Monday, January 7, 2013

Dome drama to resume next week

Hearings begin next Monday to settle negotiations between the Rams and the St. Louis CVC over the future of the Edward Jones Dome and the Rams’ lease there. If the Dome is not considered a “first-tier” facility, terms allow the Rams to terminate their lease after the 2014 season. The CVC has proposed an evolving set of improvements. They had offered an upgrade estimated to cost $124 million last February, but sweetened it by “tens of millions” of dollars six months later. The CVC’s upgrade plan is nowhere near as ambitious as the one proposed by the Rams, which has an estimated (by the CVC) cost of $700 million. The Rams basically want to tear down half the stadium (the half RamView sits in, at that) and expand it out into the street, with a giant glass wall like Lucas Oil Field. They also want a sliding roof. The CVC proposes to add about 9,000 club seats, renovate the luxury suites and build a new team store. They’d tear out the end zone scoreboards and replace them with a giant four-sided scoreboard over midfield. The Rams also want to add thousands of seats, enough to qualify the Dome to meet the NFL’s standards for hosting the Super Bowl.

If the CVC “wins” in arbitration, they and the Rams would split the cost of renovations, and the Rams would be locked into the Dome lease until 2025. Actually, game-day fans would get a sizable amount of that bill. The Rams would raise ticket prices and the city would increase taxes on tickets and parking. 

There should, however, be little chance of the CVC winning out. Their offer seems earnest and in good faith, and RamView would hold that the Dome even as it currently stands is a more-than-adequate facility for hosting NFL games. (Not counting the sound system.) Unfortunately for the CVC, they have to meet the “top-tier” standard, not an “adequate” standard. And you can’t look at the stadiums in Arizona, Seattle, Dallas, New York, Detroit, New England, Houston or Indianapolis and think St. Louis holds a candle to those. And San Francisco and Minneapolis have new stadiums on the way. The CVC’s best case imo is to try to get the arbitration panel to hold them to a standard comparing the Ed to the other fixed-roof domes in New Orleans and Atlanta. That’s a much more level playing field. Attempting to renovate the Ed into, say, the Jerry Dome, would be impractical, expensive and insane beyond belief.

The arbitrators, who are from Denver, Chicago and Iowa and thankfully not Los Angeles, are empowered to come up with their own plan, but honestly, RamView has as much business (and experience designing high-capacity sports venues) as any of them do. This option should be dead on arrival. If the arbitrators do decree a third plan that exceeds the CVC’s proposal, city politicians will push for a public vote whether to go forward. Despite the recent improved play of the Rams, this has never been a vote RamView feels likely the Rams would win. There is very vocal and principled opposition to publicly funding sports stadiums in St. Louis and around the country, with government at all levels facing ugly fiscal realities. There’s doubt the Cardinals would have won a vote for public funding when Busch Stadium III was built in 2005-6, and they’re obviously a St. Louis institution, with a century of history here beyond what the Rams have.

If the Rams “win” at arbitration, this whole thing may end up back at a negotiation table between the team and the city. The city’s made it plainly clear it can’t afford a $700 million upgrade, and if that went to a public vote, I’d expect it to go down in flames. That doesn’t put the Rams on the road straight back to Los Angeles, though stadium developments there will definitely provide Stan Kroenke leverage in negotiations. 

Though you can’t get Kroenke to say word one about the stadium situation, Rams EVP Kevin Demoff did have this to say in a recent interview with Brian Burwell for the Post-Dispatch:

The state of the franchise is as healthy as it’s been in a long time… But we obviously have some things out there looming, most notably the (Edward Jones Dome) arbitration that may go on through the winter and may go on into the early spring. We have to get that resolved and put at ease people’s concerns about where we’re going to play our games within St. Louis over the next 20, 30, 40 years, and then that will put that question to rest.

Emphasis mine. Burwell’s right when he notes that this is the most positive indication the Rams organization has made that favors a long-term future in St. Louis. The Rams could come down from their initial demands, or, as I do, Burwell thinks this is all eventually headed toward a deal for a new stadium. He mentions that “more than $500 million in funding could come directly from the NFL’s G-4 loan program and Kroenke’s rather deep pockets”. I do have to chuckle a little at that. That’ll pay for half a new stadium at best by the time plans for one get off the ground. You’re not going to get St. Louisans to vote to pay $500 million or more to fund half a stadium for a guy who just spent $130 million for a cattle ranch, either. The city’s role here should be to keep Stan free of red tape while he pays for most of the new place (Stan’s Warehouse Club?) himself. Also, NOTHING gets done without an ironclad agreement from the league to hold the Super Bowl in St. Louis the minute the new place is done.

But that’s looking way too far ahead. The current round of arbitration is expected to last two months, with a decision coming down in mid-March. I’ll even predict it for the week right after St. Patrick’s Day, because, naturally, I’ll be out of town on vacation. Best bring my laptop along, then, and yes, I still have one of those.

Links to recent articles on Rams stadium negotiations which informed this post:

-$-

4 comments:

Emanuel Stone said...

Thanks for being thorough,very nice read. I really hope the Rams come back home.

Unknown said...

I think the Farmer's Field is a better option for the Rams. As I have seen in recent years the city of St. Louis isn't that interested in their football team and come and support them. From being there a few times I have noticed it's more of a small town Baseball city. Why rip the taxpayer more money if not even 75% of the people there will go. Not fair for the people and the city.

Thomas Bird said...

Good read but a couple of things I thought were inaccurate. The arbitrators have no power to force the Rams to split the costs of anything. It is clearly stipulated in the lease that CVC is responsible for ALL upgrades and renovation costs. Secondly, I would read too much into the “play our games within St. Louis” comments. The team knows it mostly likely has at least one more year in St. Louis and isn’t going to do anything to jeopardize ticket sales and become the lame duck situation the Oilers had their last year in Houston when barely 10,000 fans showed up for the games. Arbitrators also cannot legally use other fixed-roof dome stadiums to compare the EJD to. Again, the lease clearly stipulates the EJD must be in the top tier of ALL stadiums. There is nothing in lease about comparing it to other fixed-roof dome stadiums. If either of those scenarios were even attempted to play out by arbitrators the wave of litigation from the team would be fast and furious. Whatever decision arbitrators reach, they cannot legally go against anything in the lease.
And if Stan Kroenke is going to dip into his own funds for a new stadium there is no way it is going to be in St. Louis. The fanbase for the Rams there is lukewarm at best, it’s a small market and the team is ranked near dead last in revenue and has been for many years. I don’t have a crystal ball, but all this seems to be leading to the Rams moving back to LA. If Kroenke was interested in working out a deal with St. Louis, arbitration (which is a form of litigation) would not have advanced this far. Additionally, the $700 million figure is a conservative estimate at best. A top tier stadium right now is a one billion dollar project anyway you slice it. And when you factor in the cost of St. Louis closing the convention center for 2 years to build this new stadium, you’re looking at a staggering cost for this project.

--Mike said...

Thanks very much for the info. I see now that the city wants the Rams to split the cost if its plan wins out. Sorry for my misread.

Also, I thought there weren't any retractable-roof stadiums at the time the Dome opened in St. Louis, but the SkyDome opened in '89. Doh. That argument's really shot in the foot, then.

--Mike