We’re still several months from the NFL and its constituent owners making any decisions on team relocations, yet the league and Roger Goodell are getting exactly what they want. San Diego and St. Louis are bending over backwards to make please the kings, Carson and Inglewood are having their own battle over the presumptive single Los Angeles stadium slot, and Oakland is, well, treading water I guess.
San Diego’s CSAG (Citizen’s Stadium Advisory Group) released its plan in time for the owners meetings in San Francisco. As expected, it focused on building at the current Qualcomm/Mission Valley site instead of the downtown site the Chargers preferred in prior years. The cost is expected to be $1.4 billion, broken down into various revenue sources:
The plan proudly proclaims no new taxes, which is technically true, but it neglects to mention that it’s carrying over an ongoing operating subsidy, split equally by the City and County, that was negotiated to keep the Chargers at Qualcomm. So right off the bat that’s $242 million in present value subsidy, plus the sale of 75 acres at the stadium for $225 million. Field of Schemes has the total subsidy at $647 million, I’ll call it $467 million as I won’t count the various rents as subsidies (you might) or . $500 million would come from the Chargers (60%) and the NFL’s G-4 fund (40%) in the plan, though the Chargers’ recent disinterest in the deal may indicate a dissatisfaction in their $300 million piece. Since PSL revenue ($150 million) would be limited and is already accounted for, the Chargers would have to come up with $200-210 million on their own from non-PSL sources like tickets, concessions, and some luxury seating proceeds. That translates into a $12 million/year of revenue required of the Chargers along with $10 million/year for rent, assuming that San Diego hits its fundraising targets for PSLs. For reference, the 49ers pay roughly $24 million/year in rent at Levi’s Stadium. To help offset that cost to the team, the Chargers would have control of naming rights. A $12 million/year naming rights deal for 30 years (both optimistic projections) would effectively cancel out the $300 million team contribution.
A special infrastructure financing district would be created to allow for future ancillary development to take place. That would be worth $116 million, though that money wouldn’t go towards construction of the stadium. Another $40 million come from future hotel taxes to fund a hotel next to the stadium. To many stadium advocates, hotel and car rental taxes are not considered a true subsidies since they aren’t levied on locals. They’re still taxes.
Two parts of the plan struck me immediately. $225 million from the land sale may well be appropriate for the area, which has a trolley station that could anchor some transit-oriented development. The more important takeaway is that $225 million now sets a bar for Coliseum City, in that San Diego is now offering up land for free to fund the stadium’s construction, so Oakland and Alameda County will be expected to do something similar. This is despite the fact that the NFL has recently frowned upon real estate development acting as a funding source in favor of less speculative revenue streams – as if PSL sales aren’t speculative.
The other question mark is operating costs. CSAG claims that based on examples like AT&T Stadium in Dallas, revenue from a year-round event schedule would make the stadium self-sustaining. I find this assertion highly optimistic at best. The fact is that a stadium will cost $7-10 million per year to operate just for the NFL games. If that isn’t accounted for, why should anyone believe that revenue from other much smaller events will make up for that operating cost, not to mention the cost associated with running those smaller events?
The total cost of the project is $1.4 billion with a $1.1 billion construction cost, so perhaps that “buffer” will take care of the subsidy. If it doesn’t, chances are taxpayers will foot the bill, adding another $121+ million to the public side of the ledger.
I’ll do a proper comparison of San Diego vs. St. Louis and the two LA plans plus Oakland when those come out. For now I encourage you to assess San Diego’s plan on its own merits. CSAG’s plan appears meant to be in line with the stadium financing structures for Minneapolis and Santa Clara, at least in terms of public share. If that’s the case, the NFL should be able to pivot and align with the plan they way the same are posturing to do with St. Louis. Is it a good deal? Not really, but this is the NFL we’re talking about. As usual, they hold the cards.
Just to clarify RM: $225 million from the land sale AFTER the land is given FREE OF CHARGE to the Chargers. Correct?
Plenty of support from all the cities to keep their teams per Grubman.
@Tony – Incorrect. City would sell land to developer.
Thanks RM. OT: Rockets suck!! That is all..
I agre Tony. I feel that Oakland can match what city of San Diego did
^ Copy/pasting things from the old thread… seriously?
In actually topical conversation: Is there ever going to really be much to write up about the Inglewood details? Is the developer of Hollywood Park or some big financial firm (like Goldman Sachs w/ Carson) chipping in capital or is Kroenke going to do it essentially alone? The Inglewood plan seems like the only one without government or 3rd party financing, at least as far as we know.
If people aren’t going to stay on topic with their comments, I’m going to start deleting.
ML: No, Tony is right — it’s $225m from the sale of additional land to a developer *after* $180m in land is given to the Chargers for free for the stadium proper. That’s how I came up with the $647m figure — I didn’t include the rents as subsidies either, since it’s the Chargers paying them.
Neil – $225 million is for the to-be-developed 75-acre part of the site. $180 million for the stadium (60 acres) is there for budget purposes, but since all CSAG is doing is replacing Qualcomm Stadium, there is no real transaction or transfer and no money is actually changing hands. If there’s something to critique it’s that the Chargers won’t be paying property taxes since it will be another publicly-owned venue like Qualcomm.
I know this a giant lengthy hypothetical. What happens if San Diego and St. Louis come through and both build new stadiums for their football teams and the Oakland doesn’t? Could they go to LA alone?
They being the Raiders of course.
According to Carmen Policy – yes.
Will the NFL and LA want to build a stadium for the Raiders only? I highly doubt it.
The NFL might be ok with just the Raiders in LA…if it meant the Davis family had to sell a chunk of the team, the NFL still owns the stadium, owns the power to eventually place a second team of their choosing there, owns all the revenue from the eventual Super Bowls and Pro Bowls there, etc.
At this point I would imagine the league would consider that hypothetical outcome a huge win, because it also implies that the Rams and Chargers secured brand-new stadiums in their current homes as well.
Good story, ML explaining the Carson plan and who is financing it will be interesting. How do the Chargers and Raiders (who’s owners aren’t the wealthiest in the NFL) afford $900 mil. each to fund the Carson stadium? also why can Davis generate $900 for the Carson stadium and only $500 mil. for the Oakland stadium. If an investor other than the Raiders/Chargers finances the stadium, one would believe they would charge huge rent fees to the two teams in order to recoup the cost of financing a $1.7 bil. stadium.
I don’t know if the San Diego proposal is solid or not, but it’s a good starting point for negotiations with the Chargers. This seems to be a nice outline to get something completed.
Not sure if this San Diego poll was taken before or after the funding plan was announced. It’s sounds like before. So I’m not sure how to interpret these numbers:
The smartest thing CSAG did here was focus on the Mission Valley site rather than trying to shoehorn another stadium into the Convntion Center or Gaslamp area.
I’d actually like for the Chargers to figure this one out for SD. While I by-and-large dislike the Spanos family for what they are doing and have done to the Chargers, I retain a soft spot for SD in general, and I think the Chargers should remain there.
Besides, SD is a kickass location for the Super Bowl – far better than Santa Clara.
Downtown NFL stadiums are a huge waste of space that sit unused the vast majority of the time. That plan was never really plausible in the first place.
Sure didn’t stop the local paper and several other biased sources from pushing it right up until the end (and a few still are trying to revive it and think killing Mission Valley will accomplish that).
Carson stadium won’t have eternal flame for Al Davis | ProFootballTalk
What a joke if true!
I like this deal for the Chargers big time and even County/City of San Diego.
For the Chargers the 300M is not really 300M, once they re-coup the PSL money and naming rights it is only in reality 200M or so.
City of SD is already subsidizing Qualcomm, essentially paying the Chargers to play there. Now if the City/County were broke then I see where the outrage would lie.
But in reality both have surpluses therefore no need for new taxes and it makes too much sense to transfer the current subsidy to the new stadium. Right now it is only the City pitching in and the County will with the new stadium.
San Diego is too small of a market to accomplish what the 49ers did in Santa Clara and do this 90%-100% privately. This allows for no new taxes and to only take 14M a year between City/County and the sale of land parcels.
The Chargers get to keep naming rights and premium seating sales 100%.
If Spanos turns this down he is a fool, in Carson he needs to raise 850M on his own with no public help. Not to mention he needs dumbass Mark Davis to raise the other 850M.
How is that going to happen when neither play in LA currently?
They will essentially cannibalize each other for premium seating and general ticket sales. The Carson model does not work for this reason unless there was a giant public subsidy, somewhere around half or 850M.
Chargers stay in SD, they just need to work out the final details on this. Spanos won’t get downtown but he gets his stadium at the current site.
Rams go to LA, and as for the Raiders……….stuck in Oakland unless they get on their knees and beg Stan Kroenke to share, I ask why would he let them?
Raiders are stuck in Oakland unless the A’s work out a deal to build in the parking lot and pay off the existing debt. Then its bye bye existing stadium and the Raiders will need to find a new place to play. With LA unlikely (no Carson stadium, Kroenke not needing or wanting the Raiders) and Oakland dead, this leaves 3 options: Saint Louis, San Antonio, Levi’s. The Raiders will be left with the ultimate worst-case scenario: Having to choose from 3 undesirable options since Oakland can’t afford them and LA doesn’t want them.
A’s work out deal to build in the parking lot? You obviously didn’t get the “parking surrounding stadium” memo pjk. Deal to pay off existing debt? Not sure it’s exactly a “deal” to add nearly $100 million to a $600 million ballpark price tag. But whatever.
Raiders will be in The O for the long haul…
Haha…if Raiders leave it is far from a guarantee that A’s stay in Oakland. Wolff hates Oakland!
Tony: You’re still convinced the Raiders aren’t going anywhere, even though its obvious the mayor, etc, will let them walk before ponying up $400 million for them to stay. Oakland has been looking for private developers to pay for the stadium for years. No takers. The Raiders and NFL have applied the pressure, with the Carson project. Oakland’s response has been to “increase” its offer from $0.00 to $0.00.
And you’re still convinced this will all work out just gravy for the A’s at the Coli once the Raiders “Just Leave!” We are both entitled to believe what we want to believe; harm, no foul. That is all. . .
@ Tony D
I seriously wonder if anything will ever get built at the site sometimes. (Sports related) I hate to sound so pessimistic, but it just fills like nothing is ever getting done. I agree with you there seems to be this idea (among some), that if the Raiders move to LA (presumably) that it will somehow open things up for the A’s at the site. I’m sure the Raiders being gone will help things regarding the A’s probability of building at the site, but it certainly will not guarantee anything.
The fact of the matter is we still don’t know if Wolff is willing to build at the site, even if the Raiders are playing somewhere other than Oakland. I’m hoping (probably against hope), that the Raiders get a new stadium at the site. I’m then hoping that action will open up San Jose for the A’s, although as you know I would prefer them to stay in Oakland, my overriding concern is for A’s (Raiders as well) to say in the Bay Area.
I think you guys are misinterpreting the comments that some folks are making about the A’s. I agree with you completely that even if the Raiders leave, there’s no guarantees the A’s will build. There are unknowns there.
What we do know is that public money isn’t going to be involved. The NFL wants public money and has so far not backed any proposal in any city that didn’t involve some form of public money. We also know that the Raiders have had years as the lead team in this and have yet to have any private financing in place. We also know that Mark Davis has said he can’t build a stadium himself. On top of that he hasn’t even provided a pretty picture of what a stadium at the Coliseum will look like.
As the saying goes, the definition of insanity is to do the same thing over and over and expect different results.
At this point it’s insane to think that the Raiders are going to be able to get things done at the Coliseum. It’s time to try something different and maybe give the A’s a fair chance here.
LS and Slacker NAILED IT! Somehow it all sounds better coming from you guys then me 😉
I’m sorry if it seemed as though I misrepresented anyone here. I was referring to people filling that things would magically work out for the A’s if the Raiders simply left (most people with that view don’t comment here), when Wolff (IMHO) hasn’t given any indication that he is willing to build at the site, even if the Raiders were gone.
Davis (on the other hand), really comes off as someone that really wants to make it work in Oakland (IMHO), unfortunately his preference to do so (if true) is not enough to get it done. Ironically we could have an owner in Wolff that could make it happen at the site but may not want to, and an owner in Davis that may want to make it happen at the site but can’t.
You absolutely, positively 100% get it my friend! Stay tuned everyone…AND GO LAKERS!! (Sorry, having flashbacks to many moons ago…). Not a Dubs fan, but congrats to everyone who is.
Please….enough with the Raiders to St Louis non sense…it’s Oakland or LA….maaaaaybe SA…highly doubtful it winds up being SA tho.
MLB, too, will want public funding. But it’s MLB deliberately confining the A’s to a territory that it knows presents huge obstacles in developing new facilities and getting public financing. So if MLB offers permanent revenue-sharing and the A’s can figure out a way to get a ballpark built and, as a bonus, retire the existing debt, we’re in business. But everything is on hold until the Raiders leave.
I will give you that pjk. PERMANENT revenue sharing should be a given if the A’s are forced to stay in Oakland /AlCo. A cool $30 million annually from MLB FOR LIFE for Wolff/A’s staying in Oakland. Would be a huge “FUCK YOU!” to the Giants as well; G’s basically paying the A’s to stay out of SJ…
SJ is still possible for the A’s, even the San Diego sportswriter commented about that and how it will effect what the Raiders decide to do. Manfred has commented that Oakland will to provide some financing for the A’s ballpark, if Oakland city officials can’t provide any $$$ for the Raiders, they also may not do so for the A’s ballpark also. Manfred may find that unacceptable and then approve the A’s move. The MLB commissioners office has a definite pro A’s slant since Manfred took over, also the Giants management has been on good behavior lately (no annoying comments from Baer lately, for example) Also if the SC decides to take the SJ vs MLB case will be a huge factor, this fiascos outcome is still up in the air.
The A’s will get the same level of public financing from Oakland as the Raiders in Oakland or the A’s in San Jose: $0.00.
San Jose will spend some $ for infrastructure changes around the ballpark. Also, one would believe they would do enough financing to satisfy MLB. Unlike Oakland officials – San Jose politicians are 100% on board with the A’s moving here.
Not a chance San Jose spends 1 dime on ballpark construction. Not with $2 billion unfunded pension liabilities, a reduced police force with low morale, no money for tree or sidewalk maintenance, etc. If it’s pay for the A’s ballpark or don’t get the team, then San Jose won’t get the team. The team could very well sit in Oakland until some city (Portland, etc) ponies up just enough public money to get the team. Shouldn’t be tough to beat Oakland’s and San Jose’s bids ($0.00.)
It’s true about SJ having other pension and city issues…but what City doesn’t? Honestly, some of you on here fail to realize that almost any big or semi big city in this country has some kind of City issues or money or civil issues. If a city wants a major sports team that they will have to find a way to help pay for it or deal with it someway shape of form. Why are you some of you in here so damn opposed to having Oakland and san Jose build stadium or ballpark for pro sports teams. team
And it’s getting harder to justify spending taxpayer money on these sports palaces because of these difficulties. No money for tree or sidewalk maintenance, reduced police force and benefits, reduced library hours, billions in pension liabilities, but you’re going to pay for a ballpark used by millionaires on teams owned by billionaires? Good luck with that, especially in California.
San Jose already committed $20-$70 mil. to infrastructure work for the ballpark. SJ mayor Liccardo and the SJ city council are 100% behind the A’s move – SJ politics is very opposite of what Oakland is doing about the A’s and Raiders.
It’s apples and oranges. Oakland politicians are trying to not lose any teams. San Jose has nothing to lose, but the possibility of gaining a new team.
Also, San Jose is one of the best markets in the world in terms of corporate dollars. Oakland, not so much. San Jose doesn’t have to offer much to encourage the A’s. This is similar to LA not offering up public money for an NFL team.
Oakland also has to deal with the debt the Raiders (and possibly the Warriors) have dumped on their laps.
This isn’t to say that Oakland hasn’t screwed things up. Just saying that comparing Oakland and San Jose’s approach to this issue isn’t a fair comparison.
Outside of some infrastructure funds (which will potentially benefit both cities unrelated to the ball parks) and the possibility of discounted land, neither Oakland nor San Jose will or should offer up public funding.
MLB has made it clear it is not happy with San Jose expecting a free stadium. Remember the legal briefs that MLB filed noting San Jose “hasn’t offered to pay” for a ballpark?
@pjk: If either MLB or the SC approve the A’s move – it will occur. SJ officials likely will not quit the project from it after putting plenty of effort into it, and backing it so solidly.
MLB will send the team to some city that is ready to pay Big $$ for a stadium before it gives it to San Jose for free. I recall MLB negotiating with Washington DC, with DC offering to pay 2/3rds of the stadium. MLB insisted that DC pay 3/3rds. And it did. MLB does not want the bad example of ATT Park perpetuated; it brings down franchise values if potential buyers know they’re going to have to pay for their own stadiums. As far as Oakland, let’s see what happens there. I think its clear Manfred will expect Oakland to pay up. He can even argue that the Warriors and Raiders each got hundreds of millions of improvements in the 1990s while the A’s got nothing and now its their turn. This will prompt Oakland to hold its offer steady at $0.00.
If a team is going to move to Montreal – it would be the Rays, they are firmly in last place at MLB attendance, and the team wouldn’t even need to switch divisions. The A’s rank 23rd – playing at the worst MLB stadium. Besides, the bay area is a good MLB market and offers a large fanbase.
Because of the economic differences between the two sports, salary cap, revenue sharing, etc. the NFL has a lot more leverage.
Really any city can support an NFL team. There are very few cities that can support an MLB team.
Places like Portland, San Antonio and Sacramento are all worse MLB markets than Oakland let alone San Jose. Honestly if MLB tells San Jose either give up public funds if we’re going to tell the A’s to move to Sacramento, San Jose should just laugh at them.
Also, I don’t buy the franchise value argument. Just look at the increase in value for the Giants. While it’s not MLB, look at the Warriors. Why do you think the Warriors are paying to build a new stadium in SF? They’ll not only make more money each year, but their franchise value will go up.
In terms of franchise value, also remember that the stadium and the land (especially in CA) have value. The value of the team goes up just by virtue of owning the land and the stadium.
Even if San Antonio or Portland offered a free stadium why would the A’s take it?
There is a huge issue with media rights in both those cities with other teams that are now today worth more than T-rights.
Do the Astros/Rangers want to give up the 2M+ people in the San Antonio are they share right now? Or the Mariners want to give up the 3M people in the combined Portland area?
No, they don’t, Manfred would have to negotiate deals with those teams like Selig did with the Nats/O’s situation that is still in litigation…..Not good.
Right now the A’s are televised to 10M people in Nor Cal/Nevada, media rights are boosting their value up big time, even with them on revenue sharing and will continue to do so for years to come.
As for the Raiders, they are dreaming of LA but Mark Davis needs the Chargers while Stan Kroenke needs no one.
The Raiders moving to San Antonio is more likely than the A’s because of the shared TV deal the NFL employs.
The Raiders need to get this done in Oakland now, San Diego is a great example of how one can get creative. Use that creativity to their advantage as a blueprint for Oakland stadium.
The A’s are stuck in mud for the indefinite future, it is sad but the truth. It is all the Raiders/Giants fault too….With some blame on Oakland too.
IF San Antonio can’t afford new diggs for the Raiders, they won’t do it the A’s also, San Antonio likely won’t be a destination for the A’s. Wolff has also commented frequently that the A’s have no plans to move from the bay area, and that sounds credible. If the A’s move to SJ were stopped, and a deal with Oakland officials couldn’t be hashed out the A’s have alternative local potential sites, both Wolff and Manfred have addressed that scenario.
Once again …MLB is a joke for not allowing A’s to move to SJ in “best interest of baseball” alone reasoning. That league is so damn known to be all about the best interest of baseball but don’t see how not allowing the the team to move to a City that wants them in SJ…because of territorial rights given to Giants that should have been rescinded a long ass time ago. What a sick joke!
@cisco007 How true, the Giants organization is similar to a spoiled little brat that gets anything it wants – and MLB abiding by it. There is no other organization in professional sports, or likely has been, that behaves like the giants, and receives the breaks that the Giants receive from MLB.
Davis: Oakland stadium doesn’t need ‘all the bells and whistles’ | CSN Bay Area
It’s only 80 mill still owed according to Libby as opposed to the 120 everyone thought. The City and County Leaders need to do all they can to keep Raiders here. If not they will be gone forever and no more NFL and no more big time year round revenue stream either for the City or County…especially with the Dubs going bye bye. Let Wolff go to SJ. He hates Oakland anyway. The City and County “leaders” need to have a sense of civic and community pride and keep the Raiders here where they belong.
Libby (and the other Oakland pols) aren’t including interest.
Even more of a reason to keep the team here. If Raiders leave than that money is still owed. Bad move not to try and keep them. Very bad move.