woodbuck27
06-18-2006, 08:08 AM
Packers: Stadium funds decline
Written by PackerChatters Staff
Sunday, 18 June 2006
GREEN BAY - While the Green Bay Packers aren't struggling financially by any means - they ranked seventh in the 32-team NFL in total revenue last year - the team's renovated Lambeau Field cash cow isn't producing quite as much as it did when it opened in 2003.
That's the fiscal reality the team faced as it distributed its annual report to stockholders last week after a 4-12 season on the field and what treasurer Larry Weyers called "a fairly decent year" on the balance sheet, even though net profits fell for the first time since the stadium was redeveloped.
"Lambeau Field is continuing to do exactly what the Packers told the community it was going to do ... (But) the newness of Lambeau Field is wearing off a bit," Weyers said last week. "It's not a major concern, but anytime net profits drop, it's a concern. But it's not a big surprise to us."
Weyers, a member of the team's board of directors, is chairman, president and chief executive of WPS Resources Corporation in Green Bay. New team president John Jones was set to participate in the meeting with reporters, but was unable to after undergoing open heart surgery last Sunday.
Weyers said revenue from the Lambeau Field atrium - mainly derived from tours, the Hall of Fame and Curly's Pub and the other eateries - was down about 20 percent last year, to about $4.7 million. Sales in the robust Packers Pro Shop were up 2.3 percent, to $17.5 million, while marketing and other resources contributed $19.2 million to the team's total local revenue of $41 million.
Still, despite the drop-off, the team ranked in the upper quartile of revenue teams in the league for the first time, up from 10th last year. As a result, the team must pay $4 million into the revenue sharing model defined by the new collective bargaining agreement with the NFL Players Association.
The CBA, which was agreed upon this spring, was vital to the franchise's survival because it kept the salary cap in place and ensured continued revenue sharing, but the new model also increased the salary cap by 20 percent and requires the top 15 revenue-producers to pay into a fund that is then dispersed among the 15 lowest teams in revenue.
"We do not expect to maintain this level," Weyers said, pointing out that new stadiums are set to open in Arizona this year, Indianapolis in 2008 and New York and Dallas in 2010. "We think this is the highest we'll be in the near term."
One of the main reasons profits were down was the expense of paying the previous coaching staff, which was fired after the season. Ex-coach Mike Sherman had two years and $6.4 million remaining on his contract, and the team is paying him that amount less whatever salary he is receiving from the Houston Texans as their assistant head coach/offense.
"It's not inexpensive to change your entire starting coaching lineup. In this case, the Packers bit the bullet and changed the management team," Weyers said.
Weyers said the most important development was the team adding $17.8 million to its franchise preservation fund, which now stands at $115.5 million. Packers officials have always said that their goal was to build the fund to a level that approximated the yearly costs of football operations, which last year was $105 million, but Weyers said the team now is unsure whether one year of operating expenses is enough.
The team still has 71,500 people on its season ticket waiting list, and also has a waiting list for the luxury suites.
The challenge now, Weyers said, is to find new ways to maximize Lambeau Field's revenue-producing potential.
"You can only generate so much revenue from the given space you have," Weyers said. "We're starting to approach our maximum capabilities. Are we close to that yet? Probably not.
"We took advantage of when times were good and we were making money. Obviously the challenge we're facing now is to make sure we create new ideas, new innovations."
Source: Jason Wilde - Wisconsin State Journal
Written by PackerChatters Staff
Sunday, 18 June 2006
GREEN BAY - While the Green Bay Packers aren't struggling financially by any means - they ranked seventh in the 32-team NFL in total revenue last year - the team's renovated Lambeau Field cash cow isn't producing quite as much as it did when it opened in 2003.
That's the fiscal reality the team faced as it distributed its annual report to stockholders last week after a 4-12 season on the field and what treasurer Larry Weyers called "a fairly decent year" on the balance sheet, even though net profits fell for the first time since the stadium was redeveloped.
"Lambeau Field is continuing to do exactly what the Packers told the community it was going to do ... (But) the newness of Lambeau Field is wearing off a bit," Weyers said last week. "It's not a major concern, but anytime net profits drop, it's a concern. But it's not a big surprise to us."
Weyers, a member of the team's board of directors, is chairman, president and chief executive of WPS Resources Corporation in Green Bay. New team president John Jones was set to participate in the meeting with reporters, but was unable to after undergoing open heart surgery last Sunday.
Weyers said revenue from the Lambeau Field atrium - mainly derived from tours, the Hall of Fame and Curly's Pub and the other eateries - was down about 20 percent last year, to about $4.7 million. Sales in the robust Packers Pro Shop were up 2.3 percent, to $17.5 million, while marketing and other resources contributed $19.2 million to the team's total local revenue of $41 million.
Still, despite the drop-off, the team ranked in the upper quartile of revenue teams in the league for the first time, up from 10th last year. As a result, the team must pay $4 million into the revenue sharing model defined by the new collective bargaining agreement with the NFL Players Association.
The CBA, which was agreed upon this spring, was vital to the franchise's survival because it kept the salary cap in place and ensured continued revenue sharing, but the new model also increased the salary cap by 20 percent and requires the top 15 revenue-producers to pay into a fund that is then dispersed among the 15 lowest teams in revenue.
"We do not expect to maintain this level," Weyers said, pointing out that new stadiums are set to open in Arizona this year, Indianapolis in 2008 and New York and Dallas in 2010. "We think this is the highest we'll be in the near term."
One of the main reasons profits were down was the expense of paying the previous coaching staff, which was fired after the season. Ex-coach Mike Sherman had two years and $6.4 million remaining on his contract, and the team is paying him that amount less whatever salary he is receiving from the Houston Texans as their assistant head coach/offense.
"It's not inexpensive to change your entire starting coaching lineup. In this case, the Packers bit the bullet and changed the management team," Weyers said.
Weyers said the most important development was the team adding $17.8 million to its franchise preservation fund, which now stands at $115.5 million. Packers officials have always said that their goal was to build the fund to a level that approximated the yearly costs of football operations, which last year was $105 million, but Weyers said the team now is unsure whether one year of operating expenses is enough.
The team still has 71,500 people on its season ticket waiting list, and also has a waiting list for the luxury suites.
The challenge now, Weyers said, is to find new ways to maximize Lambeau Field's revenue-producing potential.
"You can only generate so much revenue from the given space you have," Weyers said. "We're starting to approach our maximum capabilities. Are we close to that yet? Probably not.
"We took advantage of when times were good and we were making money. Obviously the challenge we're facing now is to make sure we create new ideas, new innovations."
Source: Jason Wilde - Wisconsin State Journal