THE BUSINESS AND POLITICS OF SPORTS
Life as a player in the stadium game is looking up for New Jersey's Zygi Wilf. You see Wilf's Minnesota Vikings lease with the Minneapolis Metrodome is over and Wilf's Vikings are a hot commodity. The National Football League lockout was propped up by owners like Wilf, who are saddled with outmoded facilities, which lack revenues streams or more importantly the kind of seats which rich people, rather customers, will buy: luxury boxes and club seats along with valet parking, in-stadium dining and lots of concessions.
Wilf doesn't have those gadgets like the big boys, Jerry Jones (Arlington, Texas), Woody Johnson and the Mara/Tisches families at the Jets-Giants facility in East Rutherford, New Jersey and Jim Irsay's Indianapolis venue, which gives just about as much of every dollar generated in the building to Irsay's Colts.
Zygi Wilf got incredibly good news on the stadium front this week.
Minnesota Governor Mark Dayton, who presided over a state that shutdown when state Republicans would not play ball with Democrats as both tried to pass a budget in the one of the more recent battles of dysfunctional government which is spreading like cancer throughout the country, decided to take another look at how the state could spread hundreds of millions of dollars in a partnership with Wilf to develop a stadium in the Twin-Cities area.
While Dayton was rallying the troops and waving purple pom poms, the Los Angeles City Council decided they too need to get into the stadium game and give the Anschutz Entertainment Group, by a 12-0 yes vote, a framework deal on the project's funding that will include the issuance of $275 million in tax-exempt bonds for the relocation of a convention center hall to accommodate the proposed $1.2 billion football venue. Los Angeles is broke but that isn't stopping the city council for waving pom poms for some football equivalent of poverty level NFL owner to turn his sad eyes to the nation's second largest market. A second LA group led by Ed Roski also reminded Wilf that they are still in the stadium building business too.
Those sad owners on a list could include Wilf, the St. Louis Rams (and Walmart heir by marriage) Stan Kroenke, the San Diego Chargers Spanos family, Jacksonville's Wayne Weaver, Buffalo's Ralph Wilson and perhaps the NFL's two Bay Area teams, the York family's San Francisco 49ers and Oakland's Al Davis.
Before LA city leaders, the wealthy and the beautiful people including Hollywood’s finest flock out to downtown LA to see an NFL game in 2014 or 2015 (the next available teams are Wilf's Vikings, Wilson's Bills — following the 2013 season — Spanos' Chargers although it is unclear when the Spanos' can actually vacate San Diego, Davis Raiders may be available after 2013 and Kroenke's Rams lease is done after 2014, there has to be a serious look at what kind of lease AEG can really offer an NFL owner.
The stadium will cost over a billion dollars even with Los Angeles giving away the store in whatever tax scheme the politicians offer. There will be personal seat licenses obviously and banks of luxury boxes (even in a bad economy sports people are convinced they can sell high end seats) but AEG is going to have to pay most of the bills. NFL owners like to negotiate deals with municipalities not landlords and AEG is still going to be the landlord unless Phil Anschutz is going to buy into a franchise or own a franchise.
Wilf really is better off cutting his own deal in Minnesota with Dayton and the legislature because he can make more money even putting in hundreds of millions of dollars in the place by controlling all stadium revenues from all events in the building.
The other group looking to build a Los Angeles football stadium — east of Los Angeles has seemingly brought up the same question. Ed Roski wants to put up a football facility in the City of Industry and Roski's spokesman on Tuesday issued an interesting statement.
“Our stadium proposal will generate more money, jobs and long-term success for the region and the NFL. We are more active than ever and are currently working with the league, owners and teams to bring a franchise back to Los Angeles,” said John Semcken, Vice President Majestic Realty.
That has to be music to Wilf's ears and it may be why Minnesota Governor Dayton is pushing the stadium issue now instead of waiting for the beginning of the next legislative session in January.
NFL owners apparently tried to pull a fast one on the players during the lockout when they wanted the players to give back money to the owners so that the players would provide some financial backing to proposed stadium. The NFL stopped the York family from seeking financing for the better part of a year for a 49ers facility in Santa Clara, Calif. In an effort to convince the players that building super revenue generators like a new Silicone Valley football stadium was not feasible under the past collective bargaining agreement.