Team Still Hints At Need for New Football Stadium
The bomb dropped by Chargers owner Alex Spanos on San Diego last week probably didn’t come as any surprise to elected city officials, who knew about Spanos’ desire for a new stadium five years ago when the city negotiated the team’s current contract.
In an interview with the San Diego Business Journal in February, Chargers President Dean Spanos said during the negotiations for the 1995 lease contract, he asked the city for a new stadium as part of the deal.
“At the time I said we need a new stadium in terms of what’s happening in the NFL and what will happen in the next five or 10 years,” Spanos said. “They said they didn’t think they could do a new stadium, but they could do an expansion.”
As part of the contract that would keep the Chargers at the city-owned stadium through 2020, the city agreed to expand the stadium by some 10,500 seats; increase the number of luxury skyboxes from 79 to 113; install some 8,000 club seats; build a new training facility; and make other improvements.
The total cost of the improvements was about $78 million, with the city issuing $68 million in bonds to pay for $60 million of the cost. The remaining $18 million was paid by Qualcomm, Inc. in return for naming rights for 20 years.
Last week, Chargers owner Alex Spanos was quoted by an Internet sports site that he wants the city to build the Chargers a new stadium.
“We feel we need a new stadium,” Spanos told todaysports.com. “We are having our problems there. We love San Diego, and we are hoping between now and the next few years that they (city and state officials) may reconsider and build us a new stadium.”
Reaction
While they may have been aware of Spanos’ desire for a new stadium, most city officials reacted with shock when told of Spanos’ comments.
“It’s so wildly surreal; it’s hard to respond to it in a cogent way,” said Councilwoman Chris Kehoe. “It’s so out of left field.”
Kehoe said she didn’t recall any discussions of a new stadium during negotiations with the Chargers some five years ago. The city’s chief negotiator on the deal was former city manager Jack McGrory, but the gist of those negotiations centered on expanding the stadium, adding luxury boxes and other higher-priced seats, to provide more revenues to the Chargers, Kehoe said.
The city also wanted to increase the number of seats to more than 70,000 so the stadium could meet the minimum number required by the NFL for the 1998 Super Bowl and get into a regular rotation for hosting the championship football game.
Chargers spokesman Bill Johnston said Alex Spanos was quoted accurately, but since the uproar, the Chargers owner feels badly about what he said.
“Mr. Spanos’ comments didn’t come out the way he intended and he feels bad about it,” Johnston said. “He had no intention of creating the stir he’s created. He wants to be in San Diego and that’s his main priority.”
Johnston said team officials have had internal discussions about the prospects for a new stadium but have not had talks with any city officials.
Falling Behind
He said given the fact there will be 16 teams with new stadiums by 2002, the Chargers have to figure out its options to compete with those teams.
In his earlier interview, Dean Spanos alluded to the growing disparity between the haves and have-nots of the NFL, saying the difference from the highest and lowest revenue-generating teams was about $15 million a decade ago, but was about $100 million last season.
Spanos did not reveal the team’s revenues, but did say the franchise was profitable and carried no debt on its books.
According to Forbes magazine, which conducts an annual report of sports franchises, the San Diego franchise was valued at $323 million as of 1998, up 31 percent from 1997. That ranked the Chargers No. 20 among 30 NFL teams. The survey reported San Diego had $104 million in revenues that year.
Spanos confirmed the contract that keeps the team in San Diego until 2020 actually has options allowing the Chargers and the city to renegotiate its terms. Although the first option isn’t until 2003, it can be triggered as early as this season should the Chargers exceed the team’s salary cap, Dean Spanos said.
Spanos added the team is not looking to move or use the reopener clause as a bargaining tool.
“Let me make this very clear,” Spanos said in the earlier interview. “We intend to stay here. We want to be here. If our intent was to leave San Diego, we would have never done this deal. We would have waited until 2003 (when the earlier lease expired) and asked the city to build us a new stadium or move. It’s kind of similar to what the Padres did.”
Of course, the most logical place the Chargers may relocate is Los Angeles, which doesn’t have an NFL team. Last year, the league awarded a new franchise to Houston instead of Los Angeles.
Alex Spanos’ comments were a clear indication the team will eventually pack its bags and head north, according to two of the city’s most outspoken critics of the Chargers deal, Libertarian Richard Rider and former city councilman Bruce Henderson.
“Bruce Henderson and I see this as a pre-planned first step to move the Chargers to the lucrative L.A. market, a market over five times the size of San Diego County,” Rider said.
“Forgive me from stating the obvious , we told you so,” he added.
Candidates Voice Opinions
Both mayoral candidates, Supervisor Ron Roberts and Judge Dick Murphy, said they would not spend a penny of taxpayers’ money for a new stadium.
“You notice I said taxpayers’ money,” Murphy said. Should the Chargers want to finance constructing a new stadium on its own, he would be willing to talk, he said.
Roberts originally said he was against spending any taxpayer funds on a new stadium, but went one step further.
“I’m thinking this is a way to get out of this,” he said. “Let’s get out of the stadium business. Let’s sit down with the Chargers and negotiate a 50-year agreement with guarantees, and tell them we’ll sell you the existing stadium for a dollar.”
Roberts said privatizing the money-losing Qualcomm Stadium to the sports team or some other private entity makes sense because the stadium loses money every year.
Deputy Mayor Harry Mathis said there has never been any discussions on selling Qualcomm Stadium, and nobody has approached the city with such a deal.
Mathis wasn’t shocked by Alex Spanos’ desire. He said any other NFL owner without a new stadium wants the same thing. Mathis said he didn’t think anything would come from Spanos’ statements.
“We’re not in a position to even discuss a new stadium right now. I wouldn’t seriously consider it,” he said.
