Rams Reject 15-Year Lease on Practice Facility : NFL: Team offers to sign a two-year extension with Anaheim. ‘It appears they’re shopping around,’ City Manager Ruth says.
The Rams have rejected Anaheim’s offer of a 15-year extension to their practice facility lease, which expires Dec. 31, and have countered with a two-year demand, fueling speculation that the team might be setting itself up for a move.
“It appears they’re shopping around,” said James D. Ruth, city manager. “Maybe they’re doing this for leverage. I don’t know . . . If they’re going to leave they’re going to leave. We hope that they don’t.”
John Shaw, Ram executive vice president, said the team has no plans to move but that there are serious concerns about its prospects for financial success here.
“The city manager can draw any conclusions he wishes,” Shaw said. “If he reaches that conclusion, maybe he’s concluding our economic situation in Anaheim is not a good one.
“This (practice facility dispute) is really a sub-issue. We are exploring the economic viability of a long-term commitment to staying in Anaheim Stadium. Presently, it’s inconclusive.
“Our gross receipts are among those at the bottom of the league, and with recent expenses and the advent of free agency, I’m just not sure how viable it is going to be.”
After nine games this season, the Rams rank last in the league in average home attendance at 45,555 fans per game.
“If it comes to the extent that it becomes increasingly difficult to put a competitive team on the field for economic reasons,” Shaw said, “and we can’t compete for players because of the economics of our present situation, then we would likely explore other opportunities that would increase revenues.
“At some time after the end of this year we will take a closer look at it. There are a lot of other economic factors to consider. The network television deal becomes a large factor, for example. We don’t have enough financial information yet.”
An escape clause in the Anaheim Stadium lease allows the Rams to leave after 15 months notice and with an accompanying $30 million to settle a stadium improvement debt: $2 million up front and the remaining $28 million in debt before they relocate.
The dispute regarding their practice facility will have no impact on the team’s decision to move or not, Shaw said. But the lack of a long-term lease at Rams Park would be one less loose end to tie up.
Shaw said the team notified the city by letter last week that they have reached an impasse in the negotiations over the practice facility lease.
The Rams said they were given verbal assurances that the city would spend $7 million to purchase their present practice facility from the Magnolia School District and improve it, or use that money to buy a site for a new facility.
“It was our understanding that this was going to be resolved in 1990, and they have been dragging their feet for three years,” Shaw said. “We don’t want to stay here in an inadequate facility. We want an adequate facility.
“We have been trying to build a larger weight room. We were stopped by injunction once and are still fighting that. It’s taken years to get a larger weight room, and we still don’t have it. The city’s intention is to extend the lease so they don’t have a $7 million commitment.
“Although we have no solution at the present time, I don’t see the practice field as anything more than a secondary issue to our overall situation. This is not about moving; this is about the city honoring its agreements.”
Ruth said the city and the Rams “have a major, major disagreement” over the $7 million. Ruth said the money was offered only if the district took back the school and another training site had to be bought.
“It was never the intent of the city to subsidize the Rams,” Ruth said.
With a long-term lease, he said, the city does not need to purchase another site. He said there was never any talk about city-funded improvements at the Rams’ training facility.
“I do not feel that the taxpayers of this city need to go out there and pay for a training site now,” Ruth said.
The city manager said he has also been troubled by the Rams’ recent posturing.
“The city is extremely frustrated with the Rams’ approach to this whole thing,” Ruth said.
The Rams have been renting the Juliette Low Elementary School for $120,000 a year. According to Ruth, the team initially wanted a long-term lease extension; Ruth said he was able to negotiate such an extension with the school district but was then advised the Rams wanted only two years.
“The city is in between a rock and a hard place,” Ruth said, noting it has been acting as the intermediary between the Rams and the school district. Under the current agreement, the city leases the school from the district and sub-leases it to the Rams.
Ruth said the district was initially reluctant to enter into a long-term lease because it thought it might need the school for its growing student population. But Ruth said he was able to negotiate for 15 years and that the city agreed to pick up any rent increase imposed by the district, so the Rams’ rental rate remained the same.
Now, he said, the Rams want a short-term deal.
“I’m not sure the district is going to go for that,” Ruth said. “It may not make good business sense for them. They may decide to lease it to somebody else to guarantee a steady stream of revenue.”
Shaw said, “That’s the city manager’s view; we know what was proposed, and it’s something different.”
Shaw said the Rams received a letter from the Magnolia School District dated Nov. 10, 1992 suggesting five lease alternatives. No. 1, he said, was a two-year lease with a $150,000 rent each year.
“The school board proposed a two-year lease to us,” Shaw said. “The lease expires now on Dec. 31, and we have no solution as to what will happen after that. We have practiced the last several years at an inadequate facility; if it’s the city’s desire to keep us in it, we will continue.”
The Rams’ final practice this season--barring a miracle finish to earn a playoff berth--is scheduled Jan. 1.
