A Capitol Corridor train passes by O.co Coliseum on Aug. 2, 2014.
As everyone ponders what may happen to the Oakland Raiders after the NFL owners cleared a path Tuesday for the St. Louis Rams and the San Diego Chargers to relocate to Los Angeles, I wondered if the Raiders and owner Mark Davis could finance their own stadium without significant taxpayer subsidy.
My math may be a little off, but I think it’s pretty darn likely given the numbers that have flown around the past few months. Still, it’s probably not in the Raiders’ best interests to go it alone when it could probably find some city willing to fork over hundreds of millions of dollars.
First, before it was shot to heck with the owners’ decision, the Chargers and Raiders had developed a joint proposal to develop a shared stadium in Carson between Los Angeles and Long Beach. The initial proposed cost for the privately financed facility — $1.7 billion, according to ESPN. I don’t immediately know the breakdown of the partnership, but if the Chargers and Raiders were equal partners, I would guess that the Raiders would be responsible for $850 million.
Second, the three teams that were planning to move to Los Angeles were expected to each pay a $550 million relocation fee. The San Francisco Chronicle reports that the Raiders have asked that the relocation fee be waived because they didn’t get to move to LA. Nonetheless, before Tuesday, the Raiders were prepared to pay $550 million and their share of the new stadium (maybe $850 million). That’s already $1.4 billion.
Third, the Raiders didn’t get the brass ring of moving to Los Angeles, but they got a lovely $100 million parting gift. Add that to the previous totals and you’re looking at $1.5 billion.
The pool of $1.5 billion may not be enough to build a stadium along the lines of Carson — which would’ve required locker rooms, offices and more for two home teams. The Rams’ Inglewood stadium was expected to cost $1.86 billion, according to the LA Times.
Levi’s Stadium is pictured behind some youth soccer fields on Oct. 14, 2104, in Santa Clara, California.
A better example may be found in Levi’s Stadium, the home of the Raiders’ Bay Area rival Santa Clara San Francisco 49ers. The estimated price tag of Levi’s was $1.2 billion, according to the San Jose Mercury News in 2012. Although the football experience has been criticized at Levi’s Stadium, it is apparently packed to the gills with fan amenities and expensive accommodations to help pad the owners’ wallets.
If the Niners were able to build that for $1.2 billion, surely the Raiders would be able to build something similar for around $1.5 billion. Contemporary proposals for new stadiums in St. Louis and San Diego called for spending about a billion apiece.
[An aside: The cost to build a building that will be used by its primary tenant 10 days a year is flabbergasting. AT&T Park, one of the best Major League Baseball stadiums, cost $357 million when it was built in 1997. That facility was privately financed and gets used by its primary tenant for about 85 days a year.]
I’ll readily admit that there are a lot of factors that I don’t know about. For example, the Wikipedia article about Levi’s Stadium notes that the Santa Clara Stadium Authority — the entity that actually owns the facility — borrowed $850 million from banks, a $200 million NFL loan and some local taxes. Who knows what sort of hoops the Raiders would have to jump through to secure enough funding? Also, some of the funding for the Carson proposal may have been contingent on the value of the team jumping considerably by moving to the giant media market that is Los Angeles.
Nonetheless, it would appear that there are ways for the Raiders to privately fund a stadium without extensively relying on taxpayer support.
There’s not much I can add to the ongoing criticism of the use of extensive taxpayer funding for massive edifices for a pastime. It is worth noting that Oakland, St. Louis and San Diego taxpayers were all burned to some extent by financially supporting the last generation of stadiums — Oakland, St. Louis and San Diego are all stuck paying off new buildings or expansions done within the last 21 years. San Diego also entered into a ruinous ticket guarantee leading to the city buying tickets to cover its obligation until the contract was renegotiated nearly 12 years ago.
One would think that these examples of taxpayers still holding the bag on three facilities would be cautionary tales to other governments. Alas, they weren’t even cautionary tales for two of the cities losing their NFL teams, as governments there tried assembling deals that would fork over hundreds of millions of taxpayer funds (nearly $400 million in St. Louis and $350 million in San Diego) for new stadiums. By comparison, Oakland looked absolutely frugal by declining to directly contribute to a new stadium but offered $90 million in infrastructure improvements.
To compound matters, the league didn’t particularly care for any of these proposals going to voters for approval because NFL officials wanted certainty in any of the cities’ offers. Apparently, St. Louis was preparing to move forward without a plebiscite, while San Diego officials were inexplicably optimistic a proposal would pass in a city that has dealt with owner shenanigans for 20+ years.
It’s hard to blame the NFL and the team owners for how they handle obtaining funding — it’s a business and they’re looking at their bottom line. However, the onus must lie on local governments who seem to bring truth to the saying that there’s a sucker born every minute. Serious questions must be asked about issuing 30-year bonds for facilities that may only get used for 25 years — in addition to the Chargers and Rams bailing on facilities built or remodeled since 1994, the Atlanta Falcons are preparing to leave a facility opened in 1992 (and the baseball Atlanta Braves are soon to ditch a stadium built in 1997).
I don’t know if Raiders owner Mark Davis really wants to stay in Oakland. Even if it doesn’t come with the benefits and relative safety net of taxpayer assistance, it still seems possible and potentially rewarding to use solely private funding.
