What’s Going On With the Stadium and the Chargers?

Editor: Columnist Doug Porter over at our online media partner, the San Diego Free Press, has been closely watching the ball in the big game being played out in front of San Diegans between what’s been going down around the stadium and with the future of the Chargers. In both of his columns from this Monday the 18th and Tuesday, the 19th, Porter covered the touchdowns, the interceptions, the crowd’s reactions – and everything in between. Here’s a compilation of his coverage from the two columns with minor editing for flow.

By Doug Porter

Little green men from Mars could have seized city hall on Monday the 18th and I doubt anybody would have noticed.

The Mayor’s stadium advisory group presented its vision for building a facility worthy of consideration by the National Football League and its San Diego Chargers franchise. And that was the talk of the town.

Tuesday’s UT-San Diego had eight, count’em, eight stories about the team and the stadium proposal. (At least that’s what I saw on their web site. There could be more…)

Columnist Kevin Acee displayed some skepticism in the sports section:

A starting point will be the amount of money the Chargers are being asked to contribute.

There is the $300 million initial investment, which is at least $100 million more than the team has said it can give. Then there is the rent, almost $476 million in payments over 30 years ($10 million in the first year with a 3 percent annual increases), of which the city would realize $173 million. And, finally, the Chargers would have to pay back $150 million of a $200 million loan from the NFL.

The quick math put the Chargers’ contribution over the length of their lease at $925 million. (And that doesn’t count the CSAG proposals for parking and ticket surcharges that would raise an estimated $26 million over 30 years. One NFL source said Monday the league would consider that to be a part of the team contribution.)

What is being asked of the Chargers would appear to be a non-starter, based on the team telling CSAG from the start that the team should not be asked to make an “outsized contribution.” Just the $300 million is more than many NFL teams have contributed to their projects.

Remember, this isn’t about what you or I think is fair. This is about what Dean Spanos, the NFL and the other 31 owners think.

Nick Canepa, on the stadium cheerleading beat, got front page treatment, with the headline Credible Plan Should Put S.D. Back in the Game:

Most important, the plan doesn’t call for increased taxes to pay for the project ($121 million from the lean city’s general fund, matched by $121 million from the fat county, which simply can write a check). So, it does not need a public vote, although, prior to seeing this report, Faulconer has said he prefers a ballot measure…

…And I say, if it doesn’t need a vote, why vote? The League wants to know all by the end of the year. In any event, this would not call for the dreaded two-third majority, because it doesn’t involve raising taxes. My guess is, as planned, it would get the necessary county-wide majority vote.

The editorial writers at UT-San Diego also had something to say, letting us know that if this proposal didn’t fly it wouldn’t be San Diego’s fault.

I’m told the big fear in Faulconer-ville is that the team will move to LA and the Mayor will get blamed. Maybe there’s some polling showing this could be a weakness for him in 2016. After all, as things stand right now, it’s entirely possible he’ll be running with the “Comic-Con left and it’s your fault” meme being used against him.

Here’s the money quote:

All in all, the plan could provide $1.4 billion to build a stadium and related necessities. Obviously, there are loose ends that need more scrutiny. But this seems to be a serious proposal that should be viewed as such by the Spanos family, which owns the Chargers, the owners of the league’s other 31 teams and Commissioner Roger Goodell.

The Chargers’ initial reaction was a polite statement thanking the task force for its hard work – a sentiment that everyone should share – and promising to thoroughly analyze the proposal. When it comments further, we may find out if the team actually wants to stay in San Diego – or if it’s just been stringing the city along to create a positive narrative about the Chargers trying to do right by loyal fans before they reluctantly conclude they must move to Los Angeles to remain competitive.

Hours after the plan was announced the Mayor and City Attorney made pronouncements.

Via NBC7:

“San Diego has a framework to build a new stadium that’s tangible, that’s achievable and that won’t raise taxes,” Faulconer said in a news release.

The mayor said he still wants to have an agreement with the team approved by a public vote. Even though the CSAG recommendations do not require new taxes and so don’t require a 2/3 vote to move forward.

City Attorney Jan Goldsmith reacted swiftly to the proposed recommendations, warning San Diegans that any stadium deal will be negotiated face-to-face and not in the media.

“Charger negotiations should be conducted at the table, not in the media. Thus, the City will have much less public comment during these negotiations than there has been during the CSAG process,” Goldsmith said in a prepared statement.

A Couple of Obvious Issues…

The devil is in the details:

Q for #CSAG: Will the @Chargers commit to staying in San Diego for 30 years? If not, your financing plan doesn’t work.

— Benjamin Katz (@MeanestBossEver) May 18, 2015

At Voice of San Diego Scott Lewis points out the $225 million coming to the deal via the sale of 75 acres adjacent to the site assumes an upgrading in zoning and infrastructure improvements.

Now, zoning can be changed. That, however, would take some time.

For any normal corporation seeking half a billion dollars or more from taxpayers, that would be a reasonable wait.

But we’re talking about the NFL and the Chargers. To them, this is the kind of hole in the plan they can drive a truck through.

Disgusted and Dismissive Reactions

At the Reader it wasn’t hard to imagine Don Bauder shaking his head in disgust:

The plan is based on a dubious assumption: “The city and county are on solid financial footing,” says the proposal. Oh? There is a $2 billion infrastructure deficit that is realistically double that. The possibility of a severe, long-lasting drought suggests tax money will have to be spent on providing more water, and water bills will also go up. There is a big pension deficit. The convention center is in financial trouble. And other problems loom.

Cocked eyebrows should greet this report. The plan does not rely on tax revenues from development, boasts the task force, but transient occupancy (hotel) taxes will contribute as a result of the building of a new hotel. Also, 75 acres will be sold to a developer. The task force is counting on $84.7 million coming in from a ticket surcharge and $26 million from a parking surcharge — both over 30 years. At least, a surcharge is paid by someone who is using the facility.

The task force boasts that it has “heard from numerous developers and private investors who want to fund all or part of the Mission Valley project.” Oh? Where were those developers and investors earlier when the Chargers proposed developing Mission Valley? Is there enough water for the new development? Chargers spokesperson Mark Fabiani has pointed out that current Mission Valley residents are opposed to another development, and there is still a controversy about whether a plume under the stadium is a problem.

Los Angeles Times columnist Michael Hiltzik was completely dismissive:

One must doff one’s hat to the National Football League. Its talent for siphoning money from taxpayers into the pockets of its team-owning billionaires has never shined so bright. The financing plan for a new stadium for the NFL San Diego Chargers, unveiled Monday by a local civic group, sets a new standard for allowing the league to exploit municipal panic and using financial sleight-of-hand to make the process look painless.

The citizens committee proposing this plan actually is proud of its handiwork, calling its financing plan “fair and workable” and praising itself for beating its deadline by four months. “A path to a new state-of-the-art stadium now exists in San Diego,” the panel says. They should have kept working. …

UPDATED: Three final notes, before this offering turns into a tome:

Legislative help in fending off pesky lawsuits is available. From the Times of San Diego:

Assembly Speaker Toni Atkins on Monday promised state legislative support for keeping the Chargers in San Diego, if the team and city reach an agreement to build a new stadium.

The Chargers are proceeding with plans to leave town. From KPBS:

The San Diego Chargers and Oakland Raiders have hired former San Francisco 49ers President Carmen Policy to spearhead the next stages in their push to build a joint $1.7 billion stadium in the Los Angeles area.

Policy is expected to speak to NFL owners about the Carson stadium project at their meetings this week in San Francisco, the city where he led the front office of the 49ers in their championship heyday in the 1980s and 1990s.

The land deal in Carson is done. From Associated Press:

A complex land transaction has closed that marks another step toward development of a shared NFL stadium near Los Angeles for the San Diego Chargers and Oakland Raiders.

Chargers attorney Mark Fabiani says the transaction for land in the city of Carson closed Tuesday.

The centerpiece of the deal sends the deed for 157 acres of a former landfill to an entity controlled by the city. That entity will own and control the site and lease it to a stadium authority.

Editor: Here is more background of the big game from Doug Porter’s Monday column….

The press conference staged by Mayor Kevin Faulconer’s Citizens’ Stadium Advisory Group (CSAG) hadn’t even happened yet when one well-connected reporter took to the twitter, saying the National Football League wasn’t going to be receptive to their ideas.

Early Monday morning news accounts were all about how the group had arrived at a plan for a new football stadium in San Diego with no tax increase required.

Interestingly enough, the announcement did not include any elected officials. Former Mayor Jerry Sanders was the highest profile person listed on the press release. …

Sports Business Journal Reporter Daniel Kaplan passed along a general overview of the plan, saying he’d already heard it wasn’t being “well received in NFL circles; too much team money, process, length of time, location.”

Saying the NFL favored “the Minnesota model, about half team, half gov’t,” the reporter’s tweets indicated the plan for the Chargers stadium was “very favorable loans, more loan than grant.”

Now, of course, this is just one reporter talking. But what he is saying is consistent with what’s been reported about the NFL’s expectations.

Here’s the 10News preview of the plan:

There was no immediate word on how much the Chargers would contribute to the plan. However, Tommy Powell, communications director for the grassroots fan-based organization Save Our Bolts, told 10News Monday that his group saw the full plan Friday night. Under the proposal, the Chargers will contribute $300 million, Powell said. However, they will get all that money back by taking 100 percent of the revenue from personal seat licenses and stadium naming rights. The Chargers brass allegedly reached an agreement on their portion of the funding in a meeting with the CSAG last week.

While the CSAG will recommend circumventing a public vote, the task force expects there will be one anyway, Powell said. It would also only require a simple majority of 50.1 percent to pass, and not the two-thirds vote, if there were no tax increases included in the proposal.

I’m sure most of the San Diego media will be falling all over themselves to cheerlead whatever plan emerges. They’ll ignore the fact that Mayor “Never Miss a Photo Op” Faulconer didn’t appear at the presser. There was a late morning press release saying hizzonor and the City attorney wold take questions from the media later in the afternoon. And this: “The recommendations in the CSAG report will provide a starting point for formal negotiations with Chargers owner Dean Spanos.”

If you’d like to cut through the bs on these reports, I’d suggest by starting with Liam Dillion’s What to Watch for in a Chargers Stadium Deal at Voice of San Diego, which concludes:

City leaders are going to try to pretend that a new stadium won’t cost us a dime. It will. And spending money on a stadium means we won’t be spending it elsewhere, on more library hours or police and fire services.

There’s also a cost in terms of opportunities. A public vote on a stadium could crowd out other public votes that would involve taxpayer dollars for services. The stadium has already sucked up lots of attention. A long-discussed ballot measure for November 2016 to upgrade the city’s rotting infrastructure, for instance, is withering away with inaction.

Here’s a copy of the financing plan released Tuesday. There are lots of assumptions and big IFs.

Here’s the money quote from UT-San Diego:

County and city taxpayers would contribute $120 million each, but no tax increases would be required because the money would come from each agency’s general fund over a 30-year period.