When the Green Bay Packers began the $295 million redevelopment of Lambeau Field three years ago, it wasn't just with the intention of saving the franchise for the present, but also with a commitment to ensure its future.
This week, the Packers organization will distribute to its shareholders the annual report of the 2002-03 fiscal year, which ended March 31. Inside its pages, the report will detail an after-tax operating profit of $15.5 million for 2003, which is up from $3.8 million a year ago.
But while the organization's recent business success confirms the dramatic impact of a redeveloped Lambeau Field -- which will be fully operational by the first game of the regular season -- what it doesn't do is make the Packers' ultimate dream of long-term franchise financial security a reality. At least, not yet.
Packers executive vice president and chief operating officer John Jones and corporate treasurer John Underwood called the 2003 fiscal year "a good start on a long-term challenge."
Its success has allowed the Packers to build their corporate reserve fund, which acts as the safety net for a publicly owned team that doesn't have a billionaire owner to rely upon in hard times.
The Packers' goal is to be able to grow the reserve fund to a level that it could support on its own one year of football operations. A year ago, the fund stood at $35.6 million. As of May, it had grown to $58 million.
Yet while significantly improved, the Packers' reserve fund is still well short of the goal. Last season, football operations cost approximately $100 million. And with costs on the rise annually, the football operations budget will run to $116 million by 2004.
Thus the challenge isn't merely to grow the reserve fund, but to do so at a rate that it ultimately catches up with rising football operations costs.
"I would say we started a slow process this year of rebuilding our reserves and achieving some of these financial objectives that we said were so critical if we were going to survive," Underwood said.
"Next year (football operations will cost) $109 million. Will we be able to go from $58 million to $109 million in one year? No. We know that.
"I can look you in the eye and say we'll get there, but I can't tell you when."
The Packers' recent contributions to the reserve fund have been a direct benefit of the Lambeau Field redevelopment project. Over the past year, the organization enjoyed revenue boosts in the areas of gate receipts, private box income, Pro Shop sales and marketing revenues.
Many of the new stadium amenities will come on line this season.
"The Lambeau Field Atrium will become home to the Packers Hall of Fame, a brew pub and family dining restaurant and more," Jones said. "The Atrium also will begin hosting special events, from business meetings to parties and weddings."
These additional revenue streams aren't something the Packers stumbled into. All of them were part of the vision more than three years ago, with a goal to make Lambeau Field a 365-day-a-year tourism destination.
Quickly it is becoming just that, and just as swiftly, the Packers' league revenue ranking is beginning to improve. Only 20th in 2001, the Packers are now back to 10th among the NFL's 32 teams, the highest ranking since the Super Bowl year of 1997, when they were ninth.
Maintaining that ranking will be a challenge. Jones pointed out that other NFL teams also are in constant quest to increase revenue. But, he said, the Packers will make it a goal each year to reach the "economic playoffs" as one of the top-12 teams in the revenue rankings.
It won't be an easy goal to reach, but a redeveloped Lambeau Field makes it possible.
"The worst thing that could happen would be if we rebuilt the stadium and didn't have the financial horsepower to survive and compete," Underwood said. "That won't happen."
Said Jones, "We are turning profitability into the preservation of this franchise and this stadium. We're delivering on the promises that we made to our community and fans."
The 2003 fiscal year was a step toward those promises being realized. But a long road still lies ahead.
