<p>Craving Cash , Teams Ask Ticket Holders to Pay Twice By Sam Walker </p><p>07/20/1998 The Wall Street Journal Page B1 (Copyright (c) 1998, Dow Jones & Company, Inc.) Five years ago, Michael Richardson wrote a check to the Carolina Panthers for $7,200. His money helped build a new stadium for a National Football League franchise, and guaranteed him the right to buy season tickets forever. It was a happy marriage, until the team lost nine games last season. When the pharmaceutical salesman tried to sell his two "permanent seat licenses," he discovered that nobody wanted to buy them -- even for a $1,200 discount. "It's like a pair of handcuffs," he says. From Pittsburgh to Seattle, pro sports teams are toying with a burgeoning way to raise funds for stadiums: charging a fee for the "right" to buy season tickets. But the system is already causing an uproar among the most loyal of sports customers, pricing some fans out of the market and leaving others feeling cheated. License holders still have to pony up for the cost of season tickets each year -- $320 apiece in Mr. Richardson's case. And if one year they choose not to, and they can't find anyone else to buy their license, the consequences are severe: the team revokes it. "They're forcing fans to commit to a contract with no end," says Dean Bonham, a Denver sports consultant. "In the long term, it's going to produce angry fans and empty seats." By decade's end, at least 20 teams in pro hockey, baseball and football are expected to switch to the new system, which requires payments ranging from $250 to $25,000 for seat rights that in some cases never expire. The NFL has been the most aggressive, with a half dozen teams already charging the fees and raising about $400 million in the process. Their argument: Teams can't compete without modern stadiums with luxury seating, but taxpayers in many cities are reluctant to foot the bill. "If it wasn't for the licenses, we'd have no ballpark, period," says Larry Baer, chief operating officer of the San Francisco Giants, which has sold $55 million in licenses so far toward a new but unbuilt stadium that persuaded the team to stay. "For us, it was a matter of life or death." A glitzy new stadium rose in Charlotte, N.C., thanks in good part to 60,000 Panthers fans paying as much as $5,400 each for seat licenses. Together, they raised $130 million, which was supplemented by a relatively small $70 million public land donation. But after a season in which the team lost six of eight games at home, the classified ads in Charlotte are jammed with sellers, some of whom say they have been trying to unload their seats for months. The same problem bedevils fans in St. Louis and Baltimore, where resale markets for licenses are sluggish. In Oakland, Calif., which used the licensing strategy to pay for renovations to its stadium and lure the Raiders NFL team back from Los Angeles, sales of seat licenses have fallen short of projections by about 20,000. That has sent the city scrambling for funds, and prompted a lawsuit and a grand jury inquiry. Fans in other cities have also resisted the idea. When the Cincinnati Bengals offered seat license agreements for a new NFL stadium, about 20% of current season ticket holders didn't buy them -- even with a relatively low average price of about $500. In September of last year, the Montreal Expos began selling licenses for a new baseball stadium, but have sold less than 25% of them. The Expos say their goal is to sell all 18,000 by 2001. "Licenses are never greeted with enthusiasm," says Don Schumacher, a consultant handling seat-license sales for the Bengals. Still, he argues, there is no fairer way to limit the burden on taxpayers than to levy what amounts to "a voluntary tax on football fans." Nevertheless, there is no shortage of seat-license horror stories. Ever since Carlo Vecchiarelli spent $4,000 for a pair of seat rights to Raiders games at the Oakland Coliseum, he has endured a series of frustrations. First, the license glut rendered his investment valueless. Then, when he found his 50-yard line seats in the renovated stadium, they were so close to the field that the players on the sideline blocked his view. It took a barrage of phone calls and most of the season, he says, for the Raiders to move him. "We did have some glitches, but we've worked them out," says Richard Rogers, president of the Oakland Football Marketing Association, which is responsible for ticket sales. Still, after last year's season, in which the Raiders won four games and lost twelve, Mr. Vecchiarelli, a 56-year-old college dean from Pleasanton, Calif., says he will have to drive to the stadium most Sundays to scalp his tickets at a discount. "I'd never buy them again," he says of the licenses. "It was a dumb move." When Steve Bell, a Baltimore accountant, decided to move, he called the Ravens and asked the NFL team to consider buying his pair of $1,000 licenses back. "They told me I was on my own," says Mr. Bell, who hasn't found a buyer yet. "I am not a happy customer." Roy Sommerhof, ticket director for the Ravens, says the team will help line up buyers for people like Mr. Bell, but that is about all. "He signed a contract," Mr. Sommerhof says. Mr. Bell is lucky in one sense -- he was able to afford licenses in the first place. Jim Scott attended Cleveland Browns games for 26 years before the NFL team moved to Baltimore, but he won't be in the stands when the city's new Browns franchise debuts in 1999. In their new stadium, licenses for the 35-yard-line seats Mr. Scott once bought will cost $3,000, plus $65 a ticket per game. "We make $40,000 a year, and we can't afford tickets unless we sit in no man's land," says the 45-year-old truck driver from Euclid, Ohio. "I used to be a big football fan, but I've soured on it lately." Bill Futterer, the president of the new franchise, says fans have been treated fairly. When the team offered longtime season-ticket holders discounts from 10% to 50% off the price of licenses, he notes, 87% of them bought in. Teams say the seat-license system has its benefits. Charlotte sports consultant Max Muhleman, who helped develop the concept in 1993, notes that license revenue covered more than half of what the Carolina Panthers contributed for their new stadium. Were it not for seat licensing, he says, the city never would have landed its NFL franchise. And when teams that have sold them start winning, he says, "nobody will be complaining." What is more, say some officials, fans who gripe about depreciating licenses should read the contracts they signed. People weren't supposed to buy these as short-term investments, says Carolina Panthers spokesman Charlie Dayton. "They were supposed to be in for the long haul." Some teams, like the Arizona Cardinals, have promised never to sell seat rights. But even teams with established winning traditions and sold-out stadiums, like the NFL's Pittsburgh Steelers, are considering license programs. And other teams are selling seats for shocking sums: A license to the elite "club" seats in the Seattle Mariners' new ballpark -- currently under construction -- will cost as much as $25,000 for 20 years. --- Squeeze Play Pro sports teams are increasingly charging fans for seat `licenses' that carry the rights to buy season tickets. A sampling:</p><p>Licenses Sold The Lowdown St. Louis More than Sales helped lure team from Rams 50,000 Anaheim, but license rights expire after 30 years. Cleveland 41,000 Helped return football to Browns Cleveland, but some diehards have been priced out. Oakland 31,700 Market so slow, team has Raiders begun selling tickets without licenses. San Francisco 13,000 Raised $55 million for new Giants ballpark but program only applies to best seats. Montreal 4,000-5,000 Team wants a new ballpark, Expos but needs to sell 18,000 Toronto Maple Not yet on Licensed seats will cost Leafs sale about $10,000 plus about $1,700 annual `club membership' fee. Source: WSJ Reports</p>