Unanimous approval of the five-year outline to build a 72,000-seat football stadium in Downtown L.A. goes to show that the City Council is all game for a politically radioactive project.
For the developer Auschutz Entertainment Group (AEG) - whose portfolio includes the Staples Center and L.A. Live entertainment complex - three distinct hurdles lie ahead.
David Zahniser and Sam Farmer report:
"[T]he most difficult for Phil Anschutz, the billionaire owner of AEG, could be securing an NFL franchise. The league has no intention of expanding beyond the current 32 teams, so Anschutz must reach a deal with an existing owner to relocate to L.A. The relocation would have to be approved by a three-fourths vote of the 32 owners. The league is unlikely to give away access to L.A., the nation's second-largest media market, so any deal would almost certainly include a transfer fee, possibly in the hundreds of millions of dollars."
Anticipating a barrage of "frivolous lawsuits" invoking CEQA violations, "AEG is already working on state legislation to limit the type of legal challenges - including one it fears from backers of a competing stadium in the City of Industry - that could be filed against the project on environmental grounds."
On the financing side, "the city would issue $275 million in bonds, money that would allow for the demolition and reconstruction of the Convention Center's West Hall. AEG would then build the stadium, to be known as Farmers Field, on the former site of the West Hall. Revenue from both projects - including sales taxes, property taxes, and parking taxes - would be used to pay off $195 million in bonds. AEG would be on the hook for the remaining $80 million in bonds, and if it defaulted, the city would have the power to foreclose on L.A. Live."
The final voting is scheduled in May 2012.
FULL STORY: Los Angeles OKs outlines of downtown football stadium deal

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