It's a delightful evening "... at the ol' ball game." You root hard for the home team, and with your bag full of peanuts or crackerjack you don't care if you never get back!
Reading, Pennsylvania, minor league baseball team is a growing business with property and liability exposures to match
By Bob Bloss
It's a delightful evening "... at the ol' ball game." You root hard for the home team, and with your bag full of peanuts or crackerjack you don't care if you never get back!
Baseball. Thirty major league teams are open for business again this summer. So are a growing number of minor league franchises.
When Toronto's SkyDome opened in 1989, one man offered to host his son and two friends to a game. Then he calculated costs of tickets, food and drink for three hungry teenagers, parking, and merchandise. He decided instead to take them to London for the weekend!
An exaggeration, of course. But with minor league games available nearly everywhere now, and at reasonably comfortable budgeting for an average family, an evening at the local minor league ballpark has gained widespread popularity during the past two decades.
Minor League Baseball (formerly National Association of Professional Baseball Leagues) governs 20 leagues operating in the USA, Canada, Mexico and Latin America under three classifications--AAA (generally more experienced players hoping to reach the big leagues soon), AA circuits, and Class A (usually young, recent recruits). Several "independent" leagues--teams not officially connected to major league organizations--also are in operation.
One highly successful Class AA enterprise represents Reading, Pennsylvania, aka "Baseballtown(TM)." Reading is a member of the Eastern League, with franchises in Ohio (1), Pennsylvania (4), Maryland (1), New Jersey (1), New York (1), Connecticut (3), and Maine (1).
"Baseballtown" is the Reading area's official, certified trademark. Together, the city and baseball enjoy a rich history that began in the 1800s. Five years ago Reading became the Eastern League's all-time attendance leader. Current Houston Astro Wade Miller is a Reading native. Rocky Colavito, Mike Schmidt, Greg Luzinski, Herb Score, Roger Maris, Rico Petrocelli and other standouts played minor league ball there.
Reading is a "farm club" of Philadelphia. It carries the Phillies nickname, although most minor teams now choose nicknames and mascots with regional significance (Harrisburg Senators, Bowie Bay Sox, Myrtle Beach Pelicans, etc.). All teams under Minor League Baseball's umbrella have working agreements with major league organizations. The major league "parent" pays all minor league salaries; in fact, it's responsible for all matters involving uniformed personnel. Minor league owners have responsibility for everything and everybody else.
Including insurance.
Since September 11, 2001, and then after the fatal NHL ice hockey accident in Columbus this spring, sports team operators find risk insurance requirements more complicated--and more costly--than just one year ago.
Chuck Domino is general manager of the Reading (Pennsylvania) Phillies, a Class AA baseball team which averages 6,500 fans per game. Among his responsibilities is purchasing the club's insurance program, which is handled through a Philadelphia-area agency.
Reading Phillies' veteran general manager, Chuck Domino, recently discussed the intricacies of running a sports enterprise. Insurance ranks prominently.
"There's no question that we spend more time every year on insurance," he says. "We open our gates 71 times a season. With an average attendance of over 6,500 fans per game, your policy must cover a wide variety of risks. Fortunately, we have never been sued. And in these 15 years that I've been GM, our fans and employees have very rarely had a serious accident here."
Foul balls striking spectators is the most common injury to fans, according to Domino. That same peril exists at ball parks everywhere. "We average about one per game. Knock on wood; we've never had an eye injury of any consequence. To be safe, though, medical attendants are always on duty before, during, and after our games. When they're notified of a medical problem, they respond in a matter of a minute or two. There's always an ambulance on site, too.
"Generally the injured party's own insurance covers all or most of any medical costs. But we immediately submit an injury report to our insurance broker. If additional payment is required beyond the insured's own coverage, our policy handles it."
Domino relates a tale in which a spectator refused standard protection. "A young blind man and his mother are season ticket holders. The man carries a portable radio to games, and enjoys the sounds and aromas of the ballpark. I noticed that their seats were just four rows off the field, and to the left of the backstop screen. Obviously, the young man could not dodge a hard foul ball line drive hit right at him. I met with the mother and offered them seats behind the backstop. She adamantly declined, charging me with discrimination against her handicapped son. So I insisted she sign a waiver absolving the ball club of any liability should a foul ball injure the boy. She willingly signed it."
The Selzer Company, of Warrington, Pennsylvania, has been the Reading club's insurance broker for nearly a dozen years. Account Manager Nina Young described a recent incident.
"One evening a young substitute mascot could not adjust the furry costume's eye holes properly. She tripped over the rolled-up tarpaulin and badly dislocated her shoulder. Several weeks of therapy were required. A workers compensation claim was entered and, of course, it was fully covered."
Most teams in most sports--college and professional--have costumed mascots now. Other game-day entertainers--celebrity musicians, parachutists, baseball humorists such as the late Al Schacht or Max Patkin, fireworks providers--are contracted on a "special event" basis. Invariably they carry certificates of professional liability insurance.
Jerry Gregorowicz, commercial lines underwriting manager at The Selzer Company, urges event promoters to study contracts carefully. "With the overall increase in premium costs following the terrorist attacks, many vendors simply cannot afford insurance coverage. As a result, special event operators don't do business with them."
Chuck Domino need not be reminded to proceed with caution. He's been running minor league ball clubs for 18 years, earning national recognition: 1998 Minor League Executive of the Year; 2000 Bob Freitas Award from Baseball America for best Class AA operation; top promoter in minor league baseball 1994 and 1999; 2000 Middle Atlantic Major League Baseball Scouts Association's Executive of the Year.
The 42-year old Pittsburgh native is a popular civic figure in Reading. He was 1999 co-volunteer of the year for the regional Easter Seals Society and implemented a major in-school program (Baseball in Education) in which team members visited 23,000 students.
Domino and his marketing specialists work closely with area businesses that promote their firms and brands on outfield billboards, game broadcasts, and in game programs, season schedules, and other literature. All home games feature corporately sponsored attractions such as fireworks, pre-game autograph sessions, batting glove giveaways, baseball bingo nights and camera days.
Several food court facilities help attract group outings to FirstEnergy Stadium, a 52-year old facility that's regularly modernized, freshly painted, and enlarged. Refurbishment usually means re-visiting insurance needs. Last year the Pool Pavilion Picnic Area, accommodating up to 310 patrons, was constructed just beyond the right field fence. The pool itself is only three feet deep, but CPR-trained YMCA lifeguards are on duty to keep an eye on the youngsters--and as lookouts for any long home run ball zeroing in for splashdown.
Two other picnic areas are filled at nearly every game. Many visiting groups there arrive on excursion buses. These groups--and the bus companies--are responsible for insurance while traveling. Likewise, as the players are bused to other Eastern League cities, the transportation company's insurance policies, not those of the ball clubs, are in force.
The pool and picnic area was added last year to the 52-year old FirstEnergy Stadium, requiring extra risk management measures.
Through Selzer Insurance, K&K Insurance Group is the Reading program's managing underwriter. Lou Valentic, a former minor league executive himself, is senior vice president, executive accounts at K&K, which specializes in sports, leisure and entertainment.
"We study five major categories before contracts are satisfied," says Valentic. "One is parking. Who owns the lot(s), and who employs the attendants? Two, concessions. Does the team operate the food stands and restaurants, or is an independent contractor responsible? Three, security. Under whose policies are security personnel covered in their dealings with paying customers? Four, first aid, obviously. Are the medical professionals hired by the team, or are they covered by outside agencies' policies? And five, maintenance and house-keeping. How are ticket holders protected from inclement weather? Are rest rooms in satisfactory condition? Are passageways uncluttered? And so forth.
"On Point Two, concessions, we examine liquor liability very closely. Laws vary from state to state, so we must be clear about who's in charge of beverage concessions (the team or a hired caterer), and what regulations are in effect--such as at which inning beer sales cease, limiting number of units sold to a customer and of course, legal drinking age confirmations."
Insurance industry officials estimate that premiums for special events coverage have increased from 25% to 100% from just a year ago, primarily due to fallout from September 11. Currently Domino calculates the Reading team's insurance expenses at under 5% of operating expenses. He cites several examples of significant expenditures that help mitigate the risks to employees and patrons, ultimately reducing insurance costs.
One of them is overhead netting. A "play area" of several square yards houses various arcade-type games. It's situated between the main grandstand and the right field bleachers. Often, foul balls would drop into that region. No longer. Now new netting, costing roughly $18,000, protects the youngsters playing there.
Reading's family-oriented ballpark, with its special events before and after games and between innings, is a key reason that ticket sales reach nearly 500,000 per season. New attendance records have been set for 14 consecutive seasons. The team itself deserves credit, too. Last year, Reading shared the Eastern League championship after advancing to the playoff finals that were suddenly canceled September 11.
This season several new promotional events are scheduled (including a 9:00 a.m. "shift worker" game vs. Altoona that was held in May). Led by field manager Greg Legg and hitting coach Rico Brogna, Reading expects to challenge for the title again.
The Phillies' front office and its insurance brokers wish that smooth sailing also continues on the risk and liability front. If the "I" word comes into play, they're hopeful it refers only to some "Insurance runs" for the home team. *
The author
Bob Bloss is a freelance writer based in Plymouth Meeting, Pennsylvania. He is the author of Baseball Managers: Stats, Stories and Strategies, published by Temple University Press (1999).