Hold onto your hats, because we have an actual Los Angeles NFL stadium plan, people! According to today’s Los Angeles Times:
Rams owner Stan Kroenke, who bought 60 acres adjacent to the Forum a year ago, has joined forces with the owners of the 238-acre Hollywood Park site, Stockbridge Capital Group. They plan to add an 80,000-seat NFL stadium and 6,000-seat performance venue to the already-massive development of retail, office, hotel and residential space, Stockbridge and the Kroenke Group told The Times.
This is indeed actual news, though if you’re hoping for specifics — how much it would cost, how it would be paid for — you’re going to be disappointed, because Kroenke isn’t telling you that. Stockbridge did say that “no tax dollars would be used for the construction project, including the stadium,” but we’ve heard that before for a lot of projects that end up involving tax dollars for things that aren’t strictly stadium construction; yes, this is California where that kind of thing is usually a non-starter (or at least much harder to get approved), but I’ll be withholding judgment on that until the financial story is actually released in full.
What we do have, then, is an announcement by Stockbridge that they’ll let Kroenke use part of their land, which is important because the land Kroenke owns in Inglewood isn’t enough for a stadium, parking, etc. So, does this actually mean that this stadium will actually be built?
That’s the big question, and right now I don’t think we can do better than “future cloudy, ask again later.” Kroenke, of course, is in the midst of negotiating a new Rams stadium in St. Louis, and Missouri Gov. Jay Nixon has said he’s determined to get one built, with his two-man stadium task force set to deliver a plan by the end of the month. And significantly, Nixon hasn’t ruled out using taxpayer dollars — just “no new tax burden,” which could mean redirecting existing taxes. In fact, St. Louis magazine reports that in order to get around the city’s voter-approved law banning public spending on a new stadium without a referendum, the state would have the city take over debt payments on the old stadium, which would free up state money to be used for a new one.
That would still only amount to about $200 million in public money, which might not be enough to entice Kroenke to keep the Rams in St. Louis. Or it might just not be as much as Kroenke things he can get by leveraging his threat to leave. In which case, making a vague pronouncement about his L.A. site — we found some more land, we’re gonna pay for it all somehow! — makes total sense as a way to turn up the heat on Nixon to up his ante, because Los Angeles would take us back in a second, don’t you know it, so you better step up your game, mister!
Or maybe Kroenke really does know how to finance an L.A. stadium out of his own pocket, while also paying any territorial fees that the NFL requires for a team moving to L.A. (which ain’t gonna be no $2 billion, but could well be something), and turn a bigger profit than getting $200 million or more in subsidies for a new building in St. Louis. It’s all gamesmanship here, and the whole point of it is for no one to know whether he’s bluffing or not, so we shouldn’t feel bad having to say that we don’t know whether this is a serious threat. Not that I wouldn’t be thrilled for North Korea to hack into Kroenke’s emails so we can find out what he really thinks, but I’m not holding my breath. (And also that would be illegal, so if you’re a North Korean hacker reading this for some reason, I’m not actually asking you do this, okay? Sheesh, imaginary North Korean hackers have no sense of hyperbole.)
Kroenke has the money to challenge the league’s illegal attempts to control the market, and now he’s daring them to keep him away. No matter how much the “needs 24 votes to move” thing gets repeated in the national media, for the last 30 years there’s been nothing to keep an owner from unilaterally moving a team anywhere he wants – my guess is this is a warning shot to that effect to the NFL. Over the next month or so, they’ll “reevaluate” their stance as a lame duck team in St. Louis that’s already committed to LA is a nightmare for everybody, which will allow them to continue to pretend they have such authority in the first place. (Similar to how they changed their cross-market ownership rules for Kroenke when he became majority owner, there’s no way that would’ve held up in court either.)
It could also be a final attempt to extort Missouri, of course, but this seems too direct and coordinated for that. The typical shakedown would’ve seen this leaked so that Silent Stan could avoid looking like too much of a villain. This seems much more likely to inflame the situation in St Louis than lead anyone to rush to give him money, but we’ll see.
The NFL has another way of blocking a move to L.A., of course, which is to refuse G-4 money to any team that tries to go there without permission. That’s an awfully big stick.
“…for the last 30 years there’s been nothing to keep an owner from unilaterally moving a team anywhere he wants”
Well, yeah, except for the whole “stadium” thing…
Mark Davis would need league money, thus permission, to move to LA since he doesn’t have the kind of money to build a stadium himself – Kroenke does, and the bluntness of this announcement seems to indicate he’s happy to do without.
G4 isn’t supposed to be for relocating anyway, not that the league couldn’t just amend the program or make an exception. All the talk from the last few months was that the NFL wanted to own whatever share they paid for a new stadium, not loan funds to an owner to get one for himself.
So why doesn’t the City of St. Louis, County of St. Louis, and State of Missouri (assuming all 3 government entities are involved here) immediately tell Stan there will be no 1 year deal for 2015 – either sign a long term deal or play your games next year wherever you can figure out, just not at Edward Jones.
Scott: Because they can’t — it’s in the Rams’ lease that they can unilaterally renew.
Depending on how the competition and participation agreements are written, the NFL could also opt to not schedule a team that decides to do whatever it wants (effectively, the NFL could kick you out of the league for not agreeing to its social contract).
Thanks Neil.
How sad!
Game over! This has been in the works for awhile now. This isn’t rocket science people, why on earth would an NFL owner purchase such a large chunk of land(incidentally, the same chunk of land the NFL was going to build a stadium on years ago) in Los Angeles if it weren’t for the fact that it wasn’t already planned?!? Stan Kroenke is no dummy, he saw what the Dodgers(which he tried to purchase also) and the Clippers sold for……… It’s only a matter of time now
The value of the Rams franchise will double by moving to LA. And, as a Missouri taxpayer, I hope they do move.
Did you see this follow up article claiming 40,000 jobs being created: http://www.latimes.com/local/lanow/la-me-ln-nfl-inglewood-la-stadium-20150105-story.html
Am I wrong in assuming those will be minimum wage and seasonal?
“According to the text of a ballot initiative.”
Is there a requirement in California that ballot initiatives have some basis in reality?
Don’t be lame, Jay Nixon!
The NFL should force Lew Wolf to sale the A’s, then oakland will have an opportunity to do the same as Kroenke. Coliseum City would rival this development! More Jobs! More Opportunity!
I just heard an interview with the mayor of Inglewood, James Butts, on the radio. Talk about someone who’s sworn to secrecy! It was blatantly obvious, he had to be extremely careful about what he can(and can’t) say……… You heard it here first, the Rams will be here soon, it’s a lock!
Neil, G4 is only a big stick if the team in question intended to use it. If Kroenke isn’t building it with G4 funding it’s a non-issue.
If Kroenke plans on building a stadium with his own money and no G4 help, he’s crazy. I mean, more power to him, but he’d do better and have more fun playing the slots.
Maybe, maybe not. I mean at most G4 is only 200 million bucks. Maybe he figures he can make up that deficit. I mean the guy is worth nearly 12 billion between him and his wife not including his new partners. Something tells me they know how to make money.
Right, which is why I doubt he’s actually going to build in Inglewood. The rest of the development could make sense, but there’s no way spending $1 billion or more on a stadium is going to make it more profitable. Not to mention that it makes the EIS more complicated … it makes far more sense as saber-rattling against St. Louis than as an actual plan.
Saber-rattling?? Simply by moving to Los Angeles the value of the franchise atleast doubles. Why wouldn’t he move?
If he’d lose more money on the stadium than he’d gain in increased value of the team, that would be an excellent reason not to move.
Dan- I’m not sure Stan Kroenke knows how to make money, he married into the WalMart family. He knows how to manage it, and get more from tax payers. It is depressing that Missouri is considering giving a man like this money to replace a 20-something year-old stadium while places like Ferguson have crappy schools and infrustructure.
@Neil
There’s no reason to think the NFL is against this Inglewood plan, what’s been leaked from STL is a joke. They’re at least $400 million short and the public funding will be contested in court. The MO reps are hard R teapublicans, they’re going to kill the state money and Nixon will happily get to blame the Rs.
The Chargers need this too, they will not get anything done in SD. Their newest combo convention center/stadium plan is the dumbest idea yet that absolutely no one wants and it will require a 2/3rds majority vote because it’s about $1.4 billion. It’s almost as if they want a public vote to fail in 2016 so they can move to LA.
Again, here’s how the financing can be done. Farmers’ naming rights for 2 teams was $1 billion over 30 years, PV=~$500 million. 2 sets of PSLs $250 million each, 2 sets of NFL loans rewritten for relocations $200 million each. Funnel it through a tax free “stadium authority” and there’s $1.4 billion without touching luxury suite revenue.. The NFL can up the G-4 money when they rewrite the rules on relocation money.
@Joe
You statement is completely false
“Similar to how they changed their cross-market ownership rules for Kroenke when he became majority owner, there’s no way that would’ve held up in court either.”
They didn’t change anything, they gave Stan an extension to comply. Scroll to the bottom of this link.
stltoday.com/sports/football/professional/rams-notes-bates-gets-the-point-on-armstrong-s-release/article_4dacc86c-907d-5dd2-aa87-c30bcff806d4.html
Neil wrote: “Is there a requirement in California that ballot initiatives have some basis in reality?”
No. You only have to look at what happened in Santa Clara with the June 2010 Measure J to see that there is no requirement for ballot measures to tell the truth. State law requires financial disclosure for state-wide and county-wide ballot measures, but there is no such requirement for city-wide ballot measures (hence, Santa Clara’s city attorney argued in court that there was no legal requirement to include stadium construction financial information from the Term Sheet in the actual ballot language- so the costs were left off of the ballot.) The truth about the stadium construction costs and loans came out 18 months later.
There’s no requirement that the ballot measure be written by an objective, truthful, 3rd party either. A stadium campaign committee’s attorneys (which could be attorneys hired by a team) can draft the ballot language, and get that language on the ballot via an initiative process with the help of an easily swayed city council/mayor. The language can read like an advertisement for the stadium. There is also no requirement for truth in advertising in a political campaign for a stadium.
Just look at what happened in Santa Clara. What worked here will be tried elsewhere in CA.
It’s only after the vote that the truth comes out.
Honestly, I can’t see anyone going this far just for the sake of saber-rattling to extort more $$ from his current city for a stadium. Example= the chargers have been trying to get something done in san diego for well over a decade and I haven’t seen the spanos family purchase a large chunk of land in los angeles, san antonio or any other nfl starved city? Believe it or not, sometimes where there’s smoke there’s fire………
This plan reeks a bit of the Chicago Bears’ plans to move to Gary, IN in the mid-1990s…..
Well other than Los Angeles being a former and very viable NFL market and Gary being well… Gary.
@ johnogre
They not only gave him an extension, but they basically let him set his own timetable to comply and even then allowed him to transfer ownership on paper to his kid. They used to bar owners from owning NBA, MLB or NHL teams too, until Huizenga was ready to challenge, then they amended it to allow teams in the same market, which is all he cared about. If you have a rule that you bend or change every time it’s challenged, that tells me you know the rule wouldn’t hold up.
Doesn’t getting G-4 money from the NFL require the team to obtain some amount of public funding for stadium construction?
Remember what the golden rule is? He who has the gold makes the rules!
Scott: Maybe? That’s what Huizenga told Miami, but then the Eagles went and got G4 money without public subsidies, so who knows.
@Scott Myers
No it doesn’t, It’s poorly written probably because the NFL assumes public funding is a given but it’s only a cursory mention. It’s the private contribution that’s spelled out in detail and how that relates to getting the loan and loan amount.
By NFL standards Metlife stadium was 100% privately financed and both the Jets and Giants got the full amount of G-3 funds.
@Joe
There hasn’t been one credible report claiming Stan transferred controlling interest in the CO teams to his son since the most recent extension. You are just making stuff up.
http://sports.espn.go.com/nfl/news/story?id=5496516
http://www.ocregister.com/articles/kroenke-641407-sports-louis.html
They originally gave him 4+ years to comply by moving the teams to his kid. That’s an awfully generous amount of time to enforce a rule, particularly since in 2010 the Rams had a credible local buyer who could’ve stepped back up and gotten the team if the NFL had pressed the issue (assuming they thought they could.) It’s not like the Rams were getting turned over to the league office if they didn’t have Kroenke.
The deadline was supposed to be December of 2014, then they gave him another year on top of that. I have no idea if it’s been met or not, but I can only assume he’s in as much of a rush to meet that league decree as he was to meet the first one. Nor did I say he did, only that they kept adjusting their rules to allow for it, and in the meantime to explicitly be out of compliance for 5 years. It’s a meaningless rule and he’ll do it when and if he’s ready. If they could’ve forced the issue, they’d have done it by now.