May 12 (Bloomberg) -- There are more than 240 pages in the District of Columbia's preliminary official statement to the $510 million in ballpark revenue bonds it sold last week for the Washington Nationals baseball team. The key to the deal is the 14 words printed on page 7 of Appendix 1, the ``Baseball Stadium Revenue and Tax Projection Study.''

The words are contained in the ``Ballpark Operating Assumptions'' section of the study, which states the following assumption: ``The future owner(s) of the team will strive to maintain a competitive ball club.''

The 55-page study was done by Economics Research Associates, a consulting firm with offices in California, Chicago, New York, Washington, D.C., and London. The firm, according to its Web site, focuses on ``economic analysis for the entertainment and leisure industry, real estate development, public-policy analysis, tourism and economic development.''

They nailed this one to the wall. ERA was hired by the District to estimate the tax revenue from stadium-related sales tax receipts, one of four streams of revenue that are being used to repay the bonds. Stadium-related sales include the sales tax on tickets, parking, club-related stuff, and food and beverages.

Put a good team on the field, and all those taxes come flooding in. Put a team out there that loses more than 100 games in a season, and that nobody wants to see anymore, and you've got a problem.

Big Increase

``Projecting attendance is perhaps the most critical factor in determining stadium-related revenue potential,'' the consultant says. ``Attendance is typically a function of team performance, market size, entertainment alternatives in the market and age and quality of the facility, among other factors.''

ERA analyzed attendance of 15 teams that opened new stadiums, and found that there is a 30 percent increase in per- game attendance the year a new stadium is opened.

Call that novelty value. Even people who aren't big baseball fans will come out to see how the new ballpark looks. After that, ``Attendance in the following years is largely influenced by the team's on-field performance,'' says the consultant.

If the team does well, it will hang on to some of that 30 percent increase; if it does poorly, attendance will flag to whatever it was at its old park.

Ticket Sales

There was a lot of novelty value to the Nationals last year. Major League Baseball's 29 other owners bought the Montreal Expos for $120 million and moved them to Washington last year, where they drew 2.7 million fans, 11th best in baseball. The team actually led their division, the National League East, into midsummer, and finished with an 81-81 record.

Earlier this month, the owners agreed to sell the team to real estate developer Theodore Lerner and former Atlanta Braves president Stan Kasten for $450 million.

The Nationals' juggernaut stalled earlier this year while the team was still ownerless, and when the District of Columbia and baseball balked over the cost of the new stadium. All that's behind them now. Last week, the bonds to build the stadium were sold, and ground broken for the new ballpark, which is expected to open in 2008.

Here's how ERA thinks things will play out. Ticket sales will dip this year to 2.59 million, rebound in 2007 to 2.64 million, and soar to 3.12 million in 2008, with the opening of the new ballpark. To put that number in perspective, if the Nationals drew 3.12 million in 2005, they would have ranked sixth in all of baseball, behind the San Francisco Giants (3.14 million) and ahead of the Chicago Cubs (3.10 million).

Happily Ever After

Attendance will decline after that, say the consultants, and stabilize in the fourth year the new stadium is open (2011) at 2.62 million. This is a nice, conservative estimate.

There are a couple of bar charts in the consultants report that are contained in all consultants' reports, what might be termed the ``happily ever after'' projections. Stadium-related sales totaled $93.6 million in the Nationals' first year. They will rise to $165.3 million during the first year in the new ballpark, and stabilize at $154.9 million by 2011. After that, there's just a wonderful upward slope to that chart, as sales -- and tax proceeds -- rise 2.8 percent per year.

That's what everyone is counting on, of course -- the bondholders, the team's owners, the residents of the District, the fans. And that relies on the Nationals fielding a competitive team. All the other stuff people talk about, such as the number of club seats and luxury boxes in the new stadium, is a lot of noise. It's time to play ball.

To contact the writer of this column: Joe Mysak in New York at jmysakjr@bloomberg.net