The clause

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http://www.fieldofschemes.com/2010/07/26/2726/tales-of-city-mismanagement-how-the-st-louis-rams-won-their-sweetheart-lease/

Tales of city mismanagement: How the St. Louis Rams won their sweetheart lease
Posted on July 26, 2010 by Neil deMause

Tim Sullivan’s column in Saturday’s San Diego Union-Tribune was dedicated to an important but too-often overlooked topic: how city governments really need some professional help in negotiating stadium deals.

Writes Sullivan:

The one voice we most need to hear is dispassionate and discerning, tactical and tough, more measured than “whatever it takes,” less defiant than “over my dead body,” and carefully positioned in nobody’s pocket. Someone able to joust with the National Football League across a quasi-level bargaining table.

At least one stadium expert agrees, telling Sullivan that “I think it’s pretty clear looking back at history that city officials typically get rings run around them by teams,” and adding by way of examples:

“That state-of-the-art clause the Rams have, they were just throwing stuff in there and they were amazed when St. Louis actually went for it. When Washington, D.C., was sitting down with the Major League Baseball Relocation committee, (the city) said they were thinking in terms of two-thirds public, one-third private (funding). (White Sox owner) Jerry Reinsdorf said, ‘We were thinking more three-thirds, no-thirds.’”

Okay, in case you haven’t figured it out yet, that’s me that Sullivan is quoting. But while the three-thirds/no-thirds story has been reported here before, the bit about the Rams’ surprise success at getting lease concessions from St. Louis comes from an interview I recently conducted with Jim Nagourney, a now-retired sports facility manager and consultant who was in the room when it happened.

Nagourney was working as an ad marketer for Anaheim Stadium, he explains, when he was hired away by the Rams as a consultant on their relocation plans. “I went to a meeting in Los Angeles one morning. We had a whiteboard, and we’re putting stuff down [to demand from cities]. And some of the stuff, I said, ‘Guys, some of this is crazy.’ And John Shaw, who was president of the Rams at the time — brilliant, brilliant guy — said, ‘They can always say no, let’s ask for it.’”

The result, he says, was “probably the most scandalous deal in the country,” one that notoriously included a clause requiring the team’s new stadium to remain “state-of-the-art,” or else the team could break its lease and leave. (“That was John,” says Nagourney of the state-of-the-art clause.) “The city was poorly represented — the city is always poorly represented,” says Nagourney. “And John Shaw was a brilliant negotiator. And we put in all of these ridiculous things, and the city didn’t have the sense to say no to any of them.”

The reason this dynamic happens, over and over, is simple, says Nagourney: “A city attorney is not going to know where the money really is. They’re not going to understand advertising, they’re not going to understand concessions — just a whole range of issues that the team officials intimately understand. They know where the dollars are, and the municipal attorneys do not.” On top of that, he says, city officials get “stars in their eyes. It’s their first time dealing with celebrities. They’re just so enamored with the fact that ‘I’m dealing with people who get their name on Page Six.’”

Add in perks like free luxury suites and the promise players showing up at political appearances, says Nagourney, and “they just lose all sense of proportion.”

So, Sullivan is dead right that cities could use negotiating assistance in stadium deals. The problem is that the very reasons why they’re lousy negotiators are the same ones keeping them from seeking help in the first place.
Related Posts:

St. Louis unveils plan for Rams to keep up with Joneses
Rams, St. Louis battle over London “home” games
U-T San Diego columnist: I was fired for not being “positive” enough about stadium deals

This entry was posted in St. Louis Rams by Neil deMause. Bookmark the permalink.

Fwiw, looks like the Cincy lawyers didnt know what they were doing either.
From the same field of Schemes blog.
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Bengals’ 16-year-old stadium could end up costing taxpayers around $1 billion
Posted on January 19, 2016 by Neil deMause

Hamilton County’s lease deal with the Cincinnati Bengals is bad. Real bad. There’s the requirement that the county pay to add such items as “holographic replay systems” in the event they’re ever invented, for starters — but also plenty of items costing taxpayers plenty of money here in the actual present. How much money, you ask?

Hamilton County taxpayers have spent more than $920 million since 2000 as part of a deal to build and operate Paul Brown Stadium…

By the time 2026 rolls around and the 26-year lease between the team and the county expires, the county will have spent more than $1.1 billion on the deal for the Bengals to play in Cincinnati.

Now, some of that is financing costs — a little over a third of the stadium costs are interest payments, which are really a cost of deciding to push payments out into the future, and so pretty much a wash in present dollars (where “present” is defined as the stadium’s opening in 2000). But much of it is not, including a new requirement that the county start paying about $2.7 million a year in stadium operating costs next year, because expecting a massively profitable pro sports franchise ($55.5m in profits last year alone, according to Forbes) to pay to clean its own bathrooms is just crazy talk. Here’s a handy chart provided by WCPO-TV:

Screen Shot 2016-01-06 at 12.03.29 PM_1452099867537_29456359_ver1.0_640_480Even if you don’t count the interest payments, that’s about $650 million so far, with tens if not hundreds of millions more to come over the next ten years. By which point the Bengals will almost certainly be demanding a new stadium, or at least a new lease with further upgrades to what will then be a 26-year-old venue. You really have to hope that this time county officials will pay attention to the fine print, but probably not.