AEG Gets Stadium MOU, Texas Challenge
AEG and the City of Los Angeles announced the finalization of a memorandum of understanding to take the Farmers Field football stadium and Convention Center expansion to the next phase, the company announced July 25.
The MOU is subject to city council approval, and a vote could come as early as July 29. And with an apparent agreement between NFL owners and players’ union to end a protracted labor dispute, the road could quickly be cleared for AEG to acquire a pro team to anchor the proposed stadium.
AEG President/CEO Tim Leiweke announced the completion of the MOU, reiterating that the project would be entireley privately funded.
“Thanks to the commendable efforts of the City’s negotiating team, we have fashioned an understanding that reflects a number of key changes that serve to further ensure that the interests of the citizens of Los Angeles are well protected and well served,” Leiweke said in a statement.
“Among other things, not only do the proposed terms contained within the MOU provide for full repayment of the City bonds by new revenue sources, they expressly contemplate that the majority of new tax revenues generated by Farmers Field will accrue to the general fund, providing a much needed source of new revenue for our City in the coming years.”
Completion of an environmental impact report, processing of project entitlements and negotiation of other agreements remain on the agenda for AEG pending the city council approval. But Leiweke said he expects ground to be broken on Farmers Field “within the next year.”
In the meantime, rival developer Ed Roski, with his shovel-ready plan to build a stadium in suburban City of Industry, may not be ready to go down without a fight. And he seems to have found an ally in Texas developer Billy Bob Barnett, of Billy Bob’s fame, as a lobbyist who says he has persuaded at least two California lawmakers to draft legislation to undermine the AEG stadium plan, according to the Los Angeles Times.
Barnett wants to build a $250 million entertainment complex 10 miles from AEG’s
Barnett brings the spat to California by reportedly sending lobbyist Jim Cassie to Sacramento.
One proposal reportedly would limit use of Farmers Field to weekends, barring lucrative Monday Night Football games or Friday night concerts, according to the Times. Another would restrict borrowing. Cassie told the Times his Texas client wants only to protect Los Angeles taxpayers.
“He feels that if you are going to use bonds, they really have to be protected by the taxpayers,” Cassie told the paper.
California State Sen. Bill Emmerson of the desert outpost of Hemet introduced a measure to block the sale of bonds benefiting sports facilities until the state reviews them and reports back “on the future financial risk imposed on the taxpayers,” according to the Times.
Another, unidentified, solon is reportedly working on a separate bill to impose strict environment rules on the project and include the ban on weekday events.
“Polling that was done for the proposed Los Angeles stadium shows that the biggest concern people have is traffic,” Cassie told the Times. “So, limiting use of the stadium to weekend days and nights made sense.”
One of Cassie’s business partners, Meghan Loper, is reportedly a former manager of Roski’s Majestic Realty. Cassie denies Loper is working on the Barnett legislation.
The Farmers Field / convention center plan calls for the city of Los Angeles to issue some $300 million in bonds, which AEG has promised to guarantee. The hope is to have the stadium construction completed in time for the 2016 NFL season.
“Assisted by a team of experienced outside advisors, the City’s negotiating team not only pushed hard to address important issues to their satisfaction, but they worked tirelessly and cooperatively to identify an optimal financing structure for the portion of this project that entails public involvement,” Leiweke said in his statement announcing the MOU, released the day after the Times reported on the Texas challenge.
“It appears that the objectives all parties interested in creating good local jobs are in conflict with a failed Texas developer,” AEG spokesman Michael Roth told the Times.