Are We There Yet?

The jubilation in Washington DC over getting a team quickly turned to despondence when DC Council Chair Linda Cropp led a mini-revolt to restructure the agreement the DC government had already made with Major League Baseball to bring the Expos to Washington.  After leading the chorus of "Take Me Out to the Ballgame" on the day the announcement was made that baseball was returning to the Nation's Capital and singing the praises of the deal, she has changed her tune and significantly changed the conditions of her loyalty. 

The original agreement was that DC would completely finance the building of a new stadium from public finds.  Cropps' new condition is that the new owner will have to pay at least half.  Frankly, Cropps' new proposal is the best one for everyone involved.  Unfortunately, neither she nor anyone else brought it to the table when it was "undecided" where the team would go. 

I say "undecided" because everyone in baseball knew the most money was to be made by putting a team in the DC area.  Whether it would be in the actual city or in the suburbs of Loudon County, unless niggardly Clark Griffith came back from the grave to own the team, this market will produce a franchise with as much or more spending and drawing power than the Los Angeles Dodgers or Chicago Cubs within 10 years.  There is that much money waiting to be spent in the DC area, with two of the 10 wealthiest counties in the country sitting between the two sites.  The DC market has a greater annual income, greater average disposable income and higher percentage of the target demographics for baseball than 90% of the cities that already have major league teams.  The Baltimore Orioles have been viewed as a large market team ever since the Senators left DC and they are 70 miles away from the largest portion of the population. 

Cropp is hoping that since baseball already committed to coming to DC, that she and the District would have the leverage to work a better deal before actually signing off on it.  Clearly she hasn't paid attention to what's been going with regard to baseball and DC over the last 30 years.  At best, she has focused on a few isolated events rather than the big picture.

Baseball has been screwing DC ever since the Griffith's left for Minnesota's greener pastures in 1961.  Owners have been using the threat of moving to DC specifically to extort publicly financed new stadiums from their fans in at least 5 different cities.  Now that most teams have new digs, that threat isn't as great.  But that still doesn't mean that baseball won't cut off it's own nose to spite it's face.  Owners have been throwing out ridiculous proposals for years  - contraction, replacement players - in an effort to suck more money from whoever they can get it from.  Cropp not only jeopardizes DC's chance to keep the team, but she also jeopardizes Northern Virginia's to get it if the gambit fails.  Even though Loudon County apparently finished 2nd in the race for the team, the owners will no doubt go to the third choice just to keep DC from getting any money from allowing the team to play at RFK even for a year or two.  Even if it means they get millions less per year.

Darren Rovell reported on that owners will get an additional $50 million per year in revenue if they contract the team after the 2006 season.  That money would come from a greater share of the national broadcasting revenue.  But that's not per team; that's total.  Divided among the remaining teams, the amount they'd get is less than $2 million per team.  Is that really worth losing the DC market over?  Considering that a new owner will most likely be forking over up to $400 million for a team that might not be worth $75?  It's not Montreal's fault that the team's value has dwindled.  Jeffrey Loria, who is now doing the same song and dance in Florida for the Marlins, sent the value plummeting with his chicanery as the Expos owner.  MLB paid Loria $120 million for the team in 2002, so even if a new owner has to pay for half of a $500 million stadium, baseball gets their money back, plus a tidy profit of roughly $30 million.  They don't get their operating costs back from the last three years, but the loss will be minimal because the team has been operating about $10 million over it's costs.  That nets out to about $1 million per owner to cover the last 3 years. 

The original agreement clearly benefits the owners as they will make a huge profit from the sale of the Expos.  They will also make money off the revenue sharing once the team starts operating in the black, which could come as soon as it's first year.  Fans of baseball in DC will also benefit as they will finally have a team they can cheer for and they won't have to drive 2 hours in traffic to see a team that for the last 6 years has been one of the worst in baseball, despite considerable (but misguided) spending.  And DC itself, after the initial sticker shock, should gain some benefit.  New teams and new stadiums, can have a positive effect on a city.  For example, Baltimore's renaissance coincided with the building of Camden Yards as part of the Inner Harbor renewal.  How much money the city and county actually gained is still a subject of some debate because the increases in business and tourism, as well as a considerable escalation in local property values, has been at least partially offset by a substantial debt service to pay for the stadium.  But despite the project being entirely publicly financed, Baltimore appears to be better for it.  Other cities have experienced similar trade-offs. 

Cropp's deal eliminates much of the owner's initial profits by saving the people footing the bill, the residents and businesses of DC, from paying much of it.  The owners will still get money from the revenue sharing, and perhaps most importantly, will gain considerable leverage in the public mind in the next labor negotiation by doing something the haven't done in quite some time: simply doing the right thing.  When taking sides between "greedy players and owners", it's hard to call someone a "greedy owner" if they sacrifice their own potential profits to put a team in a place it should have been all along.  By putting a team in DC under Cropp's proposal, the owners might actually look as though they are trying to act in the best interests of baseball, fans included.  At least, that's how it could be portrayed.  But we all know that won't happen, don't we.  Baseball's owners have a long and consistent history of trying to get away with highway robbery and acting with their own immediate interests, exclusive to all others, in mind.

Maybe Ms. Cropp is trying to get back at Baseball for all it's misdeeds to DC over the last 40 years.  Maybe she wants to teach Baseball a lesson that they shouldn't screw with the capital city of the most powerful nation on earth.  But as Baseball clearly proved by shutting down it's operations in DC after the vote to implement her new proposal, she doesn't have leverage or full understanding of the situation.  She thought by pulling a bait and switch that she could get more favorable conditions for an agreement.  Unfortunately, there are too many other contenders for her position to have much negotiating power, especially since there was already an agreement in place.  Now is not the time to try to get even.  The best way to pay back all the injustices authored by the people who've kept baseball out of the nation's capital for nearly two generations is to first get the team, then build a champion that will have the money to keep winning year after year.  The best revenge would be to take an increasingly larger share of the overall revenue pie over the long term, not squabble over a relatively little bit in a one-time deal.