After the death in May of its benefactor and owner, Stephen R. Shilling, the minor-league baseball team fell into default on a $9 million Sovereign Bank loan and now faces potential bankruptcy and foreclosure on Campbell's Field before its May 6 opening day.
Riversharks officials said the refinancing plan would restructure its crushing debt load. But port authority leaders said the proposal would make the Sharks more attractive to a potential buyer at the expense of toll payers.
"I don't think it serves the estate well if they declare bankruptcy, but that's their prerogative," said port authority vice chairman Jeffrey L. Nash. "Our goal is to protect the interests of the DRPA. People have to realize that the DRPA does not have the resources it once had.
"I'm optimistic there will be baseball this season - that's the ultimate goal. But everyone's got to share in the solution."
The Camden Riversharks have the third-highest attendance record in the independent Atlantic League, with 4,640 fans a game last year. They are scheduled to host the league's All-Star Game July 14.
In a letter sent Friday, port authority general counsel Richard Brown said the "best long-term solution" was to immediately sell the Sharks to a committed buyer with adequate resources. The port authority has been approached by potential candidates, Brown wrote.
The letter also proposed a separate refinancing deal through the Camden County Improvement Authority, the county's economic-development arm.
An infuriated Burns questioned the political motives of the Democrats who control the port authority. He has appealed across the river to Gov. Rendell, the agency's chairman.
"What they really seem to be saying [is], 'If you go out and sell it to a new buyer, we'll fix it, but we're not going to fix it for you,' " Burns said. "They want to create a whole new transaction for which lots of people can get fees."
Responded Nash, who is also the county freeholder director: "That is an outrageous allegation."
Shilling, who sank millions of his own money into covering the team's operating shortfalls, was a major GOP contributor. When the stadium was built, the port authority vice chairman was Burlington County GOP chairman Glenn Paulsen.
The McGreevey administration has facilitated the financing deal, as it did with last year's pact to expand and privatize the New Jersey State Aquarium. But unlike the aquarium deal, Gov. McGreevey appears unwilling to insist that the authority's New Jersey delegation accept the plan.
The team had worked on the refinancing deal for months, but it hit a snag two weeks ago when the port authority refused to sign off on the deal, which required the agency to forfeit any repayment of the $2 million it put up in 1999. Other officials involved with the discussions said that the agency might have believed it had a claim to that money, but failed to lock up the claim legally.
And now, the port authority's once-flush economic-development money has run down to about $5.5 million in New Jersey and $1 million in Pennsylvania, according to chief executive officer John J. Matheussen. "We are just not in a position to fund baseball in any greater amount than what we already have," Matheussen said.
Two days after the port authority's refusal, Sovereign Bank put the Sharks in default of the loan. Late last week, the bank referred the loan to its asset-management group.
One scenario that has been floated would involve a governmental entity or private investors buying out Sovereign's credit at a deep discount. Foreclosure would make the owner of the debt the owner of the stadium, which sits on 10 acres of prime waterfront land just south of the Ben Franklin Bridge.
Contact staff writer Elisa Ung at 856-779-3997 or eung@phillynews.com.
