Sports Close-Ups, Daily Racing Form, 1957-06-26


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naii iMinriinrn i i SPORTS CLOSE-UPS By ha Seebacher NEW YORK, N. Y., Jurie 25.— George V. McLaughlin, a director of the Manufacturers Trust Co., former New York City Police Commissioner and present and present i vice-chairman of the Tri-Bor-ough Bridge Authority, has come up with the latest plan for saving baseball in New York. This one is a dilly! Briefly, Mr. McLaughlin proposes a private financing deal of ,000,000 to buy a franchise. Once a new club CIUO has lldS been OCtill created, UlCittCU, naii iMinriinrn i i club CIUO has lldS been OCtill created, UlCittCU, the city will then build a new stadium by floating a second bond issue from eight to ten million. If its own land is used, eight million would suffice. Ownership of the club would be on a non-profit basis with future profits going to developing baseball and athletics. The players would participate in this, too, besides their present fringe benefits. Also, the city would give the stadium rent-free to the new club until half of the privately-floated debenture bonds used to buy the franchise had been paid off. The debentures, however, would have to be retired in 10 years, meaning the club would amortize the debentures at the rate of 00,000 a year plus the interest on the outstanding bonds. This, we are asked to believe is a practical package, a businessmans risk and not • a slicky deft dodge for unloading the biggest white elephant on New York in its entire history. AAA Judging from the" records of some of the clubs, the risk is atrocious. Philadelphia, Pittsburgh, Baltimore and Kansas City and the predecessor clubs of whose earnings go back less than five years, have been in the red each and every year since 52. Not one of them could have undertaken such a financial load as McLaughlin proposes. How about the wealthy clubs? The Dodgers have the best five-year record in the National League, having made ,860,714 in this period, an average of .60,000 a year. The Braves averaged higher in the past four years but lost a half million in 52, their last year in Boston. What chance, then, has a club starting off under the obligations Mr. McLaughlin outlines? First, it would have to pay the interest on the ,000,000 at 4and per cent — perhaps higher. That amounts to a minimum of 25,000 a year in interest alone on the ,000,000 which of course has to be amortized by at least half before the city gets so much as a red cent in rental on its 0,000,000 stadium. Supposing, for arguments sake that by some miracle the new club could amortize this ,500,000 in five years. That would mean paying off 00,000 a year. In five years to bring down the loan by half would cost 00,000 in interest and ,500,000 in principal, a total of ,400,000. This is a huge expense, mind you, without a single penny for rental. AAA Supposing, however, the new club could meet this suicidal nut. What about the city in the meantime? It will have a 0,000,000 debt vihich will cost, in interest compounded annually for five years ,461,-819.37. Who is going to pay that amount to the bond-holders while the club is oc- cupying the stadium rent free for five years. What if the club cannot amortize half its private debt in five years — or tenor 20? That means the city goes right on paying the interest of 50,000 on its 0,000,000 bond issue each and every year. And happy thought of thoughts, what about that final millenium when the club itself undertakes to meet this almost half a million a year in interest on its stadium debt, put aside additional money for retiring the stadium issue and, thirdly, pay_the city something more than a token payment for its occupancy of the stadium? AAA Perhaps Mr. McLaughlin, so long aware of the revenues, real and potential, of a ball club, can explain just how any club starting with as much of a burden as he proposes for this club, could ever work out [ of hock. The Dodgers, Yanks and Braves combined, couldnt pull enough fans to meet this debt. His plan would wind up costing the city both in loss of taxes and in interest payments so very much, we could wind up building bridges across the Hudson at every five blocks. Lets stop kidding ourselves and admit that building a new stadium for a club capable of drawing in the neighborhood of only a million admissions a season is Continued on Page Forty-Two SPORTS CLOSE-UPS By IRA SEEBACHER Continued from Page Two not a good investment. And who says a new club with all the costs and woes of building into a gate attraction is going to draw anything like a million people a season? The Giants cant do it and, for better or worse, they are an established club with no sensational overhead such as is suggested for this dream of McLaughlins. And, horrors of horrors, Mr. Robert Moses is quoted as calling this the "first intelligent, honest, realistic appraisal of the basic issues." If all that double talk constitutes Mr. Moses indorsement of the plan, its time* we all move to Los Angeles or San Francisco..

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