Anatomy of a deal: Amarillo financial package was turning point for … – Amarillo.com

It was last fall, and negotiations with the Elmore Sports Group to bring its AA minor league San Antonio baseball franchise to Amarillo were creeping along. Its not that they were at an impasse, but something needed to be done to get talks off high center.

Wichita, Kan., with its 400,000 population and serious talks of a $60 million stadium along the Arkansas River, was an inviting suitor. So too was Amarillo, but negotiators on behalf of the citys Local Government Corp. believed they needed a buzz.

We had to create an advantage, said Alex Fairly, president of the Fairly Group, a risk management firm whose clients include Dave and D.G. Elmore among many professional and collegiate sports teams and organizations. We needed to do something they just couldnt say no to. It had to be shocking.

The plan was to not just tell, but show the Elmores how committed Amarillo was to affiliated minor league baseball and rejoining the Texas League with a new downtown stadium. The plan was to sell all the inventory in the to-be-built $45.5 million stadium.

That meant the big-ticket items of suite sponsorships, stadium and field naming rights, and Founders agreements. More than that, it meant getting these commitments in writing. Fairly said the group did its homework on the likely number of suites in a AA stadium, their pricing, lease terms and length.

Then Bill Gilliland of the Gilliland Group, who could sell manual typewriters to Bill Gates, spearheaded the effort along with Amarillo National Bank chairman and president Richard Ware and former Maxor Corp. chairman Jerry Hodge.

I said, Can we sell this? Fairly said. Bill said, Yeah, we can sell this. How much time do we have? I was in no position to give him a deadline, so I asked him, How much time do you need?

He said, Can I have 10 days? I said, Yeah, you can certainly have 10 days.

This wasnt Gillilands first fundraising rodeo. He helped lead the effort for private donations for the Globe-News Center for the Performing Arts nearly 15 years ago. The goal was to get five-year written agreements on an unspecified number of suites in an unknown location within the stadium.

It was the easiest thing I ever did in my life, Gilliland said, and keep in mind, we had nothing to really show anybody. Two or three asked me how big the suites were, and then it was, Sorry I asked. Im in.

Thats the kind of town we live in. We had $20 million raised for the Globe-News Center and no one had any idea what it would look like. People were not necessarily supporting baseball in this. They were supporting Amarillo.

Fairly and Hodge met with Dave and D.G. Elmore in the groups Bloomington, Ind., headquarters in November with something significant to show them. They had it all commitment letters for all the major sponsorships, from suites to naming rights in place.

You may have to clean up my language, but Amarillo was sucking hind teat for a while, Hodge said. I felt like we were second to Wichita and we had to somehow stay in the mix. The turning point was the financial package.

A game-changer

If the goal was to shock and create an advantage, it worked. It left the Elmores now looking hard at a city that was essentially all dressed up with no place to go. Amarillo had the voter approval and financing in place for a new stadium, but was in need of an anchor tenant.

For the last year, we had the financial model in place, Amarillo Deputy City Manager Bob Cowell said. We could have easily secured the architects, designed it and had the thing under construction.

But everyone has been clear, both previous and current councils, and both LGCs, theyve all said were not going to put that kind of money into play without definitively knowing whos going into that.

Once the Elmores received the financial package from Fairly, Hodge and Ware, the unknown team that would go into the unbuilt stadium took shape.

We have moved teams at various times in our 36-year history of owning ballclubs, DG Elmore said, and as I reflect, I dont think there is a time we have seen the level of business support like this. The suites, the founding sponsor, the naming rights, its really unprecedented. This type of support is fantastic.

The belief was at that point that ownership and the city had a deal. While no letter of intent was signed, the two sides at least had a verbal agreement.

They were shocked, Fairly said. Their comment was this had never been done in minor league baseball. No city has had everything sold before a team committed to play there.

And it was not a braggadocios presentation, but We want you to come here. We went there still thinking there was a 10 percent chance we were getting a team, but we left feeling like partners that day.

Said Gilliland: Im a car salesman, and I dont want to say there was no doubt in my mind because anything in the world can happen, but after that, my opinion was we were going to get a AA team and they (Elmores) were going to be the owners. When they came back, and gave a full report, I thought, Boy, oh boy.

But at that point, which team would come to Amarillo was uncertain because of San Antonios struggles regarding the possibility of building its own new stadium. There was a possibility at the time, a good possibility AAA Colorado Springs would relocate to Amarillo for a few years while waiting on San Antonio to figure out its stadium situation.

They put it that way, Fairly said, because they were still hopeful something would break for them in San Antonio. It belongs there. We knew if Colorado Springs came to Amarillo, it would eventually move because we are not a AAA market. We talked in detail about the transition and how the plan would look, but at the end of the day, were a AA market.

Nothing left to chance

Just to cover all the bases pun intended negotiators provided the Elmores a five-year weather report from the local National Weather Service on conditions at 7 p.m. in the spring and summer. One reason the Colorado Springs team was moving was not only altitude, where thin air causes the ball to fly and skews pitching and hitting statistics, but also cold springtime temperatures that affects crowds.

The NWS data, however, was not promising. From April through September, it showed average wind speed at more than 20 mph.

Then Jerry had the idea, you know I think its better downtown, Fairly said.

They got weather data from KVII, a stones throw from the new stadium. Its report was much more promising.

We got hour-by-hour data, Fairly said. The average wind speed was around 10 mph. They average temperature is below 90. The humidity is low. So downtown Amarillo is one of the best places in the country to play baseball at that hour. We showed we can be an incredible place to play baseball weather-wise.

Negotiations on lease terms with the subcommittee and Elmore continued into March. At this time, interim city manager Terry Childers had been fired. For most of that time, Cowell was the nuts-and-bolts point person.

Bob hadnt been part of the critical discussions, but he became so critically valuable to this deal, Fairly said. Bob Cowell probably saved this deal, honestly. If we hadnt had Bob to keep us straight on some critically important things, I dont know where we would be.

Like any negotiations of this size, there were still snags. One was paid parking, an important revenue producer for all Texas League teams. The city, to some degree, will compete with the Elmores
on parking revenue.

Amarillo will receive revenue from the adjacent city-owned parking garage, while club ownership will get money from approximately 1,000 fixed parking spots on-site at the new stadium.

I had no idea parking could be so complicated, Fairly said.

The other issue is a city tax on each ticket sold. It was finally agreed that Elmore would absorb that cost, which was negotiated at a fee of $175,000 into the lease. Exact terms of the lease will not be available for at least two weeks, but it will be the highest in the Texas League, Fairly said.

I felt great about the negotiations, DG Elmore said. I tell you, we deal with a lot of municipalities, and have rarely experienced the environment of pro-business, support and excitement about baseball that we have seen in the Amarillo community. Everyone is pulling in the same direction. Everyone wants the same thing.

When the AAA Pacific Coast Leagues executive committee in May gave Elmore permission to move Colorado Springs to San Antonios AA stadium until a new one is constructed, that paved the way for Amarillo to get its AA franchise. Negotiators could begin to let out a sigh.

Jerry and Alex were the perfect pair to put this together, Ware said. Jerrys love of baseball and Alexs connections are probably unmatched in this for any minor league city in the United States. Were so lucky to have both of them. This truly would not have happened without both of them.

It likely would not have happened without the signed commitments for major inventory six months ago. That spoke loudly, especially with Wichita squarely in the picture. Its not an exaggeration to say that Wednesdays news conference announcing the official move may not have occurred without those commitments.

Thats hard to say, but its probably true, DG Elmore said. Theres a lot of things involved in moving three teams to various cities, but its not an overstatement to say the corporate community in Amarillo, doing what they did, was a very key factor.

It was probably the clinching element that said we need to go to Amarillo. We need to do this. It minimized our risk in going to one of the smaller (AA) markets that we had a choice. We want to put baseball in Amarillo not just for 10 to 15 years, but I want my childrens children to one day head off to Amarillo for a ballgame.

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