Orioles agree to pay state for home plate ads

$913,000 would be doled out in five installments

November 10, 2010|By Edward Gunts, The Baltimore Sun

The Baltimore Orioles have agreed to pay Maryland $913,424 for ads behind home plate at Oriole Park at Camden Yards, settling a dispute over a form of stadium advertising that did not exist when the team negotiated its lease two decades ago.

The Maryland Stadium Authority voted Tuesday to approve the terms of a proposed agreement that calls for the payment to be made over five years in installments of $182,684.80, starting this fall. The agreement must be approved by Maryland's Board of Public Works.

The dispute involved revenue from advertising boards behind home plate that were first used in 2004. The Orioles' lease calls for the team to pay rent to the state for use of the stadium, including 25 percent of in-stadium advertising revenues. The Orioles argued that because the home plate ads are directed at the television audience, the team did not owe the state a percentage of that ad revenue. In recent years the team withheld payments to the state from the home plate ads.

Under the settlement, the Orioles will pay the authority 18.75 percent of the revenue earned from home plate ads in 2007, 2008 and 2009 — 75 percent of what the state contended the lease originally called for — and 12.5 percent of revenues from home plate ads in 2010 and beyond. The agreement also calls for the Orioles' lease to be modified to address home plate ad revenues.

The stadium authority's executive director, Michael Frenz, said the percentage reduction for past years translates to about $2.3 million that the state will never see, based on his staff's calculations. But he said accepting the reduced figure was preferable to going to arbitration with the Orioles.

"I think this is the best deal we can get," he told the panel before members voted on the offer. "It's really a very good deal, given the Orioles' feelings on this matter."

Alan Rifkin, an attorney for the Orioles, said the offer was a "fair and equitable resolution."

In a related development, the Orioles and Sportservice, a part of Delaware North Cos. of Buffalo, N.Y., announced a 12-year partnership in which Sportservice will manage all concessions, catering, dining operations, stores and kiosks at the ballpark, including the Eutaw Street promenade. Sportservice replaces Aramark Corp., the concessionaire at Oriole Park since it opened in 1992.

ed.gunts@baltsun.com

The Associated Press contributed to this article.

    Baltimore Sun Articles
    |
    |
    |
    Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.