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L.A. wants guarantee NFL team wouldn't leave proposed downtown stadium

Naming-rights announcement for the proposed NFL stadium in downtown Los Angeles

A National Football League team would have to commit to remaining in a proposed downtown Los Angeles stadium for 20 to 30 years for the city to approve the project, a key city negotiator said Monday.

The city will seek “hard-and-fast agreements” that a pro football franchise would not leave a proposed $1 billion stadium to be built on public land next to the Los Angeles Convention Center until city debt related to the project is repaid, Chief Legislative Analyst Gerry Miller told a City Council panel.

The developer, a subsidiary of Anschutz Entertainment Group, has proposed tearing down and rebuilding part of the Convention Center to make way for a privately owned stadium that would complement the firm’s other holdings in the area, including Staples Center, the LA Live entertainment district and two hotels.

The Convention Center work would be financed by $350 million in city borrowing. AEG has promised to make up any shortfall in new tax revenue needed to repay the debt.

Under questioning from Councilman Tony Cardenas, Miller said the added city debt would be repaid over 20 to 30 years and officials want to see contracts ensuring that an NFL team “will be staying as long as those bonds are outstanding.”

Los Angeles officials and fans are sensitive about such commitments because the city has lost two NFL teams in the past — the Raiders to Oakland and the Rams to Anaheim and eventually St. Louis.

At this point, neither AEG nor a competing developer proposing a stadium in the city of Industry has an NFL team lined up.

At Cardenas’ request, Miller agreed to explore how the city can guarantee that a team would not leave the stadium with the city still owing money. “This is one of the major issues,” Miller said.

Marc Ganis, a Chicago-based consultant who has worked on many NFL stadium projects, told The Times on Monday that securing a long-term commitment  from a prospective Los Angeles team is possible but "it won't be simple." Complications include the Los Angeles area's poor record with past NFL teams, the lack of a major public subsidy for the stadium and the fact that the team may not also own the stadium, he said.

However, to protect themselves, cities can require that any public indebtedness be paid off before a team can relocate, he said.   

Negotiations on a preliminary stadium agreement are expected to take about three months.

Monday’s exchange came at the first meeting of a special council committee charged with reviewing the stadium plan. The 8 a.m. session at City Hall was attended by about 30 union leaders, representatives of AEG, present and former city officials and city staff members.

The panel agreed to explore holding future meetings in various parts of the city at more convenient times for working residents.

Members also approved preliminary negotiating principles for Miller and other city representatives. One proposed term could generate several million dollars a year in new revenue for the city. At least half of any new property, sales, business and other taxes spun off by the development should go to the city’s general operations account, city officials agreed.

That will be a key bargaining point. The more revenue the city takes from the project, the less that will be available to repay Convention Center reconstruction costs, potentially increasing AEG’s future outlays.

Councilman Bill Rosendahl, the panel’s vice chairman, signaled that he may press for even more city revenue, including a share of the reported $700 million in naming rights AEG has already sold to Farmers Insurance. “If we own the land ... why shouldn’t we get a portion of the naming rights?” he asked.

Cardenas said the city also needs to scrutinize AEG’s proposals to control additional advertising signage around the stadium, including at the Convention Center.  “We need to be careful not to leave anything on the table,” he said.

Several representatives of unionized hotel workers, stage hands, electricians and construction workers strongly endorsed the project, saying it would help revive the city’s job market -- unemployment in the city is slightly above 13%. AEG has estimated 12,000 construction jobs and 10,000 permanent jobs will be created if the stadium is completed.

Committee Chairwoman Jan Perry, who represents the project area, said she hopes a deal can be reached so the Convention Center can be modernized. Various studies have shown major improvements are needed to make Los Angeles more competitive with big convention cities such as San Diego, Anaheim and San Francisco. But the cash-strapped city hasn't been able to come up with a plan to finance the upgrades.

AEG officials expressed confidence that agreement could be reached on matters discussed Thursday but declined to delve into specifics issues. “Everything is part of the negotiations,” said Michael Roth, AEG’s vice president of communications.

RELATED:

Approvals for L.A.'s downtown football stadium could take a year, report says

-- Rich Connell   

Photo: Cheerleaders added to the celebratory mood at the naming-rights announcement for the proposed NFL stadium in downtown Los Angeles on Feb. 1. Credit: Al Seib / Los Angeles Times

 
Comments () | Archives (67)

well, la just lost their football team again

Los Angeles has lost the Rams and the Raiders. You won't be getting the Minnesota Vikings.

It may help your unemployment, but it will hurt Minnesota and Minneapolis and the government of Minnesota will eventually provide a new stadium for the Vikings.

Enjoy your plethora of other sports teams.

...if the team decides to breach the contract and leave before the City is made whole what will the City do? They tried to sue the developers/contractors of the downtown Arts HS and took an epic beatdown.

Any elected city official who votes for this bailout of the NFL should be asked to resign immediately so (s)he can go to work for the NFL directly and save Angelenos their salaries, pension costs and expense accounts.

"AEG has estimated 12,000 construction jobs and 10,000 permanent jobs will be created if the stadium is completed."

How many of those theoretical jobs will pay more than minimum wage, and be more than part time?
(I wouldn't believe AEG. They're a promoter, and promoters lie.)

Why do we have to come up with hundreds of millions for a private company to make hundreds of millions if not billions in our city?

Something stinks in this deal.

Correction, LA has lost 3 NFL teams. The Raiders, the Rams and the Chargers.

But is this really what LA should be spending $1B on? Does the city need a team? And let's not forget the associated costs that WILL come up after the fact to keep the stadium maintained. A team can be profitable to the owner(s) but using tax payer money to get a new stadium and to support the team is just a waste. The money is never really completely repaid. This smells of shady business practices used by Jimmy Jones to get a new stadium built in Dallas. And after everything was said and done, he paid nothing and made all the profit.

Personally, No one I know gives a rats azz about this. I do not want to spend a penny of the cities tax dollars helping out billionaire owners buliding a new stadium. LA does not need NFL football. LA needs better roads, better education and less crime/traffic.

If AEG and Timmy Lie-weekly is so confident about getting this done, then let them pay for it outright. After all, the article calls it a "privately owned stadium" well then, so be it. Fund it on your own. AEG has the money.

Then it's time to stop raping the city for tax breaks that you have already received for Staples, the Marriott and LA Live that have worked to your own benefit and filled AEG's coffers. Time to pay the city back for once and give them their due.

Oh, the NFL wants in too?? Then let them fund part of the project, because in the long term, they know they will be in the LA market, so let them take the first step towards the city......after all, it is OUR money that they want to get rich off of.

WHAT? Are you kidding, what city debt to the project? Our schools are horribly understaffed, our teachers are being laid off and the city is LOANING MONEY TO AEG? That's disgusting. Every day, more and more, I'm beginning to wonder what kind of country I live in? No health insurance, my husband just got laid off, the richest of the rich pay NO TAXES and we just keep getting screwed. They better not loan money to these people who already screwed the country. Want to loan money? How about to teachers? Enough already. Sickeing.

Remember the lawsuit(s) over the downtown high school built on the oil field? LAUSD was kicked to the curb by its high priced lawyers...what makes anyone think LA City would have any success if it sued an NFL team for breach of contract?

Look at the debacle that is the Coliseum., the Convention Center and the Rose Bowl (to a lesser extent.) If these entities are representative of the history of public ownership why would we want more?

LA would be foolish to give any public money to an NFL Team. What happened to capitalism? AEG is the worst corporate offender, with a hand out for tax dollars when government action benefits them, and a "free enterprise" attitude when it does not. Look, the facts are that cities do not benefit from these expenditures, only the team owners do. This has been documented time and time again (go ahead, Google it - far too many to list here). I lived in San Diego and watched the debacle of the stadium renovation. This will be even worse, and will not generate the hoped for revenue.

MN > Thanks for the Lakers

sounds to me like there are alot of shady backdoor deals and union corruption is this stadium project... LA doesnt NEED a football team OR a new stadium!!

Just another stadium for more people to get beat up in the parking lot after the game.

Screw that! Let's get a team to come and play AND THEN we talk about a new stadium...the way things look now, we are going to build a stadium that USC might play in...

Who the heck cares if an NFL team comes to LA? There is more than enough to do in this area without another pro team. Go hiking or biking or surfing. Stop watching other people play games and do some actual exercise yourselves.

1% for the arts as is the law.

LA has gone for 15 years without the NFL and we are just fine. LA isn't some dying podunk backwater in the Midwest or South who only gain civic identity through pro sports, we have a gazillion other things going for us to form our identity and keep us entertained. Taxpayers shouldn't spend one red cent on a pro team set up by egotistical Billionaires to employ selfish, immature Millionaires.

And if a stadium is built downtown, it will only be overrun by the corrupt unions and be a magnet for the trashy and dangerous thug-life fans that troll stadium parking lots in LA. And we're supposed to spend hundreds of millions of dollars of tax money to make that happen? No thanks!

If the NFL wants to play in LA, they can pay their own fare. We don't need them as much as they need us.

How cool will it be to finally have a football team here? Of course we won't have any magnet schools any more (the only part of LAUSD that works) but if we can get the Raiders back then who the hell needs schools?

Send the CRA money to the schools!

MN: Thanks for the Lakers, sounds like lesson learned

Go further and make it a legally binding requirement towards stadium completion. If not, go play football somewhere else, NFL fans can just keep watching it on TV. Los Angeles does not need the NFL. It be nice, but our city has done just fine without them.

Please once again LA will be left holding the bag in a few years just like all the other teams because LA will not want open up its coffers to the NFL. The NFL is just short of being a real mob they will do it as long as they get to make lots of money at the expense of the chump the city of LA. I don't recall any real lasting jobs that were created by the previous teams in fact once they left they took it all. Majority of the work was low level jobs from cleaning the stadium to taking tickets not exactly robust wonderful jobs. The only ones that had the cool high paying jobs were the internal people. So if LA wants to fooled again and again and again go for it. A broke city is better than a healthy one. Want to see football get it on cable or dish its cheaper and a much better picture.
-lavalos

Guarantee? Who cares?? There are probably only 30 or 40 people who care in the first place if we have a team in the first place.

An NFL stadium is the worst of all sports deals. Why? Because there are only 8 home games a year, with at total attendance averaging 5-600,000/year, and people tailgate before the game so they don't spend on concessions. Compare that to baseball, with smaller (and cheaper) stadiums, where people show up at game time and have a few (overpriced) beers, hot dogs, and peanuts, and both the Dodgers and Angels get over 3,000,000 fans/year. The only thing that will make sense is if USC and/or UCLA play their games there to increase the attendance numbers.

Yikes - "hard-and-fast agreements"??? There's no such thing when it comes to the hubris of sports owners. How many times have owners broken their lease and moved their team anyway? Not a dime - NOT A SINGLE DIME - should be provided by tax payers for this debacle, not in tax incentives, not in cash, and certainly not as loans that will probably never be payed back. LA should pass an ordinance banning the use of taxpayer funds for anything related to helping pro sports teams, so that the NFL will finally stop teasing us with a team when really all they are doing is using the threat of teams moving to LA to extort better deals from other cities.

 
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