THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, January 21, 1996 TAG: 9601210163
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY HARRY MINIUM, STAFF WRITER
LENGTH: Long : 383 lines
Bob Smithwick is an insider's insider, working the phones, honing the angles, closing the deal. The Norfolk economic development director's credits speak for themselves: USAA Insurance, MacArthur Mall, Nordstrom.
But on a sweltering day last August, the deal-maker turned deal-killer, turning away an international concern with more than 100 employees and a payroll of $3 million.
The business, a financially ailing Canadian Football League team based in Shreveport, La., wanted to make Norfolk its new home.
Lonie Glieberman had come to Norfolk to check out the region, the largest metro area in the country without a major sports franchise - an area he had decided, sight-unseen, was the place for his team, the Pirates.
Glieberman, the team's 27-year-old president; and Bill Haase, executive vice president, had arranged a meeting with Norfolk Mayor Paul Fraim. Instead, they were shuttled into a meeting with Smithwick, who had a straight, direct message for the visitors: Get out of town.
``He told us that he didn't think the CFL would help Hampton Roads any more than the East Coast Hockey League,'' Glieberman said. ``He didn't think it would work here. He was very negative.''
Six months later, Smithwick had had his way. Last Tuesday, the Norfolk and Virginia Beach city councils, in a rare display of regional unity, rejected the Canadian league and Glieberman's team.
They denied the Pirates the $400,000 needed to renovate Foreman Field, the only regional facility that could accommodate the team. Instead, they advised, Hampton Roads should seek a major-league basketball or hockey franchise.
Virginia Beach City Councilman W.W. Harrison Jr. summed up their feelings in one sentence: ``Thank you for your interest in our community, but we have higher aspirations.'' It was an echo of Smithwick's message.
After the summer meeting in Norfolk, Glieberman and Haase returned to Shreveport, convinced they had to look elsewhere. And had it not been for a chance conversation Glieberman had with one of his consultants, the Pirates' courtship with Hampton Roads would have ended there.
The consultant mentioned a conversation he'd had with Jeff Sias, who recruits sports teams and events for the Hampton Roads Chamber of Commerce. Give him a call, the consultant said.
Sias, unaware of Smithwick's view, started courting Glieberman and his team. On Aug. 25, he flew to Vancouver to meet with Glieberman at a Pirates road game.
The discussion went well, and Glieberman agreed to meet with Sias and local leaders the following month back in Norfolk.
``We had a very nice meeting,'' Sias said. ``I was impressed with them and their commitment to the CFL and their interest in Hampton Roads. And I thought the CFL would work in Hampton Roads.''
Glieberman and his team had an image problem from the beginning. Fraim acknowledges the Pirates might be selling tickets today had they not been tarred by bad publicity. Instead of headlines about on-field action, newspapers and TV news reports buzzed with stories about unpaid bills, lawsuits, impounded cars and a league in seeming disarray.
And Glieberman, a Detroit native, turned off some with his style: He was often late for meetings and sometimes showed up tieless and sockless.
At Sias' invitation, Glieberman secretly met twice in September with a cadre of local officials - mostly Chamber and Norfolk officials and a handful of local businessmen.
Some local officials were skittish after his first September trip. But in late September they were won over by John Ritchie, chief financial officer for the financial empire of Glieberman's father, Bernie, a Detroit commercial real estate tycoon.
The polished, well-spoken Ontario native made an impressive presentation to area leaders that got the ball rolling.
Ritchie ``told us that the CFL was trying to expand to markets such as Los Angeles, Portland, Ore., and Milwaukee, and that the American teams might form their own independent league,'' said a businessman who attended the meetings and asked not to be identified. ``He said the American teams would have significantly greater television coverage, on ESPN, perhaps even CBS.
``It was on the basis of this great potential, and the personal salesmanship of John Ritchie, that the image of the Pirates changed.''
The Sports Authority of Hampton Roads, a group representing 14 area jurisdictions that works to attract sports teams and facilities, entered into a 60-day agreement with the Pirates not to deal with any other pro football team during that period.
But officials strongly advised Lonie Glieberman to touch all the bases before going public. He needed to negotiate behind closed doors with Old Dominion officials for a lease to Foreman Field. And he needed the blessing of Norfolk city officials, especially Fraim. In addition, Glieberman should meet with each mayor in the region and members of the Sports Authority.
It was advice Glieberman now admits he should have heeded.
On Oct. 24, with no lease in hand and still having not met with Fraim, Glieberman came to Hampton Roads and announced that he would soon be starting a season-ticket drive.
The next day, Glieberman, Haase and Pirates coach Forrest Gregg met with Fraim, a former college football player and coach and an avid football fan.
``I didn't know who I was meeting,'' Fraim said. ``I just knew (Chamber of Commerce officials) had asked me to meet with someone.''
Fraim was still skeptical, but his opinion changed a bit after meeting Gregg, an NFL Hall of Famer who had coached and played in the Super Bowl.
``When you bring in somebody like Forrest Gregg, that man deserves respect,'' Fraim said. ``That's what made it so intriguing.''
Later, when the team asked for just $400,000 for Foreman Field repairs, Fraim indicated he was inclined to go along with the request.
``The request was modest,'' he said. ``There seemed to be little risk.''
But then the dam burst, and Fraim and others began to see the team as a much greater risk. The Hampton Roads Sharks semi-pro team fired the first shot at the Pirates on Nov. 7, when they began their own season-ticket drive for a CFL expansion franchise.
They had no franchise, no commitment from the CFL, could not provide the name of a significant investor and admitted they were starting a drive largely to sink the Pirates. But their strategy partially worked.
``It confused the fans,'' Haase said.
Sharks owner T.J. Morgan pulled the plug on the drive four days later, but it was only a brief respite for the Pirates.
Next up: the CFL's Baltimore Stallions. On Nov. 13, the Stallions, who were being pushed out of Memorial Stadium by the NFL's Cleveland Browns, insisted they had territorial rights to Hampton Roads and said they might move to the area.
Meanwhile, the Pirates were planning to announce a season-ticket drive on Nov. 14.
``We knew all along we were coming here,'' Glieberman said. ``But when you do a ticket drive, you're much better off with fans thinking they have to buy tickets to attract a team. That produces a sense of urgency. We thought we would sell a lot of tickets, a minimum of 5,000 in the first month, with that sense of urgency.''
The urgency was lost the next day. Instead of announcing a ticket drive, Glieberman announced the team had relocated to Hampton Roads. Period. It was the only way, he said, to stave off the Stallions.
He won the battle with the Stallions: League commissioner Larry Smith said Glieberman's pronouncement gave him the rights to the region. But in doing so, Glieberman may have lost the war. Eight weeks after the drive started, the team had sold just 2,700 season tickets in spite of an aggressive advertising campaign.
``The Baltimore Stallions incident made it almost impossible to demonstrate interest from the public,'' said Brad Face, a Norfolk businessman who was one of the first to meet with and advise Glieberman.
``The 2,700 figure is meaningless. There was never a product to buy, never a schedule, never a league defined. . . . We'll never know how tickets would have sold had things not gone sour.''
Sourness and bad news continued. At four-day CFL meetings in Toronto in late November, the Birmingham and Memphis teams announced they were folding. Baltimore didn't know where it was headed. And San Antonio, the CFL's only other U.S. franchise, was noncommittal.
To Norfolk city officials, the CFL became a big question mark. And the Gliebermans weren't helping their cause.
During the Toronto meetings, word came from Shreveport that a sign company had impounded a $500,000 classic car of Bernie Glieberman's because of alleged nonpayment of debts. Glieberman's attorney was arrested allegedly trying to sneak the car out of town.
On Dec. 4, the day after the meetings, Bernie Glieberman and Smith headed straight to Norfolk. In the one-day whirlwind tour of the area, Smith pronounced Foreman Field small but fit, and the market ideal for the CFL. And he publicly urged city officials to quickly approve the $400,000.
Behind the scenes, however, negotiations were stalled. Smithwick met with Smith and asked how the CFL could succeed here after failing in Sacramento, Memphis and Birmingham. Smith didn't have the answers Smithwick was looking for.
Two weeks later, Shreveport city officials hammered the Gliebermans again. City officials said they were offering the team $1 million to return, a legal manuever intended to bolster the city's legal position that the Pirates owed them money. Officials said they were owed $1.5 million and threatened a lawsuit.
On Dec. 21, Bernie Glieberman's promise to Fraim to pay bills to Shreveport vendors by the end of the year was called into question when a document released by a Shreveport city official indicated the team would delay its payments until April.
Bernie Glieberman immediately countered that he would pay all the bills on time.
But the damage was done.
Meanwhile, Lonie Glieberman had been engaged in intense negotiations with ODU athletic director Jim Jarrett to obtain a stadium lease.
At first, Glieberman said, Jarrett offered the Pirates the same deal the city gave him for ODU men's basketball at Scope: no parking or concessions fees and a basic rent, including admissions tax, of 18 percent of the gate. Glieberman offered to pay Jarrett's rent and a portion of concessions at Scope if Jarrett would give the Pirates free rent and a portion of concessions at Foreman Field.
``Put it in writing,'' Jarrett said. The Pirates did, and ODU rejected it.
Jarrett's next offer was steep: $254,000 in rent and $120,000 in security and cleanup costs for 10 games, no parking or concessions revenues and no display of corporate signs by the Pirates.
``We knew that wasn't a serious offer,'' Glieberman said. ``We felt he had to be waiting on the OK from someone to start negotiating seriously.''
But behind the scenes, little was being done to manage the situation by area leaders. ``The lack of communication was incredible,'' said a Norfolk City Council member. ``The mayor and Jim Jarrett weren't communicating. Nothing was being done.''
Chamber of Commerce officials tried to intervene. On Oct. 26, in a private 90-minute meeting of Norfolk city and business leaders, a proposal was made to kill the team by asking ODU not to negotiate a lease. University officials had told city officials they would negotiate a lease only with the city's approval.
``We almost did it,'' said an official who attended the meeting. ``We almost killed it right there.''
Instead, the group demanded the Pirates submit a business plan, hire a local attorney and employ a local advertising firm. The Pirates complied. The group was impressed with the 100-page plan, composed by the Virginia Beach advertising agency Barker, Campbell and Farley.
``They did what we asked, but then all the news was bad, bad, bad,'' a local official said. ``The media never had a chance to talk or write about football players because they were so busy talking about unpaid bills, lawsuits and teams going out of business.''
Fraim asked Glieberman in early December to meet with every mayor in the region to build a consensus for the team. But Pirates officials didn't follow up.
``I had two meetings with them,'' Fraim said. ``I told them the (Norfolk City) Council would want them to gain some regional support for their initiative before we agreed'' to provide $400,000 to renovate Foreman Field.
``They left and I never heard another word from them.''
Glieberman met with Virginia Beach Mayor Meyera Oberndorf, but not with others. Instead, he spent most of his time working to secure the $800,000 in corporate sponsorships the team would need to break even.
Last Monday, while speaking before the Portsmouth Sports Club, Glieberman was asked a question by Portsmouth Mayor Gloria Webb, whom he had not met. She asked him when he was going to get around to meeting other local mayors.
Until that point, he said, he hadn't thought it was necessary.
``I probably was overconfident,'' he said. ``I just didn't think we had much of a lobbying job to do. We weren't asking for much, just $400,000. It wasn't like we were asking for a new stadium, and we were offering the region something it didn't have, professional football.
``I thought city officials wanted us here. That was the impression they gave us.''
Finally, in late December, the region's leaders began to move. Quietly, meetings were scheduled between Norfolk and Virginia Beach city officials. The economic development departments of both cities were asked to work together to present a recommendation to the councils.
Meanwhile, Fraim announced on Jan. 9 that Norfolk would approve renovation funding only if Virginia Beach joined in. A day earlier, Oberndorf had revealed she had doubts about the CFL. Beach City Council members echoed her comments.
Those comments accelerated the decline. Season-ticket sales, then coming in at about 35 per day, stopped. A major corporate sponsor canceled. Glieberman couldn't get HQ, his major sponsor, to return his calls.
Other Pirates officials urged Glieberman to begin looking elsewhere. He refused. ``We'll get it worked out,'' he said.
The recommendations from Smithwick and Don Maxwell, the Virginia Beach economic development director, were made to Fraim and Oberndorf on Jan. 10 at a meeting at Norfolk City Hall. Both economic directors said they couldn't support the CFL.
The region would be better off without a CFL team. Instead, they advised, Hampton Roads should build an arena seating more than 20,000, and try to secure a major league hockey or basketball franchise.
Smithwick previously had met with three ownership groups interested in bringing the CFL to Norfolk. All had been rejected.
``I've been investigating the CFL since 1992,'' Smithwick said. ``I know a lot about the viability of the league. We just didn't think it was a good risk.''
Fraim said the recommendations from the two economic development directors ``was a key factor'' in his decision.
Fraim said he still hadn't made up his mind until the next day, when he began making a series of calls to area business leaders.
Doyle Hull, a former banker and an influential member of the Norfolk Redevelopment and Housing Authority, was among those called.
``The league and the team didn't appear stable,'' he said. ``I told the mayor that.''
Fraim said he heard much the same from most businesspeople he reached. By that afternoon, a Wednesday, the decision was all but made. Fraim and Oberndorf stayed in touch by phone through the weekend and on Monday. On Tuesday, they spoke again by phone between city council meetings.
Norfolk voted in a closed-door executive session the afternoon of Jan. 16 to kill the team. The Beach followed later, then faxed copies of a press release to the media.
Glieberman was speaking at a civic club when TV stations ran with the news at 6 p.m. Later, he met with officials from Gold's Gym and closed a deal on a corporate sponsorship. He then went to dinner with friends.
It wasn't until 10 p.m., when he arrived at his Virginia Beach Oceanfront condominium, that he got the word the Pirates had been rejected.
``I've never seen Lonie so hurt and upset,'' said Haase, the Pirates' executive vice president.
The next day, ODU ended negotiations with the Pirates, effectively shutting them out of Hampton Roads.
Glieberman and members of the Chamber of Commerce, who were still supporting the Pirates, scrambled to try to reverse the decision. They called on ODU president James V. Koch, who politely responded that he would not go against the wishes of the community.
But the Pirates nearly pulled off a lease with ODU in spite of their problems with the cities. In early January, shortly after Gov. George F. Allen told The Virginian-Pilot that ODU should be ``reasonable'' in making Foreman Field available to the Pirates, the two sides nearly struck a deal.
``We were close,'' Glieberman said. ``There was a deal on the table we could have lived with.''
According to Glieberman, Jarrett gradually lowered his offer to $65,000 in rent, $100,000 for security and cleanup, offered to split concession and parking revenues down the middle and asked for 12 percent of the team's signage revenues.
One more negotiating session was all they figured they'd need to close the deal. But that was scheduled for Thursday, two days after the city councils decided the Pirates' fate.
The Pirates' last hope was Allen, an old friend of Gregg's. Allen said he was in favor of the CFL, and sources say he confided to area businessmen he was not happy with the decision rendered by the city councils. Yet, he was unwilling to go against the cities in what spokesman Ken Stroupe called ``a local decision.''
Gregg had three conversations with Allen about the Pirates, but acknowledges he never asked for the governor's help. ``I wouldn't ask him to do something like that,'' Gregg said, ``to get into a political battle.''
A local businessman, who still thinks the CFL could work in Hampton Roads, said he is furious at the Pirates for not doing more to help themselves.
``When (Glieberman) came in here and talked about a ticket sale in October, we didn't know if Foreman Field was even doable. That was a huge mistake and we told him.
``They kept getting the best of advice and ignoring it.''
Yet others say no matter what the Gliebermans had done, they probably could not have succeeded.
``By the end, the product no longer existed,'' Face said. ``The CFL's problems hurt them more than anything.''
Added Fraim: ``The instability of the league, the instability of the franchise, the Foreman Field venue, which I think really hindered the team's chances of success, were the major factors.
``When time came to make the decision, I talked to Gloria Webb, to the governor's office. We tried to get a lot of advice. It was not an easy decision, but we think it was the best we could make.''
And so the Pirates late last week began looking for a home again. They will begin a market analysis Monday of Dallas, their probable new destination.
Glieberman has begun making plans to move out of his condominium. Yet he acknowledges he's having problems letting go.
``I love this area,'' he said. ``I could have lived here the rest of my life and been happy. I really think it would have worked. I was putting down roots here.''
Glieberman was invited last month to speak to the Norfolk Sports Club on Monday. After last week's developments, club officials scrambled to find a replacement and settled, ironically, on Fraim.
Glieberman informed them, however, that he will speak after all. Fraim is expected to be in the audience.
``We'll talk about the CFL,'' he said. ``I'll answer their questions. And say goodbye.'' ILLUSTRATION: Graphic
Photos
THE PLAYERS:
FOR TWO MONTHS, THE PIRATES OF THE CANADIAN FOOTBALL LEAGUE
CALLED HAMPTON ROADS HOME. LAST WEEK, THE NORFOLK AND VIRGINIA BEACH
CITY COUNCILS KILLED THE TEAM'S CHANCES OF STAYING HERE BY JOINTLY
REFUSING TO FUND THE REPAIRS NECESSARY AT ODU'S FOREMAN FIELD.
HAMPTON ROADS CHAMBER OF COMMERCE< The organzation represents
3,000 area businesses to foster economic growth. Chamber sports
coordinator Jeff Sias helped recruit the Pirates to Hampton Roads
after the city of Norfolk initially spurned the team, and the
chamber endorsed the team in November.
VIRGINIA BEACH AND NORFOLK CITY COUNCILS
Norfolk's seven-member group, headed by Mayor Paul Fraim, was
asked on Nov. 21 to fund a $400,000 renovation to Foreman Field.
The Virginia Beach City Council, headed by Mayor Meyera Oberndorf,
was asked in late December to join with Norfolk on the decision.
Both councils rejected the request on Jan. 16.
ECONOMIC DEVELOPMENT DIRECTORS
Norfolk's Bob Smithwick and Virginia Beach's Don Maxwell, whose
roles are to bring business to their respective cities, did much to
keep the Pirates out of Hampton Roads. Smithwick opposed the team
from the beginning, and both he and Maxwell made recommendations
two weeks ago that all but killed the CFL team.
SPORTS AUTHORITY OF HAMPTON ROADS
Composed of representatives from most area cities and counties,
the Sports Authority is intended to foster the recruitment of
sports teams and construction of sports facilities in Hampton Roads.
The authority played a key role early-on in advising the Pirates,
but by January was no longer playing a central part.
OLD DOMINION UNIVERSITY
The university owns Foreman Field, and after six negotiating
sessions, was close to a lease deal with the Pirates. In spite of
intense lobbying from area businessmen tied to the Pirates, the
university pulled the plug on the negotiations on Wednesday.
THE LOCAL SPORTS COMMUNITY
Tides general manager Dave Rosenfield opposed the CFL from the
beginning, saying, ``I just don't think it would work.'' Hampton
Roads Admirals president Blake Cullen didn't welcome the
competition, but did not speak out against the Pirates. Norfolk
State athletic director Dick Price often complained that Pirates
officials never contacted him. Bill Luther, who manages Scope and
Harbor Park, advised Norfolk officials against embracing the CFL.
THE CFL'S SHREVEPORT PIRATES
The Gliebermans and their team had an image problem from the
beginning. They said they were committed to Hampton Roads, even
moved the team headquarters to Virginia Beach. But they attracted
headlines about unpaid bills, lawsuits, impounded cars and a league
in seeming disarray.
by CNB