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Bills Are Champions When It Comes to Negotiating a Lease

By Tony Farina

The Bills may be losers on the field (no argument on that score, I’m sure), but watch out for Ralph Wilson’s bean counters when they take on politicians who don’t want to risk losing the franchise, at lease on their watch. In that contest, the Bills are a Super Bowl team.

No matter how much it costs or how much uncertainty remains for the long term, state and local politicians can’t bear the thought of being in office if the Bills leave town. As a result, the Bills have won a favorable new lease that may give fans some comfort in the short term but which leaves the Bills plenty of wiggle room after seven years to buy their way out of town—if that’s where the new owners want to go-- for about $28 million, mere chump change by NFL standards.

We reported several weeks ago that a new lease agreement was coming but Gov. Andrew Cuomo waited to make the formal announcement just in time for Christmas, riding in just behind his Maid of the Mist giveaway in Niagara Falls to Jimmy Glynn and his announcement of a $50 million state investment in the Buffalo Niagara Medical Campus, part of his Buffalo Billion commitment (see separate story).

The governor won praise for his Christmas gift to Glynn at the expense of a possibly much better deal if the franchise had been put up for bid. And there are a number of questions being raised about the Albany drug discovery, development, and manufacturing company he’s bringing to Buffalo to leverage $200 million in investment.

But let’s focus on the lease for a moment, a 10-year agreement that will cost taxpayers plenty, $226.8 million over the full term, according to the Associated Press. In total, the lease package costs $271 million for upgrades and running the stadium on game day and the Bills will pay just $44 million or 16 percent of that total with taxpayers forking over the rest. That $226.8 million is not chump change by taxpayer standards.

First up, of course, is the $135 million in upgrades to Ralph Wilson Stadium with $54 million coming from the state and $41 million coming from Erie County with the Bills picking up the last $35 million, their first ever donation to stadium work. And the team will pay $800,000 a year rent for the first seven years but that will be more than offset by local taxpayers who will pay the team over $6 million a year for expenses and also pay an estimated $2.5 million a year on debt service for the $41 million in stadium improvements.

One way to look at this deal is that the Bills are committed for at least seven years to staying here because it would cost the new owner $400 million to buy out of the deal in years 1 through 6, a significant penalty even by NFL standards.

But after that, despite the talk of a committee being formed to talk about a new stadium, there is nothing in this lease to commit the Bills beyond seven years.

And there’s little doubt that whoever buys the team after Ralph Wilson passes will need a new stadium, here or someplace else.
Why, then, is there no talk about a succession plan for this franchise given the age of its owner and his plan to sell the team after he passes. That’s a question that former Erie County Executive Joel Giambra raised last week in a letter to the Bills’ Chief Financial Officer, Jeffrey Littman, after terms of the lease were announced.

In his letter, Giambra wrote: “Without getting too specific on the health of the 94-year-old owner, it seems clear that the team needs a changing of the guard on its football operations to restore public confidence beyond the new lease agreement. I think it is appropriate to raise that issue at this time….

“If a new ownership team is coming at some point in the future, as Ralph Wilson has stated, wouldn’t it be logical to consider sooner rather than later for that change to take place. Just how active Ralph Wilson remains in controlling this team is open to speculation and many people in the community believe his hand is not personally involved in controlling this team’s destiny, resulting in a long string of disappointing seasons. Many blame that detached ownership for the team’s poor performances year after year.”

Giambra says the search for a new owner should begin sooner rather than later, in the hope of finding an owner who would be willing to handle the heavy debt load of buying the team and possibly building a new stadium. In other words, will this community be able to afford an NFL franchise and will a new owner be willing to invest hundreds of millions in one of the poorest cities in the nation? Let’s find out now, not later, is Giambra’s point.

Typically, Bills’ Chief Executive Officer Russ Brandon responded to Giambra’s plea by calling it a “tiresome question,” and once again praised Wilson’s loyalty and commitment to the area. But it certainly has not been a winning commitment for the fans, and now those loyal fans are going to be left in the dark about what will come down the road because the Bills don’t feel the need to say anything about the future and are quite happy to extol the virtues of their new lease deal and literally dare anyone to question their intentions about the post-Wilson era.

The bean counters have done quite well making money with this franchise and they have put Ralph Wilson on a pedestal and act offended when questions about his health and the team’s future are brought up. But the truth is they need to be held accountable for their decisions on the field and off, and it’s not enough to dismiss questions as “tiresome” when this community has invested so much in this franchise for so little in terms of performance.

It’s time for Littman, Brandon, and the rest of the brain trust that has helped build a franchise worth close to $900 million without winning anything to give something back. And that doesn’t mean playing “home” games in Toronto and blacking out games on a team that has missed the playoffs for 13 straight years even though the NFL has eased its blackout rules.

My belief is the bean counters, as they have for years, will shrug off complaints about their policies, their “home” schedule, and their embarrassing product and will continue to count the money and go about their business without feeling any pressure to discuss the team’s long term future. As bad as they are, no one wants them to leave.

And they know it.

 

 

Niagara Falls Reporter www.niagarafallsreporter.com

Dec 31 , 2012