Tuesday, January 10, 2006 | The Chargers scrapped plans Monday to place a proposal for a new stadium and mixed-used development before voters in November, as a team official said they were unable to sign up a development partner to help shoulder the costs and risks of the proposed $800-million project.
The announcement marks a significant turn in the team’s arduous history with the city of San Diego. The team’s special counsel, Mark Fabiani, hinted that the Chargers would be willing to entertain stadium concepts with other cities in San Diego County as soon as legally possible. Under its current contract, the Chargers can begin relocation discussions with locales outside of San Diego on Jan. 1 and move elsewhere after the 2008 season.
This November’s ballot was seen as the voter’s chance to avoid those two looming deadlines altogether. The announcement now creates a scenario in which the Chargers could leverage one city against another in stadium negotiations in the coming year.
Fabiani said the size of the project, coupled with the city’s financial and political crisis, scared away the few potential development partners who had the capital to complete the massive project. The proposal calls for an $800 million upfront investment to cover the costs of a $450 million and surrounding development.
“The city’s situation, including the opposition of key city officials, was a major factor in the opinion of some development partners that this was not the right time to throw $800 million on the table and risk not being able to actually build the project,” Fabiani said.
Fabiani heaped significant blame on City Attorney Mike Aguirre, saying his lack of cooperation and confrontational statements added to the uncertainty at City Hall. However, Fabiani said some potential development partners were also pessimistic about the city’s uncertain housing market and worried that the income generated from condominium sales wouldn’t be enough to make the project pencil out.
To be sure, the Chargers’ proposal has been ambitious from the start. Originally, the team asked for as much as $200 million in taxpayer funds to craft the stadium in their first proposal in early 2003. However, in an era when the public largely soured to the idea of public subsidies for sport stadiums, that plan soon became unworkable.
Instead, the Chargers envisioned asking voters for 60 acres of the 166-acre Qualcomm Stadium site in Mission Valley. On the land, they would develop about 6,000 condos and sell them to recoup the costs of a $450 million stadium, $175 million in infrastructure improvements, a 30-acre public park and the retiring of nearly $60 million in city debt from the 1997 remodeling of the stadium.
However, at the same time, the city has plunged ever further into a financial and political crisis. A number of elected officials have resigned under the cloud of scandal and mismanagement as the city’s pension system, facing billion-dollar deficits, has consumed growing chunks of the city’s day-to-day budget. Talks of bankruptcy lined the recent mayoral campaign.
“That situation has made it very difficult to implement what already was an ambitious project from the start,” Fabiani said.
The team will also reassess whether it makes sense to continue with the current Qualcomm proposal. Fabiani said all ideas for any location will be considered.
The announcement throws into the air the team’s future in the city of San Diego. Fabiani hinted at the fact that the team would like the opportunity to speak with other cities around San Diego County. A number of the county’s mid-sized cities have expressed some interest in hosting the Chargers.
The team’s lease with the city prohibits it from talking with other cities until Jan. 1. However, a group of business leaders has floated the idea of modifying the contract to allow the team to talk with cities within the county before that date.
Council President Scott Peters wasn’t available for comment for this story, but has expressed interest in the idea. Mayor Jerry Sanders said Monday he’d consider such a proposition, though it would be the purview of the council.
Ever-present in stadium discussions is the National Football League’s constant push for new stadiums and its desire to place a team in Los Angeles. The nation’s second largest city has been without a team since the end of the 1994 season.
Fabiani deflected talk of the Chargers relocating outside of the county.
“I hope we will never have to visit the question of talking to other cities outside of the county,” he said.
Fabiani said he was optimistic that new Mayor Jerry Sanders and the City Council appeared willing to talk about proposals.
The team’s current push for a new stadium began in 2002, when it informed city leaders that it would likely exercise an option to get out of its lease with the city in order to spur stadium negotiations with San Diego and other cities. Former Mayor Dick Murphy then convened a citizens’ task force to study the team’s desires.
The task force recommended a development that put the risks of building a stadium and housing on the Chargers, but said any new tax revenue generated from the site could be used for infrastructure or other related needs.
The team and the city later renegotiated the stadium contract to keep the Chargers securely locked into San Diego with sufficient time to get a stadium proposal on the ballot. However, with November ballot hopes dashed, that scenario seems unlikely.
A proposal could hypothetically be put before voters in the next citywide election – likely to be the 2008 presidential elections – but Fabiani said the team will likely know by the end of this year if a deal is possible in San Diego.
Aguirre and Sanders held a joint news conference to react to Fabiani’s announcement.
Both avoided taking a stance or explaining a plan of action to help the team. Aguirre said he was refraining from a counterattack to Fabiani’s statements about him. His measured response contained a little bite, however.
“Mr. Fabiani just misses the good fight. He’s hoping that we can get into it. Unfortunately we’re not going to do that for him, we’ll have to delay his gratification,” Aguirre said.
Sanders said he wasn’t sure about the assertion that the city’s problems were hampering the Chargers’ pursuit of a development partner.
“I don’t really know what that entails in terms of what their search has been and what answers they’ve gotten. So I don’t know if the city’s been an impediment to that,” Sanders said.
Asked if he supported Aguirre’s stance on the issue, Sanders’ parried the question.
“I want to make sure we have negotiations with the Chargers that are respectful and make sense to everybody,” Sanders said.
Aguirre said he thought that the City Council could still put the Chargers’ proposal on the ballot either this year or in a special election in 2007.
Sanders didn’t know about that. “A special election would be very costly I don’t know if that’s a reasonable alternative,” he said.
Scott Lewis contributed to this report.
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