The Houston Astros used to play in the Astrodome, a name that proudly reflected the city's leading role in America's space program and the architectural wonder of the first domed stadium in the country. Then the Astros moved into Enron Field, a name that now reflects a nationally disgraced company and a sports industry increasingly greedy for corporate cash.
In the wake of the largest corporate bankruptcy in American history, with thousands of jobs and millions in life savings lost, the Enron name will be stripped from the ballpark. The Astros agreed Wednesday to pay the Houston-based company $2.1 million to terminate a contract that otherwise could have forced the baseball team to welcome fans to Enron Field, in what would have been a daily reminder of an almost unimaginable hometown scandal.
In its mightier days, the energy company agreed to pay the Astros $100 million over 30 years for the right to slap its name on the ballpark. Although the Astros argued in court papers that the Enron Field name has harmed and embarrassed the team, and although these shaky economic times might suggest caution before making another corporate association, team owner Drayton McLane said the ballpark would be renamed Astros Field only until another company agrees to pay for naming rights.
In an era of escalating costs, most notably spiraling player salaries, teams tap every revenue source they can. While older ballparks such as Dodger Stadium, New York's Yankee Stadium, Chicago's Wrigley Field and Boston's Fenway Park carry traditional names honoring teams, owners or geographical areas, the name of new ballparks is generally reserved for the highest bidder.
"Teams are not going to walk away from $100-million contracts to go back to the days of nostalgia," said Dean Bonham, whose Denver sports consulting firm represents corporations interested in acquiring naming rights.
The Astros nonetheless went to bankruptcy court earlier this month, seeking approval to dump the Enron name even though the company had not missed a payment to the team and was not scheduled to make another until Sept. 1. The settlement, expected to be approved by the court, was applauded by Bonham.
"That's the best investment the Astros have made since [signing star] Jeff Bagwell," Bonham said. "The alternative could have cost them millions of dollars."
In court papers, the Astros suggested that the Enron name could alienate fans and sponsors from the team. The Enron name is on three stadium entrances, four faces of a clock tower and in several hundred places around the ballpark.
Said Bonham: "If you have just lost your job and your life savings, or if someone in your family has, how are you going to feel about walking through a door with the Enron Field name on it?"
The team also argued in court, "The Astros are being perceived in the public and cast in the national media as an affiliate [and even an ally] of Enron even though the Astros have done nothing wrong."
The Enron name is the fifth to fall from a sports facility. PSINet, an Internet service provider that also has filed for bankruptcy, agreed this month to remove its name from the Baltimore Ravens' football stadium. The names of two Florida sports facilities, Pro Player Stadium and National Car Rental Center, reflect brands of parent companies that have filed for bankruptcy.
The TWA Dome name vanished last year from the St. Louis Rams' stadium, following the airline's bankruptcy and subsequent purchase by American Airlines. Stadium officials renamed the facility the Dome at America's Center and, after an extended search, sold naming rights last month to the brokerage firm Edward Jones.
Airline mergers and the bust in the high-tech sector have eliminated many companies from industries commonly interested in acquiring naming rights; the slumping economy depressing rights fees.
The Enron debacle highlights a new concern that a naming rights agreement, no matter how lucrative, might ultimately come back to haunt the team. "Teams have to be very concerned," said David Carter, who teaches sports business at USC. "They're going to have to scrutinize the firm as much as the firm has to scrutinize the merits of being attached to the team."
At a news conference Wednesday, McLane said he already had heard from "six or seven major companies" interested in replacing the Enron name with theirs and said he hoped to conclude a deal within two months. Although the Astros reported $125 million in revenue last season, they also reported a $9-million loss, according to figures released by baseball Commissioner Bud Selig.
"The naming rights in professional sports facilities is a very important part," McLane said. "That revenue goes into operating the club. For the Houston Astros, all the money that we have received from the naming rights basically goes to funding players' salaries."
Locally, the California energy crisis darkened the reputation of Edison, but the Angels sat tight and a 20-year, $50-million deal to call their ballpark Edison Field survived.
"You can't put the genie back in the bottle," Carter said. "The genie is those tens and hundreds of millions of dollars."