Hosting football games at Qualcomm Stadium isn’t a great financial deal for the city of San Diego. It’s estimated taxpayers lose more than $10 million a year right now operating the stadium, with the Chargers as their lead tenant.
Now there might not even be many games to host. With talks between owners and players breaking down today, the National Football League’s 2011 season is in jeopardy.
That begs the question: If hosting football costs the city money and it might not host football next year, could it actually save the city money? Or will it cost them even more at a time when financial problems are cutting deep into basic city services?
I’m going to explore the question over the next week or so. The Chargers and Mayor’s Office both say they haven’t fully analyzed the contract to see how the labor battle could impact it.
Some of the issues at play:
• Rent: Will the Chargers still pay rent next season? And if they do, what happens with the rent credits that currently eat into that $2.5 million base rent? Keep in mind that when you factor in a legal settlement over disability access, the city can end up paying the Chargers more than it receives from the team in a given year. So it’s conceivable that the Chargers not paying rent would be a good thing for the city.
• Lower costs: The city owns and operates the stadium. Will it benefit from not having to spend money on things like stadium operations, field maintenance, public safety and traffic control?
• Revenue cuts: The city gets a cut of parking and concession revenues. There of course is the spending in bars, restaurants and even hotels that occurs around a football game, but that’s difficult to measure. What we’re looking at here is the pure contractual equation.
Let me know if you have any insight. And here’s the contract if you want to take a look.
I’m just starting to get answers, so in the meantime, here’s Los Angeles Times reporter Sam Farmer on the lockout’s impact on bringing football back to Los Angeles, via Twitter:
Until this all gets sorted out in the courts — and that could take years — I don’t see anyone relocating to Los Angeles or building venue.