It was not a very good day for Los Angeles.
On the same day that Mayor Antonio Villaraigosa announced that the city would have to lay off “a large number of employees,” Yahoo’s Jason Cole reported that momentum for a new stadium in downtown L.A. appears to be waning.
First, the layoffs. We all know that the California economy is bad, but it doesn’t appear to be getting any better. While here in St. Louis we’re dealing with possible park closings in the county and firefighter pension issues in the city, Los Angeles has cut more than 300 jobs since the start of the recession, with thousands more retiring and not replaced. According to the Los Angeles Times, the city faces a $220 million budget shortfall. Villaraigosa won’t say how many jobs will be cut, but the point is that the city has to cut jobs to remain financially viable.
With that as a backdrop, Cole reports that plans for a downtown L.A. stadium “may be all but dead.” The plan set forth by billionaire Phil Anschutz, owner of AEG entertainment, calls for a team to move into the new Farmers Field that his company would build. In return, the owner of the team that would move to L.A. would sell a minority stake in his franchise to Anschutz at a deep discount.
As you might expect, NFL commissioner Roger Goodell and his owners don’t want anything to do with discounts, and he told Anschutz that no owner would agree to his deal unless he was willing to pay market value. If owner A has a franchise worth $1 billion, Goodell and the other owners don’t want a team sold for $500 million. It’s just like real estate. The owners want to keep those values up. Cole reports that since meeting in December between Goodell, Anschutz, Patriots owner Robert Kraft and Villaraigosa, the NFL hasn’t heard a word from Anschutz.
It may be too late. Another part of AEG’s deal is to have Los Angeles sell bonds for part of the financing of the stadium. Can a city that’s cutting jobs, and therefore services, and faces a $220 million shortfall afford to issue bonds and help pay for a new football stadium? My guess would be that politicians that plan on being re-elected wouldn’t touch that idea with a 10-foot pole.
There’s another stadium proposal in L.A., in the City of Industry, where another billionaire, Ed Roski, has offered control of 600 acres to an NFL owner that would like to A) sell a minority stake in his franchise at market value and B) finance and build a stadium himself, presumably at a cost of at least $1 billion. It appears that owners aren’t real interested in selling a part of their franchise and then spending a huge part of their net worth to build a new stadium.
However, as I’ve mentioned before, if there was one owner that developing 600 southern California acres would appeal to, it would seem to be Rams owner Stan Kroenke. Kroenke made his billions by developing land and renting out parcels at strip centers. That rectangular mile in the heart of Southern California could be a gold mine, and the expense to build it would be enormous.
That being said, as Bernie Miklasz mentioned in his Post-Dispatch column on Thursday, Kroenke still has a pretty good deal in St. Louis. He’s paying $250,000 in rent, has been offered upgraded suites and more club seats, and is in a town with more Fortune 500 companies than L.A. has. St. Louis can still be a good deal, if the people in charge will make it so.
As a community, St. Louis needs the CVC to step up and make the Edward Jones Dome as good as it can be. We had the NCAA regional final last weekend, and should be able to attract Final Fours and other big events to the Dome.
While Los Angeles seems to be losing traction, a perfect opportunity has arisen for St. Louis to assert itself as a town identified by sports. We haven’t turned into a Midwest version of Silicon Valley. We aren’t an airline hub, and our brewery isn’t St. Louis owned any more.
With some foresight, however, our city can build a foundation based on sports. Sports and the Arch are what we’re known for. How about enhancing our athletic image even more? The Sports Commission has done a great job of getting the NCAA wrestling tournament to St. Louis. We’ve had men’s and women’s Final Fours and a Frozen Four.
It’s not much of a leap for St. Louis to combat Indianapolis for sport supremacy. As the home of the NCAA and with Lucas Oil Field, Indy will get a Final Four every five years. They did a great job of hosting the Super Bowl, they have the Combine every year, and they host numerous amateur events, and make an attempt to own amateur sports. In fact, Indy is the self-proclaimed “Amateur Sports Capital of the World.”
Sports can be a foundation that enhances a community’s culture, education and business. We’ve seen it with the renaissance of Indianapolis, and the turnaround of a city because they recognized the importance of sports.
It wasn’t too long ago that we were talking about Peyton Manning and the Colts moving to Los Angeles. It would seem that L.A. simply can’t get its act together when it comes to bringing the NFL back to town.
But St. Louis shouldn’t take anything for granted. Our community, the city, county, St. Charles County and the state of Missouri, should make an attempt to be great. We’ve been OK or good long enough. St. Louis can be a preeminent market, and sports can be the foundation. Now, as negotiations between the CVC and Kroenke kick into high gear, is the time to go for it.