With the meeting between the Nashville Predators and representatives of the Metro Sports Authority slated for later this month, it appears that most of the issues at stake here involve how much financial information the Predators should be required to disclose to the Sports Authority, and thus the taxpayers of Nashville. At this point it appears that the boundary lines are blurry, and perhaps open to negotiation. This comes from Brandon Gee at the Nashville Business Journal:
Lease negotiations were prompted by the Sports Authority's belief that the team is in a condition of default due to a federal tax lien against lead Predators owner David Freeman. In lieu of declaring a default and seeking $50 million in liquidated damages, authority members hope to renegotiate provisions of the lease.
"I think we're in a ... position to ask for some things," committee Chairman Rusty Lawrence said.
While there are legitimate concerns here to be sorted out between the two parties, follow after the jump for a look at the real danger to Nashville taxpayers, the mind-blowing ignorance of "Rusty"...
On the one side, as a private enterprise, obviously the Preds want to keep their declarations as sparse as possible, while meeting the requirements of their lease agreement with the city.
On the other hand, the members of the city government have a duty to protect the financial interest of the taxpayers, and towards that end, they'd want to know if distress is coming, rather than find out once it's already here.
J.R. Lind at the Nashville Post outlines how the Preds ownership has been advised to keep quiet about the matter, pending these negotiations. He also provides detail on the concerns that "Rusty" is trying to address, such as tracking how the team fares relative to the $20 million net-loss provision that could trigger an escape clause in the lease.
The scariest thing here is the staggering ignorance of "Rusty", an oft-cited source of concern about this situation, thanks to his position as chair of the Sports Authority's Finance Committee. Here's a quote from his memo to fellow Sports Authority members:
Although their recorded attendance is over 14,000/game, do we know what their paid attendance numbers are???
Umm... the Predators report paid attendance data DIRECTLY TO THE SPORTS AUTHORITY ON AN ONGOING BASIS. How he could be ignorant of this fact, and actually be involved in this process, is simply mind-boggling to me. By the way, Rusty, paid attendance is averaging 13,511, as noted by John Glennon earlier this week. This is the single most talked-about measurement of the financial performance of the team, it is reported regularly to the Sports Authority, but "Rusty" plays dumb.
I've said it before, and I'll say it again - a good playoff run is the best medicine for what ails the Preds, both in the short- and long-term. It would provide a nice profit to help the team in the here & now, while loading up the bandwagon with individual and corporate ticket-buyers. Can this team do that?
That's the question we'll all be watching this spring.