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Why Do the Chargers Hate Their Own Plan?

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Almost exactly one year ago, the San Diego Chargers were pitching a plan for a countywide vote in 2016, for a stadium and new development in Mission Valley. What gives?

The Chargers proposed stadium in Carson.
The Chargers proposed stadium in Carson.

In the movie Thirteen Days, a dramatization of the 1962 Cuban Missile Crisis, there's a scene late in the film where President Kennedy and his advisors are attempting to figure out how to make a deal with Premier Khrushchev to remove missiles from Cuba and avoid nuclear war.

JFK: So, we just reject the second letter (from Khrushchev which demanded the removal of the Jupiter Missiles from Turkey)?

Ted Sorensen: No, we don't reject it.

RFK: We accept the first letter (from Khrushchev which offered the removal of missile from Cuba in exchange for a no invasion pledge by the United States), and pretend the second letter never exists.

The Chargers' plan from April 2014.

Here's the tweet by Jim Steeg, member of the Citizen's Stadium Advisory Group (CSAG), that got my attention and made me think of that scene.

The entire article, which was written by Mark Walker and appeared in the UT San Diego on April 19th last year, can be read here.

The article outlines a plan by the Chargers to help finance a stadium in San Diego, featuring the following elements:

  • A plan for a countywide vote in November 2016.
  • The Chargers, partnering with Colony Capital, LLC would contribute $400 million to the project.
  • The NFL would contribute another $200 million via the G4 Stadium Loan Program.
  • The remaining cost (estimated at $400 million in the article) being contributed from public sources.
  • The Chargers do not have a preferred stadium location, and the article explicitly states the team is willing to consider the Qualcomm Site for redevelopment.

Now, before we go any further, we should note that this article came out nearly 2 and 1/2 months after Stan Kroenke purchased land in Inglewood, which likely prompted the Chargers to make their decision to pursue the Carson location, and quietly develop it as a Plan B if the plan laid out above became unworkable.

Therefore, the Chargers already knew Kroenke was likely moving forward with a plan in Inglewood, and yet, there was no sense of urgency at that time. The urgency didn't kick in until January of this year, when Kroenke formally announced his Inglewood stadium project, and caught everyone by surprise.

What is CSAG going to offer?

While we're waiting for CSAG to deliver their full recommendation in May, we know quite a bit about the proposal they plan on offering to the Mayor as a starting point for negotiations. We also know the Mayor is committed to a public vote. Let's see how this dovetails with the information from the article:

  • A plan for a countywide vote in November 2016.
  • A new stadium in Mission Valley, costing about $1.2 billion.
  • Limited development at the Qualcomm site to help cover construction costs.
Furthermore, we know that the Chargers created a website for CSAG to use, which included research materials and plans over the last several years. It seems evident their plan from last April would have been among them.

Based on what we've seen and heard from CSAG the last few months, my opinion is that CSAG is essentially telling the Chargers, "We like your plan from a year ago, and that's the direction we want to go." To tie this back into the analogy with the movie, CSAG is telling the Chargers, "We accept the first letter."

What did Eric Grubman's visit to San Diego accomplish?

There weren't a lot of positive words from Grubman, the NFL's Vice President in charge of relocation, aside from his being pleased the city is finally engaged on the stadium issue. The most important piece of information from Grubman however, was his indication that waiting for a 2016 vote was incredibly risky, and he advised against it.
"Time is slipping away; to wait is not a good option." - NFL VP Eric Grubman, in response to a question about a November 2016 vote.
Grubman also indicated the NFL was considering moving up the relocation application window from January - February 2016 to November of 2015.

According to this column by Nick Canepa, Grubman apparently told CSAG that the team would not be sharing naming rights or seat license revenues. He also discouraged a plan built around development, saying it presented "another mouth to feed," and would likely be delayed due to the process involved in getting the necessary entitlements (funny that Kroenke's partnership with Stockbridge Capital in Inglewood doesn't seem to be a problem in this regard).

Which is a problem if the Chargers are only contributing $200 million on their own. To tie this element back into the analogy with the movie, Grubman's attempts to speed up the voting process and explicitly define who gets what revenue are the "second letter," designed to engender panic and exert leverage on San Diego.

What does all of this mean?

The Chargers have already laid out a deal they would be willing to do. To some (if not a significant) degree, this is exactly the deal that CSAG is working on. If the Chargers (and a development partner) are in fact willing to contribute $400 million, then the team receiving naming rights and seat license revenue becomes more reasonable and realistic.

Not until Grubman's visit on Tuesday has anyone ever indicated that a stadium with surrounding development was a non-starter, and nicely dovetails with Fabiani's attempts to make San Diego a mess by repeatedly pitching downtown to persons with a public forum, just as CSAG was preparing to announce the Mission Valley site.

And now, we have Grubman pushing for a Special Election in November of 2015. Why?

Because as of right now, the Inglewood project is the likely choice for the NFL.

From what I've seen and read so far, Inglewood is more financially viable, does a better job of generating revenue year round, has potential facilities for NFL Network, and a theater capable of hosting the NFL Draft. Carson, thus far, is just a (very nice) stadium and parking lot. Also, Inglewood is further developed as a plan than Carson. Although both projects will likely be entitled by the end of next week, Inglewood could have a shovel in the ground months before Carson does - meaning Kroneke will start building first if he wants to - with or without the NFL's consent.

Further, I am also of the opinion that the NFL does not want Mark Davis financially stabilized as the owner of the Raiders. Rejecting the Carson project keeps pressure on Davis to sell the franchise.

Lastly, I think the Carson project could be derailed by Anschutz Entertainment Group (AEG), if they file a lawsuit demanding a full Environmental Impact Report for the Carson site. Remember, AEG owns the StubHub stadium complex, located less than 2 miles from the Carson site, and they would not like to see competition for similar events so close by. Further, AEG could file suit to protect Kroenke's flank, as they have a longstanding business relationship, or even as retribution against Spanos for not accepting the Farmers' Field proposal.

This leaves the Chargers without an ideal Plan B if nothing gets done in San Diego, and I think Dean Spanos is very skeptical that CSAG is part of a legitimate effort to make a deal in San Diego. If they want to be first to Los Angeles, the Chargers have to get the Carson project approved by the NFL. I think the only way this happens is if a Special Election has taken place in San Diego in 2015 and failed.

Otherwise, if the Inglewood project is approved, there's no reason the Chargers couldn't wait 1 more year for a 2016 vote, before becoming the second tenant in Inglewood.

Or, if the Rams stay in St. Louis, there's no reason the Chargers couldn't wait 1 more year for a 2016 vote, before getting their stadium in Carson.

Closing Remarks

The Chargers are absolutely desperate to either get a deal in San Diego, or to be the first team to Los Angeles. They were blindsided by Kroenke, even knowing he'd purchased land in Inglewood.

The Chargers' desperation over the last 4 months shows, especially when compared to the lack of publicity from the Rams and Raiders, in the strong-arm tactics they've employed, the numerous misleading and contradictory statements by Fabiani since CSAG was formed, and now the turmoil regarding the situation with their (maybe not for much longer) franchise QB.

CSAG is doing two things here, in my view. First, by not committing themselves or San Diego to a sped-up vote, they are implicitly calling the Chargers' bluff in Carson. Second, and most importantly for San Diego, they are telling the Chargers that they want the deal the Chargers themselves pitched one year ago.

The question is when the Chargers decide to return to the negotiating table in San Diego.