NFL considering half-billion-dollar L.A. relocation fee, could put off decision until 2017

Of course, whether or not St. Louis and Missouri approve $500 million or so in subsidies for a new Rams stadium, there’s still the little matter of the NFL approving which team or teams it will allow to move to Los Angeles. And despite rumors that the league was getting close to a decision, Ian Rapoport of the league-owned now reports that the L.A. situation is in “gridlock,” and while the “hope” is that a league vote could come by May, it might not take place until 2017.

What’s the holdup? It’s always possible that this is just a matter of the owners’ cabal not being able to decide which of their brethren’s move plans they want to approve, or that they’re waiting to see what city officials in St. Louis, San Diego, and Oakland ultimately approve. (Though if so, why leak it to the media when a looming deadline is more likely to create a sense of urgency for those voting on stadium plans?)

There’s one other wild card, though, which is that, according to a report last week in Sports Business Journal, NFL owners are looking to get $500-600 million in relocation fees from any team moving to L.A. Given that the best guess is that a relocated L.A. team would see its revenues rise by a present value of maybe $500 million or so, taking on well over a billion dollars in stadium debt plus another half a billion in relocation fees seems like financial suicide.

So to the existing game of chicken between the owners of Rams, Chargers, and Raiders and the three cities that want to keep them, add in an overlay of an additional game of chicken between the L.A.-seeking owners and the NFL over how much cash they’ll have to cough up to the league to be allowed to move. I can see where this might result in gridlock, yes.

Everyone knows what the NFL-to-LA negotiations are, commences haggling over the price

I got busy yesterday preparing for my talk this morning reading from the Coney Island chapter-in-progress of The Brooklyn Wars (if you want to see some highlights, Amy Nicholson of Zipper fame did some livetweeting), which means I didn’t get a chance to recap the flood of news around Wednesday’s presentations to the NFL by cities whose teams are threatening to move to L.A. Not that there was much real news in the sense of anyone coming up with new plans or decisions on how L.A. relocation will decided or discoveries of a money tree for funding the actual stadiums or anything, but, you know what, let’s just get to it, shall we:

  • Officials from each city — San Diego, Oakland, and St. Louis — spent two hours apiece meeting with NFL owners, after which St. Louis stadium point person Dave Peacock said, “I doubt our presentation could have gone much better.” Which is … good, right? This is like the “You can’t put too much water in a nuclear reactor” SNL sketch.
  • San Francisco 49ers owner Jed York came out of the meeting and said, “Let’s look at the markets where teams are already, and if they prove to not be viable, then we will look at the next step, which is relocation,” and Carolina Panthers owner Jerry Richardson added that a St. Louis stadium proposal which meets “the protocol for the NFL on relocation” would force the league to keep the Rams there. (Which, given that the NFL gets to write that protocol, doesn’t mean a ton, but it got everyone in St. Louis excited that “If we throw enough money at the Rams, they’ll have to stay, even if we don’t know how much money is enough!”
  • The Chargers and Raiders then blew up the news cycle entirely by announcing that their new point person for their proposed Carson stadium would be Bob Iger, the freaking CEO of freaking Disney. Which means nothing, really, except that they’re “serious” and all that, since “the chair of Disney is going to run our stadium” sounds better than “we want to build a stadium and we have some drawings and, uh, yeah.”
  • Oakland Mayor Libby Schaaf revealed that she’s considering issuing city lease revenue bonds for a Raiders stadium, for the first time opening the door to the city spending money on actual stadium construction costs. (ABC News calls them “tax-exempt bonds,” but lease revenue bonds for stadiums are required to be taxable, so forget that.) Lease revenue bonds would be repaid by rent payments by the Raiders, so really would just be a way of letting Mark Davis use the city’s low-interest credit card if he agrees to pay it off — though Schaaf also opened up the possibility of using tax increment financing (i.e., kicking back taxes paid by the Raiders and surrounding development), which obviously would be a whole nother kettle of fish.

In short … okay, there is no in short, since this is just a continuation of all the sides in this multidimensional game of chicken angling for an advantage. Will St. Louis convince NFL owner that their $500 million-ish stadium subsidy offer to the Rams is too rich to turn down? Will Schaaf’s offer of cheap money and maybe a smidge of tax kickbacks lure Davis into giving up on wedging his foot into the L.A. door and sticking with Oakland? Does Bob Iger provide Carson with the buzz it’s been missing since it discarded its idea for a giant eternal Al Davis flame? And most important, can anyone really make gobs of money on a move to L.A., or is it some combination of calculated risk and blackmail threat?

Answers to thee questions and more coming soon, I hope. Though I also wouldn’t recommend holding your breath, because the NFL’s deadlines, like its relocation protocols, are decided by the NFL, so if it’s in their interest to wait, they’re damn well gonna wait.

Do the financial numbers justify an NFL move to L.A.? Sorta

I’ve been threatening for a while to do a deep dive into the numbers behind moving an NFL team to Los Angeles — in short, does market size still not matter much in the NFL because everyone shares the same national TV money, or have the economics changed to where L.A. is now a potential goldmine? Thanks to Vice Sports, I finally had time to do so, and the answer is: a little of both. The short version:

  • NFL revenues may still be fairly flat across franchises compared to other leagues, but they’re up overall — and even if owning a big-market franchise is only worth 30% more than a small-market one, if the actual value of that 30% has risen, it means building an L.A. stadium is a better investment for owners than it was just five years ago.
  • Personal seat licenses have potentially changed the game, since now that the 49ers paid for a stadium essentially by crowdfunding, everyone else thinks they can, too, if the market is good enough.
  • It’s still not enough to explain why St. Louis Rams owner Stan Kroenke would want to spend $1.8 billion on an L.A. stadium. Says Roger Noll, dean of sports economists: “Yes, it’s worth something. It’s not billions of dollars.” But Kroenke may have other reasons for wanting in to L.A. — and even if he doesn’t, the gamesmanship behind the fight to move to L.A. may be making his decision to take on the risk, as well as that of the San Diego Chargers and Oakland Raiders owners, unstoppable.

Anyway, go read it for yourself and then we can always debate the numbers in comments below. It’s not quite a definitive answer to whether all the L.A. move talk is serious, a bluff, or somewhere in between, but it’s at least an attempt to establish some basis for discussing it.


NFL to meet on Veterans Day to hear latest proposals to end the L.A. relocation war

Mark down November 11 as the day to mourn the senseless loss of 38 million lives in World War I. Also, the day for St. Louis, San Diego, and Oakland to make their latest stadium presentations to the NFL.

Not that either is likely to provide any new news: We already know how those cities’ stadium plans are turning out (if not quite as definitively as the Great War, then close enough), so don’t expect any sudden surprises. And the presentations will take place in a closed NFL meeting room, and the league has said that no owners will be available for interviews afterwards, so there’s not even likely to be any good tea-leaf reading opportunities.

Behind closed doors, at least, the presentations are likely to give owners something to chew on, so maybe later in November we’ll be treated to some insider gossip about who’s siding with or against whom, which is always fun. As always, I’d prefer some coverage of whether any of these stadium plans — in the three current NFL cities or in L.A. — make any damn sense, but I guess if I want that job done, I’m just going to have to do it myself.

Watching NFL stadium extortion in slow motion is not pretty

Marine Layer of watched NFL VP Eric Grubman’s three-hour “town hall” with Oakland Raiders fans so you didn’t have to, and his recap is well worth reading. If you just want it in bullet points, though, here you go:

  • This was a sad spectacle, not that anyone should have expected anything different: “As each story about generational bonding or heartbreak was heard, the more it sounded like groveling. That’s what the owners and the NFL have reduced fans to doing: begging to keep the team in town. … Some guy within NFL Films will be tasked with editing the combined nine hours of testimony down to probably 30 minutes that will be consumed by the collective 32 NFL owners at a future league meeting. I don’t envy that person one bit.”
  • Grubman is the NFL’s answer to George Clooney’s smarmy hatchet man in Up in the Air: “Grubman’s ability to empathize with every fan and speaker was amazing to watch. Veterans and government employees received laudatory Thank you for your service salutations. Several times he prefaced a remark with, I know what it’s like to be a fan. It was as breathtaking and sickening a performance as I’ve ever seen – including Clooney’s, which netted him an Oscar nomination.”
  • Nobody has a magic wand: “No one wants to be left with the check at the end of the night, whether it’s Davis and his ownership partners, the City of Oakland and Alameda County, or stadium financiers. This is not a trivial amount of money – $400 million – that we’re talking about. Fans need to stop treating this issue like it is.”

That’s about the size of it. Not like any of this public charade is likely to matter much in the end — that’s going to come down to 32 guys in a room and someone with a list of subsidy promises and an adding machine — but it’s important to remember that even corporate sports behemoths feel the need to worry a smidge about public perceptions.

San Diego mayoral aide calls Chargers negotiator “poisonous,” tells him to stay out of stadium talks

Talks between the city of San Diego and the Chargers already broke down this summer in a barrage of sniping, with Mayor Kevin Faulconer complaining that the team management wasn’t a “willing partner” and team stadium chief Mark Fabiani calling the mayor’s plan “remarkably unsophisticated.” Now things have escalated to where Faulconer’s top political aide says if the Chargers want to resume negotiations, they better leave Fabiani at home:

“I think Mark Fabiani has been poisonous to a solution for the Chargers remaining in San Diego,” [Jason Cabel] Roe said. “From the very beginning of this process he has done nothing but mislead the mayor’s office, the fans and civic leaders on what the team’s intentions are.”

This does not at first seem to be the best way to get talks going with an unwilling partner, calling their lead negotiator “poisonous.” But then, you have to consider which audience Faulconer’s office is actually playing to. As it becomes clearer that 1) none of the cities facing team threats to move to L.A. (San Diego, St. Louis, Oakland) have the kind of slam-dunk overwhelmingly lucrative subsidy offers that will instantly win over team owners, and 2) the other NFL owners are going to have to pick which one or two teams get to move to L.A. and which have to stay home, mayors are starting to think about how to lobby the league directly to say “Look, we tried, the people on the other side of the table won’t listen, please don’t take our team!”

It probably won’t work — NFL owners may not all like each other, but they still like each other more than they like city mayors — but it’s worth a shot. Besides, when Mark Fabiani is just coming off an appearance at one of those bizarro NFL listening tour events where he was almost booed off the stage, it’s easy to score points by attacking him in public. And when you’re playing a game where the winners and losers are going to be determined by 32 rich guys in a room somewhere, scoring political points may be the only sure move you have.

NFL VP meets with Rams fans, insists their opinions count, but only if backed by public cash

The official NFL relocation guidelines are a weird bundle of contradictions: They exist only so that the league and its owners can threaten to move teams from city to city in search of a better deal, but they also have to give lip service to the notion that the NFL cares, really cares about keeping teams in their current homes. Unless there’s, you know, a better deal.

So you get NFL VP Eric Grubman, whose main job is to fly around the country and threaten cities that their teams will be gone if they don’t cough up the dough, going on a listening tour of St. Louis, San Diego, and Oakland to hear fans’ concerns. And sure enough, somebody asked him about the seeming contradiction:

Grubman bristled slightly when it was suggested that what took place Tuesday was a dog-and-pony show that won’t have any weight on NFL team owners when it’s time to vote on relocation to Los Angeles.

“I can’t guarantee [skeptics] what weight it’s going to have,” Grubman said. “But I can guarantee people that I’m not coming to a dog-and-pony show.”

What else might carry more weight? Why, I’m glad you asked:

Grubman says the NFL needs to see three things when it comes to the stadium plan in St. Louis.

“The first is there has to be a specific plan,” he said. “The second is it has to be actionable. And the third is it has to be attractive to a team.”

Eric Grubman cares about your feelings, NFL fans. He really cares. Just not as much as he does about money, because that’s his job, after all.

St. Louis pol says Rams stadium too pricey for city taxpayers, wants other taxpayers on hook instead

On Friday, you will recall, it was revealed that St. Louis Mayor Francis Slay is proposing to make up for using naming-rights money to pay for the public share of a Rams stadium — money that team owner Stan Kroenke insists should be his — by kicking back city taxes on spending at NFL games to the team. How is that going over with city officials who had specifically complained about the city “game day” tax kickback when it was first proposed as stadium funding, without the intermediate step? As you might expect, not well at all:

“The city cannot agree to fund the $150 million proposed by the stadium task force without extending itself well above the current $6 million commitment,” [city comptroller Darlene] Green said in her statement.

“St. Louis city should not be asked to shoulder the burden of the funding gap that was created when St. Louis County was given a pass for its share in building a new stadium,” she continued. “When analyzing the risks and benefits, I reiterate that all funding partners should share equally in bridging the funding gap and minimize the burden to city taxpayers.”

Green is only one vote (on the three-person Board of Estimate, not the Board of Aldermen — apparently St. Louis got around those one-person-one-vote problems), but as the main public spokesperson for the elected-official opposition, it’s worth noting what she says. And doesn’t say: Note that she only wants other “funding partners” (presumably the county) to cover a bigger share of the stadium, not necessarily Kroenke. That’s in line with her previous statement that maybe a statewide sports authority should be created to lavish public dollars on not just the Rams, but other local teams as well.

In other words, it sounds like we’re well on our way to the “How should the public pay for it?” stage of the debate, rather than “Should the public pay for it?” or even “Do we really need one in the first place?” That’s somewhat understandable given that Kroenke is playing hardball with his L.A. move threat: The general assumption is that unless his subsidy demands are met by some public entity, he’ll take his team and leave, though there’s no certainty that 1) this would be approved by other NFL owners, and 2) building his own nearly $2 billion stadium Inglewood would really be more lucrative than even a lesser offer of public money in St. Louis. Missouri officials are bidding against themselves, in other words, which we shouldn’t be surprised at, since they’ve proven so good at doing so before.

Chargers, Rams, Raiders to file L.A. relocation papers; everybody act surprised!

San Diego Chargers stadium czar Mark Fabiani says the team plans to file relocation papers for Los Angeles with the NFL, as do the owners of the St. Louis Rams and Oakland Raiders:

“If everything is moving ahead, obviously we’re not going to be standing on the sidelines and watching everything go by,” Fabiani told Dan Sileo on the Mighty 1090 AM. “We’ve got to stay in the game to protect the franchise.”

I mean, of course they are: Filing relocation papers doesn’t commit anybody to actually moving to L.A., it just keeps your options open, or at least as open as the other NFL owners decide to allow them to be. Everything that’s been reported in every city in recent weeks about the L.A. relocation dance has been just a matter of creating leverage, and we can expect to see it continue as the next window for an NFL decision (roughly January-February) grows ever nearer, though the league still has the option to punt everything to 2017. I’d still put my money on that, frankly — there’s still a lot of shaking down of St. Louis, San Diego, and Oakland yet to be done — but I don’t expect anything to get much clearer before the last minute. Until then, we have announcements like this to fill column inches.

St. Louis officials propose vote on Rams stadium subsidy, mayor gripes that democracy takes too long

And speaking of new proposals for public votes on stadium plans to keep NFL teams from moving to Los Angeles, St. Louis has got one of those, too!

Several St. Louis Aldermen are introducing a bill at Friday’s board meeting that would require a public vote before allowing the city to spend about $150 million on the $1 billion building.

The office of Mayor Francis Slay, however, warns that such a bill could kill plans to build the stadium.

Well, yes, of course it could? That’s the reason you vote on things, right? Is so that people have the option to vote them up, or down?

Okay, Slay’s actual complaint seems to be that a vote couldn’t take place until March, and he wants a vote on a Rams stadium next month, the better to wave in front of NFL owners’ noses before they meet this winter to consider which teams, if any, will move to Los Angeles for the 2016 season. He probably doesn’t need to rush: There’s little chance that the NFL would let Rams owner Stan Kroenke leave town just yet, not with St. Louis the most solid option for public stadium funding out of the three cities involved. (Not that that’s saying much, since Oakland and San Diego have been shamefully hesitant to throw money at the Raiders and Chargers.) It is a good pretext for opposing the board bill, though — democracy takes too long, we need to act now now now! — so facts, schmacts.

The bill currently has five sponsors out of 28 aldermen, so everyone panic and/or rejoice appropriately when and if it gets closer to 15.