By Gregg Krupa, Globe Staff, 12/16/99
Despite changes over the weekend that lowered Connecticut's risk in the
deal, the New England Patriots and owner Robert Kraft are the beneficiaries of
the most generous stadium-financing agreement ever offered to a National
Football League franchise, most observers agreed yesterday.
At a time when several mid-sized cities -- including Nashville; Charlotte,
N.C.; St. Louis; and Tampa -- have offered NFL owners lavish terms to secure
the status and allure of big-time professional sports, the deal approved by
the Connecticut General Assembly yesterday to move the Patriots to Hartford
outranks them all, experts say.
``People ought to recognize it's the worst publicly financed stadium deal
ever done,'' said Mark Rosentraub, director of the Center for Urban Policy and
the Environment at Indiana University. ``And anyone doing it ought to realize
that by doing it, they have succeeded mostly in making one owner very
The provisions that make the agreement on the $375 million stadium project
so strikingly generous are the state guarantees for premium seating --
potential costs that are not included in the current price of the deal.
The state has agreed to pay for as much as $13 million a year in luxury box
fees and club seating tickets for at least the first 10 years of the Patriots'
lease. That potential exposure was lowered over the weekend from $17.5
million, in a move that provided some momentum for the vote yesterday.
Of all of the recent stadium deals in the NFL -- at least 14 since 1992 --
two provide a guarantee of revenue from admissions.
But in one of the deals, for the Rams in St. Louis, the guarantee was
financed by a private civic group, not the state, county, and city governments
that paid for the $280 million RCA Dome. And unlike the Patriots' deal, the
public St. Louis Regional Conventions and Sports Complex will gain portions of
admissions revenue from stadium advertising and concessions.
In the other deal, San Diego agreed to buy unsold tickets for some regular
seats as part of an agreement to refurbish Qualcomm Stadium, the home of the
NFL's Chargers, in 1995. But those tickets are all for non-premium seats, and
the maximum exposure for the city is less than $2 million per year.
Robert Kraft and his son Jonathan have said, at a legislative hearing in
Hartford last week and elsewhere, that they have done a poor job of explaining
their deal with Connecticut. They say, in part, that a 10 percent tax on all
tickets is expected to generate as much as $8 million annually for the state.
In a sense, Kraft said, the team is sharing its revenue stream with its
But some observers say the tax exists only to provide money for the state's
borrowing costs and does not really represent a willingness on Kraft's part to
``My personal opinion is that [tickets are] priced that way to raise the
revenue for the 10 percent tax, rather than taxing the admission price that
the market will bear,'' said Dean Bonham, of the Bonham Group, a marketing
consultant in Denver. Bonham argued that ``if you are guaranteed the price of
many of the tickets, why not charge as much as you can?''
Jonathan Kraft has argued against that, saying that the club seating ticket
prices and luxury box fees were calculated independently.
``We can only charge what the market will bear,'' Kraft said. ``This isn't
10 percent added on top of what we're charging.''
The potential $8 million annual payment to Connecticut is more than some
owners are contributing to the cost of their new stadiums, but far less than
some others are passing on. Georgia received no payment from the NFL's Falcons
when it built the $214 million Georgia Dome, which opened in 1992. And the
Rams put up no money when the state of Missouri and the county and city of St.
Louis paid for the RCA Dome.
However, Charlotte's $187 million Ericsson Stadium is financed entirely by
the sale of seat licenses and other private sources. And in Washington, the
NFL's Redskins paid $180 million for the $250.5 million Jack Kent Cooke
Stadium project, with public dollars covering the remaining $70.5 million.
The Krafts cite two other expenditures that they say are significant to the
deal: $50 million for the construction of a hotel near the stadium and in the
proposed Adriaen's Landing development, and $20 million for an NFL activities
``Never has an NFL team contributed so significantly to the redevelopment
of a city,'' Robert Kraft said recently.
But observers note that the Krafts stand to profit substantially from the
spending, which, they said, is more of an investment.
``When all things are considered -- the [stadium] land being for free, the
[stadium] facility built for free, the state paying for renovations and
maintenance, the naming rights going to the team, the annual [premium seat]
guarantees, and the obvious potential for revenue from the hotel and the
activities center -- there has never been anything like this,'' Bonham said.
``There is nothing in the NFL, there is nothing in professional sports, that
compares with this deal.''
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