Beltway ballgame

Sun Staff

Each spring the money starts flowing into the bars, restaurants and hotels around Camden Yards when the Orioles are in town.

This year, nearly 3 million people from across the region are expected to converge to see the Orioles play, pouring out of buses and cars that clog Inner Harbor streets. Many arrive early or linger to eat or play in Baltimore.

But the crowds - thinner in recent losing seasons - could soon become even thinner, producing an economic trauma for the Orioles and Baltimore.

The reason is baseball in Washington. The nation's capital has made an offer worth about $600 million to lure the bankrupt Montreal Expos to Washington. Northern Virginia is also bidding.

Major League Baseball could decide as soon as next month. For Washington fans, the offer marks the chance of a lifetime. For Peter G. Angelos, owner of the Orioles, it's a potential disaster.

Angelos says residents of Washington and its suburbs make up 25 percent of the club's fans, and he warns that a new team in the capital would be economically devastating for the Orioles.

Others say Baltimore baseball might be enlivened by neighborly competition.

But civic leaders in Baltimore say baseball at Camden Yards is an important contributor to the Inner Harbor's economic boom, an added enticement for business and convention visitors, and an important backdrop for the harbor's bustling scene.

A Washington team "would have a very detrimental impact on our city and on the region," said Donald Fry, president of the Greater Baltimore Committee, a business and economic leadership group. "I think there would be significant economic fallout in Baltimore should Major League Baseball give D.C. a third chance to prove its support for baseball."

"I dread the prospect of a team locating in Washington, D.C., proper," said Anirban Basu, chief executive of Sage Policy Group, a Baltimore-based economic and consulting firm. "If you were to cause the Orioles to become a second-rate ballclub ... that obviously is going to mean less economic activity, less spending, fewer hotel room nights, less of a reason for conventions to take place here."

Not ready for two

Basu estimates that crowds attending Orioles home games spend $2 million to $2.6 million a game, or as much as $210 million a season. "That is a big impact. You are talking about $200 million a year, most of it localized," he said.

"We have a thriving economic region, but we may not be ready to support two teams yet," said Aris Melissaratos, secretary of Maryland's Department of Business and Economic Development.

There are reasons beyond economics that the decision on a Washington team is viewed with such trepidation in Baltimore. The city's history has been marked in recent decades by a struggle to maintain its major-league standing.

Fans were jarred by the loss of the Bullets, who moved to Washington in 1973, and the Colts, who left a decade later in a surprise midnight move to Indianapolis. With great effort, Baltimore regained professional football by 1996, when the Cleveland Browns began play as the Ravens. The difficulties reflect a larger economic tide. While Washington has flourished, Baltimore has lost some of its biggest businesses, including USF&G Corp., Alex. Brown Inc., Noxell Corp. and MNC Financial Inc.

Washington looms over the Baltimore area in population, income and economic activity.

The Washington metropolitan statistical area, which stretches into the Maryland suburbs, Virginia and West Virginia, is the seventh-largest in the country with nearly 5 million people. It is about twice the size of Baltimore's metropolitan area and is growing more than twice as fast. Average personal income is 20 percent higher in the Washington area than in the Baltimore area, and employers are hiring nearly seven times faster than companies in Baltimore are.

Still, some in Baltimore view a new Washington-area baseball team as more of an opportunity than a threat.

They point out that attendance at Orioles games, even without a team in Washington, has plunged 34 percent since 1997 - the last time the team made the playoffs - and say the Orioles lack the vitality to be considered a healthy piece of the city's economic scene.

"What I am hoping is that what it [a team in Washington or Northern Virginia] will do is cause a little more competition with the Orioles to compete for a fan base," said Andy Yefko, owner of Pickles Pub, a bar next to Camden Yards.

"To do that, they are going to have to put a better product on the field," he said. "It would stimulate a baseball fan base in this area."

Dennis Coates, a professor of economics at the University of Maryland, Baltimore County who has studied the impact of professional sports stadiums on local economies, thinks the impact from a Washington franchise would be tough on the team but smaller than many fear.

"For the general population, there would be virtually no economic fallout. Not very many jobs would be lost, not a lot of income would be lost," he said.

Andrew Zimbalist, professor of economics at Smith College in Northampton, Mass., and an expert on the economics of sports, said a team in Washington might force Angelos to "tighten up his operation a bit."

He sees a "great rivalry" developing between the two teams and cities.

Not 'catastrophic'

"I think there is some fun having a baseball team in Baltimore and D.C. It is not all downward," Zimbalist said. "It is not going to be anything catastrophic."

How serious a blow to Baltimore a Washington team might deliver is not easy to determine.

A study commissioned by the D.C. Sports and Entertainment Commission and the Washington Baseball Club LLC acknowledges that 22 percent of those attending Orioles games come from the Washington area.

The study says the Orioles would lose 7 percent of their fans, about 3,100 a game. Those fans could be easily replaced if the team increased its market penetration by 10 percent, the study says.

Another study, commissioned by the Virginia Baseball Stadium Authority, which is trying to lure the Expos to Northern Virginia, predicts that the Orioles would lose 932 fans per home game, compared with 1,090 fans if the team went to Washington.

Residents of Northern Virginia, Washington and the capital's Maryland suburbs make up 13 percent of the Orioles' fans, that study says.

Losing even a fraction of those fans would mean less revenue for the Orioles and a weaker economy for Baltimore, some experts say.

A vibrant team that keeps the turnstiles spinning and concessions selling adds to Baltimore's and Maryland's tax base.

In 1992, the Orioles contributed $15.81 million in annual state and local government taxes and employed 2,343 people, according to a report by the state Department of Business and Economic Development.

Basu, who updated the study at the request of The Sun, estimates that state and local government taxes attributed to the Orioles have slipped to about $14.05 million and that employment is down to 1,828.

"By and large, the impact comes from [falling] attendance," Basu said. "A team in Washington or Northern Virginia would transform Baltimore from a large market to a middle to small market. It would mean that the Baltimore Orioles would be much less likely to be competitive in the long run."

Tickets mean taxes

Marc Ganis, president of Sportscorp Ltd., a Chicago consulting firm, said a team in Washington or Northern Virginia would slice into the Orioles' revenue, damaging Baltimore.

"I don't think there is any question about it. We have a lot of spin-doctoring going on in Washington that there will not be a lot of adverse impact on the Orioles," he said.

Orioles tickets, Ganis said, are assessed a 10 percent admission tax, and 10 percent of every ticket not sold is a direct tax loss to Maryland. Concessions and parking also generate income for the state.

"If the Orioles' revenues are ... diminished by $10 million a year ... the Orioles are going to spend $10 million less a year in the community," Ganis said. "All of that money just gets lost. Gas stations are even impacted."

John A. Moag Jr., a former Stadium Authority chairman who is now a sports investment banker, said the state will feel the pinch because its ability to pay bonds and other costs depends on Orioles ticket sales, concessions and parking.

"There's absolutely an impact on the state and the city," Moag said. "It's a direct impact in terms of revenues, and it's a substantial indirect impact in terms of the number of bodies that you have roaming through the Inner Harbor on a game day."

Opponents of a Washington team also argue that the club's revenue generated from local television, cable and radio would be cut in half, and that skybox owners and box seat holders, along with team sponsors, might flee to the bigger market.

"Some [companies] may just choose one or the other," Ganis said. "In the mind of national advertisers, it is the Baltimore-Washington market. They may find a way to split it."

Christine Turneabe-Connelly, a spokeswoman for Southwest Airlines Co., an Orioles sponsor, said the company "wouldn't want to take away from one city just to support another one. Typically, we would not rob Peter to pay Paul when both of them are very important to us."

C. Michael Zabel, a spokesman at M&T Bank, a large regional bank that has a small number of branches in Washington and its suburbs, said he doesn't expect any changes in its relationship with the Orioles. The company leases a skybox and has seats in the stadium.

"I wouldn't expect that to change if Washington happened to get a team," he said.

Still, a new Washington team would lure fans in Virginia, Washington and its Maryland suburbs.

Fans such as Gary Muren of Gaithersburg, who walked briskly through the parking lot of Camden Yards last Sunday with his wife to attend the Orioles' game against the Tampa Bay Devil Rays, would be difficult to keep.

Muren, academic director of computer information technology at the University of Maryland, University College, said that if Washington had a team and built a ballpark at the RFK Stadium site, the decision would be easy.

"I love the old RFK," said Muren, 47, who was rushing to a pregame party. "You get there by subway. You come here, parking is a big negative."

Others criticized the traffic and the quality of the team.

Joe Ganis, 69, a retired IBM employee, said he wouldn't drive the more than 60 miles from his house in Ashburn, Va., several times a year if Washington or Northern Virginia had a team.

Missing Cal Ripken

Ganis said he attends Orioles games "only because it is the only team around."

He is not happy with the Orioles' performance, either. "I miss Cal Ripken," he said.

Not every Washington-area fan would drop the Orioles.

Don Dinan, a lawyer who lives in Washington, has held six box seats with a group of friends since 1980.

Although they have talked about cutting back to four seats if Washington gets a team, Dinan would continue to attend games in Baltimore, he said.

He attends 30 to 35 games a year. On weekends, he brings his family, and they eat dinner in Fells Point or Little Italy.

"Whether we scale down from six to four, I don't know, " Dinan said. "At least in our case, we would definitely keep going. I have been rooting for the Baltimore Orioles since I was 8 years old. You don't give that up. We are American League fans; we are Oriole fans."

Sun staff writer Ed Waldman contributed to this article.

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