Staying or Going, St. Louis Should Limits Its Losses in Rams Deal

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edward-jones-dome_300pxJim Nagourney, who spent three decades negotiating stadium deals on behalf of government agencies and team owners, describes how he helped snooker city officials as a consultant to the Los Angeles Rams, who were then negotiating a move to a new stadium in St. Louis. “We had a whiteboard, and we’re putting stuff down” to demand in a stadium lease, he recalls. “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, which Nagourney calls “probably the most scandalous deal in the country,” included a clause requiring the new stadium to remain “state-of-the-art,” or else the team could break its lease and leave. “The city was poorly represented—the city is always poorly represented…. We put in all of these ridiculous things, and the city didn’t have the sense to say no to any of them.”The Nation

That's just ugly. There couldn't be a much more searing condemnation of the process that saw St. Louis commit many millions of dollars to lure an NFL team. The Rams moving to St. Louis is often cited as a point of civic pride (or the healing of a civic bruise). We're a big city because we have the NFL, people say. Of course there's zero evidence that any professional sports franchise provides a city a net financial gain. The above quote is from a story in The Nation titled, "Why Do Mayors Love Sports Stadiums?", which looks at the increasingly expensive, and creative, deals to build stadiums.

The Rams giveaway and the challenge of an urban football stadium have been written about here previously. St. Louis doesn't have the worst stadium deal in the nation. That's Cincinnati far and away. But the lease from the 1990's has an escape hatch for Ram's owner Stan Kronke. The "state-of-the-art" clause has been ignored once and may be reconsidered this time around as well. But St. Louis doesn't have the capability to finance substantial renovations to the dome. The last renovations were paid for refinancing debt. That's not happening again.

Of course whether or not the Rams stay, the City of St. Louis, St. Louis County and the State of Missouri will continue to pay for the dome, a total of $24M each year and a total payout of $720M over 30 years. Even a team that stays, often piles a heavy debt on their city. Indianapolis is on the hook for $61M of remaining RCA Dome debt, which will take until 2021 to pay off, while they now subsidize Lucas Oil Stadium. The RCA Dome stood for just 24 years.

So it appears rather, let's say, impossible, that the Rams will get a new stadium in St. Louis. As Ray Hartmann wrote in a recent St. Louis Magazine piece, the decision regarding whether the Rams stay or go will be made in LA (and this aspect of the issue isn't being covered by the St. Louis press). With a new billion-dollar stadium and other incentives, why wouldn't the Rams move? According to Forbes, the St. Louis franchise is the 30th most valuable in the NFL. Who thinks that wouldn't change with a move to LA?

I love watching football and think it's great that St. Louis has a team, but I care more for the economic health of the region. We simply gave away too much to bring the Rams to town. Whatever happens, let's hope that a new and different group of civic leadership emerges to negotiate the future of the franchise, or at least that the old one is no longer listened to. Again, the saving grace is likely that the decision doesn't rest of what St. Louis or Missouri do, but on what the effort in LA wants.

The dome lease in St. Louis is nearing the first of many deadlines of back and forth between the Rams and area officials. Presumably each hurdle will be followed and reported, but St. Louis should gain a backbone and understand that Kroenke's leaving or he's not. No scheme, such as giving the defunct Bottle Works site to the Rams will tip the balance. And if he's staying, the city, county and state should avoid another decade's long, multi-million dollar giveaway. Given our history, there's little hope we'll avoid such civic "leadership", but with our coffers empty, perhaps there's hope.

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  • rawest1

    I will be crushed if the Rams leave.  I’m not sure I could survive in a city without the NFL.  Nashville, here I come!

  • rawest1

    Or maybe New Orleans.  Or Indy?

  • stev0205

    Even after many losing seasons, and that horrendous display last sunday, I too will be devastated if the Rams leave. I watched The Greatest Show on Turf rise and fall when I was younger (even got to see them win the NFC championship in the dome!), and the Rams will always be my favorite team.

  • Gary Kreie

    Its likely to be San Diego, not the Rams.  Then they get All of the SoCal fans to ensure sellouts.  The past 16 years have provided local fans with lots of exciting games and a chance to see the biggest stars of the game, even if they played for the other team.  And it lend big league status for our city — without the Rams, we are just another Oklahoma City.  As a Rams Season Ticket holder since 1995, I don’t feel that I was fooled by anyone.  I’m always skeptical of a story like this, where the foolish party (Senator Eagleton) is conveniently dead and can’t defend himself.  These deal-maker types always think they won and brag about it.  We will have had the team for 20 years in 2015, and I don’t think Stan is selling them to move.  The dome was packed Sunday and very loud.  People who are resigned to see them leave are usually fans who watch games for free on their HDTVs.  Ticket values are going up — my friends and I have 6 ticket for 4 people, so we usually sell 2 — and we’ve been getting premium prices this year — unlike recent years.  The games are fun — try to make one.

  • Downtown2007

    It’s better to wake up on Monday morning complaining about a loss on Sunday than to be complaining about not having a team at all.

    • rawest1

      agreed 100%, completely

  • Alex Ihnen

    I get what everyone’s saying, but you’re fans. You believe that each person in the city and county should subsidize an NFL team because you like the NFL. I’m very happy that STL has a team, I’m a fan too, but this is very simple: we must recognize that there’s a cost. And this conversation is about what that cost should be. Is a $720M payout too much? Would $2B be too much? What about $4B? Where’s the line and how much is St. Louis willing to give up?

    • rawest1

      You have absolutely nothing to worry about, I guarantee it. St. Louis won’t be giving up any more.  Not in this climate, and not with the data out there like what you’ve cited in this and other articles.

      That said, Alex, look… it’s more than just the fact that we’re fans.  The Rams moved here when I was six.  A life-long St. Louisan, I have grown up with the team here in the city for practically all my life.  Some of my earliest memories bonding with my father involved us grilling down by the river before games with his friend and his friend’s son, watching the barges and throwing rocks at driftwood before heading up into the dome to watch the team play.  I hope very much to be able to do the same with a child of my own, someday.

      To many of us, the Rams are every bit as much a part of St. Louis as the Arch, the Cardinals, and Budweiser beer.  They have formed a huge role in my relationship with the city, and if they were to leave, to me, it’s like a piece of the city would leave with them.  My perception of St. Louis would be irrevocably altered, and I would never feel the same way about the city again.

      I know it’s easy for some people like you to be objective about it and say “hey, the football games are a great time,” or “hey, I think it’s great the city has a team.”  To many of us, it’s much more than merely a football thing.  It’s a St. Louis thing.

  • Anonymous

    we’re keeping the rams, Alex really needs to get off this, its near annoying. 

    • Alex Ihnen

      I’m not saying the Rams are leaving. I’m saying St. Louis should be cognizant of what it’s giving away to entice them to stay. I have my teams I grew up with as well and don’t want to see them move, but it’s simply not too much to ask reasonable people to consider what makes a healthy local economy. Giving away money isn’t it. Touchy crew you Rams fans are! No one seems interested in considering how much it’s worth to keep the team, other than saying we shouldn’t talk about it.

      • rawest1

        It’s because we already lost a football team.  If we lose a second one, we can pretty much kiss the NFL in St. Louis goodbye, and as another poster said, might as well be “welcome to Oklahoma City”

      • rawest1

        Additionally, the reason why “[n]o one seems interested in considering how much it’s worth to keep the team, other than saying we shouldn’t talk about it” is because like I said in my other reply, to many of us, the question is a non-starter.

        It’s like asking us what it’s worth to keep the Arch.  Or the Cardinals.  Or the Eads Bridge.

        • Sane Rams Fan

          I guarantee that 99% of St. Louisans wouldn’t equate the loss of the Rams with the loss of the Arch or the loss of the Cardinals. Including most Rams fans. I’m one of them. I hope they stay, and I would be OK with a reasonable arrangement to make that happen. But if they demand that the taxpayers need to spend whatever amount of money necessary to give them one of the top 8 stadiums in the NFL or they’re gone, I say don’t let the door hit you on your way out.

          We’ve already gave them one stadium, 100% paid for by taxpayers. They’re not getting another, and they’re not getting a $100MM+ upgrade on the one they’ve got, either.

  • Anonymous

    the big screen in Cowboys Stadium cost 40 million, 40 million is considerably less than a new stadium. Hang one in the dome and call it a day. 

    I bet if Kroenke were in favor of dropping I-70 Alex wouldn’t be in such a hurry to run the rams out of St. Louis. 

    Before the Rams came to St. Louis Kroenke was trying to get an expansion team here, he only agreed to buy 40% of the Rams on the provision that they could relocate to St. Louis. The guys behind LA’s stadium want to own a team and Kroenke doesn’t buy sports properties to give them away. 

  • Benya31

    why would new orleans or indy leave? they both have either brand new or completely overhauled stadiums

  • http://twitter.com/chrisbay Chris Bay

    As someone who passionately loves St. Louis but has no interest in professional sports, it’s very disheartening to read many of these comments. What if they city had invested $720M in arts and public spaces? I know, I know, it’s a silly question. That would never happen. 

    But we’re all perfectly happy to justify that kind of expense on a sports franchise. This city will remain here regardless of whether or not the Rams do. And if any of you care about this city beyond the fact that it has a football team, then you’ll stay and continue to work on improving the city regardless of whether or not the Rams leave. 

    A football team is not what makes us a first tier city; the Rams leaving will not make us second tier city. If your definition of those terms depends on the presence of a football team, then I’ll be happy to hold the door open for you when the Rams leave. This city is and always has been more than a sports city, and while many here passionately love sports there are also many here that passionately love the city for other reasons. Let’s not forget that this city belongs to all of us.

    • Anonymous

      Its all subjective, but if the Rams leave St. Louis I’m leaving right along with them. Chicago, Denver, Detroit, Baltimore, Cleveland, hell even Kansas City, I’ll go work and help them be a better city. The hurt of losing the Rams would be too much, I guess it’d be on the same level of losing the flying saucer building for someone like yourself. All things being equal I’d rather be in a city with sports than one without it. Losing the Rams isn’t going to propel us to a top tier city. 

      You guys keep making the assumption that if we lose the Rams whatever money is left behind will be wisely invested. That money could be easily wasted on some other boondoggle masking as a ‘silver bullet’. Reports on historic tax credits say they return as little as 11 cents on every dollar spent. 
      You guys think the city is it red brick buildings and its red brick buildings alone. I think St. Louis is its red brick beauties, forest park, its neighborhoods etc. AND The Rams. 

      You guys can go on and keep on believing once The Rams leave its smooth sailing, to a lot of people, people like myself it’ll be a failure of leadership to lose the Rams. 

      • Alex Ihnen

        Well, I don’t claim half the assumptions you make, but it is true that there’s “x” amount of disposable income in the region and if it doesn’t go to Rams games, it does go to something else. The enormous tax subsidies pick a winner in this case and a lot of money goes to the Rams. There are similarities to other tax subsidies, yes, even historic tax credits. I hope you don’t end up in Cleveland or Kansas City. They’re fine places, but not because they have NFL teams.

        • Anonymous

          its disposable personal income, the average Rams season ticket holder isn’t going to run out and support the Arts to the tune of $2000 10 times a year. They’re going to upgrade to a 50 inch, get a lazy boy and NFL Redzone. And we’re still going to be paying off the Dome. Kroenke hasn’t even asked for a new stadium. Why can’t we cross this bridge when we get to it? It’ll be here soon enough. And why are we using the Rams as an example? If you want a real fight, it’ll be in convincing 91 municipalities to quit stabbing eachother in the back with TIF financing to lure a grocery store down the street. But no, you guys wants to pick on the Rams when they haven’t asked for anything.

          And I’ve been to Cleveland and Kansas City they’re fine cities and like I said all things being equal, why not choose the city with sports? Its a personal decision, one you’re likely not to understand it but that’s fine. 

          Keep believing that once the Rams leave Clayton won’t stab St. Louis in the back for the next Cenetene. 

          ‘$9.6 million TIF sought for Schnucks complex in St. Charles’

          The Rams are a symptom not the cause…and Kroenke hasn’t asked for anything yet. 

          • Alex Ihnen

            I’m still at a loss as to why you’re so upset about this. I haven’t called for the Rams to leave, etc. etc. etc. etc. I don’t think the average Rams fan will go the symphony instead, etc. etc. etc. You’re certainly right that I don’t understand wanting to pack up and leave a city primarily because of an NFL team, though I understand that some feel that way. That’s OK. It’s also OK to ask how much a community should spend to have a professional sports team. This is exactly the 2nd story written about the Rams’ future in St. Louis. It’s a big deal, financially and emotionally. nextSTL covers TIF abuse, our fractured government and many other issues. In fact, we had a big story about Lindenwood Town Center – the TIF to relocate a Schnucks etc. in St. Charles. What an awful waste of money!

          • Gary Kreie

            I agree with Anonymous.

  • JAE

    I didn’t even realize St. Louis had a football team when I moved here …

  • stev0205

    I think one thing that nobody mentioned is how most NFL players give a lot back to their communities. Hell, Jeremy Maclin came back and ran a football camp, and he doesn’t even play here! Kurt Warner too. The Rams certainly aren’t slingshotting St. Louis into a top tier city, but they are not exactly bleeding us dry either.

    Now.. if you want to talk about bleeding us dry, let’s talk about how the new Busch Stadium was built.. talk about some sneaky, stabbing St. Louis in the back kind of stuff.

    • Sane Rams Fan

      The Dome was paid for entirely by tax dollars. Busch Stadium was paid for mostly by private money.

      I don’t like the way the Cards have reneged on their obligation to develop Ballpark Village in return for the tax incentives they were given to fund the ballpark, but to suggest that the Cards new stadium cost the taxpayers anywhere near as much as the Dome is ridiculous.

      • Alex Ihnen

        It would take a thorough study, but the city is letting the Cardinals keep approximately $350M because they paid to build the stadium. That’s just shuffling millions and is not fundamentally different than Dome financing.

  • rbeedee

    I think the main question Alex is asking is: how much are/should we be willing to spend to keep the Rams here? I understand than the Rams have passionate fans and that keeping the Rams in St. Louis is important to them, maybe even so important that if the Rams leave, they see no point in remaining in St. Louis. But the question remains, how much are we willing to shell out to make that happen? How much can we spend before it becomes detrimental to the city as a whole?

  • Michael

    I like sports, but I don’t think the tax payers should pay for something I like.  The ownership should fund itself.  I also believe the current Stadium / Convention Center could be more profitable as a single use Convention Center.  I believe that the St Louis Convention and Visitor Center shares that belief. St. Louis misses out on too many events that are reseved for Football events and the “chance” that we might be in the playoffs (like that will happen anytime soon).