Peter Angelos, Washington, DC, and Major League Baseball are negotiating a deal to bring baseball to DC. This is just a sop to wealthy owners of MLB teams.
Baltimore Orioles owner Peter Angelos acknowledged publicly today that he is willing to strike a deal with Major League Baseball to allow the Montreal Expos to move to Washington if certain conditions are met.
"Those conditions are the preservation of the franchise, the protection of the asset and the safety of the revenue stream," Angelos said this morning. "If those ingredients are present, an agreement can be struck."
The Baltimore Sun first reported in today's editions that Angelos is willing to make a deal. Angelos has previously resisted financial overtures from baseball, and he has told people close to him that he would take legal action against the league to keep the Expos out of Washington.
Baseball also is believed to be proposing that it will guarantee the amount of annual revenue that the Orioles earn, as well as the team's value, according to two sources familiar with the talks. Under the proposal, Major League Baseball would make up any shortfall if the Orioles' annual revenue falls below an agreed upon threshold, according to sources.
Angelos repeatedly has said that a team in Washington will drain away fans, hamstring the Orioles financially and inhibit the team's ability to compete. Baltimore plays in the American League East Division against two of the richest teams in the sport: the New York Yankees and the Boston Red Sox.
Angelos has failed to improve the Orioles franchise since he bought it eleven years ago. In fact, despite winning their division twice (1996 & 97) the Orioles have not been to the playoffs since, and worse still, they have failed to break .500 the past seven seasons. And this is the deal he gets? I wonder if, since the competition in D.C. may actually force Angelos to produce a better team as well as increase interest in baseball throughout the DC-Baltimore corridor, Orioles ticket sales increase he has to compensate MLB. But I actually believe that the incentive problems inherent in all of this wealth redistribution to wealthy team owners will cause them both to flounder for years to come.
Baseball wants to make the Expos announcement by the end of the week to give the D.C. Council enough time to approve the legislation for a publicly financed, $440 million package to renovate RFK Stadium, and build a new stadium on the Anacostia waterfront. The council must act on the legislation soon to have the money for the RFK renovation, which city officials said will take at least three months.
DC is in a unique situation given its proximity to Virginia and Maryland. Arguments for publicly funding a stadium are usually based on the revenue the stadium will generate from people coming to the stadium and spending money on hot dogs, souvenirs, and the like. But the argument fails to account for the revenue that is now not generated at the theater, restaurants, or stores as a result of the baseball stadium. In other words, revenue generated at the ballpark is just a transfer of spending that would have occured at these other venues. DC will indeed claim that the revenue generated will come partially from people living outside of DC (Virginia and Maryland). But that argument still fails to account for the fact that non-residents who go to games would otherwise not have spent their money in DC at other (non-welfare recipient) establishments.
