By Ayesha Rascoe
NYT Institute

Like a high-stakes poker game, the government of Louisiana and the state’s sole NFL team, the New Orleans Saints, are involved in spirited contract negotiations marked by bluffing and trash talking. The participants have different motives and constituencies but whether they seek to maintain office or economic gain, the one constant is that they must play the hands dealt to them.

Louisiana Governor Kathleen Blanco, a Democrat, sits on one side of the table aiming for a new contract with the Saints that would lessen the state’s financial obligations to the team. Blanco inherited the obligation from her Republican predecessor, Mike Foster, in the state’s current contract with the team, which guarantees the Saints $186.5 million in state subsidies through 2010.

The state had to borrow money last year for the team’s annual subsidies payment, and unless the contract is renegotiated before July 5, the state will have to borrow $8.25 million again to make this year’s payment.

“I believe the current deal with the team provides exceedingly generous payments to the Saints,” Blanco said in an April 27 press release.

On the other side of this contract battle sits Saints’ owner, Tom Benson, a New Orleans native. After several months of negotiations, Benson has effectively left the bargaining table. Rejecting the state’s offers for new agreements, Benson said he would like to maintain his contract through the upcoming 2005 football season.

“After much deliberation, I believe it is in everyone’s best interests to continue to operate under the existing agreement reached with the State and approved overwhelmingly by the Louisiana legislature only three years ago,” Benson said in an open letter to the public in April.

Roderick Hawkins, a deputy press secretary for the governor, said Blanco has sought a personal meeting with Benson to discuss negotiations further, but has not received a response from the Saints.

While a representative of the Saints would not comment about the negotiations, Benson told the Times-Picayune on May 24, he plans to stay in New Orleans. He also denied reports that his team was interested in moving to San Antonio. Benson added that the Superdome needs to be replaced with a new stadium so that his team can remain competitive.

Even after NFL Commissioner Paul Tagliabue announced on May 25 that he will intervene in the negotiations, it still remains unclear as to when and how this standoff will be resolved. Behind the scenes, the battle between the two sides is nothing more than a clash of the worlds of politics and business. For Blanco and Benson, their driving forces depend on the positions they hold.

“The greatest motivator for all politicians is to get re-elected,” said Gary Clark, chairman of the department of political science at Dillard University.

As elected officials, Blanco and other members of the state legislature are indebted to their constituents. Media Research Insight’s poll of 350 voters in April found that 62 percent of those polled strongly opposed the use of tax dollars to keep the Saints in Louisiana. For Republican Sen. James David Cain, who commissioned the poll, the results are cause for concern.

“I know in my heart I hope the Saints stay in Louisiana, but it’s getting hard with [issues like] health care and teacher’s raises,” Cain said. “It’s going to be hard because I know the public doesn’t want to give them any more money.”

Cain, who represents district 30, which is about 200 miles north west of New Orleans, cited regional rivalry as one of the reasons that support for the Saints does not seem to be widespread. Voters who live outside of New Orleans may not want their money to go to a team they believe does not represent them, he said.

“If Shreveport had the Shreveport Bears, would New Orleans be clamoring to save the Shreveport Bears?” Cain said. He said he wants a deal to be reached with the team, but he believes the city of New Orleans should pay for any public costs the team incurs, instead of the state.

Regional differences like these have dominated Louisiana politics for years, Clark said.

“Historically there has been a love-hate relationship between Baton Rouge, being the capital, and New Orleans,” Clark said. “It’s being manifested in the Saints.”

Clark described southern Louisiana residents as more likely to embrace a New Orleans sports team that generates millions of dollars in tax revenue as well as jobs for middle and lower income workers. He said people further north in the state are less enthusiastic about the Saints.

Senator Ken Hollis, a Republican whose Jefferson Parish district surrounds New Orleans is determined to keep the Saints in the state.

“They offer us the opportunity to be a big league city,” Hollis said. “If we lose the Saints, we will never be able to afford a team.”

Having the team allows the state to host Super Bowls, which Hollis said have generated about $400 million for Louisiana. New Orleans has hosted six Super Bowls in the Superdome since 1978, the last one in 2002. For Hollis, this economic gain alone could justify keeping the Saints.

Hollis said while the current contract gives the team too much leverage, he does not blame Benson, a businessman, for trying to maintain it.

While politicians are often concerned about the opinions of voters, Clark said entrepreneurs, like Benson, must make sure the entities they own or manage are as profitable as possible. Their constituents are not voters, but stockholders and employees.

Benson began his career as a mogul by owning car dealerships in Louisiana. According to Superdome public relations director Bill Curl, when Benson acquired the Saints in 1985 he bargained for a better contract for the team. Since then, Benson has renegotiated several times for improved contracts, according to Curl.

The 2001 deal provides the team with subsidy payments from the state on a sliding scale, with payments now at $15 million and eventually reaching $23.5 million in 2009. The team can opt out of this contract after the 2005 season but would have to pay $81 million in penalties. In 2011, the team could exit the agreement with no penalties.

Although Curl said the deal was meant to be temporary while the state explored building a new stadium or renovating the Superdome, Benson can now keep the deal until 2011 or until the state offers him an agreement to his liking.

The deal Benson rejected in April would have reduced subsidy payments in 2008 from $20 million to $14 million. Instead of the $23.5 million in 2009, 2010, and 2011, the team would receive $9.5 million, annually. Curl said the team could make up the difference in the payments with increased revenues from a renovated Superdome.

In the state’s offer, the Saints were asked to give $40 million towards the $174 million in planned renovations to the Superdome. During the recent negotiations the Saints offered to pay $17.5 million for the improvements to the stadium. The team also wanted to keep all subsidy payments the same through 2011.

As far as a new stadium, Curl said a state-hired consultant found that a new stadium would be unfeasible.

“The state does not have money to build a new stadium,” Curl said.

While the state does not have the cash on hand for this year’s subsidy payment, Curl said the government will honor its obligations. Curl said the state is looking at different options such as refinancing the Superdome’s bonds to fulfill this commitment.

With elected officials looking to boost their political favor and Benson searching for a new stadium, the two worlds have intersected.

Clark said these worlds meet everyday.

“It’s just now you’re seeing this discussion in an open arena, because politics is business and business is politics. It’s inescapable.”