Modell Waiting to Fatten Wallet in Baltimore

Art Modell might one day claim the financial windfall he anticipated by moving his NFL franchise to Baltimore. For now, however, he’s paying a hefty price for taking from Cleveland it’s beloved Browns.

Modell recently took out a sizable loan from the league and is looking for a minority partner to help defray the high cost of running the Baltimore Ravens. Unlike most NFL owners, he does not have another enterprise to draw money from when the bills start piling up.

So Modell is looking for someone willing to pay to get into his own little family business, in which his son David serves as president and chief operating officer.

“It’s very pure and simple: I had partners in Cleveland, I have no partners now,” Modell said. “When we came out here, our attorneys and our investment bankers said that at some point in time, you’re going to want to take in a partner to reduce some of this debt load.”

That time is now. The move from Cleveland three years ago left Modell $185 million in debt and has created speculation that the Ravens, who have yet to have a winning season, are also struggling financially.

But Modell isn’t thinking about siphoning gasoline to run the golf cart he uses to watch training camp practice. In fact, he insists that his portfolio has never been more solid.

“This is my 39th year in the National Football League, and no franchise in Cleveland and Baltimore was ever better off financially,” he said. “All we’re trying to do is get more working capital by reducing some of our debt load.”

Modell bought out two of his partners before moving the team, one of them Al Lerner, now the owner of the expansion Cleveland team.

He didn’t count on paying one-tenth of the $233 million it cost to build the new stadium in Baltimore that opened last year. There was also a $29 million relocation fee, which he once protested but has agreed to pay, and the expense of moving furniture, equipment and employees from Ohio to Maryland.

The NFL took out an $85 million loan to help Modell restructure his finances and keep his debtors happy. Modell, in turn, says he plans to pay off the IOU within the next three months.

The Ravens are still perceived by the league to be a healthy operation. Modell has a 30-year rent-free lease and is making millions on Personal Seat Licenses. He will also receive $5,275,000 a year for the next 20 years from PSINet, which purchased naming rights to the stadium.

Before the Buffalo Bills set out to renovate their stadium, owner Ralph Wilson checked the lease agreements of many of his peers. He found Modell’s deal almost impossible to beat.

“I’d probably trade places with him. The franchise there is solid,” Wilson said. “He has a very, very good lease, and he will make more money than we will in any given year.”

That’s what Modell is trying to tell everyone.

“We are in superb, superb shape,” he said.

The NFL figured as much when it decided to back Modell with a loan.

“This was a way to protect the league’s interest at a very minimal cost, if any, to the other clubs,” NFL spokesman Greg Aiello said. “The Ravens continue to operate normally.”

David Modell said the Ravens’ debt will not effect its pursuit of the players necessary to create a winning team. He pointed out that the team signed new coach Brian Billick to a $9 million contract, signed top draft Chris McAlister and are negotiating a contract extension with Pro Bowl defensive end Michael McCrary.

“The last time I looked, the team was still on the field and we’re signing football players and still talking with Mac,” David Modell said. “Everything is moving along in a very status quo fashion.”

The Modells hoped the move to Baltimore would provide the money to make the franchise competitive enough to get to the Super Bowl for the first time. Wilson, however, sees the Ravens operating at a disadvantage.

“If you want to keep your team good, you have to have money and you have to spend it,” Wilson said. “I get some money from my other holdings. This is a very tough business to be competitive in if your only source of income is your football team.”