NFL Relocations and League Expansion

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Mark Davis: “I don’t know” if there’s any chance Raiders stay
Posted by Darin Gantt on August 12, 2015, 5:44 AM EDT
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AP
The Raiders have left Oakland before, so it shouldn’t be a surprise when they do it again.

Following yesterday’s owners meeting outside Chicago, Raiders owner Mark Davis was blunt when asked if he though the team still had a future in the Bay Area.

“I don’t know. I don’t know,” Davis replied, via Tom Pelissero of USA Today.

The league didn’t take any votes on the Los Angeles project, but they didn’t need to, since Oakland officials weren’t invited to speak. Even San Diego showed up to make a pitch for the Chargers, and St. Louis has been aggressive in its efforts to keep the Rams.

The NFL’s L.A. point man Eric Grubman met with Oakland officials last month and said there was no “viable” proposal to keep the Raiders in place.

“What I would say is we had a fair and open discussion, but it was not specific around a proposal,” Grubman said. “I was disappointed – not for the league. I’m disappointed for the fans, because there’s no proposal on the table that can give us something to go to work on.”

So that puts the Raiders, who are free to get out of a lease at the decrepit Coliseum, in a better position to escape to where the money is — in their case, a shared-with-the-Chargers stadium in Carson.
 
The Carson stadium will cost about $1.8 billion. That will be split between two teams, so the Raiders will owe $900 million. The Raiders have already said they have $300 million to put towards a stadium, along with the $200 million low interest loan from the NFL leaves them only $400 million in financing. In steps Goldman Sachs:

"In Santa Clara, and in Carson, Goldman's plan was to create a public authority to build and own the stadium, using the proceeds of a construction loan raised from private investors. The loan would be paid back using revenue from sponsorships, high-end seating and non-NFL events at the stadium and, in a two-team stadium in Carson, using as much as $800 million in personal seat licenses — upfront payments that allow fans to buy season tickets.

The structure of the deal would also save both teams a lot of money in the long run, said John Vrooman, a sports economist at Vanderbilt University.

Using a tax-exempt public authority to sell personal seat licenses and sponsorships allows the teams to avoid many taxes on those sales, saving them tens, perhaps hundreds, of millions of dollars, Vrooman said. The teams would also avoid property taxes on the building, though they would pay rent and other local taxes on the private use of a public facility.

Public agency bonds for the stadium would be tax exempt and sell at lower interest rates.

"Goldman Sachs' job is to use, if not disguise, every public funding tax shelter and loophole," Vrooman said.

Goldman's investors also prefer the opportunities for private profits in L.A., which San Diego can't match. That makes the Carson stadium a much safer bet. Building something similar in San Diego without generous public subsidies would require the Chargers to borrow more money at higher interest rates. The economics don't work, Fabiani said.

"In L.A., the naming rights are worth more. Suite sales are worth more. Sponsorships are worth more," he said. "In San Diego we just don't have those advantages. Even though we'd like to do the same thing in San Diego, we couldn't finance it."

Goldman declined to make members of its stadium financing team available for interviews. But at a recent Carson City Council meeting, Tim Romer, who heads the firm's West Coast public-sector financing operation, said he's confident that this plan can succeed in the L.A. market.

"We're committed to making this happen," he said. "We've concluded the financing is viable."

Some have their doubts. Tony Manolatos, a spokesman for San Diego's stadium task force, says Goldman's plan in Carson leans too heavily on personal seat licenses. To raise $800 million, the Chargers and Raiders both would have to sell more seat licenses than anyone except the Dallas Cowboys and 49ers ever have — in a market where neither team has deep roots — while competing with each other.

"No one has ever sold that amount of [personal seat licenses] in a new market," he said.

San Diego officials last week countered with an offer that includes $242 million in city and county subsidies, $173 million in construction bonds and $225 million from the sale of city-owned land near the stadium. The Chargers would put up $300 million and the NFL would pay $200 million. Team officials say they're reviewing the proposal.

If Goldman is right, their investors should see a solid return. The Santa Clara deal generated about $75 million in interest and fees, according to financing documents, with more potentially to come when construction bonds are refinanced later this year. In Carson — where the stadium would cost $400 million more — financiers could easily recoup $100 million.

"They're basically the middlemen," said Roger Noll, a Stanford University economist who watched the Santa Clara stadium deal unfold.

Goldman should have no trouble raising money, said Randy Gerardes, a senior municipal bond analyst at Wells Fargo Securities.

"A market like L.A. is attractive," Gerardes said. "Just like it's attractive to the NFL, it's attractive to investors. There's a lot of money there, a big corporate base."

tim.logan@latimes.com"

And then as to the relocation fee, the last two were paid by the Titans and the Ravens, and they were $29 million dollars. The Relocation fee cannot be so cumbersome that it denies the teams the ability to compete. The talk of $500 million for each team is BS. At the most, it might be $200 million for each team, which can then be paid over a long period of time.
 
OAKLAND -- As plans for Los Angeles-area football stadiums progress, this much has become clear: For all their talk about wanting to keep the Raiders in Oakland, neither the local political establishment nor the team is taking the lead on a plan to make that happen.

Conversations this week among NFL owners in Chicago about new stadiums for three teams -- the Chargers, Rams and Raiders -- are only the latest in which prospects in Oakland were little more than an afterthought. St. Louis and San Diego are aggressively pitching plans to keep their teams from moving. And Oakland?

"There's no champion to get a stadium deal done," said former Councilman Ignacio De La Fuente, who led negotiations to bring the Raiders back from Los Angeles two decades ago. "The Raiders haven't worked very hard on it. And neither has the city."

So far the city has been on the losing end of the stadium blame game. Even Raiders icon John Madden on Wednesday demanded action from local officials.

"They have to come up with some plan," the Hall of Fame coach told KCBS. "So far it's been 'we're not going to do this, we're not going to do that.' But they haven't said ... 'we want to keep the Raiders, and this is how we can help.'"

City officials have said they are willing to lease public land for a stadium and pay for infrastructure costs, but a lack of financial resources remains a stumbling block on both sides of the negotiating table.

Oakland officials reiterated Wednesday that they have no intention of matching the $350 million that San Diego is offering to put toward a new stadium for the Chargers or the roughly $400 million that St. Louis and Missouri are offering the Rams.

Meanwhile the Raiders remain one of the leanest NFL organizations, devoid of the development industry talent required to spearhead a stadium project the way the 49ers did in Santa Clara, said Robert Boland, a professor of sports business and law at Ohio University.

"The 49ers really armed up when they were building their stadium," he said. "You really need four or five people in house who are sought-after development experts, and I don't know if the Raiders had the ability to take on that level of cost at the time they needed to get the ball rolling."

It's still too early to bid the Raiders farewell. The city is continuing to meet with team officials. And later this month an outside developer will submit his final proposal for a mega development at the 120-acre Coliseum complex that would include a new football stadium, even though an earlier version was widely panned. Also, there's a chance that voters in San Diego and St. Louis could reject stadium subsidies, evening the playing field with Oakland.

But it's still unclear whether team or city leaders are willing to go out on a limb to strike a deal in Oakland.

Unlike her counterpart in San Diego, who has been the point person on a new Chargers stadium, Oakland Mayor Libby Schaaf has kept a low profile on stadium talks. Schaaf, who wasn't available for comment Wednesday, didn't attend a recent meeting with the NFL's top stadium official and has turned over negotiations to an assistant city administrator.

Meanwhile, despite his repeated mantra that he wants to stay in Oakland, Raiders owner Mark Davis continues to act as if Los Angeles is his preferred choice, Boland said.

De La Fuente said Schaaf should take a bigger profile in stadium talks, but that the onus is on the Raiders, who four years ago showed him a rendering of a new Oakland stadium but never sought out a financial partner and pursued it.

"I told them that they have to be the ones to push it," De La Fuente said. "Look at the 49ers. They did it themselves. They were the drivers. The Raiders have been waiting. They expect people to somehow send them a plan."

A phone Wednesday to Raiders President Marc Badain was not returned. While the team hasn't shut the door on Oakland, it is working with the Chargers on a $1.7 billion stadium in the Southern California city of Carson.

That proposal is competing with a nearly $2 billion Inglewood stadium proposed by Rams owner Stan Kroenke. Only one of the stadiums is expected to win NFL approval; however, the Raiders could still wind up in Los Angeles as the Rams' tenant.

There still isn't a viable stadium plan in Oakland, NFL Executive Vice President Eric Grubman said after Tuesday's owners meeting. The Raiders say a stadium can be built for $900 million, but have only pledged $500 million between the team and the league.

Most NFL cities have plugged that type of gap with public funds, but Oakland and Alameda County voters have shown no interest in going that route especially with taxpayers still on the hook for nearly $100 million for renovations to O.Co Coliseum that brought the Raiders back from Los Angeles 20 years ago.

Back then, De La Fuente said, politicians such as himself and former Senate Pro Tempore Don Perata "took the bull by the horns" to bring the team back, and were lauded publicly for their aggressiveness.

But the stigma of that deal complicates any effort to keep the team now, he said.

"Politicians now are more shy about it," De La Fuente said. "They don't want to be accused of making the same mistake. That is part of the issue here."
 

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Purdy: Rating the potential outcomes of Raiders' stadium quest
By Mark Purdy
Mercury News Columnist

Posted: 08/13/2015 07:27:36 PM PDT


Flags wave high in the sky in the parking lot before the Oakland Raiders vs. Dallas Cowboy preseason game at O.co Coliseum in Oakland, Calif. on Friday, Aug. 9, 2013. (JOSE CARLOS FAJARDO)


Anybody who claims that they know how the Raiders' stadium saga will end -- and when it will end -- is drinking delusion juice laced with shots of Throwing-Darts Brandy.

The truth is, no one knows exactly how this whole thing will turn out. Including the NFL itself.

But in my view, there are five possible outcomes for what happens with the Raiders and Chargers and Rams, all of whom seek a move to Los Angeles. I'll rank those outcomes in order of probability, from most likely to least likely:

1. The Rams move to Los Angeles while San Diego and Oakland stay put, at least for a while.

In my four decades of covering the NFL, I have gleaned one important rule: The richest guys usually get their way. Stan Kroenke, proprietor of the Rams, is worth more than $5 billion and is the league's second wealthiest owner behind Seattle's Paul Allen.

Kroenke wants to shift the Rams franchise from St. Louis to a proposed stadium he has enough money to build on the former site of Hollywood Park Racetrack in Inglewood. Kroenke would prefer to be there by himself initially. And despite the NFL's huge ego, there are measured voices within the league who wonder if bringing two teams simultaneously to market in Los Angeles is such a terrific idea.

Two sudden teams would mean selling twice as many tickets and club seats and suites, dumping a lot of inventory out there at once. A safer choice would be to award just one team to Los Angeles and test the waters to gauge the area's true pro football demand before adding a second franchise.

2. Rams move to Los Angeles and are forced to take one other team as a joint tenant.

In this vision, the Rams and either the Chargers or Raiders hit town together -- at the Hollywood Park site that seems more equipped to be done sooner -- and turn Los Angeles instantly into a two-team town with the full force of the NFL's marketing machinery.

But the question is, would the league give Kroenke the right to choose that team? (My guess: Yes.) And which franchise would become the second team? (My hunch: Chargers.) And would the other team then be a strong candidate for a move to St. Louis, where the city has assembled a seemingly realistic stadium package in hopes of keeping the Rams? (My deduction: Yes.)

3. Raiders and Chargers are given the green light to build their stadium in Carson, while Rams stay put in St. Louis.

This possibility does not rank as high as the previous two simply because the Carson deal contains more moving parts. The stadium site is a former landfill, and an environmental cleanup is under way but not complete. There are also bureaucratic hurdles to traverse by setting up a stadium entity, a separate stadium authority and Goldman-Sachs financing. None of this is insurmountable. But in California, building any sports venue is difficult. Surprises always surface.

Also, please approach with caution the words of Carmen Policy, the former 49ers executive serving as point person for the Carson effort. Policy is an awesomely smooth talker and intelligent negotiator. But he also has been the carnival barker for three previous failed NFL stadium deals -- for a new 49ers venue at the Candlestick site (scuttled by Eddie DeBartolo's legal troubles in Louisiana); for a previous Los Angeles effort on a Hollywood Park stadium involving the Raiders (dropped when Al Davis decided to return to Oakland); and for a 49ers stadium at Hunters Point in San Francisco (rejected in favor of Santa Clara). More than anyone, Policy knows there are no sure things.

4. The Chargers get a new stadium deal done in San Diego, bow out of Los Angeles quest; Raiders then face option of joining with Rams in Los Angeles, continuing to play in Oakland or moving elsewhere.

It sure doesn't seem as if the Chargers have a future in San Diego. But let's say they get a stadium deal done there. This leaves Oakland owner Mark Davis in a pickle. He was an equal partner in the Carson project. Would he agree to become a quasi-tenant of Kroenke at Hollywood Park? Or would Davis think of a move to St. Louis or San Antonio? He has publicly said St. Louis wasn't a good fit for the Raiders. And San Antonio would have to construct an NFL stadium.

5. Rams and Chargers move to Los Angeles. Raiders stay in the Bay Area at Levi's Stadium or a new Oakland stadium.

Stop laughing. Oakland does not appear capable of getting its stadium act together. But there's always hope. And you know what might hustle up any effort among East Bay politicos? The Raiders playing in the South Bay.

It's strange, the utter disdain Davis has shown for the idea of splitting home dates at Levi's Stadium with the 49ers, even on a temporary basis. Geographically, the venue is actually closer to Oakland than San Francisco. And the 49ers' contract with Santa Clara already provides the financial parameters for a second team.

Would Davis really rather share a stadium in Southern California instead of one amid the NorCal Raiders followers that he professes to love? Davis could announce a plan to play experimentally at Levi's for two or three years, giving Oakland more time to come up with something, and thus remain portable for the next potential move.

Those are my rankings. I'll stick by them firmly until at least next week. Because the way it's going, the ultimate outcome could easily be none of the above. Enjoy the drama! There's more to come.
 
GG said:
Raiders-Niners to share Levi....despite Davis' moanings.
Rams-Chargers to share Hollywood Park...or Rams to Hollywood Park and Chargers stay put in San Diego.

Imo what will happen.
Click to expand...

I still have a hard time believing that the Raiders and Niners would share a stadium. Had this option get pushed through, it would've happened years ago when the Niners were in the infancy of getting their stadium designed etc. Fact of the matter is that Levi's Stadium is a 49er stadium, it might be able to house 2 teams but there is nothing neutral about that stadium at all. And I don't see anyone putting extra $$$ into the stadium to make it 2-team friendly, even though that would be my preferred option and probably the cheapest option as well (I estimate it would cost around 500 million to refurbish the stadium such that 2 teams could consider it a "home" stadium).

That being said, Mark doesn't want to move the Raiders there. And frankly enough, the Niners are well known to not want a second team there either.

Still lots of posturing going on. At this point, anything is possible. I wouldn't actually be surprised if the Rams get sold to an investment group committed to keeping the Rams in St. Louis, and then for Kroenke to buy out Mark Davis and move the Raiders into Inglewood. The NFL has wanted Mark Davis gone for years, and pretty much have had Larry Ellison on standby to purchase the Raiders had Mark decided it was time to sell. That being said, I still have no idea how such a scenario would play out. But at this point, nothing is farfetched because anything can happen.
 

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Sam Farmer of the Los Angeles Times explains that the NFL will “manage the outcome” in part because a traditional approach, with owners casting ballots regarding who can and can’t move, likely will fail. Farmer notes that Chargers owner Dean Spanos likely has nine votes to block the Rams from moving, and that Rams owner Stan Kroenke likely has nine votes to block the Chargers from moving.

Which means no one will be moving unless the NFL figures out a way to broker a deal. Which also means that the deal that gets brokered could entail Spanos and Kroenke joining forces in Inglewood, with the Raiders (who are currently partnered up with the Chargers at the proposed Carson location) being the odd man out.
 
I was under the assumption that Mark would sell at the first chance he gets.

Moving to LA in theory doubles the value of the franchise. Such a shame as the Raiders intellectual property would be one of the most valuable in the league.
 
So the only reason chargers want to leave SD is so they can get a new stadium that won't leave the owners bankrupt? Plus being in LA they become a big market team.
 
GG said:
Am so p#seed off with Mark. Not willing to share a stadium in Santa Clara but willing to sell the raider soul to share a stadium with the chargers
Click to expand...

You've missed the point on the Carson project totally. For starters, this whole idea that the Chargers and Raiders hate each other, is so far from the truth. Alex Spanos is an East Bay guy, grew up in Stockton. Al Davis was instrumental in getting Spanos into the league, and they remained very close friends up to Davis' passing. The only rivalry between the two organisations was on-field.

I've never understood the whole "OMG Raiders could move to the NFC, what is the world coming to?!" ridicule. It's a bloody conference for crying out loud. It's not as if they would be moving out of the league. Like Al Davis said, "I'd rather be right than consistent." If it becomes the only option that the Raiders need to move to the NFC in order to move the Carson project forward, you just do it. The history in the AFC is always going to be there, that's never going away. Al Davis was a key cog in the merger between the AFL and NFL. Key word is "merger." The whole "AFL and NFL need to be independent of each other" may have had merit 30 years ago, but times have changed, and it simply doesn't carry any weight any more.

As for your theory that the Raiders would have to go overseas for at least 1 or 2 home games per year to get a new stadium....well, that's ridiculous. If the Raiders move to the Los Angeles market, the NFL is not going to dilute the market presence in SoCal by forcing one of the teams there to play their home games in an external market. I could potentially see the Raiders hosting a game in London every year for the next few years whilst a stadium is being constructed though. Such an arrangement may be needed due to temporary stadium issues.

I do agree with you on the eternal flame though. Very disappointed about that. I certainly would hope that if the Carson project goes forward, that there are two big monuments of some sort outside the ground paying tribute to both Alex Spanos and Al Davis.
 
Beetlebum said:
The mass brawls in the carpark twice a season will give Rog something to be outraged about once Brady and Belichick have left the league :D
Click to expand...

Actually if you take a look at the last Battle of the Bay, it was a very peaceful event. I was actually surprised considering I was expecting to see at least one or two fights in the parking lot pre-game. Saw nothing. Not that I see the Niners and Raiders ever being in the same division. I think there would be a number of owners who would object to the reduced travel distances (on a regular basis) for away games.
 
"The Inglewood, Calif. stadium fronted by St. Louis Rams owner Stan Kroenke is now the league's preferred choice, according to both Bleacher Report's Jason Cole and Bernie Miklasz of 101 Sports in St. Louis.

Both reporters have been covering the NFL's relocation efforts closely. And now, both appear to believe that Kroenke's Rams are favored to relocate -- along with the San Diego Chargers.

The rumors indicate the NFL doesn't want any divisional turmoil. By excluding one AFC West-based team, the two conferences won't have to trade member teams.

For now, the Raiders appear as if they're the odd team out. Cole reports that the league doesn't think the Silver & Black can pay their share of a new Carson, Calif. home."
 
Props to Chewy316 you were right ;)


--------------

"Officials in St. Louis and San Diego have at various times purposefully referred to their stadiums as being for “an NFL team.” Believe it or not, the talk about the Raiders replacing the Chargers if the latter moves north is not fantasy. Two league sources said that scenario has been discussed among owners, in part because the league has all but given up on a solution being found in Oakland." San Diego Union Tribune, 9-11-15.
 
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