CINCINNATI — Nearly four months have passed since the Cincinnati Bengals signed a deal with Paycor HCM Inc. over naming rights to the stadium once named for Paul Brown.
In the weeks that followed, city officials approved new signs for Paycor Stadium. And the team and Paycor officials held a ribbon-cutting ceremony to christen the new name and the 16-year-sponsorship deal.
Yet Hamilton County, which owns the stadium, is still unaware of the financial terms of the deal and can’t verify if taxpayers will get a share. The county has not approved the name change or the new signage, as officials continue to push for that information.
“The county has requested that the team fully disclose the financial terms and conditions of the naming rights agreements to ensure transparency given the terms and conditions of the county-Bengals’ lease,” said county spokesperson Bridget Doherty.
WCPO requested communications and documents from the county about the naming rights deal. While many emails were redacted as attorney-client privilege, some reveal tension over the lack of information.
“This is (XXX). More conversations necessary,” Tom Gabelman wrote in an Aug. 22 email to county officials, that was partially redacted to WCPO.
Gabelman, who is the county’s outside attorney and consultant on riverfront development, was referring to an attached two-page letter the Bengals provided from accounting firm Clark Schaefer Hackett which stated that taxpayers would get zero revenue from the naming rights deal.
The Bengals gave financial details of the deal to the accounting firm so it could conduct an independent analysis.
“The county must independently verify the terms and conditions of the naming rights agreements, including importantly, the financial terms and conditions on behalf of the county taxpayers. This is to be expected given the public funding and public ownership of the stadium,” Doherty said.
But Aaron Herzig, an attorney for the Bengals, said the team has given the county plenty of information, including allowing five different county attorneys more than 16 hours to review the naming rights agreement, except for some proprietary financial terms.
Herzig said the naming rights deal has a confidentiality agreement that contains the team's competitively sensitive information. But that’s not how county officials see it.
“The county understands that the confidentiality provision within the Bengals- Paycor naming rights agreement provides a specific exception with respect to the county in recognition of the county’s rights arising under the county-Bengals lease,” Doherty said.
The county also asked the Bengals to provide its sponsorship agreement with Kettering Health, “with respect to the indoor practice facility,” according to an Aug. 22 email from Gabelman.
The Bengals have also declined to provide that agreement to the county, Doherty said.
The Bengals signed a 10-year partnership with Kettering as the team’s official healthcare provider, which provides in-stadium care at five clinics throughout the stadium, according to a May press release.
Integrity Express Logistics is the official logistics partner of the Bengals which advertises on the interim practice facility as part of its sponsorship agreement, Herzig said.
“Lots of other companies buy advertising at the stadium as part of a sponsorship agreement — including Kettering Health and IEL. Advertising is not “naming rights.” Article 9 of the lease addresses advertising. It says that the team controls all advertising at the stadium and gets all of the revenue from it. That is a standard provision in stadium leases across the country … the county has no reason to see the team’s proprietary contracts with its sponsors, which is why it hasn’t asked to see one in 23 years,” Herzig said.
There is only one naming rights deal in the lease, which the Bengals purchased from the county for $5 million in 1997.
The original lease states that the Bengals team is entitled to retain the first $16.7 million from the sale of the naming rights, plus 70 percent of any net revenues in excess of that. The county's share is 30 percent.
However, the lease also defines net revenue as "gross revenue minus the Bengals' cost of fulfillment," which includes the cost of signage suites, advertising, private suites, club seats, tickets and other products which would be subtracted from the total naming rights revenue.
In addition, all net revenues received over the next 16 years must be discounted to their value in the year 2000, using a discount rate of 6 percent. A $10 million payment in 2022 would have been worth $5.8 million in 2000, according to this inflation calculator.
County officials also have other concerns related to Paycor.
“I would like some assurance that county dollars are not going toward electrical work which should be paid as a fulfillment cost, by the team, given the naming rights agreement they have inked,” Hamilton County Administrator Jeff Aluotto wrote in an Aug. 24 email to other county officials.
Many emails between Gabelman and county officials have been redacted as attorney-client privilege. Attorney Josh Engel reviewed these emails at the request of WCPO to see if any should be made public. Engel is a former Warren County and Massachusetts prosecutor, and former chief legal counsel for the Ohio Department of Public Safety.
“They have the right to assert attorney-client privilege, but they’re not required to. They can waive that at any time,” Engel said. “So, if they want to make these public records available, they have every right to do so, nothing is stopping them.”
In some emails, it appears Gabelman is providing legal analysis of the Bengals lease to county officials. In others, he appears to be consulting with county officials on media strategy.
“Sometimes there has to be a balance between what the public has a right to know and what makes the government work well,” Engel said. “At least the way that some of these redactions look, it does not appear that there is really that balance going on. It appears that they are reflexively inserting attorney-client privilege at every opportunity they had.”
It is especially important to reveal as much public information as possible in a high-profile issue such as this one Engel said. And because county commissioners have criticized the Bengals for being too secretive.
“We’re the landlords, we’re going to start knowing what’s going on,” Hamilton County Commissioner Alicia Reece said at a Nov. 3 meeting. “No more behind the scenes, whispering, come on out in the open. This is paid for by the people, so it’s got to be out in the open.”
At that meeting, Reece said she’d like to see a big sign at Paycor Stadium that says welcome to Hamilton County, “on behalf of the taxpayers who own the place.”
Commissioner Stephanie Summerow Dumas also criticized the Bengals at that meeting.
“I’m trying to wrap my head around the level of arrogance that is going on right now as it relates to our relationship - the board’s relationship with the Bengals,” Dumas said. “How an entity like that- with us being the landlord – could have such a level of arrogance. … maybe they’ve been that way before but we’re not having it on this board.”
But if the county wants more transparency from the Bengals, perhaps it should consider making more of its own internal communications public, Engel said.
“On the one hand the county is complaining that the team is not being transparent enough, but on the other hand they have an opportunity to be more transparent on their end - they probably should grab that,” Engel said. “That doesn’t mean they should disclose all of their communications with their lawyers, but I would hope they would go back and say which of these communications can we disclose without jeopardizing our potential litigation.”
