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Thursday, October 20, 2005 | Breaking more than a half year of silence, the city of San Diego and the Chargers appeared on track to resume negotiations Wednesday after team officials presented a council committee with its most recent development proposal.
The City Council essentially broke off contact with the team in February when it voted not to contract outside consultants for negotiations. But City Attorney Mike Aguirre, who as a private citizen was a vocal critic of the city’s business dealings with the football club, signaled his willingness Wednesday to begin talks with the team again.
The hearing came less than a week after the Chargers surfaced with public concerns that the city’s fiscal and political crisis was scaring away development partners and, therefore, threatening to postpone a planned November 2006 vote on a development proposal.
On Jan. 1, 2007, the franchise can begin contract negotiations with other cities, according to a lease revised by the team and the City Council last year.
“I’m encouraged that it looks like we will be headed back to the negotiating table,” said Councilman Scott Peters, chairman of the Land Use and Housing Commission.
Aguirre said he would ask the council next week to retain Paul Jacobs, a sports business consultant from Denver who previously advised the city and once served as executive vice president and general counsel for the Colorado Rockies baseball club. The city attorney said the rest of the negotiating team would be filled with representatives from a broad pool of interests and ensure that any proposal would keep the Chargers from leaving San Diego.
Team officials say they need a partner to spearhead a development package that would include an estimated 6,000 condos, 300,000 square feet of retail space and office buildings. The proposal’s financing depends on using profits from this development to finance the costs of a new stadium.
Mark Fabiani, the team’s special advisor, said the city’s cooperation could provide comfort to potential development partners worried about the city’s stability.
The city is mired in a widening financial and political crisis, highlighted by a pension deficit that’s estimated to be more than $1.4 billion. The mayor has resigned, as have two councilmen after being convicted of corruption by a federal jury.
The Justice Department and the Securities and Exchange Commission have been investigating city politics and finances since February 2004. Talk of bankruptcy has regularly accompanied the mayor’s race that culminates with the Nov. 8 election.
Developers, who are said to greatly fear a Donna Frye administration, are also likely waiting on the results of the election. Frye, a city councilwoman and environmentalist, faces former police Chief Jerry Sanders in the election. Sanders has said he would streamline the development process if elected.
“There is not one thing that prevents a development partner from going forward, but collectively, there are just too many uncertainties,” Fabiani said.
The Chargers began their push for a new stadium in 2002, using the threat of leaving town to try and leverage more than $200 million in public financing for a stadium development on the 166-acre Qualcomm Stadium site in Mission Valley.
Gradually, the plan has changed to include fewer public contributions. Today, Chargers officials propose to completely cover the costs of the following: stadium construction, operation and maintenance; an estimated $175 million or more in surrounding infrastructure improvements; paying off nearly $60 million in existing bond debt for Qualcomm Stadium; and a 30-acre public park.
In exchange, the team wants the city to give it 60 acres of the Mission Valley site to facilitate condo development.
“It’s a project we believe turns a money-losing piece of land into a money-generating piece of land,” Fabiani said.
The proposal had changed slightly since the council last saw it in 2004; the Chargers dropped their attempt to have the Mission Valley site turned into a redevelopment zone in February.
Aguirre said the proposal is simple.
“The voters are going to be given the choice whether to give the 60 acres over to the Chargers at no cost,” the city attorney said. “If they decide to transfer the 60 acres, our job is to make sure it’s iron clad and the Chargers have no way to leave. But the difficulty in the past has been that the Chargers have made promises they haven’t fulfilled.”
Fabiani said the Chargers must secure a development partner within the next two months if they hope to meet the February deadline for submitting ballot proposals. If they don’t meet that deadline, a ballot proposal would likely go before voters in 2007 or 2008, Fabiani said.
However, Aguirre and Peters said the deadline could be as late as August if the City Council voted to place the proposal on the ballot, thereby avoiding the need for a signature drive.
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