It’s First and 110 Days, as L.A. Moves Into the Lead

The official--and startling--NFL pronouncement Wednesday was that the league might decide between Houston and Los Angeles and award its 32nd franchise as soon as Feb. 16 in a special meeting in Dallas.

But if the buzz after Tuesday’s presentations is accurate, the race between L.A. and Houston is over. It is now Los Angeles’ to lose, the only debate remaining in the next 110 days being who wins, the New Coliseum Partners or Michael Ovitz and his Carson project.

“What great news,” said Ed Roski, who brought the Coliseum back to life with a rousing show before the owners Tuesday, which included a new canopy-covered stadium. “It looks like our work has born some fruit, and this is the best news that we could have hoped for coming out of this meeting.”

Ovitz, who said Tuesday he had no interest in pursuing an expansion franchise beyond the end of the year, said, “Between the end of the year and Feb. 16--I can handle that, but I can’t handle much beyond that.

“I’m very excited that both groups were able to convince the NFL that L.A. is the place to be and come up with this firm timetable. We’re a lot better off than where we were 48 hours ago.”

Tagliabue said the league’s financial and stadium committees will combine to meet with Houston and the two L.A. groups over the next 30 to 60 days to refine and verify financial presentations, and also work on establishing a franchise fee, which will begin at $476 million--the price paid by Cleveland.

The NFL owners recently received their payoff for Cleveland--$17 million each--with Baltimore and St. Louis excluded, their penalty for moving.

Unlike the Cleveland deal, which resulted in a bidding process among prospective owners, Tagliabue said the league will set the franchise price, much like it did in 1993 when Carolina and Jacksonville entered the league.

Carolina and Jacksonville each paid an expansion fee of $140 million and surrendered half of their share of the TV money for three years--approximately another $60 million each.

Both Roski and Robert McNair, the driving force behind Houston’s effort, said they had no quibble with the starting point for the franchise fee, but Ovitz reiterated his position that such a high fee is unrealistic in assembling a doable deal.

“We will have to assess that,” he said. “But it’s difficult to do a privately funded deal for a stadium with the Cleveland numbers. I have been very clear about that; that’s not a new position.”

McNair, who has to hope that L.A. falters in its final preparations, said: “We’ll pay whatever the market price is. We don’t expect a discount and we don’t expect to pay a premium. We will negotiate.”

Some of the NFL owners remain opposed to adding a 32nd franchise at this time, and will most likely react in negative fashion to any suggestion that they accept less money from either Houston or Los Angeles.

The 32nd franchise, unlike Cleveland, also will be due for a higher TV payoff when it enters the league in 2002--another compelling reason to expect the NFL to establish a higher expansion fee.

Tagliabue said the committees will recommend a winner to all 31 owners at the special meeting in Dallas, and if there is a consensus--24 votes--the league will award the expansion franchise to begin play in 2002.

The league’s weeklong annual owners meetings are in Arizona in March, providing an escape for the owners if they are unable to reach a conclusion at their one-day meeting in Dallas.

Alarmed by declining TV ratings and impressed by Los Angeles’ strong showing in presentations here before the owners Tuesday, the NFL appears to be positioning itself for a better TV payday with the catalyst being the nation’s No. 2 market.

The NFL has the option of tearing up its eight-year, $17.6-billion TV contract after the fifth year--after the 2002 season. The addition of Los Angeles and its five million TV households would allow the NFL the opportunity to stoke competition between the networks once again, and at the same time allow NBC--replaced by CBS this season--back into the bidding process.

“We looked at television in 1994 and the highest rating we had in any market was in Cleveland,” Tagliabue said. “The ninth-highest was Houston and Los Angeles was 14th or 15th, which reflected some of the difficulties the Raiders and Rams were having with blackouts. Look at last year’s ratings and Cleveland was 30th, Los Angeles was 29th and Houston 23rd.

“We’ve obviously had a steep decline. Cleveland we’ve addressed, but the importance of addressing Houston and Los Angeles is illustrated by that television [drop-off].”

In addition to the television-driven argument that favors Los Angeles--which has 3.4 million more TV households than Houston, ranked 11th overall--the NFL believes it can raise the bar on the price it can exact for naming rights to a stadium, luxury boxes, premium seats, advertising and sponsorship fees in Los Angeles.

“There was very positive discussion and assessments in regards to the presentations here and recognition that these are opportunities we haven’t seen before and we should move on this as an urgent priority,” Tagliabue said. “There are owners who have reservations [about expansion], but no one has spoken against expansion.”

The competition becomes serious now, because Tagliabue said he does not foresee the league expanding beyond 32 teams “in my lifetime.”

Houston remains ready and hopeful that L.A. will falter down the stretch, and despite positive reviews after their presentations, each bid has shortcomings to overcome.

Ovitz’s financial pitch fell flat with many of the owners, who were surprised by the amount of money projected to be borrowed to complete the Carson project. They also failed to learn what equity--if any--Ovitz and his partners intend to put in the project.

The New Coliseum effort, meanwhile, probably needs more clout in its ownership group, and Roski said he remains open to adding partners. There have already been discussions with Fox officials; Ed Snider, part-owner of the Philadelphia Flyers and 76ers and former owner of Spectacor Corp., which previously managed the Coliseum, and Disney’s Michael Eisner.

“We’re looking at all possibilities,” Roski said. “This morning we’ve had people calling like crazy wanting to jump aboard. We’re ready to put on the full-court press now and complete the deal.”