray five years ago, it wasestimated a stadium could be built for $75 million. And nobody expected a franchise fee of more than $100 million. The latest stadium estimates are $160 million, and the NFL privately has warned investors its franchise fee could hit $150 million. Start-up costs add another $25 million.

Charlotte's ownership group, a big-money partnership led by ex-Colt and fast-food magnate Jerry Richardson, had planned to finance everything privately.

But the reality of the task sank in over recent months, in part because of questions from the NFL. No one in modern sports history has privately financed a major-league team and a stadium at the same time.

The problem would be the mortgage payments on the stadium. Ever since Dolphins owner Joe Robbie obtained a waiver to build his namesake stadium in Miami, the NFL reluctantly has allowed a team to keep certain luxury seat fees to pay off stadium debt.

Usually those fees are included in ticket revenues that are split 60-40, with the visiting teams getting the 40 percent. If Charlotte is forced to devote that money to mortgage payments, less money would go to the other teams. Such fees can be $1,000 a seat per season. Spread over 6,000 seats, that adds up to $6 million a year. The visiting team's share would be $2.4 million a season, including preseason games.

"Obviously, it is a handicap. But other cities have handicaps, too," Atlanta Falcons owner Rankin Smith Sr. recently told the Charlotte Observer. "All of the cities that are trying to be an expansion city have their pluses and minuses. Some have more than others."

Taking another look

In Baltimore, the stadium is being financed by lottery-backed bonds, and the team would pay a relatively modest rent and share in the revenues from concession sales. St. Louis also is financing its stadium publicly, through bond sales.

Charlotte's group will announce a new financing plan in September, said Mark Richardson, son of Jerry and general manager of Richardson Sports, the partnership formed in 1987 to bring the team to Charlotte.

Options include finding other investors to finance the stadium as a separate entity; seeking benefactors to contribute, and/or selling multimillion-dollar corporate sponsorships, possibly in exchange for naming the stadium after a company.

Others have used these methods, though rarely on this scale. Target Center in Minneapolis and America West Center in Phoenix was built with contributions from its namesake corporation. A corporate foundation provided $25 million of the $77.5 million cost of the Indianapolis Hoosier Dome, and corporate support totaling $125 million went into the Toronto SkyDome.

"I think that's [public financing] a real advantage for Baltimore and St. Louis," said Max Muhleman, president of Muhleman Marketing, Inc., and a consultant for Charlotte.

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