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Posted at 11:08 AM ET, 10/26/2011

A few minutes with D.C. United President Kevin Payne, Part 2

Today’s hot topics with D.C. United President Kevin Payne: the club’s financial challenges, the lease at RFK Stadium, the seemingly endless pursuit of a new venue, temporary stadium options, Baltimore’s interest, supporters’ anxiety, United’s diminishing place in the MLS hierarchy, owner Will Chang’s commitment and frustration.

“I don’t think he’s very happy about what this is costing him. When I say things like ‘the current deal at RFK is unsustainable as a business,’ at the end of the business is a person who is writing big checks. There is a point at which he’s not going to write those checks.”

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What’s the state of the club’s finances?

“It’s a struggle for us here at RFK. We have the highest expenses and lowest revenue.”

Can you renegotiate the lease?

“We’re talking to EventsDC [which manages the stadium]. We’ve always had a good relationship with them. I think they recognize our situation. We’re hopeful we can reach an agreement that makes more sense and allows us to remain here. It’s about the amount we pay and the amount we make here. Compared to the average team in our league, the combination of expenses and revenue, we’re about $2.85 million worse per year: about $1 million more in expenses than the average MLS team and about $1.85 million less in revenue. It’s a lot of money.”

How long can you keep going at that rate?

“We can’t.”

What if EventsDC isn’t willing to alter terms of the lease?

“I don’t want to get into a confrontational thing in the media. I think they understand it’s not a sustainable business model for us and we’ll have to seek alternatives.”

What alternatives are there?

“You can name them.”

FedEx Field, Navy, Maryland, UVA, Baltimore...

“I don’t think UVA is an alternative.”

Have you had conversations with any of those “alternatives?”

“We’re doing what we need to do to make sure that we have a viable business going forward.”

Have the Redskins approached you or have you approached the Redskins?

“No, not that I’m aware of.”

The University of Maryland athletic department has a substantial operating deficit. Have you spoken to them about playing at Byrd Stadium?

“I’m not going to get into who we have or haven’t talked to.”

[Sources tell the Insider that Maryland is aware of United’s situation and that “very informal and very preliminary” conversations have taken place. United wouldn’t move permanently into a university stadium but would explore a temporary option with a more favorable lease than RFK’s until a facility of its own is built.]

Where do things stand with Baltimore?

“We’re not hiding anything. We are trying to work through some issues with the District and we are having conversations about how to get something in the District, but we’re having those same conversations with Baltimore. I’m not sure I want to categorize it, but the state of Maryland, Maryland Stadium Authority and city of Baltimore know how to do this. They’ve done it successfully. They have a process. It’s a pretty straight-forward process.”

There’s a huge risk moving to Baltimore. You would leave behind most of your fan base and you would essentially have to start from scratch in a smaller market.

“If we get to that point, there certainly are issues for us to consider, but right now we’re trying to understand where the best stadium opportunity is for us — which locale is able to commit to us first.”

Fans are waiting. They’ve heard all the rumors, rumblings, false alarms. So should they expect something soon?

“I hate to put a date on things. It’s not like we’re not working on this, but it’s not easy. It’s complicated. And it’s not something that lends itself to being negotiated in the media. I know it’s frustrating for our fans, but trust me, it’s a lot more frustrating for us. We’re doing the best we can. We’re pushing as hard as we can. I think everyone is dealing in good faith. We certainly hope we have some resolution sooner rather than later, but I’m not going to put a time on it.”

You’ve been pursuing a stadium plan for a long time. Meanwhile, Houston’s stadium is going to open next year. Kansas City moved into a new stadium this year. Most of the teams around the league are playing in a new or renovated stadium. What makes this situation so different that you haven’t been able to get a deal done?

“We spent a lot of time and effort on Poplar Point [park land across the Anacostia from Nationals Park]. Through no fault of our own, the District and the federal government haven’t been able to reach agreement on the land transfer, so we had to start over again. We probably wasted time in Prince George’s County [Maryland], in retrospect, and then had to start over in D.C. At the same time, we were contacted by Baltimore. Houston spent quite a bit of time on it too and frankly the resources of AEG are the reason they were finally able to say, ‘We’re going to do it.’ We’re not in that position. We’re not Red Bull. We’re not Kansas City, which got public financing for their stadium.”

So have you lined up additional investors to join Will Chang?

“We are having conversations with several different groups or individuals about investment in the team. There is certainly a connection with a new stadium because nobody wants to buy into the team if we are going to remain here at RFK. The groups are all saying essentially, ‘We want to see that there’s a pathway to a stadium. We don’t necessarily have to have a deal done.’ We’re hoping we’re getting closer to that.

How many groups or individuals are you talking to?

“There are at least three conversations going on right now. They all have at least local ties. They’re not all 100 percent local.”

Wizards/Capitals owner Ted Leonsis’s name comes up every few years connected to D.C. United. Have you spoken with him?

“I’m not saying anything about who we are or aren’t talking to.”

Is Will Chang in this for the long haul or is he losing patience with the financial and stadium situation?

“I don’t think he’s very happy about what this is costing him. When I say things like ‘the current deal at RFK is unsustainable as a business,’ at the end of the business is a person who is writing big checks. There is a point at which he’s not going to write those checks.”

Have you gotten to that point?

“No, but we certainly have put a lot of strain on him. We want to relieve that. So I think Will is deeply committed to D.C. United – has been and is.”

There is a fear that, the longer this drags on with the lack of new investors and the stadium frustration, Will is going to say he’s had enough.

“That’s not something I am going to speculate about.”

So as far as you’re concerned, he is committed?

“I know he is committed.”

Everything seems to be moving in the right direction at the league level with new clubs, rising attendance, the new TV deal. Do you feel your club has fallen behind most of the others?

“I can understand why people would say that. We still do a lot of things very well. We still have an incredibly loyal fan base. There’s no question that the uncertainty about our stadium situation is really damaging. People would more readily accept RFK if they had a clearer idea of how much longer and what the future holds. It’s frustrating to be in this position. We certainly don’t think of ourselves as anything other than one of the top organizations in the league, but by some objective measures, right now we’re not.”

By  |  11:08 AM ET, 10/26/2011

Tags:  D.C. United, MLS

 
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