by Bradley Parsons
Staff Writer
The Jacksonville Jaguars are scaling back negotiations with the City in hopes that talks focused exclusively on the team’s stadium lease will produce an agreement on electronic advertising before the season starts.
The team and City officials had been seeking a comprehensive solution to disputes over advertising revenue that also would address the team’s recent run of lagging revenue. But now the team is stepping away from talks regarding possible deferrals of its rent on City-owned Alltel Stadium and revenue sharing from the stadium’s next sponsorship deal.
Team Chief Financial Officer Bill Prescott said any agreement in those areas would likely have to be reworked when Alltel’s naming rights deal expires in 2007.
“We were involved in more global negotiations, but we were concerned we would be in a position where we’d be forced to renegotiate the rent deferral and naming rights aspects in the next two or three years,” said Prescott. “We looked at it and said, ‘This global settlement isn’t going to work, so let’s focus on the things we need to deal with now.’”
The pressing issue for both the team and the City is who controls advertising on electronic ribbon boards inside the stadium on certain days when the Jaguars aren’t playing. The Jaguars’ lease gives the team control over the signs year-round and rights to the resulting advertising revenue, said Prescott. But City officials are concerned that the electronic signs could distract from fixed signs carrying sponsors’ names for games like the Toyota Gator Bowl and the annual Florida-Georgia game, making it harder for the games to attract needed big-name sponsors.
With both the City and the team strapped for cash — the City is facing a tight budget year and the team said it’s lost money two of the last three years — neither is excited about giving up the advertising revenue.
The parties had discussed an arrangement wherein the Jaguars would give up electronic sign revenue for certain games and the City would defer portions of the team’s rent on Alltel to make up the losses. The City would recoup that revenue in part through a more lucrative naming rights deal. Now the stadium sponsorship and rent breaks are removed from the equation according to Prescott and a letter from team owner Wayne Weaver delivered to the mayor’s office on Friday.
In that letter, Weaver said he wanted to focus on clearing up the signage dispute and on bringing in fans to improve his team’s financial bottom line.
“We will go back to focusing on filling the stadium with enthusiastic fans,” said Weaver. “My sincere hope is that these efforts will allow us to survive until the growth of the Jacksonville community provides a climate in which we can compete financially with the other markets in the NFL.”
A lack of ticket sales, particularly for premium seats, several blacked out home games and the financial struggles of corporate sponsors like Winn-Dixie all have contributed to drag down the team’s revenues in the past three years, said Prescott. He said the team’s revenues ranked among the bottom quarter of the NFL’s 32 teams.
Prescott said other NFL franchises receive financial backing from their home cities to keep them financially competitive with teams from larger markets. The Indianapolis Colts get $12 million a year, the New Orleans Saints receive $18 million from the city and state, he said.
The Jaguars aren’t seeking similar guarantees. But Prescott said the team needs help from the City to stay viable. Weaver’s letter went a step further. He said he was looking “for an environment in which the team can survive.”
“We understand we’re a small-market team, and we believe in that market,” said Prescott. “But what we’re saying is, ‘We need you to give us some relief to allow the market to grow.’”
Prescott said he thought a deal could be worked out before the season opener on Sept. 11 to provide the City with a “clean stadium” — one free of electronic advertising. But if a deal isn’t reached, the annual Florida/Georgia game, scheduled for Oct. 29, would be the first game impacted.
“That’s the first non-Jaguar event and that’s where it becomes an issue,” said Prescott. “That’s what we don’t want to happen, is to be sitting here in October still trying to work this out the week before Florida-Georgia.”