ROBERT IRSAY FOR MOVING THE BALTIMORE COLTS TO INDIANAPOLIS
EMINENT DOMAIN
Eminent domain is defined as the inherent power of the state to seize a citizen's private property, expropriate property, or seize a citizen's rights in property with due monetary compensation, but without the owner's consent. It was an increasingly popular, especially in Baltimore, political maneuver designed to improve economic and social conditions within a city.
EMINENT DOMAIN
Eminent domain is defined as the inherent power of the state to seize a citizen's private property, expropriate property, or seize a citizen's rights in property with due monetary compensation, but without the owner's consent. It was an increasingly popular, especially in Baltimore, political maneuver designed to improve economic and social conditions within a city.
Passionate fans of professional sports teams often fail to realize that their favorite franchise is a privately owned business seeking consistently higher profits. In the winter of 1983 and 1984, several cities noticed the Baltimore Colts’ economic potential to bring new money to their areas. The mayor of Baltimore, William Donald Schaefer, made Robert Irsay an offer to counter the offers made by these other cities to keep the Colts in Baltimore. Fear of the Baltimore Colts accepting an offer from a city other than Baltimore forced the state of Maryland to intervene in the situation. On March 26, 1984, two bills were introduced for study in the Maryland legislator only a day after Mayor Schaefer extended an offer to Irsay to consider (Walters, Miserendino).
The first bill introduced to the Maryland legislator outlined a plan to buy the team from Irsay and sell the team to local investors. The state’s asking price for the team in 1983 was $40,000,000. As of 2009, the Indianapolis Colts’ franchise valuation was $1.025 billion dollars, or slightly more than 2500% of the asking price offered by the state of Maryland in 1983(Forbes). It does not take an investment expert to realize the growth potential of owning a National Football League franchise. Robert Irsay did not consider selling the team after analyzing the offer.
The second bill introduced to the Maryland legislator outlined a plan to use eminent domain proceedings to condemn the team and operate it “in the public interest” (Walters, Miserendino). As previously stated, the use of eminent domain had become an extremely popular method for seizing private property. These private businesses in Baltimore usually came under control of the state for a much cheaper price than their public value indicated. On March 27, 1984, the Maryland legislator passed the second bill. So, only two days after the mayor of Baltimore extended an offer to Robert Irsay the state of Maryland passed a bill seeking to condemn the team based on principles of eminent domain.
Other businesses seized in Baltimore were different from the Colts because their assets were not movable. They could not easily relocate to another area to avoid losing control of their company to the state. Faced with being condemned, the Colts quickly collected their assets and got out of Baltimore’s jurisdiction. The move to leave Baltimore in the middle of the night was a brilliant scheme based out of necessity implemented by Robert Irsay. The Colts owner did not move during normal business operating hours because he believed the state would expedite the finalized legislation and obtain a court order to seize their assets (Walters, Misererdino). Robert Irsay correctly guessed the state’s next maneuver. On March 29, 1984, Maryland’s House of Delegates passed and Governor Hughes signed the pending legislation and wired a $40,000,000 “purchase offer” to Irsay and on March 30, 1984 the city filed a condemnation suit (Walters, Miserendino). A judge ruled that the Baltimore Colts moved out of the city of Baltimore’s legal jurisdiction by the time the state seizure proceedings started. The quickly made decision to relocate the Baltimore Colts to Indianapolis was a move that literally saved Robert Irsay millions of dollars.
NFL DRAFT
The 1982 Baltimore Colts finished the season with a winless record. That record, 0-8-1, was the worst record in the league. As a result, the Colts were granted the first overall pick in the 1983 NFL draft. They could choose any player that was draft eligible from the collegiate ranks. This particular draft is viewed by football historians as the most talent laden draft in NFL history. Six players drafted in the first round of this draft would be inducted in the Pro Football Hall of Fame. The Baltimore Colts drafted John Elway.
John Elway was an exceptionally gifted athlete who played quarterback at Stanford University in the early 1980s. He was a coveted commodity by every professional football team as well as every professional baseball team. Before deciding on a career in professional football Elway signed a lucrative minor league baseball contract with the New York Yankees. He was also receiving contract offers to play for the newly established rival to the National Football League, the United States Football League. To say John Elway had many great career options upon being drafted first overall by the Baltimore Colts would be a monumental understatement.
Elway used his leverage during initial negotiations with the Colts. He continually expressed his displeasure with the organization. John Elway was quoted as saying, “I don’t want to be a jerk or anything…we told you for three months that I’m not going to play in Baltimore” (Time). The Baltimore Colts selected the star quarterback despite these harsh words prior to the draft. He would never play a single down for the Colts. Instead, he led Denver's team to five Super Bowl appearances and two Super Bowl victories. The Colts did not receive another #1 draft pick as compensation for Elway’s refusal to play in Baltimore.
Elway’s presence would have been pivotal for the Baltimore Colts remaining in the city. The Colts were in the midst of six straight seasons with losing records, including the previously mentioned 1982 season. The Colts also desperately needed a new quarterback to restore their public perception due to the exploits of the quarterback who was drafted the year prior to John Elway. That quarterback, Art Schlichter, was reported to have a “six-figure tab with bookies” (Time). Nothing will alienate fans of professional sporting events like allegations of substantial gambling. During this streak of losing seasons the Colts were playing at Memorial Stadium in front of a crowd that was far from capacity level. In 1981, during an eleven game losing streak there was a game featuring 7,998 no-shows reducing the actual game attendance to 24,787 (Baltimore Sun). Memorial Stadium held 60,240 seats for the Colts home games. It is difficult for any sports team to remain profitable playing in a stadium consistently filled to less than half of total capacity. The attendance was 27, 934 for the 1983 season finale (footballstadiumdigest.com). Star players sell tickets in professional sports. In John Elway’s first season in Denver the Broncos led the National Football League with an average home attendance of 73,911, despite having a losing record that season (Chicago Tribune). Instead of attempting to locate new cities for the Colts to play in or pursuing legislation for eminent domination condemnation, the owner of the team and local officials could have been working together to find ways to spend the increased revenue brought to the city.
The first bill introduced to the Maryland legislator outlined a plan to buy the team from Irsay and sell the team to local investors. The state’s asking price for the team in 1983 was $40,000,000. As of 2009, the Indianapolis Colts’ franchise valuation was $1.025 billion dollars, or slightly more than 2500% of the asking price offered by the state of Maryland in 1983(Forbes). It does not take an investment expert to realize the growth potential of owning a National Football League franchise. Robert Irsay did not consider selling the team after analyzing the offer.
The second bill introduced to the Maryland legislator outlined a plan to use eminent domain proceedings to condemn the team and operate it “in the public interest” (Walters, Miserendino). As previously stated, the use of eminent domain had become an extremely popular method for seizing private property. These private businesses in Baltimore usually came under control of the state for a much cheaper price than their public value indicated. On March 27, 1984, the Maryland legislator passed the second bill. So, only two days after the mayor of Baltimore extended an offer to Robert Irsay the state of Maryland passed a bill seeking to condemn the team based on principles of eminent domain.
Other businesses seized in Baltimore were different from the Colts because their assets were not movable. They could not easily relocate to another area to avoid losing control of their company to the state. Faced with being condemned, the Colts quickly collected their assets and got out of Baltimore’s jurisdiction. The move to leave Baltimore in the middle of the night was a brilliant scheme based out of necessity implemented by Robert Irsay. The Colts owner did not move during normal business operating hours because he believed the state would expedite the finalized legislation and obtain a court order to seize their assets (Walters, Misererdino). Robert Irsay correctly guessed the state’s next maneuver. On March 29, 1984, Maryland’s House of Delegates passed and Governor Hughes signed the pending legislation and wired a $40,000,000 “purchase offer” to Irsay and on March 30, 1984 the city filed a condemnation suit (Walters, Miserendino). A judge ruled that the Baltimore Colts moved out of the city of Baltimore’s legal jurisdiction by the time the state seizure proceedings started. The quickly made decision to relocate the Baltimore Colts to Indianapolis was a move that literally saved Robert Irsay millions of dollars.
NFL DRAFT
The 1982 Baltimore Colts finished the season with a winless record. That record, 0-8-1, was the worst record in the league. As a result, the Colts were granted the first overall pick in the 1983 NFL draft. They could choose any player that was draft eligible from the collegiate ranks. This particular draft is viewed by football historians as the most talent laden draft in NFL history. Six players drafted in the first round of this draft would be inducted in the Pro Football Hall of Fame. The Baltimore Colts drafted John Elway.
John Elway was an exceptionally gifted athlete who played quarterback at Stanford University in the early 1980s. He was a coveted commodity by every professional football team as well as every professional baseball team. Before deciding on a career in professional football Elway signed a lucrative minor league baseball contract with the New York Yankees. He was also receiving contract offers to play for the newly established rival to the National Football League, the United States Football League. To say John Elway had many great career options upon being drafted first overall by the Baltimore Colts would be a monumental understatement.
Elway used his leverage during initial negotiations with the Colts. He continually expressed his displeasure with the organization. John Elway was quoted as saying, “I don’t want to be a jerk or anything…we told you for three months that I’m not going to play in Baltimore” (Time). The Baltimore Colts selected the star quarterback despite these harsh words prior to the draft. He would never play a single down for the Colts. Instead, he led Denver's team to five Super Bowl appearances and two Super Bowl victories. The Colts did not receive another #1 draft pick as compensation for Elway’s refusal to play in Baltimore.
Elway’s presence would have been pivotal for the Baltimore Colts remaining in the city. The Colts were in the midst of six straight seasons with losing records, including the previously mentioned 1982 season. The Colts also desperately needed a new quarterback to restore their public perception due to the exploits of the quarterback who was drafted the year prior to John Elway. That quarterback, Art Schlichter, was reported to have a “six-figure tab with bookies” (Time). Nothing will alienate fans of professional sporting events like allegations of substantial gambling. During this streak of losing seasons the Colts were playing at Memorial Stadium in front of a crowd that was far from capacity level. In 1981, during an eleven game losing streak there was a game featuring 7,998 no-shows reducing the actual game attendance to 24,787 (Baltimore Sun). Memorial Stadium held 60,240 seats for the Colts home games. It is difficult for any sports team to remain profitable playing in a stadium consistently filled to less than half of total capacity. The attendance was 27, 934 for the 1983 season finale (footballstadiumdigest.com). Star players sell tickets in professional sports. In John Elway’s first season in Denver the Broncos led the National Football League with an average home attendance of 73,911, despite having a losing record that season (Chicago Tribune). Instead of attempting to locate new cities for the Colts to play in or pursuing legislation for eminent domination condemnation, the owner of the team and local officials could have been working together to find ways to spend the increased revenue brought to the city.
MEMORIAL STADIUM
The 1982 NFL strike changed the way the owners of NFL teams and players did business with each other. Benefits gained by the players during this strike period included severance pay for the first time, increases in minimum salary, pension, and preseason pay (NFL Players Association). The 1982 strike also gave players many important new advantages in the negotiation process that forced salaries across the league to increase dramatically. The most important new advantage was the ability for players to receive copies of all the contracts signed by other players in the league, which gave players accurate information when they negotiated their salaries with owners. Previously, players did not know what other players were earning playing football because contracts were unavailable. Former player and current agent Tom Condon responded to the changes by saying, “I got more than the players before me, and the players after me got more than I did” (USA Today).
Baltimore Colts owner Robert Irsay had to develop new sources of revenue to afford all of these changes in the NFL system. The city of Baltimore did not help the Colts gain the most favorable accommodations while playing at Memorial Stadium. City officials were more concerned about another Baltimore sports franchise, the Baltimore Orioles. It made more sense to Baltimore politicians to give the Orioles favorable conditions because they generated so much more money for the city than the Colts. The Orioles played more than seventy home games a season and the Colts played only six games at home a season. As a result, the contract signed between the Orioles and the city of Baltimore gave the baseball franchise “full control of all concessions for all events at the stadium in exchange for 5 percent of the after-tax revenues for the first five years of operations and 10 percent thereafter plus a further cut of 20 percent on nonbaseball concessions” (Miller 69). The owners of sports team make a significant amount of money on the concessions sold during their games. Irsay was losing a large percentage of his total profits from concessions because his team only played there six times a year. His team also had to pay a significant rental fee for the ability to play their games at Memorial Stadium.
Memorial Stadium had problems that hindered its money making potential when the Colts played there. There was not an adequate amount of available parking for patrons of these NFL games. The stadium only had 2,800 parking spots available for fans at Memorial Stadium (Miller 70). By comparison, a stadium in Milwaukee had 11,000 parking spots available for fans (Miller 70). Parking is crucial for improving fan attendance because most fans travel to the games in their car. Fans are concerned with finding a parking spot quickly and easily without having to pay a fee to park during the game. They would have been more likely to stay home and watch the game on television knowing parking was an annoyance. As a result, the sports franchise would lose money on concessions while that fan is watching the game on television instead of being in the stadium purchasing food, drinks, and souvenirs.
Fans also want to have a comfortable experience while watching their team perform. Memorial Stadium featured outdated wooden bleachers that were extremely uncomfortable. The Colts and Orioles decided to replace the wooden bleachers with individual seats (Miller 70). This move would make the fan experience more enjoyable, but it would also be a direct reason for increasing ticket prices to make up for the reduced stadium capacity caused by the individual seats being installed. Fans at the stadium also desire a great view of the playing field. The city of Baltimore saved money on the construction of the upper deck by building the higher level on concrete piers that created many viewing obstructions (Miller 70). Most importantly, these restricted views severely limited the amount of premium seating teams could offer to fans for much higher prices (Miller 70).
The Baltimore Colts’ lease of Memorial Stadium ended in 1984 during the negotiation period between Robert Irsay, the city of Baltimore, and the state of Maryland. Robert Irsay wanted a new stadium that could harness the Colts’ ability to bring revenue into the city. The city did not want to comply with the owner’s demands because of the poor attendance figures in the early 1980s. Other cities noticed the dissention between the Colts and politicians. The city of Indianapolis constructed a state-of-the-art stadium a year prior these negotiations without a tenant to use the facilities. Out of desperation, the city of Indianapolis offered Robert Irsay a wide variety of perks to bring the Colts to Indiana. These perks included a subsidized loan, attendance guarantees, and a free practice facility (Walters, Miserendino). Irsay was able to generate similar offers from other cities across the country for his franchise. In 1984, the Colts were being treated by other cities as well as the Baltimore Orioles were being treated by the city of Baltimore.
RECESSIONS
The 1970s and 1980s featured several major economic recessions resulting in many lay-offs of Baltimore residents. The first recession occurred during the first half of the 1970s. Unemployment surged from plant closures and deindustrialization (Fee, Shopes, Zeidman 236). The second recession occurred from 1981-1983 (Fee, Shopes, Zeidman 237). Manufacturing and retail outlets reduced their workforces dramatically. The grocery chain Acme markets reduced its number of employees by 1,200 (Fee, Shopes, Zeidman 236). Another grocery chain, Pantry Pride, downsized their number of employees by 4,000 as a result of the recessions (Fee, Shopes, Zeidman 236). One of the largest employers in the Baltimore region, Bethlehem Steel, reduced its workforce by 8,500 (Fee, Shopes, Zeidman 236). Most of the inner-city neighborhoods experienced an increase in their poverty rates. Journalist Mark Levine wrote an article about the increases in poverty in Baltimore neighborhoods which said “Of the officially designated neighborhoods in the city…210 (75.8 percent) experienced increases in the percentage of their residents living below the poverty line between 1970 and 1980” (Fee, Shopes, Zeidman 238).
Citizens living below the poverty line will not have the expendable income to attend Colts games. Citizens who have recently lost their jobs will stop spending money on things that are not necessities. The city of Baltimore could not help the Colts with their problems generating revenue due to the changes in federal government programs designed to assist struggling cities. Ronald Reagan’s administration stopped federal funding for these programs based on the prognosis from President Richard Nixon indicating the ‘urban crisis’ was over (Fee, Shopes, Zeidman 237). As a result, the city’s expenditures on social services for the poor fell by 45 percent during these recessions over the 1974-1982 period (Fee, Shopes, Zeidman 238). The urban crisis was far from over in the Baltimore region.
BIBLIOGRAPHY
Associated Press, "NFL Team Valuations: #15 Indianapolis Colts". Forbes Magazine. December 5, 2009
Callahan, Tom. "Sport: Two-Way Elway Gets His Way". Time Magazine Monday, May 16, 1983: http://www.time.com/time/magazine/article/0,9171,925961,00.html. Accessed December 5, 2009.
Edited by Elizabeth Fee, Linda Shopes, Linda Zeidman. The Baltimore Book. Philadelphia: Temple University Press, 1991.
Forbes, Gordon. "'82 Strike Changed Salary Dealings Forever." USA Today 08 JUN 2001, Print.
Kay, Linda. "USFL Flexing its Muscle New League Adding Another Star to the Stable." Chicago Tribune 08 FEB 1983: C3. Print.
Maisel, Bob. "Colts still lead the league in doing what it takes to lose games." Baltimore Sun 23 NOV 1981: B1. Print.
Miller, James Edward. The Baseball Business: Pursuing Pennants and Profits in Baltimore. Chapel Hill, North Carolina: The University of North Carolina Press, 1990.
Walters, Stephen J.K., and Louis Miserendino. "Baltimore's Flawed Renaissance: The Failure of Plan-Control-Subsidize Redevelopment." Perspectives on Eminent Domain Abuse 3. (2008): n. pag. Web. 05 Dec 2009.
"1980s- Era of Change." NFL Players Association. 05 DEC 2009. National Football League Players Association, Web. 12 Dec 2009.
"Baltimore's Memorial Stadium: where the neighborhood came to play football." Football Stadium Digest. 05 DEC 2009. August Publications, Web. 12 Dec 2009.
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