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Update on stadium efforts

Posted Jul 30, 2011

Chargers Special Counsel Mark Fabiani says the key element for securing a downtown San Diego stadium is tying the project to a sports and entertainment district. Fabiani also explains how California redevelopment legislation and the new NFL CBA affect the Chargers’ efforts.

Now that players and owners have agreed on a new Collective Bargaining Agreement (CBA), how interested are you determining what it means for the Chargers’ stadium efforts?

Yes, absolutely, we are reviewing very closely the final agreement.

Here’s why: Most of the other new NFL stadiums that have been built around the country have been financed with substantial assistance from the NFL. Under the old CBA this assistance came in the form of loans from what the NFL called the G-3 program. That program was made possible because the players allowed the funding for that program to be credited against overall League revenues. Unfortunately, the G-3 program is now flat out of money as the result of significant expenditures devoted to the new stadiums in Indianapolis, Dallas, and the Meadowlands. 

For a new G-3 program to be instituted and funded by the League, the players would in the new CBA again have to give the owners some credit for the funds spent on new stadiums.  So we will be looking very closely at the new CBA, if the players ratify it, to determine what kind of credits are permitted.

You’ve stated that recently-passed California redevelopment law changes may still undergo a legal process before they’re set in stone. If the legislation remains unchanged, how does it affect your efforts?

Assuming that the California Supreme Court does not invalidate the new redevelopment laws, the changes will impact our efforts in the following ways:

(1) The City of San Diego will not have available redevelopment money until sometime into the next decade – perhaps as late as 2024 or 2025. So we can no longer count on any immediate redevelopment funding for our project.

(2) Therefore, we now need to find alternative sources of funding. One idea that is getting some traction is the creation of a new Sports and Entertainment District that would tie closely into the existing Convention Center – and perhaps become part of the proposed Convention Center expansion. This sort of District could give us access to funding sources that are now not available for a simple stand-alone pro football stadium.

(3) Finally, we are exploring ways to bridge the gap between when stadium funding would be necessary and the time when redevelopment funding would be available in the next decade. It may be possible, with the cooperation of other government entities in the region, to bond against the future redevelopment revenues so that stadium construction can begin before the actual redevelopment dollars are available. This option increases the cost of the project, but such cost increases may be unavoidable in light of the recent state law changes.

You’ve remained consistent in stating that the proposed East Village stadium site is the “last, best option.” What positives remain associated with this site and do you still believe there’s a viable way to get a stadium built there?

Yes, we are firmly convinced that the site is viable, for these reasons:

(1) The site has the strong support of government leaders, the business community, and organized labor. No other site in our region enjoys this kind of political support.

(2) Because the site is downtown, we can take advantage of existing parking, roads and mass transit – saving us hundreds of millions of dollars in infrastructure improvements that would be required at all of the other sites we have considered (including, especially, at the existing Qualcomm site).

(3) There is a tremendous opportunity downtown to make the stadium part of the Convention Center complex – allowing San Diego to attract larger conventions than ever before, and allowing the stadium (with a retractable fabric roof) to be home to Final Fours, major boxing and MMA events, and the kind of other major national events that San Diego now cannot compete for.

You’ve talked before about the Chargers’ long-term financial and time commitment to securing a new stadium in San Diego. Have you noticed any change in that stance in the last year or two?

The biggest change in our efforts over the last several years has involved the enduring economic recession that has damaged so many families and businesses in this country.   Building an NFL stadium in California is hard enough under normal circumstances, but attempting to do so during these extraordinarily difficult times requires a tremendous degree of commitment and determination. Dean Spanos and his family deserve all the credit in the world for sticking with this project.

Many different cities have attempted to secure or build NFL stadiums in California in the last decade or two. In light of the redevelopment revenue possibly being made unavailable, how does the challenge of getting a stadium built anywhere in this state compare to elsewhere?

Building NFL stadiums in California was tough to begin with. That’s why you have three of the oldest stadiums in the NFL in Oakland, San Francisco and San Diego – and why you have no teams at all in two of the most potentially lucrative markets in the country: Los Angeles and Orange Counties. 

And now, the job just got much tougher, because of the redevelopment law changes. But make no mistake about it, these redevelopment law changes have an adverse impact on every pending stadium proposal in California, including the ones in San Diego, Los Angeles, the City of Industry, and Santa Clara.

As for San Diego, we are fortunate to have sources of revenue available to us that do not exist in these other California cities: The 250 or so acres of land that the taxpayers already own at the Qualcomm and Sports Arena sites.  If we could move the football stadium downtown, cover the new stadium in a retractable fabric roof, and free up the money-losing Qualcomm and Sports Arena sites to generate tens of millions of dollars a year in revenue for the taxpayers, we will have gone a long way toward a solution.

What elements should Chargers fans that want a new stadium at the East Village site monitor and root for?

The key element is this: Make the NFL stadium a part of a new downtown Sports and Entertainment District, and then find ways for the stadium to complement the existing Convention Center. Doing this will both broaden support for the project and open up potential funding sources that are not available for a stand-alone football stadium.
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