The Morning Report
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So, as has been described for years now, the Chargers want to build a new stadium in San Diego not using the traditional funding mechanism for these kind of things (i.e. a major cash subsidy from the city or region’s taxpayers.)
They want to do it, supposedly, using a different type of subsidy. They want to get control of government-owned land and develop the land into condos or offices or dwarf roller coasters — whatever the next development boom might sustain. They want a partner who would be interested in that kind of deal. The partner would pay for this opportunity by helping build the stadium.
On Thursday, San Diego City Council President Scott Peters offered up a new idea for a more traditional type of subsidy for the Chargers. He said it was just an idea and not something he’s actively trying to cook up.
It came out when I asked him what he thought of the mayor’s suggestion not too long ago that he was on board with the concept of the city of San Diego giving the Chargers land that could be developed for profits that would pay for a new stadium in a city like National City.
Peters answered that people would have to vote on something like that — which he jokingly admitted was a good way to dodge the question. Then he added this:
The issue has always been do you want to provide land to the Chargers that’s not generating any income at the time as a way to keep them in town?
We should give $5 million a year to the Chargers to go someplace else. Because it costs us — what? — $15 million to keep up the stadium? So it would be an economic win for the city of San Diego to have that land available for something else.
That wasn’t the big idea.
The big idea was this: The city has to support the upkeep of Qualcomm Stadium. If the Chargers left, the city could save that money. And now that the city can actually imagine borrowing money again, it could take that $10 million a year and give it to Wall Street in exchange for an upfront loan of $100 million, which the city could hand over to the Chargers somehow.
Let’s let Peters tell it:
If it is $10 million a year that we spend to keep up the stadium and you took a $10 million income stream and you put that toward a bonding, that’s probably a $100 million contribution you could make to the project without costing us any additional revenue. Right now the city spends — I’m going to estimate — $10 million to keep up the stadium. If the Chargers move somewhere else and the Holiday Bowl and San Diego State (football) moved someplace else, there’s $10 million that you didn’t have that you have right now.
Now, say the voters wanted to spend that money on keeping that Chargers in town, you could take that kind of revenue stream and issue municipal bonds — someday, over the rainbow, when we’re back in the bond market — and that could generate $100 million for the project.
It could, I suppose.
You could also use that kind of money on things like police and parks.
But as Peters said, it’s really up to the voters.