HAGERSTOWN SUNS, CITY COUNCIL MEET
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About three dozen people crowded into a conference room in Fredericksburg’s City Hall on Monday evening to hear a wide-ranging discussion between the owners of the Hagerstown Suns and City Council.
At the conclusion of the meeting, the council voted unanimously to extend an exclusivity agreement with the Suns that had been scheduled to expire Monday until July 10, the day after a planned public hearing that will allow local residents to weigh in on the Suns’ proposal to relocate to a new stadium in Celebrate Virginia South. The agreement prevents the city from speaking with any other professional baseball team that may be interested in coming to Fredericksburg.
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Although Suns majority owner Bruce Quinn contacted city officials to express interest in relocating to Fredericksburg seven months ago, Monday was the first time he has met face to face with the entire City Council. Also present from the team were Jeff Nelson—a former Major League Baseball pitcher who is married to Quinn’s sister and is a part-owner of the Suns—and attorney John Ferrante.
The Suns are a Class A affiliate of the Washington Nationals, whose jersey and hat were worn by two members of the public who attended Monday’s meeting. The Suns have proposed to lease a publicly financed, $29.5 million stadium from the city for 30 years at an annual cost of $105,000. The team would also contribute to the city half its naming rights proceeds and 15 percent of its net profits in excess of $700,000.
And the team has agreed to put up $3 million up front to acquire the land for the stadium, with one possibility being the 38-acre parcel that was once intended to be home to the National Slavery Museum. The team would be responsible for all construction costs beyond $29.5 million and would cover all capital improvements and maintenance costs on the stadium beyond the up to $100,000 the city would contribute annually.
To cover much of the estimated $1.84 million in annual debt service, a tax district on Central Park and Celebrate Virginia properties has been proposed that could require affected property owners to pay a new tax of as much as 32 cents per $100 of assessed value. Fredericksburg Mayor Mary Katherine Greenlaw said there has been ample opposition to that tax district from Central Park owners.
Quinn said he was open to reworking the deal and said he wasn’t looking for a “free lunch” from anyone. He mentioned the possibility of creating a surcharge on each ticket sold at the stadium that could go to debt service. He said he’s willing to negotiate and was glad to finally be meeting with city officials face to face.
“This is not a get-rich-quick scheme,” Quinn said. “We’re in baseball because we love it.”
Council member Brad Ellis provided an analysis of the deal’s current structure showing that the project has a debt-to-income ratio of 60-to-1, a figure that bankers wouldn’t even consider when evaluating a potential loan.
“I’d love to see this deal transpire, but it needs to make good business sense,” Ellis said.
Quinn and Nelson said the project will have direct economic benefits to the city, including dozens of new full-time jobs, about $2 million in local business spending, additional lodging taxes from nearby hotel stays, tourism visits and more. They also said it could help jump-start the struggling Celebrate Virginia South project.
But the Suns owners also spoke about the intangible benefits and community pride associated with having a professional team and new stadium. They said they’d work closely with youth baseball in the area and hold nonprofit fundraisers and art shows at the stadium, which would host numerous concerts and community events in addition to baseball. Quinn has spoken about the possibility of bringing professional lacrosse and soccer to the stadium.
Nelson, who said he recalls his days in minor league baseball fondly, said the players would become a part of the community, with perhaps some of them living with host families. Area residents could then track their progress to the big leagues. The Washington Nationals plan marketing deals whereby local residents could buy packages of tickets to Suns and Nationals games.
Quinn also said there will likely be opportunities to attach more development to the stadium in the future that could allow the city to get additional state sales taxes back from the project. And he said the naming rights proceeds from the stadium might end up fetching considerably more than the projected $200,000 a year.
Quinn asked that the July 9 public hearing in front of City Council be pushed back to allow more time to negotiate the deal. He said he doesn’t want the conversation to focus on the proposed tax district if that ends up getting stripped from the final deal, or if the tax rate gets significantly reduced.
City Council decided to keep the July 9 meeting scheduled, noting that it could lead to receiving good ideas that could shape the final negotiations. After that meeting, the council could decide to start the process of adding the facility to the city’s Capital Improvements and Comprehensive plans, and entering into formal negotiations on the various aspects of the deal.
Quinn wants to relocate the team to Fredericksburg in time for the start of the 2015 season. He said the city would need to approve the final lease by the end of October to make that timeline possible. Trying to build the stadium any faster would likely lead to increased costs, he said.
City Council queried Quinn on why attendance has fallen in Hagerstown, Md., every year since the current ownership group bought the team for $6.7 million at the end of the 2010 season, and also why the team has not provided the city with audited financial results.
Quinn, a Florida businessman, blamed the attendance in large part on an outdated stadium built in 1930. He said the city is welcome to pay to audit his team’s results, but he said he has never bothered with the expense of doing so because the team is privately owned by a group that paid cash in 2010 and has no debt.
Quinn said the Hagerstown stadium provides fans a viewing experience comparable to one at a little league game. He continues to talk to Hagerstown officials about a new stadium as the local talks play out. The team’s lease there expires at the end of the 2014 season.
Both Quinn and several City Council members characterized Monday’s meeting as a positive one that helps move the process forward.
Bill Freehling: 540/374-5405