SAN DIEGO -- The San Diego Chargers will start campaigning for the passage of the team’s plan for a new NFL stadium and convention center expansion by the end of this month.
Unveiled two weeks ago, the $1.8 billion proposal faces an uphill climb to get approved by voters if it makes it on the ballot in November.
However, Fred Maas, stadium adviser for the Chargers, believes the team crafted a fair deal that potentially solves several issues for the city, including a stadium that can be used for more than 10 football dates a year, a convention center space and the possibility for a football-only facility and expansion of San Diego State University at the Mission Valley site that houses Qualcomm Stadium.
“We tried to lay out a program that takes many of those issues into account,” Maas said. “But one of the advantages of a city initiative is it allows us to present to the voters something we think is both reasonable and fair.
“We think that we’ve put a very attractive proposal forward, and look forward to garnering the support of city leaders and ultimately the voters.”
The plan: The Chargers propose San Diego raises its transient occupancy tax, which is paid for by visitors staying at hotels, from 12.5 percent to 16.5 percent.
The revenue collected by the city would go to pay the debt service on $1.15 billion in bonds issued to help pay for land acquisition and construction of an expanded convention center for the new stadium project, projected to cost $800 million, along with a third of the cost for a new $1 billion stadium, projected at $350 million.
The Chargers and the NFL would contribute $650 million. The NFL would be responsible for $300 million, including $200 million from the G4 stadium loan program and a $100 million gift negotiated as part of the Rams moving back to Los Angeles.
The Chargers would contribute $350 million.
The initiative also creates a marketing fund for the city to help promote tourism and conventions in San Diego.
Upon agreement on the proposal, the Chargers would agree to not relocate for 30 years and play all of their home games at the new stadium. The team would be responsible for any cost overruns, along with annual maintenance involving the stadium portion of the project.
The 65,000-seat stadium and convention center expansion would be owned by the city of San Diego under a joint powers authority.
Maas said the Chargers have leaned on the expertise of investment banker Goldman Sachs, including managing director Tim Romer, who was heavily involved in the financing of Levi’s Stadium, the Minnesota Vikings new U.S. Bank Stadium, MetLife Stadium and the Golden 1 Center, (the Sacramento Kings' new basketball arena).
“He speaks with a level of experience and expertise that few others have,” Maas said of Romer. “We didn’t send him on a mission to try and make unrealistic predictions. This has to work for us. It’s got to work for the city, it’s got to work for the community and it’s got to work for the hoteliers.
“So it doesn’t work to make unrealistic assumptions. He feels good about it, and therefore I do as well. But we tried to be very cautious to try and come up with formulas that deal with cost overruns. We tried to address as many questions as we possibly could in a very short amount of time.”
The Chargers also provided answers to frequently asked questions on the project.
How does it work? The Chargers have to qualify the measure for the ballot, which requires 66,447 valid signatures certified by the office of the registrar by mid-June, presented to the San Diego city clerk’s office and ultimately approved by the city council.
The city council can either vote to adopt the initiative or place the measure on the ballot. If placed on the ballot, city voters will get an opportunity to vote on the measure during the Nov. 8 presidential election.
San Diego city attorney Jan Goldsmith is still evaluating whether the measure will require a two-thirds or simple majority vote for approval, although the team is moving forward on the assumption it will require a two-thirds vote.
The Chargers cannot begin collecting signatures until three weeks after the publishing of the initiative, which will happen on April 23. The team is also expected to present the first public renderings of the project at that time.
The team’s goal is to collect 100,000 signatures over a six-week period, creating a buffer in order to have enough signatures certified.
Reason for downtown location instead of Mission Valley: Because of the initiative process, the Chargers could not negotiate with stakeholders directly affected by the project like San Diego mayor Kevin Faulconer and the hotel community.
However, Maas said the plan has some wiggle room for negotiations between affected parties if approved.
“We looked at a serious amount of land-use issues,” Maas said. “We’ve looked at the financing issues. We’ve had substantial meetings with the city’s financial folks. So it’s not been created in a vacuum.
“We’ve had a healthy dialogue with the folks in the city, as well as representatives with the hoteliers. So it’s not been just us trying to fly by the seat of our pants. It’s been deliberate and steady, with a lot of resolve.”
Maas also explained why the Chargers chose a downtown stadium site over Faulconer’s plan for a stadium at Mission Valley.
“We believe that people will be persuaded that what we’re proposing is something significantly more than a 10-day-a-year facility,” Maas said. “What we’re really talking about is a facility that can be used 365 days a year that will be integral to the community and have events outside the football season. It will have Final Fours, Super Bowls, prize fights and other convention events and other things that we currently can’t have in San Diego.”