As soon as the news broke that the San Diego Chargers and Oakland Raiders were partnering up for an NFL stadium proposal, to be located in Carson, my phone rang.
In the last year, I've had a handful of "sources" for stadium information. Most of the time, I keep what I learn from them to myself until it can be backed up by someone else. Most of the time, I'm more interested in figuring out what is really going on with the Chargers and San Diego than I am with breaking a story. After all, this is a blog, not a newspaper.
I saw the name on my phone, and it was one of my sources. It was someone who is tapped into what is going on with all of the NFL, not just the Chargers and their stadium situation. This person had texted me two days earlier, telling me that the Chargers were not leaving San Diego, and I assumed this was him calling to say "Welp, I guess I was wrong."
For the next two hours, he explained to me what the Carson project really is. It's leverage. Leverage for the Chargers to use against San Diego (getting them to speed up their timeline). Leverage for the Raiders to use against Oakland. Leverage for the NFL to use against Stan Kroenke. All of this I mostly knew already, but let's go over it....
Leverage for the Raiders
Nobody wants to share a stadium with the Raiders and Mark Davis, not even the desperate Chargers. They added the Raiders to their plan to make the financials seem more realistic, but they blew their cover at the same time. While the Chargers might end up in Carson, and they are in the process of buying that land (although it is not final yet), it is nothing more than a backup plan.
Oakland is broke, broker than San Diego, and Mark Davis has enough of his father's DNA that he's demanding a new stadium akin to "Jerry's World" in Dallas. That's not going to happen, especially because Mark Davis is essentially broke himself. He doesn't even have $200 million to add to the project, like the Chargers have been willing to pledge towards any project in San Diego.
As I said months ago, the NFL is slowly but surely forcing Mark Davis to sell the Raiders. They will not give him any extra assistance to build a stadium, which he needs, and they know the value of his team goes down as that stadium in Oakland gets worse and worse. That's not to mention the fact that he may not have enough money to pay the estate taxes that will soon be due. The NFL is happy to let Davis "wither on the vine".
The Chargers letting Mark Davis tack the Raiders onto the Carson stadium project was an actual godsend for Mark Davis. It is likely the only possible outcome that allows him to continue owning the team.
One interesting caveat here, that probably will end up meaning nothing, is that Mark Davis has fair offers to sell the Raiders right now. Those that are offering want to take the team and move it to Los Angeles, and actually have the means to do so. It will be interesting to see if the Chargers get a stadium in San Diego and the Rams start building in Inglewood if those offers stick around or disappear.
Leverage for the Chargers
Contrary to what you may think, after the recent news, Dean Spanos has no real desire to leave San Diego. He's almost a businessman second, and a San Diegan first. I don't know if he feels that Los Angeles is overwhelming, or if he simply doesn't want to deal with the traffic, but I can assure you that every single person that I've ever talked to that has talked to Dean is adamant. The only way the Chargers leave San Diego is if the city decides against helping them to build a stadium, which is possible.
Jeff figured out how San Diego could build an NFL without a super-majority vote. That is of the utmost importance. When the Chargers announced the Carson project, they were demanding that the Mayor's office push up their timeline and figure out a way to build a stadium without that super-majority vote (because there's no chance in hell it would pass). Now, the Mayor's office has complied on the first part, and hopefully they'll comply on the second part of that demand when they announce their plan in May.
As is usually the case when you go digging into something like this, my goal was to follow the money. Even the nonexistent (yet) money...
Leverage for the NFL
Now, the question that many have been asking is this: How would the Spanos family benefit, financially, from staying in San Diego? That is the wrong question. More importantly, right now, is how would the NFL benefit from it? That's the question I needed some help in answering.
What I found out was surprising, but not shocking.
While it all depends on how things play out in San Diego, Oakland, and St. Louis, the NFL ultimately would prefer only one team to move to Los Angeles. That plays right into Stan Kroenke's plans for Inglewood, right? Well, kind of...
Stan Kroenke's people have said, multiple times, that he does not wish to share his stadium with another NFL team. He wants to be the only NFL team in Los Angeles. The NFL would prefer this too, for the next six or seven years, but they have their eye on expansion.
The last time the NFL allowed an expansion team was 2002. Then, it cost a $700 million expansion fee, plus $352 to build what is now NRG Stadium in Houston to house the Texans. By 2022, if a potential NFL owner could build a franchise in Los Angeles without needing to build a stadium, that could be worth $4-5 billion in an expansion fee.
Let's do some quick math here....
Let's say that the league creates two new teams in 2022, and their total combined expansion fees equal $6 billion. That would be $187.5 million into the pocket of every NFL owner, not to mention increases in games played (34 teams plays perfectly into 17 games) and television contracts.
That may not seem like a lot of money until you realize that most NFL teams don't make much money. Some of them even lose money. At most, they're pocketing a couple million per season. In fact, NFL owners are currently splitting up $1 billion for sponsorships and $1 billion from DirecTV each year. So, adding $6 billion on top of that would be a big get for every NFL owner and would make them very happy with the Commissioner.
Now, back to Rams owner Stan Kroenke. Kroenke says he will move to Los Angeles with or without the NFL's approval, and that seemed like it was going to work out just fine...until the Carson project was announced. Roger Goodell is now using the defense of "We cannot build another NFL stadium in California while two other teams in California play in outdated stadiums," and it might actually work. He can now add on to that defense, "If the Chargers and Raiders cannot get deals done in their home market, they get first dibs on Los Angeles before the Rams."
Part of that defense is legitimate. A new NFL stadium in L.A. for the Rams does nothing but hurt the Chargers in San Diego and the Raiders in Oakland. The other part of that defense is starting up negotiations with Kroenke, and they already know what they're going to offer. "Fine, you can be the only team in Los Angeles...for five years. Then you have to take an expansion team as a second tenant."
In the meantime, the $750 million relocation fee that Kroenke pays can be split unevenly, with the Chargers and Raiders getting big chunks of it to help their stadium deals along.
In the end, the Chargers and Raiders might be able to pocket $200-300 million just by staying in their current markets. That would also make the other 30 NFL owners richer in the process, and also take advantage of the Los Angeles market...which makes Roger Goodell a superstar in the eyes of his employers.
I don't know how the Raiders are playing this out in Oakland, and I don't really care. The Chargers might be able to do Carson without them and would probably prefer that, but right now their goal is to stay in San Diego. They're focused on that. Releasing the details of the Carson project now was nothing more than a way to get that done.
The Chargers, and Mark Fabiani, have played this perfectly. They have the San Diego Mayor right where they want him. They are on pace to get a stadium done in San Diego, and to profit in the process (and help other NFL owners profit). I'm more confident than ever that the Chargers are not leaving.