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The Bengals Respond

By · March 28th, 2007 · Letters
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In the summer of 1995, the Bengals made a decision with profound ramifications for this community. Faced with the opportunity to move to Baltimore, the team said no and worked to get new stadiums for both the Reds and Bengals built here -- a project that has transformed the Cincinnati riverfront, set the stage for a new Ft. Washington Way and National Underground Railroad Freedom Center and placed into public hands the entire central riverfront with great hopes for the future. CityBeat's cover story "Prevent Defense" (issue of March 14) seeks to find fault with the Bengals for the events of that summer by packaging a series of misstatements and outright falsehoods. Your article asks the question: "Was it a threat or a fraud?" The only fraud is in CityBeat's story.

Your story is based on two premises: (1) that the terms of the deal the Bengals could have received in Baltimore were secret and intentionally withheld from Hamilton County when the Paul Brown Stadium lease was being negotiated, and (2) that the Baltimore deal was not a very good deal at all. Both are false.

There were no secret terms. When Art Modell accepted the Baltimore deal and agreed to move his Cleveland Browns, the move and the deal that prompted it became one of the most scrutinized stories in sports history. Articles appeared detailing its terms in newspapers, sports magazines, business publications, even in college alumni magazines. Books were written about it. The agreement itself was and remains a public document, available to all. In particular, the experts Hamilton County hired to negotiate the Paul Brown Stadium lease knew those terms as they undertook their work. You hype the supposed secrecy by highlighting an "uncovered" letter between Baltimore officials and the Bengals, but, as your story confirms, "Modell essentially got the same deal offered to the Bengals." The Baltimore deal's terms were well known to all.

Baltimore was a better opportunity, by far. There is simply no question; the Bengals would have done far better in Baltimore than staying in Cincinnati even in a new stadium. That was the conclusion of objective observers at the time Modell moved his Browns:

"... the Browns will be transformed immediately, from a franchise that claimed to lose money in Cleveland to a Baltimore-based team making an annual profit of about $30 million, according to economic analysts." ("Browns Deal: Boondoggle or Boon for Maryland?" The Washington Post, Nov. 12, 1995.)

"The deal was so lucrative it would render a franchise one of the most valuable in sports." ("Inside the Browns Deal," The Baltimore Sun, Dec. 17, 1995.)

That conclusion has been confirmed by experience. Forbes magazine annually looks at the revenues of NFL teams. Baltimore is consistently in the top 10 teams in the League. Cincinnati is in the bottom third.

The last Forbes analysis showed Baltimore making $26 million more than Cincinnati for the 2005 season alone. In aggregate, in the first eight years after Baltimore opened its new stadium in 1998, Forbes' analyses show Baltimore operating revenues exceeding those of Cincinnati by $178 million. Add to that the $70 million that the Browns received in seat license revenue (the Bengals received no such revenue), and you have, over the first 10 years, $250 million more for whatever team took the Baltimore deal than for Cincinnati. That is real money that the Bengals gave up in order to make something work in Cincinnati for the benefit of our community.

When the Bengals said no to Baltimore, Cincinnati's stadium plan was far from a reality.

By contrast to what Baltimore had to offer that summer, Cincinnati offered a lot of questions. A stadium plan was in place, but it faced substantial uncertainties. Public opinion polling showed it resoundingly defeated if brought to a vote. Even if the vote passed, could the community support the team at a level toward which other NFL teams were heading? The answer would depend largely upon pricing and numbers of suites, club seats and corporate sponsorships. There was data on all those in Baltimore, but the Cincinnati markets were untested and unknown. Where would the stadium be located? How much would it cost? What would be the terms of the lease? All of those were set in Baltimore, none were set in Cincinnati.

That was the choice Mike Brown and his organization faced in June 1995. Hundreds of millions of dollars in Baltimore. Dozens of questions in Cincinnati. With a firm faith in this community, the Bengals chose not to accept Baltimore's money. The Bengals set their focus on getting the sales tax enacted into law and helping this community move forward.

Instead of looking at real economics or the situation in Cincinnati in the summer of 1995, CityBeat's article wanders a tortured path around its "uncovered" letter of June 1, 1995 from the Maryland Stadium Authority's outside counsel to the Bengals' outside counsel. CityBeat highlights two elements it says are in that letter: (1) "all costs for a new stadium were capped at $200 million," and the "requirement" "that Mike Brown give up his majority ownership stake in the team." Like the premises underlying the entire story, both of those statements are false.

"All costs" for the Maryland stadium were much more than $200 million. As your reporter knew when he penned the words, it was not true that "Among the Maryland deal's major components, all costs for a new stadium in Baltimore were capped at $200 million." First, the $200 million referenced in the letter was not "all costs for a new stadium." Maryland had already paid large sums for the stadium -- land acquisition, site preparation, infrastructure improvements, parking, even architectural design -- all in place by the summer of 1995. That was one of the clear advantages in Baltimore: They were ready to break ground and could get the stadium open in 1998, two years before Cincinnati. Nor was what Maryland spent after breaking ground "capped at $200 million." After signing its deal with Art Modell, it spent the $200 million and many millions beyond that -- a fact that your article recognizes even while it tries to compare the total cost of Paul Brown Stadium with the $200 million partial cost of the Baltimore stadium.

Maryland never required local ownership. CityBeat's "uncovered" letter says "MSA will assist the Bengals in securing new local stockholders in the team," but it says nothing about requiring local ownership and nothing about majority control. In fact, the possibility of local minority ownership was discussed as a potential advantage to the team in its efforts to sell corporate sponsorships in the Baltimore market, but it was never a requirement. The deal Art Modell signed had no reference to local ownership -- majority or otherwise. And he did not give up any ownership stake, let alone his majority stake, to accept the Baltimore deal. You report that he "sold a 49 percent ownership interest in the team to a Baltimore businessman," but that sale came four years after Modell agreed to move and, as was widely reported at the time, the sale came because of personal financial setbacks of Mr. Modell, not because of some requirement from the Maryland Stadium Authority.

Terms of the Baltimore deal were the same or better than the lease here. Your article pretends to compare the terms of the two deals, says there is a "stark contrast" and leaves the impression that the Hamilton County deal is more favorable to the team than the Baltimore deal. It gets there only by repeatedly highlighting terms of the Hamilton County deal while carefully omitting the fact that Baltimore offered the same or an even more favorable term:

CityBeat wrote: "The stadium deal negotiated by Hamilton County officials in the '90s starkly contrasts the deal floated by Baltimore. Among the perks given to the Bengals, the county must pay for costly equipment upgrades virtually any time another NFL stadium makes improvements."

The truth is: Only if a substantial number of publicly-owned stadiums adopt new technology and pay for it with public dollars is there any such provision; Baltimore's lease has a similar provision related to its scoreboards, but it is triggered much more easily.

CityBeat wrote: "The county also agreed to exempt the team from rent payments in the deal's later years."

The truth is: True for Cincinnati; in Baltimore, there is never any rent at all.

CityBeat wrote: "Further, the Bengals and the county must share revenues from any special events held at the stadium, such as concerts and high school football tournaments."

The truth is: True for both Cincinnati and Baltimore.

CityBeat wrote: "Also, the Maryland deal refused to grant the Bengals any guarantees on ticket sales..."

The truth is: No ticket sale guarantee was paid in either city.

CityBeat wrote: "... and required that the Maryland Stadium Authority (MSA) share in any revenue generated by the sale of personal seat licenses."

The truth is: Maryland's share of seat license revenue was less than 8 percent of proceeds, while Hamilton County's share was 100 percent of proceeds. Mr. Modell's team received $70 million in seat license revenues; the Bengals none.

Under any objective comparison of lease terms, the Baltimore deal is a better deal for the team than is the Paul Brown Stadium lease.

Art Modell was rightly lambasted in Cleveland for having taken the lucrative Baltimore opportunity without first talking to Cleveland officials. Mike Brown gave up the Baltimore opportunity, and with it hundreds of millions of dollars, to keep the NFL in Cincinnati. For that he deserves better than the fabricated attacks of your paper.

-- W. Stuart Dornette Taft, Stettinius & Hollister

Cincinnati Bengals counsel

Editor's Note: CityBeat's March 14 article states that the Baltimore deal offered to the Bengals was information that Hamilton County officials could have known in the late 1990s but chose not to or knew and deliberately kept from taxpayers. The article doesn't state that no county official knew about the deal, just that the public or most elected officials didn't generally know about it at the time.

The article doesn't state that the Baltimore offer "was not a very good deal at all" but compares provisions of the deal with the one the Bengals received in Cincinnati.

The article did not question whether the Bengals committed fraud. One sub-headline states: "Was it a threat or 'a fraud?' " The quotes around "a fraud" refer to direct quotes from Todd Portune and Tim Mara.

See discussion of these issues at citybeat.wordpress.com.

 
 
 
 

 

 
 
 
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