49ers repeal petition claims more than enough signatures to force vote

And we’re off: Santa Clara Plays Fair says it has compiled enough petition signatures to force a new referendum on the $1.2 billion San Francisco 49ers stadium proposal. With today the deadline for collecting 4,500 signatures, a just-released press release from SCPF (not on their site yet that I can tell) reports that the group has collected “nearly 11,000 signatures from Santa Clara voters asking the City Council to either repeal the development agreement and the financing plan for the planned 49ers stadium or submit them to the voters.”

Next up is almost certainly the courts, given the city of Santa Clara’s insistence that its stadium deal isn’t subject to referendum, despite it being significantly different from the plan that voters approved in 2010. Tune in again next week for Preliminary Injunction Theater!


27 comments on “49ers repeal petition claims more than enough signatures to force vote

  1. Note that SCPF had only 30 days to gather the signatures, and that 30 days included xmas, xmas eve, new year’s etc. and many days when both voters and volunteers were on vacation.

    People here are really motivated to get a chance to vote on this issue.

  2. I was surprised by how many people have turned against the stadium. Again and again I heard people say they had voted for the stadium in Measure J, but now they were against the stadium. The biggest issue seemed to be that while campaigning for Measure J the 49ners had indicated they would put money into the deal, but in the deal passed by the City Council last month the 49ners didn’t put in a single dime.

  3. I was surprised by how many people have turned against the stadium. Again and again I heard people say they had voted for the stadium in Measure J, but now they were against the stadium. The biggest issue seemed to be that while campaigning for Measure J the 49ners had indicated they would put money into the deal, but in the deal passed by the City Council last month the 49ners didn’t put in a single dime.

  4. San Jose Mercury has another cheerleading piece today discussing how good winning will be for selling corporate rights and PSLs.

    Hey, if this is all so true, why don’t the 49ers just own and build their own stadium?

    There’s a lot of 49er buzz in the air lately of course, but when people see an invoice of $50K or $100K for the mere right to purchase tickets, they will be thinking of their home theaters.

  5. thanks for the info Neil. The Santa Clara Weekly recently posted an article that contained the following:

    “The agreement (DDA) further makes it clear that the collateral for the loan is the 49ers football team itself: “StadCoÔøΩs obligations…are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.” Required by the lenders, the consent letter “permits the NFL under certain circumstances to seek a purchaser of all of the assets of the Team and StadCo.”

    Have you seen this done in the past, is such a letter sufficent to protect a city if the Stadium Auth and the team can’t meet the loan payments? Thanks for your assessment.

  6. thanks for the info Neil. The Santa Clara Weekly recently posted an article that contained the following:

    “The agreement (DDA) further makes it clear that the collateral for the loan is the 49ers football team itself: “StadCoÔøΩs obligations…are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.” Required by the lenders, the consent letter “permits the NFL under certain circumstances to seek a purchaser of all of the assets of the Team and StadCo.”

    Have you seen this done in the past, is such a letter sufficent to protect a city if the Stadium Auth and the team can’t meet the loan payments? Thanks for your assessment.

  7. thanks for the info Neil. The Santa Clara Weekly recently posted an article that contained the following:

    “The agreement (DDA) further makes it clear that the collateral for the loan is the 49ers football team itself: “StadCoÔøΩs obligations…are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.” Required by the lenders, the consent letter “permits the NFL under certain circumstances to seek a purchaser of all of the assets of the Team and StadCo.”

    Has the NFL provied Consent letter in past stadium deals?, is such a letter sufficent to protect a city if the Stadium Auth and the team can’t meet the loan payments? Thanks for your assessment.

  8. thanks for the info Neil. The Santa Clara Weekly recently posted an article that contained the following:

    “The agreement (DDA) further makes it clear that the collateral for the loan is the 49ers football team itself: “StadCoÔøΩs obligations…are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.” Required by the lenders, the consent letter “permits the NFL under certain circumstances to seek a purchaser of all of the assets of the Team and StadCo.”

    Has the NFL provied Consent letter in past stadium deals?, is such a letter sufficent to protect a city if the Stadium Auth and the team can’t meet the loan payments? Thanks for your assessment.

  9. thanks for the info Neil. The Santa Clara Weekly recently posted an article that contained the following:

    “The agreement (DDA) further makes it clear that the collateral for the loan is the 49ers football team itself: “StadCoÔøΩs obligations…are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.” Required by the lenders, the consent letter “permits the NFL under certain circumstances to seek a purchaser of all of the assets of the Team and StadCo.”

    Has the NFL provied Consent letter in past stadium deals?, is such a letter sufficent to protect a city if the Stadium Auth and the team can’t meet the loan payments? Thanks for your assessment.

  10. @SantaClaraRes – the Weekly should not be your source of news. It is heavily biased in favor of the stadium, and during Measure J the Weekly had 25 out of 26 weeks of coverage that shilled for the stadium. Then there was the greater than $20,000 in advertising dollars the 49ers campaign spent on the Weekly for full page color ads (often more than one per issue). It you think that advertising dollars don’t affect what’s written, guess again.

    The Weekly was one of the ways in which mis-information about stadium costs was propagated during Measure J. Expect nothing less than misinformation from the Weekly now that enough signature have been gathered.

  11. Santa Clara Weekly is a real rag. To it’s credit it has run several anti stadium letters, but overall it is no where near the quality of the Mt. View Voice or the Palo Alto Daily–other local free papers.

  12. I was strongly against the stadium, and even put a yard sign up. Now…not so much.

    1) The winning really is huge. HUGE!!! It will make PSL’s, Naming Rights and Pouring rights much easier to sell. Good chance they’ll still come up short, but it shouldn’t be a major shortfall.

    2) The increased debt of the Stadium Authority is being paid for by higher rents by the 49’ers. The Stadium Authority can borrow money cheaper than the 49’ers due to the favorable tax treatment of muni-bonds vs corporate. No big deal.

    3) The hit to the Great America Revenue is almost nil in the short term.

    4) Good chance the Raiders will play there for a couple years, and can further mitigate financial risk.

  13. I was strongly against the stadium, and even put a yard sign up. Now…not so much.

    1) The winning really is huge. HUGE!!! It will make PSL’s, Naming Rights and Pouring rights much easier to sell. Good chance they’ll still come up short, but it shouldn’t be a major shortfall.

    2) The increased debt of the Stadium Authority is being paid for by higher rents by the 49’ers. The Stadium Authority can borrow money cheaper than the 49’ers due to the favorable tax treatment of muni-bonds vs corporate. No big deal.

    3) The hit to the Great America Revenue is almost nil in the short term.

    4) Good chance the Raiders will play there for a couple years, and can further mitigate financial risk.

  14. SCR, that clause isn’t in the DDA summary that I got from the city’s website, and the full text doesn’t appear to be posted there. Anyone know where to find it?

  15. I don’t know why they announced 11,000 signatures initially as it turns out that was later corrected to two figures around 5,500. There were two petitions that people could sign for somewhat different issues related to the stadium. Both petitions added together had 11,000 signatures. The 5,500 or so of each is under the 6,000 unverified signatures that it was felt would be necessary in order to ensure ending up with correct amount of verified signatures. So there is a possibility that not enough valid signatures have been collected.

  16. It is common to announce the total number of signatures collected. People had a choice about whether or not they wanted to sign both petitions, and people chose to sign both.
    A previous referendum issue here(a sale of state land within Santa Clara) had 2 petitions and announced the total number of signatures.

    Only about 4,500 verified signatures are needed, and people here were very careful to get signatures from registered Santa Clara voters which would qualify as valid, not from anyone outside of the city. The group collecting the signatures is composed of really smart, dedicated, motivated people. Many people here are outraged by our city council’s behavior in approving $850 million in loans for a stadium that wasn’t on the June 2010 ballot. Many people who signed the petitions were previous ‘yes’ voters on the stadium who feel betrayed by our city council.

    The signatures were collected in 3 weeks despite the massive number of union blockers, the SJ Merc editorials (2 of them) saying ‘don’t sign the petitions’, the city attorney’s letter saying that the referendum can’t happen (despite the guarantee for referendum in the CA constitution and our city charter), the need to get the ACLU involved to preserve our right to free speech, and the SC Weekly article which compared apples and oranges (an initiative lawsuit does not apply to a referendum).

  17. Santa Clara Plays Fair does not seem to understand the new deal is actually better for the city.

    The 1st deal had the following breakdown

    Stadium Authority- 330M.
    -Any shortfall would come from the general fund.

    New Deal:
    In the new deal granted the Stadium Authority takes on the 850M loan but it is the 49ers and the NFL who are on the hook for it.

    -The 49ers increased their lease payments to 30M a year. They also have said year to year whatever the difference is between debt service and their lease payment they would make up the difference.

    -Just because the Stadium Authority sits on the debt does not mean anything. With the 49ers and the NFL paying it off year to year you can take the key to the General Fund and “lock it up”.

    The city council sees as a trade off for taking the debt on in a tax sheltered vehicle. The 49ers are the ones in charge of paying it off.

    That is what you call “good business”. This signature drive is illegal and is a waste of the courts time.

    This is an act of desperation that in reality has no merit.

    The City of Santa Clara protected themselves by doing it this way. They protected the taxpayers 100% from any short falls by putting it all on the 49ers.

    Unless the 49ers dissolve as a franchise or the NFL dissolves as a league, the city can sue either or both if they fail to comply by the agreement.

    The NFL is a multibillion dollar business and they can sneeze and pay off the debt in one shot no problem.

    In conclusion the old deal had any shortfall on the city and the General Fund. The new deal puts all the risk on the 49ers and the NFL. Why can’t Santa Clara Plays Fair see this is as good as it gets for NFL stadiums??

  18. SBSJ,

    I don’t have much time right now, but the stadium bonds will be taxable (from Fidelity’s website):

    Taxable municipal bonds
    The interest on some municipal bonds is taxable because the federal government will not subsidize the financing of activities that do not provide significant benefit to the public. Bonds issued to finance things like stadiums, replenishment of a municipality’s underfunded pension plan, or investor-led housing are a few examples of issues that would not qualify for federal tax exemption.

    Also, check the DDA, there’s no spreadsheet showing dedicated funding sources. It’s all conjecture on what we will really get. Cart before the horse in this regard.

    Also, we are not dealing with the 49ers, we are dealing with Stadco, a Delaware front co which can evaporate at the first sign of distress.

    Furthermore, the 49ers are not a regular business tenent that can be easily evicted; they will hold great leverage over the SA and evidence from other cities suggest they will use it.

    Right now they (and the council) will say anything to attempt to mollify people.

    I maintain that it is wrong for a small city to be accepting such business risks for the benefit of a private family business.

    If this is such a super awesome deal, why didn’t other local cities want to get in on the action?

    Why doesn’t the “multibillion dollar” NFL step in and help out Cincinnati, Oakland and other cities in financial distress if it would be so obviously easy (to you) for them to do so?

  19. I know this is my post above but I think it bears repeating:

    “The interest on some municipal bonds is taxable because the federal government will not subsidize the financing of activities that do not provide significant benefit to the public. Bonds issued to finance things like stadiums”

    I like the part about “Do not provide significant benefit to the public”.

    Please like football and will say anything on its behalf, it get that. But it doesn’t make it true that the deal makes sense.

  20. The right to a referendum is in the CA Constitution Article 2, the Santa Clara City Charter, and specifically for development agreements is contained in the Santa Clara City Codes. There is nothing illegal about collecting signatures for a referendum. People always have the option of petitioning for a vote through the referendum process to get relief from the decisions of their elected officials. That’s what Santa Clarans are doing.

    And the 49ers/stadium boosters are free to make whatever arguments they wish during a campaign once the DDA/Joinder are put on the ballot. They can argue however they want that $850 million in debt is good for Santa Clara’s Stadium Authority.

    The fact remains that had those loans been on the original Measure J ballot, there’s no way Measure J would have passed. The 49ers/pro-stadium council members/the 49ers campaign front group SCEP fought very hard to keep the costs off of the ballot for Measure J. All of that has been documented on Santa Clara Plays Fair’s website.

    The voters never authorized a blank check through Measure J, which is how our council majority treated it. This action is between the people of Santa Clara and our City Council.

  21. It’ll be a lot of court time and a lot of money from SCPF before it ever sees a ballot. Just because SCPF’s position is that it can be put on the ballot doesn’t mean it can or that it will.

  22. A good summary of what’s going on here is available on:

    savesantaclara.org/index.php

  23. “SCR, that clause isn’t in the DDA summary that I got from the city’s website, and the full text doesn’t appear to be posted there. Anyone know where to find it?”

    The quotes in the Santa Clara weekly came out of the 12/13/2011 city council meeting Agenda Report.
    They are from a section called

    “1. Commitment Letter”

    The Construction Loan must close prior to April 30, 2012. The Commitment Letter contains certain conditions to closing, including the execution of the Design-Build Agreement and the Design-Builder
    obtaining bids or proposals representing at least 75% of all of the subcontracted project costs. As an
    additional condition to closing, the Team must enter into a non-relocation agreement for the benefit of the Construction Lenders. Additionally, the Construction Lenders are requiring the execution of a NFL Consent letter that permits the NFL under certain circumstances to seek a purchaser of all of the assets of the Team and StadCo.

    The Construction Loan will have a maturity date of September 1, 2015.

    The Commitment Letter also imposes certain obligations on StadCo. These obligations include the
    requirement that StadCo loan to the Stadium Authority the loan proceeds received by StadCo pursuant to the Construction Loan for use for development of the Stadium. Additionally, StadCo is obligated to purchase from the Construction Lenders the remaining balance of the Stadium Authority Construction Loan on the maturity date. StadCo’s obligations under the Commitment Letter are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.

  24. Note that Stadco is an LLC, which means it is a shell company that can fold at any time. If there was no risk, then why would the 49ers have to create a LLC?

    “In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.”

    ‘It is expected’ means nothing.

  25. Wishful thinking isn’t going to carry the deal when the honeymoon period of the stadium ends.

    I’m trying to read the DDA. I highly doubt our council has read it. I frankly don’t think that they’re very bright individuals. What really matters to them is that the team comes and let’s not worry about the “financial” bummer stuff too much.

    If you don’t love pro-football and look at the deal from the city’s perspective, it just doesn’t add up.

    If everything goes “right” and useless for anything but pro-football structure. If things don’t go “right” ask Cincinnati, Oakland, Houston, & Indy about their stadium authorities…

  26. Here’s what the Commitment Letter actually says, which has been exaggerated by our local weekly free paper which shills for the stadium. Note that Stadco is a LLC which is just a shell company that can fold at any time. Stado will have no power over the team itself.

    “The Commitment Letter also imposes certain obligations on StadCo. These obligations include the
    requirement that StadCo loan to the Stadium Authority the loan proceeds received by StadCo pursuant to the Construction Loan for use for development of the Stadium. Additionally, StadCo is obligated to purchase from the Construction Lenders the remaining balance of the Stadium Authority Construction Loan on the maturity date. StadCo’s obligations under the Commitment Letter are supported by a requirement to make a capital call on the Team. In the event that StadCo fails to perform its obligations, it is expected that the NFL will be involved in working out a resolution of any loan defaults pursuant to the NFL Consent Letter.”