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City decks NFL proposal with lots of folly

Football league would bring in $187M for personal seat licenses?

The San Diego Chargers today (December 30) submitted its stadium subsidy plan to the National Football League. It is almost the same as the earlier plan put forward for a Mission Valley stadium.

The stadium's cost would be $1.1 billion. St. Louis, which yesterday (December 29) sent its plan to the NFL, wants to build a $1.1 billion stadium to keep the St. Louis Rams from moving. However, Stan Kroenke, owner of the Rams, has already broken ground on an Inglewood stadium that would cost close to $2 billion.

Kroenke, who with his wife is a double-digit billionaire, proposes a stadium with the bells and whistles that NFL stadiums now have. In recent years, pro football has become a game for the affluent.

According to the Chargers' proposal, the city would put in $200 million, the county $150 million, the NFL $200 million from its loan program and sale of personal seat licenses ($187 million), and the Chargers' $363 million (which could be partly if not wholly paid with sale of naming rights and corporate sponsorships.) To count on $187 million from personal seat licenses is folly.

The document stresses that the Chargers steadfastly refuse to work with San Diego. The proposal claims that the team is 22nd among 32 NFL teams in total revenue, 18th in annual ticket revenue, and 17th in average ticket price.

The document argues that the actual San Diego market is 6.5 million people, instead of half that, which is the official population of the San Diego metro area. To reach 6.5 million, the document adds in Imperial Valley and Baja California. But how many people from those areas will attend games if ticket prices are the 17th highest in the NFL? According to Team Marketing Report, the average Chargers ticket this year was $84.55, just below the league's average $85.83.

The document also claims that polling shows that the public is interested in going to a game in a new stadium. But these polls, done by phone and email by a consulting firm, have been questioned: other polls show that San Diegans do not have a favorable opinion of paying for such a stadium with their taxes.

Oakland, which wants to share a $1.7 billion L.A. stadium with the Chargers, has not submitted a plan for remaining in its home city. It still owes $100 million on the rehabilitation of its current stadium. St. Louis wants to get $400 million from city and state sources, $250 million from Kroenke, $300 million from an NFL loan, and $50 million from personal seat licenses. The situation in St. Louis is the same as it is in San Diego: the current owners of the teams do not want to stay.

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So they want to put public funds into the pocket of a billionaire. Disgusting.

I can't afford to go to a Chargers game, why should my tax money go to subsidize this part time entertainment for the well to do?

MichaelValentine: You have just described one of the most revolting aspects of the billionaire stadium scam. The people who can't afford to attend games pay taxes to build a posh stadium that serves, mainly, the well-to-do or the very rich. Attending pro football games now appeals greatly to the affluent. But the little folks shell out tax money for a luxury-appointed stadium that they cannot afford to go to. Best, Don Bauder

And the gullible rabble of suckers will vote for it, their social instincts appropriated by The Great Manipulators to convince them that a bunch of billionaires and multimillionaires are "home teams." They will suck the rest of us into this black hole and banish us from the paradise of "America's Finest City" to slabs on the desert and other places more befitting our economic status.

Flapper: This is a big problem. Those who want a tax-supported stadium will outspend the opposition by 100 to 1 or more. It's hard to win an election when outspent like that. Best, Don Bauder

don bauder But who is it that wants the stadium?? Who is it that is going to fork out all that money?? The Chargers don't want the stadium, so it won't come from them. Are you suggesting that the business community and the local fans will spend it? Perhaps the city will spend even more taxpayer dollars promoting it and getting it's lesser informed citizens to vote for it? Seriously, I am curious as to where you think the money will come from that will be used to buy the vote.

danfogel: I can think of a number of scenarios: 1. The Chargers get shut out in L.A. and figure that they won't be able to wait a couple of years and get it. They are stuck in San Diego. The establishment will want to build the team's billionaire owners a stadium.

  1. The Chargers move to L.A. The Raiders, getting no help from Oakland, have to choose between St. Louis and San Diego. They choose San Diego. The establishment cons the public again.

  2. No L.A. scenario gathers the necessary votes of owners, who are hopelessly split. The Chargers, tail wagging between their legs, return to San Diego, hat in hand. The establishment decides that building a stadium is more important than repairing the infrastructure.

  3. The Rams move to L.A. and Kroenke chooses the Raiders as tenants. The Chargers diddle with the idea of moving to San Antonio or London, but decide to stay in San Diego after the establishment assures them that they can screw the public into building the team a new stadium.

  4. The owners vote for the Carson location. The Raiders and Chargers plan their move. But the financing breaks down on a half-built stadium, and while the teams sue Goldman Sachs (a six-year process), either the Chargers or Raiders decide on one going to San Diego and another going to St. Louis. Whoever comes to San Diego gets a stadium built with taxpayer money.

  5. The Chargers move to L.A. Lawsuits against the move pile up. Lawyers go to Congress, asking that the NFL's antitrust exemption be removed. The league owners vote to put an expansion team in San Diego. The establishment cons the public into building a stadium for the team.

Best, Don Bauder

or maybe the fans ( and taxpayers) wise up, and they stick it to the chargers ( Spanos)

In which case, Spanos sells the team and reaps a billion dollar profit.

JustWondering: I think the Spanos family might sell the team even before there is a move to L.A. or somewhere else. Alex (now non compos mentis) has several children and grandchildren. Not all are involved with Chargers.

The major source of the family's money is the Chargers team. To get to L.A., it may take a new owner or owner of 49.9 percent to provide more financial heft. Alex Spanos's wife may be holding things up now. Best, Don Bauder

As I recall, the kids own 15% each and the old folks own 36%. NFL ownership rules require a majority owner or group to hold at least 30 % of the team. If the kids wanted out, they could sell their stakes and regardless of what the old ones want, someone else would be in control.

danfogel: I wouldn't swear by it, but I think a 15-36 split is about right. I guess it is possible that such family differences could lead to different majority ownership. I am not sure it is likely. I suspect Alex Spanos's widow has a big role to play. The Chargers assets are the family's main holding, but there are other assets. I wonder if Alex's children and grandchildren would dare cause a family rift over the Chargers when they could be cut out of the other assets.

On the other hand, pro sports teams are going for such ridiculous prices that the children and grandchildren may not care about those other assets. Best, Don Bauder

don bauder I wasn't aware that Alex Spanos had died.. As far as I am aware, although he is mentally incapacitated, he is still alive. Being that the Chargers are at least 90% of the Spanos family wealth, it the kids wanted to sell their shares, at the right price, they wouldn't be losing much. And that is if, and a big if, mama Spanos could get the old dudes's estate plan changed. Seeing that he's still alive, if the plans have already been made, with him be mentally incompetent, would mama be able to cut the kids out? I don't know if she could or not. But as greedy as the Spanos family is, it would be one hell of a fight.

danfogel: Alex Spanos is not dead and I should not have called his wife his widow. However, he is in his 90s, and I was thinking ahead. Still I was wrong.

I don't know whether the senior Mrs. Spanos could make changes. It depends on contingencies in the will, I suspect. Best, Don Bauder

Murphyjunk: That would be wonderful. And it could happen. I sense that San Diego public opinion is running against the Chargers -- and against the billionaire subsidy scam -- now. Best, Don Bauder

At least John Moores was smart enough to pour in some cash and reach the World Series before getting the taxpayers to fund the Padres' new ballpark.

JustWondering: Oh yes. Moores rented a team for the year of the vote. The Padres got to the World Series, and although the team was creamed by the Yankees, enthusiasm was on steroids in San Diego. The ballpark got around 60 percent of the vote. Once he got his ballpark, Moores dumped the players who had gotten the team to the Series. Best, Don Bauder

don bauder All well and good. But my question was pretty straight forward. Specifically, where do you think the money will come from that will be used to buy the vote. Exactly who is going to foot the bill to outspend those opposing a new stadium by at least a 100 to 1 margin? Who are those individuals or organizations willing to do that. Be specific. Name names. Who do you think they are??

danfogel: I thought I named them. They could be the Chargers returning after being rebuked in L.A. It could be an expansion team. It could be the Raiders, who choose San Diego as home after the Chargers join with Kroenke in Inglewood. There could be other permutations. The NFL would be helping out, under the table in this case. Best, Don Bauder

Since it's seems to be pretty clear the Chargers want to leave for "Los Angeles", I'm just wondering how much is left to pay on the 1997 bonds use to pay for the expansion of our existing stadium? If I remember correctly the Chargers are "responsible" for that debt if they left before 2020.

I also see the City's NFL submission: http://www.sandiegouniontribune.com/documents/2015/dec/30/san-diegos-letter-nfl/ is real fluff propoganda. While touting all of San Diego's amenities, it overlooks all the basic infastructure and services which are falling apart or non existent.

JustWondering: I believe it is in the range of $25 million depending on when they would leave. Best, Don Bauder

JustWondering: The San Diego submission to the NFL is a joke. In one section, the report says that more than 90 percent of San Diegans, according to polls, say they would like to see a game in a new stadium. Huh? If a pollster called ME and asked if I would like to see a game in a new stadium, I would say yes. Best, Don Bauder

90 percent polled at a sports bar during happy hour ( on one of those rare occasions when the chargers were ahead.

Murphyjunk: That would be one way to fix a poll. There are many other techniques. Best, Don Bauder

don bauder But everyone knows that's a lie. You watch football on television, but you don't attend games.

danfogel: I have gone to one Chargers game at Qualcomm. I went to one Bears game in Wrigley Field roughly 55 ago. I went to one Cleveland Browns game in the seven years I was there.

However, I have gone to a number of Holiday Bowls. I watched yesterday's on TV and approved of the outcome. Best, Don Bauder

Me too! It would be a hellacious commute for you to see a game in a new San Diego stadium.

JustWondering: But coming back for an opera would not be hallacious. I know. I have done it several times. Best, Don Bauder

So I guess those trips to Sante Fe and San Diego for an opera would qualify you as an opera fanatic, much like those football fanatics you often talk about.

danfogel: Opera fanatics travel all over the world to see operas. I have only seen operas overseas a handful of times. Besides, I don't favor government support of opera.

At one point, San Diego Opera wanted to build a new house that would require the City to donate valuable land. I was an advisory director at the time and did not favor the idea. Arts groups in San Diego now get money from the transit occupancy tax. Since substantially every arts group gets some, and it is not a large portion of San Diego Opera's pie, I never opposed that. Best, Don Bauder

Mike Murphy: Billionaire owners and millionaire players being subsidized by the poor and middle class. Best, Don Bauder

Fred Jacobsen: Agreed: giving the MV land to SDSU would be better than developing it or using it as a location for a highly subsidized stadium owned by billionaires. Best, Don Bauder

With the underlying (pun intended) contamination issues, would the city even be able to anything with the land, with out first remediating the contamination?

danfogel: There is still controversy on that plume. Some say the effects have been mitigated, others disagree. Best, Don Bauder

Not sure why the idea of giving the MV land to SDSU is a good idea. The city loses either way. A gift of public assets is illegal no matter who gets the land.

Dennis: If what you say is true, most cities, including San Diego, are violating the law. Maybe if the land is turned over for a very low price, a city can get around such a law. Frankly, I am not aware of this restriction. Best, Don Bauder

Dennis: Wow. A strict reading of this would have prevented the City giving Moores $300 million for the ballpark now named Petco. There must be a way the gift recipients (teams) get around this. Best, Don Bauder

Dennis: Here's an add: a strict reading of this would prevent the massive amount of corporate welfare in the form of subsidies for hotels, shopping centers, auto dealerships, big box retailers, pro sports team owners, ad nauseam, in California. There has to be wiggle room in there. Best, Don Bauder

I'm sure there are those that would try to parse the language to make it legal but I still don't know why anyone would want to give away an asset that not long ago was considered to be worth up to a billion dollars.

Dennis: The land is given to a billionaire by a city council. The politicians on the council know that if they don't subsidize the billionaire owner, the team may leave and they may lose the next election. Best, Don Bauder

As I recall the Chargers want a stadium-by-the-bay and do not want to stay in Mission Valley. I believe that the decision to stay or go was made in the smokey back rooms long before the Mayor and the legions of stupid fans started whining about the Chargers leaving. If they go who cares and if they stay they will be bad neighbors as they don't want to stay unless the idiot voters and idiot politicians fund the stadium-by-the-bay. Happy New Year Don - Keep up the good work! Go San Diego Dischargers!

AlexClarke: You mean the Dishonorable Dischargers? At one point the Chargers indicated that they could go for a downtown stadium. However, since then, they have made it clear that L.A. is their objective. Best, Don Bauder

I haven't seen anyone cover the scenario in which the Raiders and the Rams win the lottery and the Chargers have to come back to the bargaining table. I'm sure they'll use the current offer as a starting point, but would the local government team have the guts to play hardball? Take that offer off the table and start at zero public contribution?

ronh: I have been writing about that possibility for some time. I think it is quite possible that the Chargers will not get to L.A., at least within the next couple of years. The Carson proposal is not credible. I suspect Kroenke will win and then pick between the Chargers and Raiders -- or maybe not choose either until he sees if the market develops as hoped.

San Diego will have to come back begging the city it spurned. Many think residents will forgive all those insults and lies hurled at San Diego, and come running back. Possible, but doubtful. Biggest problem: the Chargers may come back to San Diego, but still be trying to get to Los Angeles or some other market, such as London. I would think if San Diegans think the team is only a temporary resident, enthusiasm will wane fairly quickly. Best, Don Bauder

I was more interested in what the politicians' response would be. Given that the Chargers probably won't put all their cards on the table, their response is likely to be "nice offer" and negotiate upward. I think the government should take the offer off the table today and start with zero public contribution if the Chargers come back. But I don't expect a profile in courage given that it's OPM.

ronh: Zero public contribution works in L.A., but weak-kneed San Diego politicians would never do it. Best, Don Bauder

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