Angelos goes to Milwaukee for meeting with Selig

Owner appears to be close to deal that would protect Orioles from Washington team

Baseball

October 06, 2004|By Ed Waldman | Ed Waldman,SUN STAFF

Peter G. Angelos traveled to Milwaukee yesterday to meet with Major League Baseball commissioner Bud Selig amid indications that the Orioles owner will soon be able to announce a deal to protect the club from financial harm by the new team in Washington.

The owner has been negotiating with MLB president Bob DuPuy for more than a week about how baseball will ensure that the value of the Orioles will not be damaged after the former Montreal Expos begin play at RFK Stadium next season. Until yesterday, the meetings had taken place in Angelos' Charles Center law offices.

Greg Massoni, press secretary to Gov. Robert L. Ehrlich Jr., said Angelos and Ehrlich spoke yesterday, and "I suspect that sometime this week there will be a press conference with Mr. Angelos and the governor. I was hoping that it would be [yesterday or today], and it may very well be.

"Hopefully, they'll have a signed deal, and I believe that's what Peter went out there for."

Angelos, who declined to comment last night, has said throughout the negotiations that he has kept the governor informed and that Ehrlich has been supportive of his efforts.

The state, through the Maryland Stadium Authority, built and operates the twin-stadium Camden Yards complex. The money to pay for the stadiums' operations and debt service on millions of dollars in bonds comes from several sources, including annual payments by the Orioles and Ravens, a ticket tax, a $1 million annual payment by the City of Baltimore and the state lottery.

The Orioles' rent is calculated as a percentage of various revenues, from tickets to peanuts. Even in the mid-1990s, when the team was setting a major league record for consecutive sellouts, the rent fell short by as much as $3 million a year in covering the cost of the 12-year-old park's operation. But the ticket tax paid by fans, which totaled $4.7 million last year, made up the difference. If the Orioles' attendance falls as a result of the new team in Washington, the proceeds from the ticket tax would fall, too.

Selig, through a spokesman, declined to comment yesterday. DuPuy did not respond to an e-mail request for comment.

Neither the Orioles nor Major League Baseball has discussed the deal publicly, but sources familiar with the negotiations said it calls for:

Baseball to guarantee the Orioles' locally derived revenue - earned from ticket sales, concessions and items other than game broadcasts - won't fall below a benchmark of about $130 million. If they fall below that in any given year while the team is owned by Angelos and his investment group, baseball will make up the difference.

Baseball to guarantee the club's resale value at roughly its current level as the lone occupant of the market, about $360 million. If Angelos and his partners, who paid $173 million for the Orioles in 1993, sell the team for less, baseball will make up any shortfall. The $360 million will grow over time according to increases in the value of baseball franchises nationwide.

A regional sports network to also be created by baseball to produce and market the local on-air and cable broadcasts of the two teams into their shared market of nearly 8 million people. Both teams will receive equal profit distributions from the new network, but the Orioles will own 60 percent of the network's stock, to 40 percent for the Washington franchise.

The Orioles had sought to keep a team out of Washington altogether, arguing that nearly a quarter of their fans come from the D.C. region and that the new team would siphon off a substantial number. The proposed stadium location, south of the Capitol on the northern bank of the Anacostia River, is 44 miles by car from Camden Yards.

The team was prepared to sue the league, possibly joined by the state of Maryland, which stands to lose some revenue because the team's rent is based on the money it makes each year.

Sun staff writer Jon Morgan contributed to this article.

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