Wednesday, November 30, 2005
MLB Jeopardizes 2006 Season For Nationals
"Given my travel schedule and steroids and everything else, I've been sidetracked."
This was a quote from Major League Baseball's Commissioner, Bud Selig, as given to the Washington Times on November 18, 2005. He was referring to the ongoing interview process of potential ownership for the Washington Nationals baseball team, which was relocated to Washington, DC from Montreal, Canada, just prior to the 2005 season and now makes RFK Memorial Stadium its temporary home. But Mr. Selig's quote only references part of the ongoing troubles of a ball club in total limbo, forcing it into a state of unpreparedness for the 2006 MLB season.
Not unlike the on-again off-again dash to finalize an agreement with the city of Washington, DC in December of 2004, the end of 2005 looms as a potential death knell to getting a stadium built, a lease agreement finalized, and the installation of an owner or ownership group in the near future. In order for a general manager, field manager, and coaches to be named, the future owner must be chosen and ratified by 29 MLB owners. As long as MLB continues to haggle over the 2004 agreement with the city of Washington, DC, which was rushed and was arguably a poorly-drafted document according to DC City Council members and community activists, the Washington Nationals have less and less opportunities to sign free agents and attract management personnel.
The agreement made between the city of Washington, DC and MLB last December was dependent upon the city to build a stadium for the Nationals by 2008. In order to do so, the city must raise the capital through the sale of bonds to publicly finance the $535 million price tag. However, the cost of the stadium has risen due to unanticipated construction and raw material expenditures and now the key features which the original plans called for such as an underground parking garage, escalators and elevators, improved roads outside the stadium, and expanded Metro train platforms jeopardize the success of not only the stadium, but the gentrified area surrounding it.
The aides of Mayor Anthony Williams, who negotiated the stadium agreement with MLB, estimated that the stadium of 41,000 seats would cost $395 million. However, no money was allocated for infrastructure such as the roads and Metro platforms as they assumed that the federal government or Metro itself would pick up the tab. Additionally, Natwar M. Gandhi, the city's CFO, raised the estimated cost since the water for the stadium was not included in the original agreement. The architects chosen for the stadium's design also escalated the original cost of $244 million to $337 million as land costs could now be as high as $98 million, but not certain. The ceiling now for the stadium, based upon whose calculator you believe, but supposedly set by the City Council, now stands at $535 million.
With a final stadium architectural plan still yet to be approved, the mayor believes that either MLB, the federal government, private developers, or even the new owner should pick up the tab on the ancillary costs not accounted for in the $535 million bargain. Should MLB, private developers, or the federal government not chip in, then the taxpayers of Washington, DC will be left holding the bill for the balance, which was what started all of the arguments a year ago. Therefore, millions of dollars earmarked for other projects for the city of Washington, DC, such as improvements in homeland security first-responders, would be sacrificed.
But it gets better. Have your eyes glazed over yet trying to comprehend the numbers? Well, here are some more. Also holding this whole thing up is a $6 million lease agreement that the city says that MLB is responsible for, but is being contested by MLB. And the stadium's financing is contingent upon the lease agreement, as bond raters will not provide grade ratings until the agreement has been executed. The complete financing plan must be in place prior to Christmas 2005 in order to begin the process of selling bonds. It will be another race to the finish line much like last year.
However, had not Bud Selig procrastinated last year, there would not have been such a rush in the end and the agreement would have had more time given for better cost estimates and more time for bids on an architectural design. Such failures have come back to haunt the Nationals a year later.
At issue with the lease agreement is MLB's argument that the lease agreement must be in place prior to selecting a new owner for the team, while the city wants a guarantee in writing that MLB will pay $6 million a year for the lease of the stadium. Yet, MLB says the agreement was to have included money for the lease. In addition, the city is asking for a $24 million letter of credit from MLB in the event the stadium cannot be completed due to a terrorist attack, natural disaster, or even a MLB strike. And should other resources fail to come through, they are also requesting MLB for an agreement of $20 million for the underground parking.
But the missing quotient in this whole scenario is the missing owner. Had there be an owner in place by now, it would then be up to such owner whether or not they want to pay for a lease. At the very least, they could offer input on the design of the stadium and cost containment and work directly with the city rather than the city indirectly asking promises of MLB, which may never come to pass.
But Selig has been "sidetracked." MLB has missed six of its own self-imposed deadlines to appoint a buyer for the team. To date, Commissioner Selig has only interviewed five of the eight interested groups having failed to address any more prospective candidates since September. So is that the fault of the city of Washington, DC, too? First, Selig said he would choose an owner by the spring of 2005, then it was the 4th of July, only to replaced by the date of the All-Star Game, and since then, we have seen the date of the beginning of the MLB playoffs, the World Series, and the November owners' meetings come and go as other promised deadlines, to no avail.
The reality is that regardless of the details of the agreements on construction and financing, the longer MLB drags its feet on getting an owner in place for the Nationals, the closer it gets to the 2006 season without management in place. And as it is, the prerogative of the new owner to choose new management, without it, deals and trades cannot be accomplished. Manager Frank Robinson, as well as General Manager Jim Bowden, is twisting in the wind regarding their jobs. But even more importantly, and even if they are dismissed, it will take time for any new manager or General Manager to get organized, let alone basically re-build the team all over again. New players are not looking to go to a team with no management or guarantees of potential salaries or management's ability to ensure that a good team awaits blue-chip free agents.
As good as the Nationals were in their overachieving first half of 2005, with a 50-31 record, they tailed off dramatically after the All-Star Break with a record of 31-50. Nevertheless, they finished with a .500 record. But trading for additional personnel was part of the problem during the season and is crucial to the Nationals now. For a team being sold by MLB in the amount of $450 million, a payroll of $50 million pales in comparison.
"It's not fair to this ball-club and this organization to be put in this position for the coming season because we're behind on moves and things we can do and approaching players, the free agent market, either signing free agents or even really seriously talking to them. Just overall, the feeling and the atmosphere around this ball club is that we're at a disadvantage," according to manager Frank Robinson. He has been the consummate professional in taking over the helm of the disenfranchised Montreal Expos and now Washington Nationals during the past four seasons, which initially was to be a one-year deal for him and then perhaps going to the front office to help manage the transition between cities and the release of MLB ownership of the club to a new owner.
Frank Robinson's coaching staff has been directed by Jim Bowden to start looking for new jobs. This has also angered Frank, and the Nationals are very close to losing Robinson, even if the new owners wish to retain his services. He has worked with virtually no payroll, and in two different cities in two different countries, for four years. And in one of those years his team played a third of their games in Puerto Rico. But Robinson is not the only upset party in this twisted tale, which could largely have been avoided. The Mayor of Washington, DC is upset, certain members of the City Council are at odds, the residents of Washington, DC are concerned with absorbing potential cost overruns, and the candidates who want own the team are anxious.
Finally, the players, manager, and coaches of the 2005 Nationals deserve better and fans of MLB are being taken for granted. Without ticket prices set nor a television contract in place, it will be difficult to continue to generate as much interest in 2006 as in 2005 in Washington, DC, since fans want a good team put on the field, too. And now that its maiden voyage is over, any success the Washington Nationals enjoy in 2006 will be in spite of Commissioner Selig, not because of him.