Q & A : Rams’ Shaw on Why Team Is Putting City on Notice
On Tuesday, Rams management will formally notify the city of Anaheim that the team is giving 15 months’ notice of its intention to terminate its Anaheim Stadium lease. While the action can be rescinded, its intent is to give the National Football League franchise the option of exploring opportunities in other cities hungry for pro football, such as Baltimore, St. Louis and Memphis, Tenn.
Executive Vice President John Shaw has been the Rams’ point man in the effort to make the best deal possible for Georgia Frontiere, the team’s owner and president. On Thursday night, he talked with Times staff writer T. J. Simers about the significance of Tuesday and what might lie ahead.
Q. What do you make of this action on May 3?
A. I see it as a legal maneuver that grants to the football team an additional option to improve its economic condition, whether it be in Anaheim, the Southern California area or another city. It doesn’t mean we’re going to leave Anaheim. The notice that we’re going to be serving to the city can be revoked any time in the next 15 months and, in a way, it’s really creating for us the opportunity to be a free agent, to use a football term.
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Q. When do you expect this whole thing being resolved?
A. I have no timetable. We’re not going to do anything quickly. We’re just going to explore. We gave the city of Anaheim a four-month period of exclusivity (from the Jan. 6 announcement of the intent to invoke the escape clause).
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Q. Did the city do anything with that period of time?
A. No.
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Q. Did you expect the city to do anything with that time?
A. I wasn’t sure.
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Q. Do you understand the frustration of some city officials who contend the Rams have done nothing to indicate just what they want? That you aren’t being specific?
A. I think the city was very creative when it had to move the team from the Los Angeles Coliseum (for the 1980 season). It’s my understanding they were very creative when they moved the team to the city of Anaheim. I feel, given the same type of situation, they could be creative enough to keep the team right now. So I really don’t understand the frustrations. . . .
I think the city knows the type of proposals we are receiving from other cities. And I think several members of the City Council have made it clear they have no interest in having the taxpayers subsidize a football team. We’re sensitive to that point of view. If that is the view of the city, we respect it and appreciate it. I’m not sure, with that view, they could compete with some of the other cities that are using state and local money to deliver to a potential football tenant a brand-new football facility, a state-of-the-art, single-purpose facility.
In 1990, when we negotiated the buyout clause, the city at that time told us it didn’t have any money to address some of the issues that we felt at that time were important. They found a way to purchase a couple of acres of land and build a new facility (The Pond of Anaheim) for two tenants, two potential tenants that weren’t even identified at the time, in basketball and hockey. Also at the time, when we negotiated the escape clause, the city view was $30 million would be a prohibitive price for a club (to pay) to move out of the city. I think the present view would be that it wouldn’t be prohibitive. I think it is also the city’s view, and they have told us this on a number of occasions, that they will be able to attract other tenants. And so if that’s the attitude that they’re going to have, they might be successful in bringing another NFL team to Southern California. I think it would be difficult for that to happen.
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Q. Is there a leading candidate in the race to get the Rams?
A. No, there’s been strong interest from several cities.
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Q. Do you believe the Rams will move?
A. It would be purely conjectural for me to answer that, and I don’t think it’s fair to do that. It’s a decision that will be made by ownership.
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Q. Have you already made a recommendation to Georgia Frontiere on whether to move or not?
A. Absolutely not.
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Q. What about the team’s lame-duck status and its impact on fans?
A. I think “lame duck” is an inaccurate term because we have not announced our intention to move. We have only announced our notice to terminate our lease.
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Q. Is there any leader, in your estimation, in Anaheim who can step forward and make this work to keep the Rams here?
A. I think the mayor of Anaheim (Tom Daly) has been very aggressive in trying to find some alternatives for us.
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Q. Do team officials believe the city will be able to put together a package that will keep the Rams in Anaheim?
A. We’re hopeful that they can. If they’re competitive with other cities, we would look at the package.
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Q. Do team officials think the city has neglected the Rams’ demands on the stadium lease and practice facility?
A. We haven’t made any demands on the stadium lease.
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Q. A better word might be concerns.
A. As it relates to the stadium lease, we have no concerns or demands. As it relates to the practice facility, we had an oral commitment from the city to expend $7 million to either contribute to a new facility or improve the existing facility, which is antiquated (the city denies such a commitment). The practice facility, though, is only a sub-issue to the larger issue.
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Q. Have city officials broken promises?
A. As it relates to the training facility, they have broken a promise. . . . As it relates to the stadium lease, I feel they haven’t broken any promises, and have lived up to the lease. One of the lease terms provides us the opportunity to leave on 15 months’ notice by paying a substantial amount of money.
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Q. You don’t really have any (other) concerns about the stadium lease?
A. The lease is what it is. I feel we negotiated an escape clause, which we gave a certain amount of consideration. We feel the stadium is economically obsolete. We haven’t made any demands of the city; we just feel in order to compete in this era of free-agency, we have to find a way to increase our stadium revenue. The escape clause gives us the opportunity.
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Q. When you say Anaheim Stadium is economically obsolete, aren’t you in effect ruling out Anaheim?
A. Ruling out is too strong. I think there’s a way--with some creative thinking--to make Anaheim a viable candidate.
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Q. Can Anaheim Stadium be a viable candidate to house the Rams?
A. That’s something the city is really going to have to explore.
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Q. Just how different is Anaheim Stadium from some of the state-of-the-art facilities you have mentioned, and what have been presented to you?
A. I think there’s a huge economic difference in some of the newer facilities and our present arrangement in Anaheim. In the newer facilities, there is a large amount of money made in luxury boxes and premium seating. There’s no premium seating in Anaheim, and our luxury boxes are the lowest-priced in the league, and we have a hard time selling them out. Plus, the advertising revenues from the stadiums, the concessions and parking in the newer facilities are a much greater financial arrangement to the team than our present situation in Anaheim. So newer facilities provide much greater opportunities for stadium revenue.
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Q. But the Rams aren’t losing money, are they?
A. The Rams are not losing money. Last year, the Rams did not lose money. This year, the Rams project a substantial loss. The salary cap has increased our payroll by about $5 million, our radio rights are now the lowest in the league, around $500,000--down from $2.5 million last year. And the network contract--even though it had a higher per-year average than the last contract, the actual television revenues this first year will be less than what we made last year.
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Q. The city says the team would be doing better financially if it put a quality team on the field. Do Rams share any blame in the situation?
A. Obviously, the Rams have some responsibility with the lack of the team’s performance. Fortunately for the fans of Southern California, they have the luxury to support winning teams because there are plenty of opportunities to support winning teams. Yes, we share some of the responsibility, but the burden of constantly of putting a winner on the field to be economically competitive is a large burden in view of the fact several other cities support teams that don’t win.
Most sports franchises go through winning and losing cycles. The Rams had a winning cycle in the ‘80s where they were in the conference championship game twice, the playoffs six or seven times, and even in that era of winning we fell far short of selling out our stadium. We averaged 57,000 in a stadium that seats approximately 70,000. The Raiders were a very competitive playoff team last year, and they had either the second- or third-lowest attendance in the National Football League. Whatever the factors that drive the economy in the Southern California market--possibly, it’s a recession--the teams that are winning are having a hard time filling their stadiums.
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Q. Do team officials feel that the fans have supported or abandoned the team?
A. We feel that we have a number of Ram fans, and that unfortunately because of either the team’s performance or the economic recession that we’re in right now in Southern California, the number of our (season ticket holders) has decreased dramatically. Even without the potential of moving, our season ticket base has decreased 40% over the last three years.
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Q. Is there any way the team can be financially successful in Anaheim?
A. Given a stadium that’s competitive with the newer facilities around the National Football League, I believe the team could be financially successful in Anaheim.