Renegades' minority owner ready to bail out

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CFL may be called on for support as Smith appears unwilling to answer Glieberman's call for more cash DAVID NAYLOR AND ALLAN MAKI

From Thursday's Globe and Mail

If the Ottawa Renegades operate for the 2006 Canadian Football League season, they would likely have to do so without the support of minority owner Bill Smith.

Smith, who became a partner with Bernie Glieberman last spring in a deal hatched just before training camp, is expected to resolve his interest in the club within days. And though he has been with the franchise since its inception as one of its founding partners, Smith doesn't sound ready to answer Glieberman's call for a financial commitment for the coming season.

"At this point, I'm not going to commit anything going forward," Smith said. "I have to return a call to Bernie and give him some answers from some of the conversations we've had. I have some personal and business decisions to make in a very serious timeline. I'm going to be clearer in the very near future where I'm going."

Glieberman became the 51-per-cent owner of the Renegades last spring in a deal in which he agreed to cover the club's losses for 2005, which amounted to $3.7-million. With the franchise gutted in terms of infrastructure and public confidence at an historic low, those losses are expected to be significantly higher.

Smith said he agreed to let Glieberman operate the franchise last season, but insisted he needed to see progress in order to pony up for 2006. At this point, all he sees is steeper losses.

"I think you've got to be prepared to throw in $5.5-million, maybe $6-million, to get the thing going," Smith said. "That's what I think it needs."

Smith said he has consistently expressed that opinion during the past 10 months when it came to the issue of further investment in the Renegades. But with roughly $4-million in personal losses since the franchise's first season in 2002, he's had trouble finding reasons to extend his losses.

"I'd like to see a management team in place that I was convinced could run the football operation in a responsible fashion and the business operation in a professional manner, both on the marketing and advertising sides," Smith said.

Asked what he thought of the Renegades' operation during the past 10 months, most of which occurred under former president Lonie Glieberman, who resigned two weeks ago, Smith replied, "No comment."

The Globe and Mail did not receive return telephone calls from Bernie Glieberman yesterday.

Smith's apparent direction leaves the Renegades' future in the hands of Glieberman, who is also apparently balking at the anticipated losses. Sources say Glieberman remains interested in trying to rectify things in Ottawa, but not at any cost.

If Glieberman were to walk away, one influential league suggested, the overwhelming likelihood is that the league governors would vote to fold Ottawa and play with eight teams.

Phil Kershaw, the consultant hired by Glieberman last summer to oversee the franchise, believes the majority owner hasn't lost all faith yet.

"If there's a plan that's coherent and makes some sense, he is prepared to move forward on the plan, but it has to be viable," Kershaw said. "The community wants to get behind this. They just want some evidence that they're heading in the right direction and I don't think that's unreasonable for them to request."

Among the difficulties anticipated with any plan for Ottawa is a lack of infrastructure, which includes everything from business personnel to football equipment and even an equipment manager. In addition, Lonie Glieberman's discount-ticket promotions have made it difficult for another operator to charge fair value for tickets that went for $10 in 2005.

"There's not an economic model that works," a source said. "You can't just go back to the ticket prices from two years ago and expect people to be happy."

It's expected the league may be asked to subsidize some of Glieberman's losses for the coming season in order for him to remain part of the picture. CFL vice-president Brent Scrimshaw said Glieberman spoke yesterday with CFL commissioner Tom Wright, who is on vacation in the Dominican Republic. The two are expected to meet next week, by which time Smith could be completely out of the picture.

"[Wright] has been talking to Bernie every day, which includes today," Scrimshaw said. "There's no question there are concerns related to the state of the club. Is the house on fire right now? No, because [Glieberman and Wright] are still talking."

The CFL distributed an internal memo yesterday aimed at calming fears that Ottawa may be nearing insolvency. Those fears are fuelled by concerns that the league may have to operate the Renegades this season, using up league television and sponsorship money to do so.

Some club officials were surprised by the severity of the Ottawa situation. They said they were of the belief that Glieberman would cover the Renegades' financial losses this coming season. Others insisted they knew last month that the commissioner was growing more anxious over Ottawa's ownership plight and how it could affect the other franchises.

"I'm told [the Renegades] are still signing players and doing business," one club official said. "But you have to ask yourself who's running the show there and for how long?"

Historically, the CFL has been willing to operate a troubled club. It operated two troubled clubs, in Hamilton and Toronto, during the 2003 season. However, those insolvencies occurred in midseason, leaving the league little choice. Pulling the plug on a franchise in March would allow the CFL time to set its schedule for an eight-team league when play begins in June.

The league has considered hiring the Hamilton Tiger-Cats' marketing branch to operate the ticket and sponsorship functions in Ottawa this season. The Tiger-Cats, under owner Bob Young, have become a model in sales for the league and have been taking on sports-marketing clients beyond the CFL team.

"That hasn't been finalized, but I think it's a good idea," a source familiar with the Renegades' situation said. "The club doesn't have any infrastructure, so it would make sense, but it's not final."