Former Stadium Authority chair: Bad faith should not be rewarded
By Thomas Kelso
The writer was chair of the Maryland Stadium Authority from 2015 to 2023 and chair of Gov. Larry Hogan’s reelection campaign.
In the late summer and fall of 2021, Maryland Stadium Authority leadership and I had meetings with Gov. Larry Hogan (R), House Speaker Adrienne A. Jones (D-Baltimore County), Senate President Bill Ferguson (D-Baltimore City), then-House Appropriations Chair Maggie McIntosh (D-Baltimore City), and Senate Budget Chair Guy Guzzone (D-Howard) to try and advance the concept we had developed for an evergreen stadium funding bill.
During these meetings there was enormous skepticism expressed about this concept, not least of which was the amount we were proposing. But the greatest concern was whether the Ravens and Orioles supported the bill because the bill had zero chance of advancing if the teams were not fully onboard and committed to it.
What became known as House Bill 896 in the 2022 legislative session allowed the Stadium Authority to issue up to $600 million of bonds at any one time for each team to be used for stadium upgrades to enhance fan experience and to extend the useful lives of the stadiums. This bond limit is evergreen, which allows the authority to issue new bonds as the old bonds are paid down. This allows for the stadiums to receive capital investment more frequently than once every 20 to 30 years which is critical as stadiums age.
If there is capacity under the bond limit, there is no requirement that the teams contribute any money of their own — a highly unusual situation in professional sports today.
The only requirement for the teams to qualify for additional capital in the future is the underlying lease will need to be extended at least as the longest outstanding bond. In meetings with me, Stadium Authority leadership, leaders in the legislature, and the governor, both teams assured everyone they were excited by this bill and in full support. It was clearly understood that there would be NO additional stadium funding outside of this bill.
Had either team shown any hesitation about this deal or indicated they wanted more, the bill would not have received Governor Hogan’s support, or support from legislative leaders.
As expected, once the bill was passed and executed by the governor, the Orioles began plans to enter detailed lease negotiations. Through both written and oral communications, it seemed clear to Stadium Authority leadership and me that they were intent on getting a new agreement by the end of 2022.
In August of 2022, the Ravens also expressed their desire to move forward with a new lease. We were prepared to negotiate both leases simultaneously, incorporating the stadium funding bill into each.
The Ravens followed through on their desire for a new lease and it was approved by the Board of Public Works on Jan. 4 of this year. During the negotiations, the Ravens asked for no additional funding.
The Orioles never fully engaged, and I began to hear feedback from Orioles’ leadership that they felt the $600 million was not enough and they could get even more if they waited for a new administration in 2023.
The Orioles list of additional wants included in the memorandum of understanding between Gov. Wes Moore (D) and team owner John Angelos includes the full benefit of the $600 million plus:
- complete control over how the $600 million is spent through elimination of the Stadium Authority’s statutory role in making sure the stadium is maintained in a manner designed to extend its useful life;
- elimination of Authority-run procurements and the resulting protections for Minority Business Enterprises and prevailing wage through the dismantling of Authority’s statutory role in owning and maintain Camden Yards;
- elimination of the Board of Public Works’ role in approving how state dollars are spent;
- a development agreement that essentially gives the Angelos family control of a significant portion of the Camden Yards complex for 99 years (even if they sell the team);
- a below market rent on the development properties and no upside for the state while leaving it with all the downside risk; AND
- more money through at least a $100 million operating subsidy over thirty years.
The result of this giveaway is a reward to the Orioles for operating in bad faith. It gives control of how Oriole Park is maintained to the Orioles. As their number one goal is profit, they would likely spend less than they would under the original lease. What could possibly go wrong?
Eventually, taxpayers will be on the hook for reversing the effects of deferred maintenance. The high standards for maintenance required by the Stadium Authority will be a thing of the past.
A bad lease the state is stuck with for 30 years which contains workarounds like the leasing of Stadium Authority employees to the Orioles will prove far worse than an extension of the current lease.
The pause in negotiations provides time for the governor, legislative leaders, members of the Board of Public Works, and the members of the Maryland Stadium Authority board to stand up to Mr. Angelos and tell him no.
Tell him that those who are sworn to protect the interests of Maryland and its taxpayers will not reward bad faith. Major League Baseball Commissioner Rob Manfred has been 100% clear that the league will not allow the Orioles to move as they understand the incredible generosity included in the stadium funding bill and appreciate that Oriole Park is the #1 stadium in baseball.
In developing and passing the stadium funding bill, the state acted in total good faith. The Ravens upheld their end of the bargain and now we should demand the Orioles uphold their end as well.
Editor’s Note: This commentary was updated to remove an incorrect attribution to Orioles’ lobbying representatives.