February 08, 2010
Goodell: Players should help pay for L.A. stadium
Well, this is interesting: NFL commissioner Roger Goodell, in his pre-Super Bowl press conference on Friday, departed from the usual script of league commissioners endorsing team move threats by throwing a bit of cold water on developer Ed Roski's attempts to lure an NFL team to the Los Angeles area:
"I don't think we can guarantee that a team will be there," Goodell said. "We are all working very hard to get a team back in the Los Angeles market because we know there are millions of fans there that would love to see NFL football as part of their community. I think progress is being made. The good news is clearance has been given to build a stadium." ...
Goodell, however, didn't sound as optimistic about the time frame considering the economic climate and the ongoing labor talks between the league and players' union, which could cause a lockout in 2011 after the current labor pact expires.
"The key issue is the challenges of financing a facility in this environment with the labor agreement that we have," Goodell said. "The cost of building that stadium is almost entirely on the ownership and that is a big burden to pay in this type of environment."
That last clause is the key: Roski's plan is for a team-funded stadium, albeit with lots of public money for land and infrastructure. What Goodell appears to be doing is injecting the L.A. stadium battle into the now-escalating NFL labor talks, hinting that the players union should kick back some shared revenue in exchange for getting a stadium that will increase the league's revenues. Okay, more than hinted:
"Investing in a new stadium in Los Angeles will generate more revenue that the players will share in," Goodell said. "That's the kind of investment if we work together with the players association and the clubs where we can develop a relationship and invest in those kinds of facilities that will generate new revenue and allow the game to grow and allow us to get back and engage millions of fans in Southern California and that will be good for us and that will be good for the players."
Goodell reiterated the point on Face The Nation yesterday, saying, "You have to invest in these stadiums that we're in today. ... And we need to make sure that the owners have the capital to be able to do that. And then the pie grows and everyone benefits."
No reply from the union yet that I've seen, unless you count this.
January 06, 2010
Roski: L.A. wants Bills, Jaguars
Developer Ed Roski's Majestic Realty has narrowed down its wish list of teams to relocate to its planned L.A.-area stadium, with managing partner John Semcken now saying the Buffalo Bills and Jacksonville Jaguars are at the top of the relocation list.
"Jacksonville and Buffalo are two teams in very, very small markets," Semcken told the Associated Press. "They are teams that have either outdated stadiums or are having trouble filling their stadiums or both." He added that Majestic won't contact the San Francisco 49ers, San Diego Chargers or Minnesota Vikings as long as they're pursuing stadium plans of their own — which is probably just fine with those teams' owners, as they'll only want to use L.A. as a bogeyman to help in their hometown stadium demands (or, at most, as a fallback in case those stadium plans fall through).
Of course, market size hasn't generally been a prime consideration in the NFL, since so much of its revenue comes from national TV contracts and the like, not local sources — which is how L.A. wound up with no teams in the first place, for that matter, since a revenue-packed (for the time, anyway) stadium in middle-sized St. Louis was more appealing than a less-snazzy one in the nation's second largest city. That may change a smidge under the new revenue sharing rules, but not a ton, so it's unlikely that either the Bills or the Jaguars will be leaping at this opportunity unless Roski shows them some serious coin in terms of stadium revenue that they'll be able to get at the new digs.
And that likely means luring two teams to spread out the construction costs a bit, which means getting two owners to stop just using Roski for leverage and actually agree to move to L.A., at least one of whom would have to sell majority ownership to Roski since that's what he's insisting on ... all of which is to say, just because Roski has filled out his Christmas card list, don't expect to see flying reindeer in the immediate future.
December 08, 2009
NFL stadium-grubbing notes from all over
I don't know if it's something in the water or the holiday spirit or what, but the last couple of days has seen a rash of attempts to drum up support for NFL stadium deals on pretty flimsy pretexts:
- NFL commissioner Roger Goodell reiterated his henchman's statement from a couple of months ago, insisting that Dolphin Stadium need upgrades if it's going to host more Super Bowls after this year. No word on who would pay for any renovations — which could reportedly include a partial roof to protect fans from rain and/or moving seats closer to the field — but the South Florida Sun-Sentinel did report ominously that South Florida Super Bowl Host Committee Chairman Rodney "said it will be up to the community, which is bidding for the 2014 Super Bowl, to determine the importance of hosting the NFL's championship game."
- The Los Angeles Times reports that the NFL's decision over the weekend to try to eliminate some revenue-sharing payments to low-revenue teams could be "the jab that knocks them to the canvas in the next two or three seasons" and prompts them to relocate to, say, Los Angeles. Given that this will at most amount to a few million dollars a year per team and will likely be overturned in the next collective bargaining agreement, if not sooner than that by a union challenge, this seems a bit of an overstatement.
- A survey of 550 Minnesota residents found that they were more likely to say it was important to keep the Vikings in town when the team was winning, as it is now. Though the Minneapolis Star Tribune reported this as "When Vikings win, drumbeat for new stadium beats faster," it doesn't look like the poll actually asked whether respondents wanted a new stadium; and, in fact, a higher percentage of residents said this year that the Metrodome is an acceptable home for the Vikings than in past seasons when the team was losing.
In other NFL stadium news, the Santa Clara city council is expected to vote tonight to set a 49ers stadium vote for next June. Starting tomorrow: Six months of new pretexts!
UPDATE: But first, the owners of Great America, whose parking lot the 49ers stadium would be built in, are suing the city to void the deal! The fun never stops!
December 03, 2009
L.A. Threat Watch: NFL cities hitting "panic button"
A nice rundown by San Diego Union-Tribune columnist Tim Sullivan of how the approval of a new NFL-ready stadium in Industry, California is helping NFL teams in other cities leverage new stadium demands of their own:
Every city with an NFL tenant and without an ironclad lease is feeling intensifying pressure from Ed Roski's City of Industry initiative. Every team within range of an escape clause has been wielding newfound leverage since October, when Gov. Arnold Schwarzenneger signed a bill exempting Roski's project from the California Environmental Quality Act. ...
The threat of extortion is always implicit in professional sports. Any business owner has a right to maximize revenue and to seek concessions from the landlord, rights that are obviously accentuated when that business is immensely popular and limited to 32 outlets in 50 states. Still, the shortcut granted Roski has caused a discernible shift in the balance of power, providing NFL owners a tangible relocation threat at a time when public financing is deeply problematic.
"It's not a coincidence," said David Carter, executive director of USC's Marshall School of Business. "I think it's a combination of the economic environment and the political realities that cities are facing right now (and) the Southern California option that is very real."
Sullivan goes on to note that Roski still faces some potentially steep hurdles in acquiring a team: He's part-owner of a casino, a big no-no with sports leagues, and wants to be majority owner of whatever team relocates (and, let's not forget, pay for it with development rights, not cash). Still, that hasn't stopped San Diego Mayor Jerry Sanders from suddenly devoting attention to building a new stadium for the Chargers, or the Florida Times-Union from running an editorial begging fans to buy tickets to Jacksonville Jaguars games because "Los Angeles doesn't have a pro football team and doesn't need one, but Jacksonville does."
Noting that the Chargers haven't explicitly threatened to move to Industry, Sullivan rightly proclaims one of the rules of stadium politics to be: "You don't need to announce a threat that is already perceived." Still, there are always ways of hinting...
November 18, 2009
California NFL stadiums creep forward
California may be setting records for budget deficits, but that isn't stopping it from also setting records for most NFL stadium projects all at the same time. Some recent developments:
- The city of San Diego is about to hire a stadium consultant to explore ways to pay for a new downtown stadium for the Chargers near Petco Park. Chargers stadium czar Mark Fabiani told the San Diego Union Tribune yesterday that the total cost at that site could be less than $800 million, though it's unclear if he was including land costs — the Union Trib notes that Fabiani had previously indicated that revenue from developing land around a new stadium "would play a big part" (their words) in funding construction.
- Zennie Abraham, a former economic advisor to the city of Oakland, notes that San Francisco came out with an
economicenvironmental impact report for its 49ers stadium plan the same time as Santa Clara issued its EIR, and claims the S.F. report looks better. (Abraham derides the Santa Clara report as "written as if by a snickering, snipping bureaucrat who had no patience with questions.") Abraham further notes that with two cities in the running, "the NFL will use Santa Clara as a, well, pawn, in the creation of a deal that ultimately works for both the league and the 49ers." Of course, he could just as easily have said that San Francisco will be used as a pawn to get a better Santa Clara deal. It's how whipsawing works. - "Walnut's most high-profile resident" came out in favor of the new NFL stadium proposal in neighborhing Industry, calling it "a great opportunity to provide a lot of jobs and to be an economic boost for the area." This famous Walnuttian? Charlie Beck, who was just appointed to be the new chief of the Los Angeles Police Department, notwithstanding that he lives 20 miles from the city limits. (Also, Lance Parrish and Taboo may argue this designation.)
November 01, 2009
Our relentless assault on both new and old media
It not every week when I'm quoted in both the L.A. Times and Deadspin. Read Dave Zirin's op-ed analyzing the Industry NFL stadium deal here, and then follow that up with Deadspin's Why Your Stadium Sucks installment on the new Yankee Stadium, where I have the honor of throwing out the first tirade. Best comment (not-by-me-or-anyone-I-know-personally division) goes to Martin Pederson of Metropolis magazine:
After the first playoff game against the Twins, Michael Kay and David Cone were speculating about the subdued nature of the crowd. Was it the 6 o'clock start? The early lead by the Twins? "Excuse me, guys," I shouted at the TV, "it's the fucking architecture!"
October 23, 2009
In a press conference in Industry, CA, Governor Arnold Schwarzenegger announced that he has signed the environmental exemption bill for Majestic Realty's proposed stadium development. "This is the best kind of action state government can create — action that cuts red tape, generates jobs, is environmentally friendly and brings a continued economic boost to California," he added.
It is curious that such an environmentally friendly project requires an environmental exemption.
Maria Elena Durazo, head of the Los Angeles County Federation of Labor, repeated Majestic's guarantee that stadium employees, including parking attendants, will be paid middle class wages. According to payscale.com, this would mean the middle class begins at $7.65 per hour.
October 16, 2009
Industry NFL stadium gets its environmental exemption
The California state senate has approved an exemption from state environmental laws for Ed Roski's City of Industry football stadium. The L.A. Times report notes that this was after the senate president was "unsuccessful in negotiating an agreement that would have a citizens group drop its lawsuit" against the stadium — given that the exemption effectively nullified the lawsuit, this must have been one of those "jump or I'll push you" negotiations.
In any case, let the move threats begin! Er, continue!
October 06, 2009
California Senate mulls get-out-of-lawsuit-free card for Roski
The proposed city of Industry football stadium could clear its biggest remaining hurdle in the next two weeks, as the California state senate takes up a bill to allow developer Ed Roski's Majestic Realty to evade environmental laws to move ahead with the project. (A citizen group's lawsuit charges that Majestic should conduct a new environmental impact study, since the original one planned for commercial warehouses on the site, not a stadium; instead, it was amended with a "supplemental" report.) Environmental groups are now worried that if the Majestic loophole is approved, this will, in the words of one, lead to "a crop of bills in December" seeking similar exemptions from state law for other projects.
(Note, by the way, that this is different from the tax-increment financing bill proposed earlier in the year that also would have aided the Majestic stadium project. That one died over the summer.)
October 02, 2009
L.A. NFL stadium move threats spreading faster than swine flu
Forget the Dallas Cowboys' snazzy new stadium — what's really sparking renewed stadium demands across the nation is the spreading fear that a new stadium in the Los Angeles area could lure an NFL team or two to relocate. The latest team to take advantage: the Minnesota Vikings, whose VP for stadium wheedling Lester Bagley told the St. Paul Pioneer Press they're preparing a new push for $700 million in stadium subsidies, and added this only slightly veiled threat: "If the answer is no, then why would you own a team in this market?"
The Vikings have "no interest in extending our lease at the Metrodome" beyond 2011, said Bagley, who added for emphasis, in case anyone failed to make the connection: "The clock is ticking, and the lease is coming due. The state can't afford to have us become free agents."
Meanwhile, in Jacksonville, Jaguars owner Wayne Weaver is apparently attempting to develop a more home-grown move threat, saying he might move one home game to Orlando's Citrus Bowl — though he added that it would need renovations to "accommodate the kind of revenues you have to derive out of an NFL stadium." This at the same time that Weaver is trying to get additional public money from Jacksonville to renovate his team's current home. Bring out the whipsaw!
September 28, 2009
Media playing "Guess who's coming to L.A. stadium?"
With an Industry NFL stadium looking more likely, newspapers are busying themselves with the game of figuring who'd play there. The Los Angeles Times declares the San Diego Chargers the frontrunner "because the Chargers have a window each year to get out of their Qualcomm Stadium lease without the threat of a lawsuit." The Jacksonville Jaguars, who are blacking out their entire season on TV thanks to poor ticket sales, are considered next most likely, with the Minnesota Vikings, St. Louis Rams, Buffalo Bills and Oakland Raiders earning honorable mention.
Of course, the Times also notes that Industry developer Ed Roski wants to own part of whatever team moves to his new building — but wants to pay for it not with cash, but with development rights to other parcels in Industry, which is a bit dicey, considering that "California development rights" is the new "swampland in Florida."
The Chargers, meanwhile, are rushing to take advantage as their newfound belle of the ball status, meeting today with Escondido officials to discuss a new stadium there. Ironically, the team's main demand there is development rights, though a North County Times estimate shows that they'd actually want a huge swath of the city's property:
In order to generate $400 million in revenue, the ancillary development would have to be either 1,400 condos, a retail complex significantly larger than the Westfield North County mall or about 2 million square feet of office buildings, which would nearly double the amount of office space in the city.
Escondido, the paper notes, currently has two half-built condo complexes sitting empty, and a 30% vacancy rate on its existing office space. I know it's old-fashioned, but the Chargers really might want to hold out for actual cash.
September 23, 2009
Walnut to drop Industry stadium suit for cash
The city of Walnut has apparently agreed to a payoff — er, a settlement in its lawsuit against the neighboring city of Industry's planned NFL stadium. No word yet on how much boodle Walnut got for going away; an official announcement is expected tomorrow.
A group of citizens still have a lawsuit pending against the project for insufficient environmental impact studies. If that fails, developer Ed Roski can move ahead with the stadium project ... just as soon as he finds a team to play there.
July 28, 2009
California tax-kickback bill gets disappeared
Looks like that stadium-friendly TIF bill in California may not be happening after all:
The governor and legislative leaders originally included it in their compromise budget plan. But the Assembly killed it Friday during the Legislature's marathon session to close California's $26.3 billion deficit.
Some lawmakers who supported the bill weren't sure why it was pulled off the table at the last minute. Some local officials cited billionaire Ed Roski Jr.'s proposed National Football League stadium in Industry as a sticking point for legislators in the eleventh hour.
Critics, including Los Angeles County Supervisor Zev Yaroslavsky, had argued the redevelopment extensions would keep millions from counties and could benefit private interests, such as Roski, owner of Majestic Realty.
"To be honest, we're trying to figure out what happened," said Industry Mayor Dave Perez.
You just can't buy good legislators these days.
July 23, 2009
California budget to boost stadium TIFs?
The California budget deal — otherwise known as the great experiment in whether conservatives are right that we don't really need Medicare or public schools — could have an unexpected effect on stadium deals, with a provision being voted on as soon as today that would extend the life of redevelopment areas for up to 40 years. "It prevents the cuts to local government from occurring," Senate Republican leader Dennis Hollingsworth boasted of his measure.
Um, no. Redevelopment areas use tax-increment financing, or TIFs: They don't actually generate new revenue, but rather redirect new property taxes to local governments (or, more commonly, to developers promising to build projects that will hike local property tax receipts). Needless to say, this revenue shuffle has proven popular with stadium boosters, despite a compelling pile of evidence that TIFs only end up making Swiss cheese of your local tax base.
The reason the state is pushing this plan, in any case, is because as part of the deal, the state would get to siphon off 10% of future TIF revenues, and borrow against that revenue now, helping close the state's current budget hole at the expense of future state budgets. It's a common theme to the budget deal: As our old friend Stanford economist Roger Noll told U.S. News and World Report: "In the short run it gets us through this year, and in the long run the same problem comes back even worse next year because $10 billion worth of gimmicks has been used that cannot be replicated."
But enough about budgets; what does this mean for stadiums? According to the L.A. Times, it would allow the City of Industry to siphon off "hundreds of millions" of dollars in coming years for infrastructure to support Ed Roski's planned NFL stadium; it would also presumably aid teams like the San Francisco 49ers and Oakland Athletics in their stadium plans, as both teams have previously mulled TIF funding as a revenue source. Roski and his company, notes the Times, have contributed more than $1.2 million in the last six years to state politicians; when the vote comes up, we'll see if his money was well spent.
July 20, 2009
L.A. developer unveils NFL team hit list
Southern California developer John Semcken told Fanhouse.com last week which NFL teams the company is considering for its planned football stadium in Industry, California:
"Jacksonville, Buffalo, Minnesota, New Orleans, St. Louis and the three California teams. Now New Orleans just signed a lease for 25 more years, so they're out. But the other seven are still in," says John Semcken, Roski's vice president at Majestic Reality....
"You know what I think? I think the Raiders and the 49ers are eventually going to share a building in Northern California,'' Semcken says, "and two other teams are going to share a building in Southern California.
"Two teams. Then we'll have 25 weeks of NFL here. Ten preseason and regular season per team -- that's 20. Both teams will be so rich that they'll make the playoffs, that's 22. Then they'll win the second round, that's 24. Then we'll have the Super Bowl, that's 25!"
Uh, okay. You certainly can't say that Semcken isn't ambitious (Roski retained plausible deniability by declining to say which teams he'd target), but projecting two teams doesn't help his leverage any — his best shot at getting an NFL owner to cough up the rent money Majestic would need to build its stadium seems to be to get a land rush going, with the first team inking a deal getting dibs on the L.A. market. (Not that market size matters that much in the NFL, where national TV revenue is the name of the game.)
If nothing else, though, Semcken's public statement has to be stirring up headlines in the cities of teams he mentioned ... come on, anyone? Nobody?
April 08, 2009
Diamond Bar drops stadium opposition
The proposed NFL stadium in the Los Angeles-area City of Industry cleared one hurdle yesterday, when the neighboring city of Diamond Bar agreed to drop its opposition to the project in exchange for a $20 million payoff to help mitigate traffic concerns. Diamond Bar councilmember Carol Herrera enthused: "Any way you look at it, the project is going in. There's no way to stop it." (Okay, maybe "enthused" wasn't quite the right word.) The Industry plan still faces a lawsuit from another neighboring town, Walnut.
April 01, 2009
L.A. stadium on hold during legal battles
The City of Industry NFL stadium is officially on hold while lawsuits from neighboring towns are resolved, according to Majestic Realty exec John Semcken: "We can't begin the process until there aren't any lawsuits." (Yes, that's the same John Semcken who said last week, "If they think we're going to stop working on football because of little old Walnut, they've got another think coming.") Semcken also asserted that "we've designed the building to accommodate two teams," in case more than one NFL franchise wants to move there.
And before you ask: He said this Monday, so he wasn't just honoring today's date.
March 26, 2009
LA stadium developer must crack Walnut
The City of Walnut has filed suit in Los Angeles County Superior Court to block the development of a new football stadium in neighboring Industry, citing insufficient study of the environmental impact.
According to the San Jose Mercury News, stadium developer Majestic initially filed a full environmental impact study for a mixed-use development on the site, and only a shorter supplement to that when the plan was changed to radically different stadium project. The suit, if successful, will force Majestic to produce a completely new environmental study.
Majestic managing partner John Semcken was in no mood for conciliation. "If they think we're going to stop working on football because of little old Walnut, they've got another think coming."
The NFL is not answering questions on the subject, including the biggest one: which team, if any, will play in this stadium?
February 27, 2009
City of Industry approves NFL stadium, needs only NFL team
As expected, the City of Industry council unanimously approved plans for an $800 million football stadium yesterday, paving the way for the NFL's return to the Los Angeles area. John Semcken, managing partner of Majestic Real Estate, which is headquartered in Industry and would build the project, says the company would begin looking for a team on April 1, specifically mentioning the Oakland Raiders, Buffalo Bills and Minnesota Vikings as among his eight targets. (You have to guess that the San Diego Chargers and New Orleans Saints would be in the mix as well.) If nothing else, this is going to kick-start a lot of move-threat-based stadium talks in eight cities across America.
How the project is being funded, meanwhile, remains a bit of a mystery. Majestic says it will pay for construction itself with private money, though land and infrastructure is being covered by city property taxes. With no team in place yet, though, Majestic would no doubt have to pay off what could be $60-80 million a year in stadium debt through venue revenues, which is going to make the place much less attractive as a relocation target. (In the NFL, where all games are on national TV, market size is relatively unimportant; what counts is how much crap you can sell in your stadium.)
This could end up being another Kansas City arena scenario, where the requirement for a lease where the team actually pays some rent makes your building mostly useful as a stalking horse for team's demands for new buildings back at home. Though at least, unlike K.C., Majestic was smart enough not to build the building first; construction won't begin until a team has agreed to move there.
January 22, 2009
Both Industry residents vote for NFL stadium funding
Voters in the City of Industry, California, approved the sale of $500 million in bonds on Tuesday for infrastructure to support a new NFL stadium, as well as "retail and office space" and all the other stuff you throw in when you want to convince people your project is "not just a stadium." The preliminary vote count: 60 in favor, 1 opposed.
Yeah, you read that right: Industry is so named because it's almost entirely industrial property, with only 777 residents, most of whom, apparently, can't be bothered to register to vote. Ed Roski, the billionaire behind the football stadium project, has his Majestic Realty headquartered there, a stone's throw from the mall where they filmed the mall scenes for "Back to the Future."
The bonds will, according to press reports, be paid back by property taxes, and I admit I'm not entirely clear how this will work. Last April, the state legislature killed a proposal to divert county property taxes to the city last April for the project; it looks like the city will instead pass its own property-tax surcharge, but in a city with so few residents, it's trickier to determine exactly who will end up paying for this. If anyone out there has a firm grasp on California tax law, please write in.
In any case, the main thing standing in the way of the stadium project now is that Roski doesn't have a team to play in it. And the lawsuit neighboring towns have threatened over traffic concerns. And a few other things.
January 06, 2009
Mayor threatens to sue over L.A. stadium
FoS correspondent David Dyte has more on the L.A.-area NFL stadium plans:
Backers of the proposed, still teamless NFL stadium in Industry, California, have a tough nut to crack. Joaquin Lim, the mayor of nearby Walnut (population 30,000) has threatened to sue if Industry (population 777) approves a pro-stadium environmental report later this month. Industry's mayor, David Perez, was due to host Lim at a meeting yesterday to discuss the issue. No word yet on how the talks went.