2003 - 2004
September 13, 2003
City takes charge of Generals franchise
Officials took over the team without a written agreement with team owners.
BY MATT WILLIAMS
GREENSBORO - The city of Greensboro has taken over all operations of the privately owned Greensboro Generals minor-league hockey team, agreeing to pay the team's payroll and other expenses in exchange for any money the team generates.
An agreement, not yet formalized in writing, calls for the city to assume all responsibilities from team managers Don Brady and Bill Black, Greensboro businessmen who themselves have leased the franchise from an ownership group led by local attorney Art Donaldson.
Assistant City Manager Mitchell Johnson said that, according to the deal's initial terms, the city-owned Greensboro Coliseum would pick up the entire cost of fielding the team - including player salaries - and collect all the revenues from tickets, concessions, advertising and parking.
The exact costs and projected revenues are not yet known. Since the team is privately owned, its previous finances have not been disclosed.
The city is taking a risk in running the franchise, but the coliseum has to operate like a business, Johnson said. "We're running the team and we're going to take a hit if it isn't successful," Johnson said, adding that the city has the option to drop the team if it doesn't turn a profit. "If the thing doesn't work out, then we'll be firing people."
The arrangement never went before the City Council in a public meeting. Individual council members say they were told informally about broad terms of the deal, and they have generally supported the plan.
City officials say the move was made to keep the team from going out of business. Officials say the coliseum had more to lose by letting a major tenant leave than it will spend to run the team. The Generals are scheduled to play 36 home games in the coliseum for the 2003-04 season.
Coliseum director Matt Brown moved forward with the plan starting in July, putting at least four former Generals employees on the city's payroll, including the team's coach. Brown himself is listed on Generals news releases as the team's chief operating officer.
The Generals franchise is still owned by Donaldson's group. In June, Donaldson agreed to lease the team for $1 to Black, a Greensboro car dealership owner, and Brady, owner of Brady Trane.
Black confirmed that he was working on an arrangement with the city, saying that he essentially turned over the team to the city for the season. During that time, Black said he hopes to find investors to buy a new hockey franchise to replace the Generals.
Brown declined to speak with a News & Record reporter, but told editorial page editor Allen Johnson that he expects the city to at least break even this year. Brown said that investors, led by Black, would pay up to $200,000 if the franchise loses money.
But Black said he had yet to sign up any investors because he hadn't filed incorporation papers for the investment group.
When asked what would happen if the team lost more than $200,000, Brown said he had a "backup plan." He declined to elaborate.
The future of the team is complicated by a strike of the league's players. East Coast Hockey League officials say they are continuing to negotiate an agreement, and Brown said he is confident the strike would be lifted by the beginning of the season, which starts Oct. 17.
When asked whether Brown could move forward to pay the team's expenses before the city had reached a written agreement, City Attorney Linda Miles said Brown had to hire a coach in time for the season and was acting in the best interests of the coliseum.
Adduono is being paid $56,350 over an 11-month contract. Human Resources Director Patsy Burks said an original salary of $61,464, posted on the city's payroll, is an annual figure and incorrect.
Mayor Keith Holliday said council members were privately consulted in July about the arrangement but not given specific details. Holliday said he couldn't remember whether the council voted to approve the deal, but assistant City Manager Mitchell Johnson said the council action wasn't legally required anyway.
Holliday supports the deal, saying it is an important step to keep the Generals in the city.
"We knew there were going to be expenses, including salaries," Holliday said. "This was our best chance of having hockey."
Council member Tom Phillips said he also backed the arrangement.
"I don't have a problem with it," Phillips said. "It's a business."
Council member Florence Gatten also said she supports the deal.
Marc Bush, president of the Greensboro Sports Commission, said he can understand why the city would invest in running the team to keep it in the city.
"I don't see what they are attempting to do for the Generals as a problem," Bush said. "I view it as an understandable and justifiable and good business decision for the city."
Joe Brown, the coach and general manager of Greensboro's professional soccer team, the Dynamo, said his team wasn't as lucky as the Generals in getting help from the city. Economic difficulties meant that his team dropped into a lower league class to save money. Joe Brown said the city hadn't approached him about helping his team.
"We didn't know there was an opportunity to help us," Brown said. "If the Dynamo knew of this opportunity, we wouldn't have to drop a level."
The franchise, which at 12 years is the oldest team in the city, has operated without assistance from the city, he said. The team raised money to build its own stadium in Bryan Park, which was donated to the city. He said the city should either help all of the teams or none of them.
"You can't support one and not support the other ones," Brown said. "I have to Pay taxes for a competing business in the marketplace."
Contact Matt Williams at 373-7004 or firstname.lastname@example.org