NFL’s LA relocation committee meeting upstaged by Iger-Carson announcement

Oakland Mayor Libby Schaaf went to NFL headquarters in New York to present her city’s case for keeping the Raiders in town. While no decisions are immediately forthcoming, it was important for Schaaf to keep Oakland in the game. Schaaf and the Oakland contingent arrived shortly before Oakland’s scheduled slot, then left the building by taking the back entrance after she was done, avoiding the assembled press in the process. Maybe the Mayor had to catch the next JetBlue flight back to Oakland or she had tickets to Hamilton, I don’t know. In any case Oakland gave its modicum effort, which was better than literally nothing.

A slide from Mayor Schaaf's presentation

Actual slide from Mayor Schaaf’s presentation

Shortly after the meeting ended, Schaaf’s office proffered this statement:

NEW YORK, NY – Mayor Libby Schaaf released the following statement following the City of Oakland’s presentation to the NFL on November 11 in New York City:

“Today’s meeting with the NFL reinforced that Oakland is correct in continuing to work directly with the team and the NFL to keep the Raiders in Oakland where they belong.

We were very grateful and excited to have the opportunity to make Oakland’s case to the NFL today. I felt it was a positive discussion and that we were well-received by the Raiders’ leadership and the other NFL owners. They were engaged and asked great questions.

Moving forward, the City of Oakland is working to defease the current bond and purchase Alameda County’s stake in the land and existing facilities. We are also beginning to analyze ways that we might monetize future revenue that could be generated from a stadium development.

We remain committed to responsibly keeping as many of our sports teams as possible. My focus continues to be on forging a partnership that supports a team-centered effort to build a new stadium for the Raiders in Oakland that will be successful for the fans and the team and responsible for the city and its taxpayers.” (11/11/15)

What was in the presentation? Mostly it rehashed the work done for Coliseum City. The preso emphasized that the Coliseum land was publicly owned and properly entitled, with a completed EIR in hand. There’s also $40 million in funding available for the planned $140 million expansion of the Coliseum BART transit hub. Beyond that there was little to crow about deal wise. Even though Schaaf isn’t promising any public money for construction, there’s still a laundry list of issues to resolve before any kind of groundbreaking. Among them:

  • Financing for an estimated $100 million in additional infrastructure
  • The buyout of Alameda County
  • Terms to cover the outstanding Coliseum debt (a City/County issue, not the Raiders’)
  • Potential funding sources: tax increment and lease revenue bonds

Those funding sources are what’s expected to pay for the infrastructure at the very least, perhaps more. Keep in mind that the top three items could cost Oakland $400 million or more depending on when the deal happens. It will difficult enough to raise those funds before even considering how to bridge the stadium’s funding gap.

St. Louis and San Diego also had their turns and made their proclamations. But before they even had a chance to plead, an announcement from 3000 miles away sucked all the air out of the room. The Carson Holdings group overseeing the joint Chargers/Raiders stadium project announced that Disney CEO Robert Iger would become a non-executive chairman, with the option to buy a minority stake in either team. Iger, who ran ABC/Capital Cities during the height of ABC’s Monday Night Football run, is a trustworthy known quantity among the league’s owners. That said, Iger is not a billionaire, with a net worth said to be somewhere in the $100 million range. If Iger were to want a piece of the team, he would probably bring in some private equity partners from elsewhere to put up whatever was needed to take care of the project cost in Carson.

For months I have stayed away from the all-too-easy horserace aspects of this story. I won’t handicap any project’s chances now. As a strategic move, the Iger announcement worked like gangbusters. The play was for legitimacy, which is impossible to deny as of November 11. Last week many in Oakland were satisfied in believing that Stan Kroenke’s Inglewood project was superior enough to Carson that the Raiders would be forced to stay by the Bay. Now only a fool would say that.

29 thoughts on “NFL’s LA relocation committee meeting upstaged by Iger-Carson announcement

  1. Glad Schaff isn’t breaking on her commitment. Those yahoos in Minneapolis folded like a cheap tent when the Viks threatened.

    After browsing the slides, I think she did a good job of giving the NFL some economic trends to make Oakland intriguing. It’s not Mickey Mouse money, but it says – hey this region is the hottest in the country, and you’re gonna remove a team from here?

    The biggest point in Schaff’s favor is the clear-eyed political leadership (reinforced by having the councilman in tow). This is probably the first time, in a long time, that the owners are seeing Oakland get its act together. And having the pre-build process already done puts a lot of big dollar contingencies to rest.

  2. When the relocation papers are filed and the moving trucks are lined up, I’ll believe it. Announce your major investor just before Oakland makes it presentation to the NFL? MD could have announced the investor long ago. He’s still leveraging against Oakland, which means he still thinks(or wants)a stadium in Oakland. Does anyone know if this investor is gonna pay the Raiders relocation fee? Yes, its unlikely they’ll stay, but 11th hour deals have been made before. Insanely optimistic, I guess. Shit.

  3. Spanos’s net worth: $1.5 bil., Davis’s net worth: perhaps $1 bil. Iger’s net worth: .$85 mil. total = $2.085 bil.

    Kroenke’s net worth (total) including the wife, a (Walmart co-owner) ($13 bil.) money talks – b.s. walks.

    Spanos and Davis know their Carson plan is doomed and this is a last ditch effort to save their plan. Iger may not help their effort much.

    The NFL owners group siding with Kroenke evidently has enough votes to block the Carson plan.. Kroenke would likely go through with the LA move even without NFL support anyways (Both the Raiders and Baltimore previously did it) Also the San Diego newspapers are reporting that the NFL owners are leaning towards the Kroenke plan.anyhow.

  4. I really think the scenario that makes the most sense is the Raiders to St Louis or even San Diego and the Rams and Chargers to LA. Basically the Chargers look like a zombie team, playing out the string (complete with their last three home games looking like they should be played in Pittsburgh, Oakland and Chicago), and Kroenke hell bent on moving on to LA. As for the Raiders, they are not getting a new Stadium in Oakland, and they are not going to be moving to Santa Clara. There are plenty of options for deals to be made and satisfy ownership of all three teams, and I think one thing that will NOT happen is giving the Chargers rights to the San Diego Market and blocking another team from moving there (unlike the Giants and San Jose). I do think San Diego (if the Raiders do not go there (or somehow the Chargers stay)), will one day get another team.

    • @David Brown “I really think the scenario that makes the most sense is the Raiders to St Louis or even San Diego and the Rams and Chargers to LA.”

      Why does it make more sense for the NFL to move the Chargers to LA and Raiders to San Diego (thereby disrupting two markets) rather than must moving the Raiders to LA (disrupting only one market, and putting the team back in a market where they have some history and established fanbase)?

      I get that with respect to St. Louis, what’s not good enough for Kroenke may be good enough for Davis. But I don’t see why what would be good enough for Davis in San Diego shouldn’t also be good enough for Spanos.

      Also, though I fully believe Davis would consider San Diego is it were open and offering a free stadium. I’m not sure that’s a great market for him. There’s a lot of historic hostility for the Raiders there.

  5. The NFL has made it clear there is to be a team contribution, a league contribution and an NFL contribution, no? Toward stadium construction. With Oakland unable to provide the local contribution, there was nothing left for Schaaf to do but cheerlead for Oakland. It’s not going to be sufficient.

    • mean tto say team, league and local contributions.

    • “The NFL has made it clear there is to be a team contribution, a league contribution and an NFL contribution, no? Toward stadium construction. With Oakland unable to provide the local contribution, there was nothing left for Schaaf to do but cheerlead for Oakland. It’s not going to be sufficient.”

      ML, am I correct in understanding that Schaaf has opened the door to possibly issuing bonds for stadium construction to be paid back through team lease payments? How different is this really than a “local contribution”?

      • I’m certain she’s drawing the line at helping to pay for construction. She’s been consistent about that.

      • Matthew Artz seemed to interpret the lease-revenue bond thing differently. If he’s right, that seems like a significant development and maybe would improve Oakland’s chances of keeping the team:

        “The only new stadium financing idea mentioned in Schaaf’s 23-page slideshow presentation was lease-revenue bonds.

        That would likely require the city to issue bonds for stadium construction that would be paid off through lease payments made by the Raiders. Given that the estimated funding gap for a new stadium is at least $400 million, such a bond offering would likely require the team to significantly increase its annual rent. The team currently pays $925,000 for use of O.Co Coliseum and its Alameda practice facility.”

        http://www.insidebayarea.com/breaking-news/ci_29108928/nfl-executive-praises-oakland-presentation

      • The problem with that notion is that all the other pre-development costs like infrastructure and taking care of the debt plus buying out AlCo will cost far more than tax increment can provide. That’s where lease revenue will most likely factor in, probably from ground leases. If Schaaf wants to extend that to stadium construction, well, I hope she enjoys the rest of her one term.

      • Not saying she would, but if she did the political spin might be “these bonds will be fully serviced by a revenue stream that wouldn’t exist if the Raiders left.” Granted, the taxpayers would still be on the hook if the Raiders defaulted, which might call up unpleasant memories of 1995. But an NFL team under a defined lease seems a much better credit risk than theoretical PSL sales which haven’t occurred yet.

      • “Granted, the taxpayers would still be on the hook if the Raiders defaulted”

        I would certainly hope that the lease terms would include something along the line of “In case of default, remaining debt becomes immediately due, payable by only the team. If team cannot pay, either (a) city takes VOTING ownership share in team proportionate to debt (say goodbye, MD), or (b) a lien will be placed on all profits until paid.”

      • “I would certainly hope that the lease terms would include something along the line of “In case of default, remaining debt becomes immediately due, payable by only the team.”

        The team would be the one defaulting so by definition it would be on the hook. There would probably be acceleration and other language along the lines you suggest in any lease (a lot of which might be somewhat redundant).

        “If team cannot pay, either (a) city takes VOTING ownership share in team proportionate to debt (say goodbye, MD),”

        No team would ever agree to language like this (nor would the NFL allow it). However, the city would have recourse to the assets of the team just as any creditor does with any debtor. If the team didn’t pay a judgment, eventually it could be subject to forced sale.

        “or (b) a lien will be placed on all profits until paid.””

        Perhaps the city could negotiate some kind of security interest to get priority over general creditors. But either way, an NFL team is a pretty low risk for going bankrupt and is a pretty good credit risk. It’s not the same order of magnitude of risk we saw with the speculative PSLs in 1995. If I were an Oakland taxpayer, I wouldn’t be terribly worried about this.

  6. One thing I’m almost certain about. The NFL will not approve three teams in southern California. There will be either one team for LA(Rams) and one team in SD(Chargers), or two teams for LA and no team in SD. Fearing the three team scenario, the Chargers are hedging their bets by teaming with the Raiders. The NFL knows this, and will not allow the Chargers to dictate the ultimate relocation decisions. As for the Raiders, they are the odd team out. Without any serious stadium funding offer from Oakland, and lacking the private resources to fill the stadium funding gap,the Raiders are reluctantly forced to piggyback with the Chargers. As a result, I do believe that the Raiders will be offered the following choice of three less than preferred outcomes: 1. To remain at the Coliseum as is. 2. Levi’s Stadium on a short-term trial run basis with future relocation option. 3. Immediate relocation to St. Louis.

    • @illpec “One thing I’m almost certain about. The NFL will not approve three teams in southern California.”

      The NFL’s priority is squeezing as much public money out of municipalities as possible, and both STL and SD appear willing to play ball. If STL plays ball, there won’t be three teams in SoCal because STL will have a team. If SD balks, there won’t be three teams in SoCal because SD will not have a team.

      However, if STL balks and SD plays ball, there is a very high likelihood there will be three teams in SoCal. “SoCal” is not one monolithlic metropolitan area, and there is more than enough people and money in the separate LA and SD metros to support three teams.

      “I do believe that the Raiders will be offered the following choice of three less than preferred outcomes: 1. To remain at the Coliseum as is. 2. Levi’s Stadium on a short-term trial run basis with future relocation option. 3. Immediate relocation to St. Louis.”

      They will likely also have the option of piggybacking on Kroenke’s efforts, remodeling the Coli or taking Joe Lacob’s advice and financing their own stadium at the Coli site. But as I’ve said before, out of all these options, I worry most about the one where someone hands them hundreds of millions in free money.

  7. I admire Mayor Schaff for making the presentation without offering any public money. It’s got to be extremely difficult to be the lone public official to deny major funding for a sports franchise.

  8. Yeah the Rams have the inside track.The Carson project is doomed although I could see the Chargers being a second team in Inglewood with the Rams.As for the Raiders?Cover roughly 10,000 seats on mount davis play decent football and you’ll get your 54,000 Raider fanatics.Don’t see the Raiders moving anywhere anytime soon.Don’t think St Louis would have the passion to support them.As for San Antonio?Why bother.Rather be in the bay area as the #2 team then be the #3 team deep in the heart of texas.

  9. No one on this thread knows what the heck is gonna happen, but we now know one thing for sure. LA has two legitimate plans to choose, one solves stadium issues instantly and the other likely doesn’t.

    • AMEN! The only public comment from anyone that matters that I am aware of is Jerry Richardson saying “I support Carson.” Clark Hunt, Robert Kraft, John Mara, Bob McNair and Art Rooney also matter, and as far as I know, have said nothing about Carson, Oakland, Inglewood, San Diego, St. Louis or anywhere else.

      • There is evidently a large block of NFL owners who support Kroenke, In fact, most likely do. The NFL was leaning towards the Kroenke plan recently, it’s questionable that adding Iger will help the Raiders/Chargers much with the Carson plan. Perhaps, if the NFL gives their nod to the Carson plan – then adding Iger may improve the Raiders/Chargers chances of financing the project.

        Recall also that both Oakland and the Colts moved without NFL approval (a few other NFL franchise relocations may have also possibly could have occured that way – however the NFL voted to approve them to avoid egg on their face before the franchises moved without NFL approval) Kroenke would likely also move the Rams without NFL approval if the NFL doesn’t approve the Rams move anyways, and a number of NFL owners likely wouldn’t mind that.The Kroenke faction likely has enough votes to block the Carson plan also.

  10. Bringing in Iger is a nice move and definitely helps the Carson project, but I don’t see it as major game changer. Having a connected Hollywood guy on your team is nice, but one of the nice things about having billions rolling around in your pockets is you can go out and buy a connected Hollywood guy if you need one. (Assuming Kroenke doesn’t already have one or more on staff).

  11. Could Not see the Raiders moving to San Diego. Don’t think the fans there would support them. It is kind of amazing that it’s been 20 yrs. since the LA area had 2 football teams. If the Chargers are smart they’ll hook up quickly on the Rams stadium bandwagon and seal the deal that only 2 teams end up in LA. And I couldn’t see the NFL letting to AFC teams move to the same market losing AFC markets in the bay area and the San Diego area. As a football fan and a Raider fan I would love to see the Rams return to Los Angeles. And the Raiders stay in the East Bay.

  12. Can someone please explain to me how Stan Kroenke is so great besides the fact that he’s rich?

    The Rams stink. The Nuggets stink. The Rapids stink. The Avalanche stink. The one cool team he has is Arsenal and trust me as a dedicated Gooner, the fans all hate him.

    I get that the narrative has been that the Inglewood project is automatic. It’s been that for so long that people take it as gospel. But if the NFL is supposedly committed to “getting it right” in LA — shouldn’t they look elsewhere than Stan “I spread mediocrity wherever I go” Kroenke?

    I know some are clinging to the notion that Inglewood will be built no matter what because it would (ostensibly) help their particular team stay put. But if it wasn’t a 50-50 proposition at this point between Carson and Inglewood, why would all this crap even be necessary?

  13. think i saw schaff on tv earlier thursday night saying that city has proposals or at the least a downtown oakland site for the a’s?

    umm hopefully that site isn’t howard terminal because if it is that site has no shot.

    no other site hok presented nearly a dozen years ago is available anymore in the downtown area.

    uptown, howard terminal, oak to 9th and lane college is a no go. even the proposed site of to the east of where the new brooklyn basis project has been basically rejected by the local businesses there that had to move to even make the site viable which it isn’t.

    so i don’t know what site schaff was talking about other than howard terminal and there’s no way the a’s or any ownership group is going to spend the amount of money for such a project to be built there within the next decade.

    • Parcels can be put together Downtown, but at what cost? Modified Coliseaum North with the Stadium (A’s or Raiders) on 66th Ave. Directly across from Current North Lot should be doable at minimal cost plus lots of development potential and access to the current parking lots.

  14. Considering the way the Yorks have been running the Niner’s franchise lately, if Schaff and the Raiders could reach an agreement, the Raiders could be very successful by building a new stadium at Oakland.

    • I agree. Even if things were going well for the Niners, the geographic relocation to Santa Clara opens all kinds of opportunities for the Raiders. It makes Oakland’s central location much more meaningful, and provides an entree to tap into San Francisco’s corporate base (making up somewhat for the East Bay’s currently weak corporate base). I’m noticing that the Raiders are having much more success selling club seats this year; I suspect the Niners’ move is a factor.

      Shame Mark’s recent comments make it seem he is not sincerely interested in staying.

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