$1.4B Chargers Stadium Plan Unveiled; No New Taxes Proposed
Tuesday, May 19, 2015
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CSAG Site Selection And Financing Plan For New Chargers Stadium
Citizens' Stadium Advisory Group Site Selection And Financing Plan For New Chargers Stadium
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Construction of a 65,000-seat football stadium for San Diego should be financed with a mix of financial contributions from the city and county of San Diego, the Chargers and the NFL, plus bond and land sales, a nine-member advisory group appointed by Mayor Kevin Faulconer recommended Monday.
A report released by the group two days before its deadline said no new taxes would be included, so that a two-thirds vote of the public would not be required. Funding sources would exceed $1.4 billion for a facility estimated to cost around $1.1 billion, according to the report.
"We have overstated costs just a bit, and understated revenue just a bit, making for a very prudent, fiscally conservative recommendation," said Adam Day, chairman of the Citizens' Stadium Advisory Group. "It overcomes all the hurdles that were thrown in our path — both real and imagined — and it is a good deal for the taxpayers."
He said the task force conducted extensive research and analysis of NFL stadiums that have been constructed in recent years. Another consideration was to make sure the Chargers and other tenants would enjoy the financial benefits of a new playing facility, rather than designating all the new revenue streams toward construction costs.
"We developed a financing plan that would actually succeed in this unique San Diego environment, ensuring that it is fair for the Chargers and other tenants, fair for the city and county, and fair for taxpayers," Day said.
"Our plan is the first of its kind, and it should jump-star negotiations between the Chargers, the city and the county," Day said, adding that the recommendations provide "a fair and workable path to a new stadium in San Diego."
Mark Fabiani, the Chargers' general counsel on stadium issues, issued a statement saying that he's grateful for the CSAG members who volunteered their time.
"We will now ask our stadium development team — including our financing, legal and land-use experts — to thoroughly review the CSAG results," Fabiani said.
Faulconer said the plan is "tangible" and "achievable."
"Earlier today I communicated to Chargers owner Dean Spanos that the city/county team and City Attorney Jan Goldsmith are ready to sit down and negotiate," Faulconer said. "I'd like to start by June 1. San Diegans deserve a good and fair deal, and I will not accept or support anything less."
Supervisor Ron Roberts, who has served as the public face for the county on stadiums, said the report shows a path forward for the project.
"While there is much to be done in the coming months, this is a time for optimism," Roberts said.
The task force has already recommended that the facility be built adjacent to Qualcomm Stadium, which would be razed to make way for development, including a massive parking structure, a 500-room hotel and a park alongside the San Diego River.
Day said he envisions a pedestrian-friendly, transit oriented mixed-use project, but not a high-density development that would draw opposition from Mission Valley residents.
The next step will be for a team of financial and legal experts to take the recommendations and mold them into an actual plan that can be taken to the Chargers and voters. The city and county of San Diego jointly hired Nixon Peabody, which has consulted on 25 stadium projects, and Citigroup, which has been involved in raising money to build stadiums recently in Atlanta, New York and Orlando.
The Chargers have been pushing for a new playing facility for more than a dozen years, and have recently taken steps to build a joint $1.7 billion stadium with the rival Oakland Raiders in the Los Angeles suburb of Carson. The proposed 72,000-seat facility off the San Diego (405) Freeway is considered to be a backup plan for both teams in case they aren't able to forge agreements in their current cities.
Also, the owner of the St. Louis Rams is planning to build an 80,000-seat stadium in Inglewood, another Los Angeles suburb.
The funding breaks down to:
— $300 million from the Chargers.
— $200 million from the National Football League.
— $225 million from the sale of 75 acres of Qualcomm Stadium land to a developer.
— $173 million of bondable construction capital from the team's rent.
— $121 from the city of San Diego.
— $121 from the county of San Diego.
— More than $100 million from fans in the form of personal seat licenses, and surcharges on parking and tickets.
— $21.6 million rent from San Diego State University and the organizers of the Holiday and Poinsettia bowls, with $1.25 million paid by both annually.
SDSU released a statement that said the development of its athletic program was a critical part of its goal of becoming a Top 50 public university, and it would channel the support of its 350,000 students, faculty, staff and alumni toward the development. University officials have long eyed the Qualcomm property for potential expansion.
The report said another $50 million could be raised with naming rights, sales of bricks, and capital contributions from concessionaires and telecommunications firms.
Faulconer said that while a two-thirds public vote won't be required, he still would like a final deal with the Chargers to go before voters. He said that San Diegans want a plan that makes sense, is fair and is fiscally responsible.
"That's one of the things we're going to spend most of our time on here as we move forward with negotiations with the Chargers, which is to make sure that it is a plan that's fiscally responsible," Faulconer told City News Service. "To have our City Attorney's Office working together with outside experts, we have a team that is together, that is ready to go, and I'm confident that we'll come up with a solution that makes sense."
City Attorney Jan Goldsmith said the report shows that a stadium project is doable.
"These people put a lot of time and effort into this, and I'm really impressed with their volunteer work," Goldsmith said. He said he doesn't believe any legal issues exist that would be insurmountable.
At the state level, Assembly Speaker Toni Atkins, D-San Diego, promised state legislative support for keeping the Chargers in San Diego, if the team and city reach an agreement to build a new stadium.
"I look forward to continuing to be part of the discussion with the mayor, the City Council and the community to see if the right agreement can be reached," Atkins said. "As I have stated previously, if an agreement can be reached, I am committed to making sure San Diego can benefit from state legislation that is consistent with what other cities have received for their sports facilities."
The advisory group released renderings of what a new stadium might look like by Dan Meis, who is responsible for designing NFL facilities in Cincinnati and Philadelphia, as well as the Staples Center in Los Angeles and Safeco Field in Seattle.
The full report, which includes the renderings in the appendix, are available online at sandiego.gov/mayor.
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