Carolinians are hungry for professional football, but hungry enough to plop down as much as $5,000 for the right to buy a season ticket?
Backers of the NFL bid in Charlotte, N.C., think so. They have submitted an unprecedented plan to the league that would finance construction of their $160 million stadium largely with a special fee assessed on season-ticket holders.
The one-time fee, which could range from $500 to $5,000 depending on the seat, would give the buyer a perpetual right to buy a specific season ticket. Once bought, the right could be sold, given away or bequeathed to descendants. The season tickets themselves, which averaged $270 this season in the NFL, would be extra.
The NFL is not sure it will work but might be willing to put it to|| TC test before awarding its next two franchises, said a source not connected with the Charlotte application who is familiar with the league's thinking.
If the plan works, it could remove what is widely viewed as Charlotte's greatest liability: doubts about its stadium and team financing. It also would be a dramatic departure from the trend of taxpayer-financed sports facilities.
The city is vying against four other finalist cities, including Baltimore, which have either public financing for new stadiums or plans to renovate existing facilities. Many analysts consider St. Louis, Baltimore and Charlotte to be among the most likely cities to get the two teams, meaning questions about Carolina's financing plan bear directly on Baltimore's chances.
In addition to St. Louis, Baltimore and Charlotte, Jacksonville, Fla., and Memphis, Tenn., are competing for two teams the NFL has said it wants to add.
The NFL rejected Charlotte's initial plan to borrow the money for the team and stadium, a bill that could top $300 million. The league feared the debt from such a plan would cripple the new team and divert to interest payments money that otherwise would be split with the teams that play against Charlotte.
The new plan involves some corporate sponsorships, possibly in exchange for naming the stadium after a corporation, but the expected revenue is small compared with the season-ticket fees, the source said.
Officials connected with the Charlotte bid will not discuss it publicly, other than to pledge that it will make the stadium accessible to fans of all economic backgrounds.
"We want a plan that will make as many tickets available at the lowest possible prices," said Mark Richardson, general manager the partnership trying to bring a team to Charlotte.
The group has promised several times to release details of the plan, only to delay doing so without explanation. A source familiar with the plan said the league's decision to delay expansion until at least next year has removed some of the urgency of completing the plan, and has allowed the Charlotte group to experiment with different figures.
At one time, the plan called for minimum fees of $1,000, but they have been scaled back to $500 in an attempt to make it more affordable, the source said.
League officials say they are satisfied with the explanation of the plan they have received from Charlotte backers. Privately, however, one league official said: "The question on the table is, 'Will it sell?' "
The league is considering allowing Charlotte to try selling the seat rights along with letting all the competing cities sell luxury boxes and season tickets before the new franchises are awarded, the official said.
Competitors are skeptical the Charlotte plan will work. It would require an unprecedented outpouring of support -- and cash -- from fans. Raising just $100 million would require selling the rights to 65,000 seats at an average of more than $1,500, for example. The stadium will hold 70,000 seats.
"I would think that is a very risky thing. It is hard enough to sell 125 sky boxes," said Pepper Rodgers, a spokesman for the Memphis bid.
Rick Catlett, with Jacksonville's effort, said a rights fee would depress the prices that could be charged for season tickets, thus reducing the amount of gate receipts visiting teams would get for playing in Charlotte. NFL tickets average $27 a game, and 40 percent of gate receipts flow to the visiting team, under NFL rules.
Herbert J. Belgrad, chairman of the Maryland Stadium Authority, said: "Our financing is absolutely secure. I think that's what distinguishes us from some of the other cities."
If Baltimore is awarded a team, a new stadium would be built downtown adjacent to Oriole Park at Camden Yards. It will be financed by bonds and lottery and stadium lease revenues.
Similar plans were used to construct other stadiums, but never on a scale like Charlotte envisions. The Dallas Cowboys' Texas Stadium was built for $35 million in 1971 and was financed by no-interest seat bonds that fans purchased along with season tickets and luxury suites that will be paid back in 2008.
The new home for the Texas Rangers, now under construction, is being partly financed by no-interest bonds required by luxury-suite renters. The bonds will be paid off through a $1 per ticket surcharge.
John McLoughlin, an expert on stadium financing with the Government Finance Group of Arlington, Va., said Charlotte's effort would be closely watched in the industry. Although the use of seat options to finance stadiums has grown more popular, it has never been accomplished on the scale contemplated in Charlotte, he said.
Far more common are taxpayer-subsidized arenas, generally backed with sales taxes or hotel/restaurant taxes, he said.