Miklasz asks “is it too late to put the old Busch back together again?”
Local sports writer Bernie Miklasz had a great column in yesterday’s St. Louis Post Dispatch.
I don’t normally reprint full columns but the Post-Dispatch’s links expire in a couple of weeks. So, to keep a permanent record, here is his must-read column:
The old Busch Stadium is down. All that remains are scattered debris and a circular outline of where a ballpark used to stand. And that’s unfortunate. We should have stopped the wrecking ball, if for no other reason than to help the team’s owners.
I say this because I had no idea the new Busch stadium would create such financial hardship for team chairman Bill DeWitt and his partners. Actually, for years the media and fans were told the opposite: that the owners needed a new ballpark to increase revenue and payroll. And the new ballpark will open in 2006, so this should be a happy time, yes?
Well, one of DeWitt’s associates called me last week to talk on background and he politely made the point that the team can’t increase payroll for 2006 for a simple reason: The owners have reached into their own pockets to pick up much of the cost for building the new ballpark, and resources are limited.
Thursday I wrote a column criticizing the owners for holding the line on payroll, a position that may force general manager Walt Jocketty to search under sofa cushions and car seats for loose change if he wants to hire some new relief pitchers.
And just to make one point perfectly clear, I’m not asking the owners to go berserk and spend irresponsibly. I just would like to see Jocketty have some reasonable payroll flexibility to find what he needs to keep the 2006 roster up to standard, because the goal is to win the World Series.
Imagine what Jocketty could do with an extra $10 million in payroll. I’m not asking DeWitt to be George Steinbrenner, OK? But with the cost of baseball salaries on the rise this off-season, Jocketty could use some wiggle room on the payroll. It’s a reasonable request.
Anyway, back to the owners’ plight. DeWitt and associates are responsible for funding about 77 percent of the cost on the $388 million project, and they’ll be paying about $15 million annually for the next 22 years to retire the stadium bonds. But public money, including a $30 million tax break, is part of the deal. And fans contributed $40 million in the owners’ seat-license program.
To frame this in the proper context we have to go back to the beginning, to the sweet deal that Anheuser-Busch gave DeWitt and partners in selling the team in 1995.
For a sale price of $150 million, the new owners got one of baseball’s most storied franchises, Busch Stadium, four parking garages and land beneath two nearby hotels. In less than a year, the new owners sold the garages for $91 million and received an additional $9 million for the land. After this benevolence from the brewery, the new owners entered the baseball business with a terrific head start.
DeWitt and the partners have been good for baseball in St. Louis, and baseball in St. Louis has been good for them. The value of the franchise has increased every year, and the Cardinals were valued at $370 million by Forbes magazine before the 2005 season. With a new ballpark in play, the franchise value will undoubtedly jump again in 2006.
The owners are paying for a substantial part of the new Busch for a reason: They believed it was a positive and necessary investment that would pay off handsomely for them.
As team president Mark Lamping said of the new stadium two years ago, “We’re going to have premium seats and luxury boxes generating significantly more money.”
Right. And the owners and management said repeatedly that they needed the revenue boost from the stadium, and the new radio deal, in order to field the kind of team the fans have come to expect.
“We’d have a lot more money to put into the payroll,” DeWitt said of a new stadium back in 2002. “We’ve made some projections on payroll in a new ballpark and payroll here (at the old Busch), and it’s significantly different. It means a lot.”
These words pleased Jocketty, who at the time said: “The biggest challenge I have this off-season is trying to rebuild a pitching staff with very limited resources. And if we were in the new stadium right now, I guarantee you we’d be in a position to raise our payroll significantly to the point where we probably could re-sign all the guys we have as free agents.”
Uh, not so fast there, Walt …
Jocketty might be confused these days. Because in 2004 DeWitt said: “The new stadium will provide us with increased revenues and the ability to have a higher payroll. We should be in a more competitive position.”
Wasn’t the OLD Busch Stadium a money pit, and a drain on the owners’ finances? Oddly enough, while competing at the old Busch from 1996-2005, these owners consistently raised payroll.
But now that the new Busch is just about here – complete with higher ticket prices, more premium seats, and all the revenue-enhancing amenities – the payroll is staying the same.
I’m sorry to ask, but is it too late to put the old Busch back together again?
I don’t want to see DeWitt and his partners suffer through the incredible hardship of having to compete in a new ballpark.
Miklasz raises some very good points about the arguments used to get the new stadium — the old stadium was a money pit and we need to compete with other teams. Now that it is too late it is beginning to look like St. Louis may have been snookered.
I enjoy watching baseball games in person. I’m not a devoted fan but on the times I’ve gone to the game I had a great time and paid close attention to what was happening on the field. While we like a winning team I think St. Louis fans have proven they’ll support the Cardinals win or lose. Sure, they’ll bitch about players or management making bad decisions but they will still line up to buy tickets. Only now they’ll pay more for the right to watch a game and with salaries not increasing as expected, maybe we won’t be so competitive after all. But the team owners will have more money in their pockets and their investment will be worth substantially more. Seems par for the course…
On a somewhat related note, my State Representative, Jeanette Mott Oxford, and Fred Lindeke will be in court on Wednesday December 14th at 9am:
The attorney for Coalition Against Public Funding for Stadiums will be pleading our appeal related to the lawsuit involving the St. Louis County bonds toward building of the new Cardinals stadium.
If you can attend to show support for Mott Oxford and Lindeke go to the Wainwright Building, Division One.
I don’t always agree with the view of the economists at the St. Louis Federal reserve but I found an interesting article on public funding of stadiums from 2001:
Cities go to great lengths to lure a new team to town or to keep the home team home. They feel compelled to compete with other cities that offer new or updated facilities; otherwise, the home team might make good on its threat to leave. The weight of economic evidence, however, shows that taxpayers spend a lot of money and ultimately don’t get much back.
I highly recommend reading the full article. Please remember, just because you love baseball and the Cardinals doesn’t mean you must love the team’s owners or that we must give them what they ask for. As responsible citizens it is our duty to educate ourselves, question leadership and challenge assumptions.
– Steve
Maybe a visit back into the P-D’s archives will improve everyone’s memory.
Here’s what the P-D itself wrote in Dec. 2003 — after the Cardinals finalized a deal to put up 77 percent of the cost of the new stadium:
“A more basic question is whether the stadium will do what it was intended to do: create more money to pay the absurd salaries that baseball players command. Team president Mark Lamping said the final financing package won’t give the Cardinals the kind of revenue to chase every free-agent superstar, but it should enable them to stay in the Top 10 of big league payrolls, and compete directly with other teams in the National League Central Division. “We will have significantly more revenue, even after we pay the $16 million a year,” Mr. Lamping said.”
Even a casual fan like you, Steve, understands that teams don’t compete against themselves. They compete against teams in their own division for the best record against each other and the other teams in the league. Last I checked, St. Louis has a payroll in the Top 10 of MLB (despite playing in one of the smallest markets) and it won its division by double digits last season.
[REPLY – Thanks for the comment but you’ve helped support the point made by Miklasz. The reason for replacing the stadium was that the Cardinals couldn’t be competative in the old Busch. They must have the revenues from a new stadium to keep paying rising saleries. We bought it, literally. Yet four years later, in 2005, the Cardinals are in the top 10 in saleries and reached the playoffs — all without revenue from a new stadium. Today they are backpedling on having more money for salaries. – SLP]
Not really, Steve.
Here is more from the same Dec. 2003 editorial. See Lamping’s point at the end: the new ballpark revenue make up for the small market media revenue. Until the new ballpark, the owners’ pockets put a Bottom 5 media market team on the Top 10 payroll list. With luck (and attendance), the new ballpark revenue will keep it there.
“New stadiums, as they’ll tell you in places like Detroit, Pittsburgh, Cincinnati and Milwaukee, aren’t always a panacea for financial and competitive woes. What will make the equation work here, Mr. Lamping said, is the Cardinals’ attendance base. Since 1985, except for strike years, the team has drawn at least 2.4 million fans a year, and usually outdraws the league average by half a million fans. Attendance won’t increase in the new park, but per-fan revenue will, and that money should help keep the team competitive.
‘Fans don’t want to hear this,’ said Mr. Lamping, “and I don’t want anyone saying we’re crying poormouth. But the owners have been financing our payroll out of their pockets. They’re not going to do this indefinitely.'”
Bernie ought to dig out his own notebook — or pop for the $2.95 archive version.
So the Cardinals’ official spokesman has to turn to a P-D editorial to defend his organization?
Is there no way to take apart Miklasz’ argument without recycling planted editorials?
You typically don’t need much to take apart Miklasz’s arguments. He writes entertaining columns but that is all they are. He is wrong all the time and has been known for “creating” a number of stories as people who pay attention can tell you.
As for the Cardinal’s finance: EVERY SINGLE THING that is being said about the Cardinals financial situation is SPECULATION. They are a private organization and unless you somehow have access to their books there is no way to know how well they are doing.
That means:
Regardless of their success on the field, there is no way to be sure that the past couple of seasons have been profitable for the franchise.
There is no way to know if team revenues are paying for all of the team’s payroll or if the owner are out of their own pockets.
No one (including Bernie) knows whether or not the team is pocketing the extra cash from the building of this stadium or not. Whether or not you believe they do is based entirly on how cynical you are.
Bernie is just annoyed that the Cardnials didn’t spend $55 million on a pitcher who wasn’t worth it, $3 million on a second-baseman who was questionably worth it, or $5 million on another pitcher who also wasn’t worth it.
The only public fact we do have is that the Cardinals already are #6 in major league baseball when it comes to payroll. The team NEVER stated that by building a new stadium they would attempt to climb higher in those standings. For all we know they merely meant that they would better be able to maintain that ranking and stay on solid financial ground.
Everyone also seems to miss the fact that the Cardinals have likely been overspending for up to 5 years in order to get the fans supportive of a new stadium.
You can say I am a Cardinal fan and a Cardinal apoliist. But I am merely trying to respond to the anti-sports franchise, anti-business, cynical tone that permeates this arguement whereever it takes places.
Look at the facts……what Bernie writes is not the facts. That is ok, afterall he is an opinion columnist. Just don’t quote him as gospel.
[REPLY – Very good points! Perhaps the Cardinals should hire you to speak on their behalf…
For me I don’t really care what pitcher they have. I’m going to go to a few games and enjoy myself regardless. Given the loyalty of the St. Louis fans I don’t see them ever having a vacant stadium even if they started losing but I could be wrong.
What rubs me the wrong way is the secrecy of the whole thing. Claims were made by the team about costs for maintaining Busch II and player salaries and then not having access to revenue streams like other teams. Yet, we can’t really see the numbers. We are just expected to pay our share, beyond tickets, for something we know little about by design. I like know more about where my public dollars are being spent. – SLP]
It’s interesting that Mott-Oxford and Lindecke got sued around the same time Behrendt and Plackemeier got sued, with the cause in both cases basically being participation in civic affairs. These lawsuits are even more destructive to the future of this city than the bad designs advanced by the plaintiffs! The result could be massive intimidation and mission creep of the litigation to extend to other forms of public participation. The lawsuit against Lindecke and Mott-Oxford is especially bad because its subject is a citizen-initiated referendum — one of the ways in which citizens can seek direct democracy when their representatives in government ignore them. Bothe lawsuits are definitely a SLAPP lawsuit, but I think that there may be a larger end-run around the First Amendment at play as well. As a citizen with a few controversial opinions, I hope that they prevail.