Questions Remain with Harry Grove Stadium Lease

George Wenschhof

Today, The City of Frederick will hold another workshop on the proposed lease. Aldermen Shelly Aloi (R) and Karen Young (D) questioned various aspects of the proposed lease from The Keys during a city workshop held two weeks ago.

As a result, several minor tweaks to the lease were done, but still no attempt has been made to compare the lease offer from The Keys to the proposal offered by Frederick Atlantic LLC.

John Lavoie; managing member of Frederick Atlantic LLC, emailed me a side by side comparison of the two bids submitted to the City of Frederick.

After looking at this comparison, one can see why questions have been raised by the Aldermen.

For instance, in the capital expense section of the scoring, The Keys won by 3.0 points when their obligation was up to $100,000, but only obligated if the city matched.

The Frederick Atlantic LLC bid was for $100,000 through years 1-3 with no obligation by the city, with the money placed in a local bank account.

The overall average scoring by the city RFP review committee was 89.80 for The Keys and 80.35 for Frederick Atantic LLC.

Interestingly, the utility fees (estimated $150,000 annually) which are presently being negotiated between the city and The Keys were an obligation agreed to by Frederick Atlantic LLC.

Now, The Keys are requesting in their lease proposal, to receive the first $150,000 (now $125,000) in parking revenue to offset utility fees, whereas Frederick Atlantic offered to pay 100% of utilities.

Another question brought up in the previous city workshop was concern to the lack of "green initiatives" in the lease offered by The Keys.

This was an area in the RFP which was won by Frederick Atlantic LLC.

As to potential parking and signage revenues contained in the proposed Keys lease, it would be wise for the city to reconsider this as a revenue source.

First, the added cost of parking to attend a minor league baseball game will have an adverse affect on working families who want to take their families to see a game. As a result, this added cost would also most likely drive attendance figures down.

Second, in regard to additional stadium signage; what type of appearance will billboard advertising on the outer wall of Harry Grove Stadium present as one enters The City of Frederick?

When I emailed these concerns to Alderman Karen Young, she responded with the following:

"I agree that we should be very cautious about charging for parking. If this is about "affordable family entertainment", parking charges will defy that goal. The Keys used some very misleading assumptions in their parking revenue projection. My calculation shows $25,653 for the city. Is the juice worth the squeeze?

Furthermore, the Keys estimate over $250,000 in total income to the city. My calculation (taking out naming rights and using a more realistic parking projection) is $156,103. That's BEFORE our bond payments on the scoreboard. I am obtaining that number to get a better net income projection.

I agree with your signage observation. Do we really want to over-ride the LMC to make this deal work?"

In another email, Young indicated the projected cost for the city in 2012 to operate Harry Grove Stadium is $287,756. This figure includes operating expenses, maintenance and debt service.

She added "Unless we charge for parking and make money from signage, this contract doesn't work. I am very uncomfortable signing a ten-year contract that depends on parking and signage revenues to break even!"

In addition to the above concerns, concession sales have never been discussed, but remains an irritation to many who attend a game.

While, the cost of admission has remained low, the cost of a hot dog, peanuts and even bottled water mirrors the price one pays at Camden Yards, the home stadium for the Baltimore Orioles.

It would have been nice to see an attempt made by the city to review who manages the concessions and have been given a suggestion price range.

Jack Boehmer, in a letter to the editor which appeared in the Frederick News Post on August 11, wrote how minor league baseball is big business, adding how when he was in charge of concessions at Harry Grove Stadium 15 years ago, he took in one million in six months.

With all the questions raised, slowing down to fully understand the ramifications of the proposed lease would be prudent. Careful review and consideration by the city aldermen should take place prior to ratifying a long term lease for the use of Harry Grove Stadium.

Stay Tuned...

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