Chargers fans are alight with anger at the city’s hoteliers. It is the product of a public perception push the Chargers have pursued for years. The team has an idea for downtown, and it is the hotel owners — and the mayor supposedly in their pockets — who stand in the way.
This message was like a blue flame the team kept stoked as it lobbied to move to Los Angeles. Now team owner Dean Spanos has decided to stay in San Diego, provided he finally gets a new stadium.
In the process, he has set up a final confrontation with hoteliers.
The irony, though, is that the Chargers’ new plan for a stadium relies on hoteliers to work.
That’s not only because hotels could spend money to defeat the Chargers’ plans at the ballot box. And it’s not because the political opposition of the visitor industry, even without money, is devastating to a multifaceted ballot measure whose only unifying trait is that it is all about the visitor industry.
It’s because for the Chargers to build a stadium in East Village under this plan, they need the hotels to voluntarily invest in it — hundreds of millions of dollars in fact.
Help Us Raise $100k By the End of May
The smart money says the downtown stadium would never happen:
Scott your article sheds more light on the situation than anything I have ever read on this mess. Great job of digesting all the information and distilling it in a simple way. I do think it's all for naught though as both the Chargers and the Downtown crowd have worn out there welcome with the people of San Diego.
BTW how was the $30M in deferred maintenance the current Convention Center desperately needs handled? Oh, I guess they will get around to that later.
The impending deluge of tv and print advertising with happy-faced fans (paying FAR too much for each of the eight games a year) while tourists gleefully enjoy a convention as they're being clipped for (what appears to be, ultimately) around a 15% tax/ surcharge... leads one to believe this is simply a rich man's chess game, helping the wealthy get wealthier... and potentially a token of good for the average Joe.
Once again, citizens will take the back burner while the rich men play chess. My bet is in the long run citizens are sick of the same old 'trust-us' charade and this entire fiasco will fizzle.
I'm wondering what the over-under is in the number of years it will take the power brokers to learn that the citizens, simple as we may appear, have big priorities too - and they certainly don't include satiating the greed and power struggles of so few.
Good luck with amy two-thirds vote. You all are screwing this up on such a grand scale it's entertaining. It would actually be funny were you not throwing away so much money... and ignoring the more fundamental needs of your city.
The only unifying force I sense is the underlying current of how this slop will get packaged and sold to citizens.
Good article, but still hard to understand the complex mess. Maybe, the players should try some out-of-the-box thinking.
For starters, the Chargers/Spanos might offer the City/County some minority ownership. NFL owners have made gobs of money. The Spanos family payed less than $49 million for the Chargers in 1984. Now the team is worth over a billion dollars. Even after accounting for inflation, $115 million in present day dollars grew to $1.5 billion (according to Forbes Magazine) in about 3 decades. The voters might like the prospect of a similar financial ride, especially if the City/County got a share of tickets that they could monetize each year. The City/County also might get a few dates per year of stadium use which they could rent to monster truck racers or flower shows or to whatever else they saw as fit and profitable.
A stadium might also be easier to sell if it was cheaper. What if the voters were presented with a design that could be expanded, perhaps a 50,000 seat stadium that could grow to 100,000 seats? Yes, you still have to plan for 100,000 seat parking, utility services, etc. But, less money would be needed immediately, and the public could see whether their investment was doing well before committing to everything a few years down the road. Did the new stadium increase business and tax revenues downtown? Did conventions take advantage of its facilities? Were traffic and parking plans working? Increasing the stadium to Superbowl size makes sense if things go well. Meanwhile, those who control the stadium would have an incentive to keep their promises.
If you want the public to vote for stadium dollars, you need to give the public a chance to win, not just ask them to give money to rich guys.
If Donald Trump becomes the Republican candidate for president, I’ll believe that a good share of voters are stupid enough to buy virtually anything if it’s packaged well (Trump calls it “branding”).
Here we have an inherently complex situation in a city historically very suspicious of new taxes for ANYTHING, even fire stations. To think the voters, if they are allowed to vote, will not reject any form of this scheme simply because of it’s complexity and it’s backing, is ludicrous. We have, in Dean Spanos, a “brand” that’s not exactly worshipped, and many of the other players, Moores, Peace, Briggs, the hoteliers, are suspect as well. Ergo, the name of the game becomes to fashion a plan that requires no taxpayer vote.
@Bill Bradshaw Spanos is not a brand; rather the equivalent of some plague or another.
Personally I wish someone would try to put a tax increase on the ballot in November to help fix Balboa Park. That would guarantee that all the other issues would be voted down and maybe Balboa Park would get some assistance. The convention center and any new stadiums should be totally privately funded. Balboa Park is our jewel and worthy of a ton of support.
In the end it will be the taxpayers of San Diego who will get stuck for paying for a new stadium for the Chargers or an expansion of the convention center or some form convenadium. And basically that it what this is all about. It's about the greed associated with power politics. To a high degree that is what San Diego politics has always been about. It doesn't know of any other way to operate. Spanos has always just been looking for a billion dollar hand out at any one's expense. He and his family have absolutely no intention of even trying to fund this boondoggle of a downtown stadium using any their money. He is trying to use some smoke a mirrors plan where he can fool the tax payers. Many local politicians and local special interest operators who have something to gain want in on the action. Why can't these people who have something to personally gain from this venture just privately fund it with their own money and leave the tax payers of San Diego out of it altogether?
My answer is simple. This is how they do things here. These operators know the voters of San Diego are quite stupid and easily fooled. Basically it is just too easy for them to simply take it from the taxpayers. This is the nature and culture of this city. The politicians love it. This is why the city has no funds for needed infrastructure repairs, and meeting the financial needs of a growing population. Instead they spend millions if not billions of tax payer dollars over the long run to satisfy the needs of the special interest politics of corruption and greed.
Let's be honest for just one minute. There is no critical need what-so-ever or any structural need for a new stadium. Qualcomm is perfectly usable for now and years to come. The same is true of the convention center. In fact the convention center can't even operate with enough revenue to meet it's own day to day maintenance. Both operations cost the tax payers millions of dollars in revenue each and every year because of the way they are managed. They don't even charge the users of both facilities enough money to even break even. This is why the bond issue to upgrade Qualcomm over 20 years ago still owes most of the principle to the bond holders. These special interests are trying to again get the city to float bond issues that will drown the tax payers of this city in debt. In the end that means even more money from the general fund will be used to fund and service this debt while the growing infrastructure and daily operating needs such as transportation, fire & police, and general services go unfunded or underfunded. Then the city council will ask the voters for even more tax increases to fund basic services because all of the current revenue continues to be squandered. This is how San Diego operates. I see no changes in the future.
There is simply nothing else to say. Until those who want this new stadium or convention center can use their own private money this should be a non issue and the voters should flatly reject it on face value.
Regarding the >50% vs 2/3 voter approval: If I understand this, if the TOT increase is earmarked for convention expansion or tourism marketing district, then 2/3 voter approval is needed. But if the TOT increase goes into the general fund, then only 50% is needed? But the JMI - Briggs way around the 2/3 requirement and still facilitate convention and tourism marketing funding is to allow hoteliers to earmark 2% for convention and tourism and get a 2% deduction on their TOT bill? Ultimately, the hoteliers still decide where the 2% goes, rather than City Council. If that is correct, I don't see how that isn't viewed as a gimmick that violates the intent of the law.
I agree that the term "motley" was inappropriate, along with the reference to the citizen's plan coalition as "misfits". Perhaps Scott is so eager to ingratiate himself with the current "civic power structure" that he uses derogative terms like that without thinking. I agree that if the mayor and his hotelier campaign contributors put a competing initiative requiring a 2/3rds vote on the ballot in November, it will fail. It may take down the SANDAG Transnet tax increase ballot measure, which will also require a 2/3rds vote.
By November, we'll probably know if the TOT surcharge tax the hotel owners adopted to fund their tourism marketing efforts has been eliminated by the courts, like the convention center expansion TOT tax surcharge. If that is the case, instead of poisoning the well for everybody with a separate convention center expansion tax ballot measure, the hoteliers may decide to sign onto the citizen's plan coalition, to ensure a continuation of tourism marketing money (and a new convention center annex off the bayfront). It that happens, you can bet that the mayor will jump on the bandwagon as well. The alternative is to drive the Chargers to LA, shut off tourism marketing revenues and very likely kill off the SANDAG Transnet tax increase ballot measure. In that case everybody loses.
@Don Wood motley is not a pejorative. Check a dictionary, Don. I'm not eager to ingratiate myself with anyone. The motley alliance, though, seems pretty happy with the piece.
On the question of whether the word “motley” is pejorative, the answer depends upon whether one goes by express dictionary meaning or social associative meaning. Literally it merely means multicolored but by associative meaning the multi-colors associate with either a fact or widely held false belief that the word derives from reference to multiple patches of colored cloth for clothing, and either way that associates with either the traditional costume of a fool or the disrepair of one without proper clothing as in “A motley crew with no ranks…and half of them without uniforms” (Shorter Oxford English Dictionary, 2007). The fun thing with such a word is that it can be used to subtly insult while protesting innocence of such intent. On the other hand, some persons find “fool” to be an honorific, signifying the self-wisdom of knowing ones imperfect funny mortal place in the universe. For an example see http://www.fool.com/ (as to Motley Fool) “And about that name? It was taken from Shakespeare, whose wise fools both instructed and amused.” Or see 1 Corinthians 3:18 "you should become 'fools' so that you may become wise"
Nice review. The term "motley" was inappropriate and unnecessary in my opinion. I never expected Mayor to place his measure on the June ballot. They will target November and hope all measures fail a 50% approval. The Mayor and his allies know if they can tread water for two years the Chargers will be forced to take the deal in LA or lose it all together. With the Chargers gone the hoteliers and their allies will have one less competitor standing in the way of a contiguous expansion of the Convention Center.
@David Berry @Don Wood I've argued with Scott many times over his verbal characterizations, but in this case of "motley crew," it sounds like people are taking it as a pejorative when it is not. If you Google the term or look it up in a dictionary, you'll find it defined as "a gathered group of people of various backgrounds, appearance, character, etc." I think anyone who's watched San Diego politics over the past decade or so would say a team composed of John Moores, Cory Briggs, Fred Maas, the Chargers and Donna Frye is unexpected and certainly diverse.
"It would mean Briggs did more to influence the long-term design of downtown than Faulconer." Irony and karma working hand in hand. Quite fitting.
It's clear what JMI and Spanos get out of the initiative. What Briggs - Frye, purporting to be acting in the interest of the public, get out of it seems illusory and abstract:
1) A TOT tax hike that Briggs sued to stop;
2) Shortcutting CEQA, of which Briggs is supposedly a staunch supporter;
3) Preventing the first convention center expansion that doesn't wall-off the waterfront and creates open space, and which is the only one that is truly an "expansion" - which is the whole point;
4) Environmental protection of the old stadium and parking lot site at I-15, I-5, and Friars;
5) Limiting density in high density trolley served Mission Valley thus encouraging more sprawl;
6) Creating TOT funding for waterfront open space, tourism, and recreation while dropping a monolithic mega "Convadium" next to fine grain historic and culturally diverse neighborhoods, adding traffic, pollution, and stadium / convention demolition pressure for things like parking - with limited environmental recourse;
7) Facilitating university expansion north of I-8 (in Mission Valley), while essentially preventing such expansion in downtown - where there is interest in expansion and where it would more equitably distribute jobs and higher education to under-served neighborhoods.
It has been said that the Briggs initiative is eligible to pass with a simple majority instead of a 2/3 "super" majority, since it doesn't assign the increased TOT to a specific plan. The problem with that argument is, Donna Frye has already been on KUSI, and specifically laid out where the increased TOT monies would go; 2% (or $36 million) for tourism marketing, another 2% (or $36 million) for "tourism related infrastructure--POSSIBLY including a new convention center annex", and the other 1% (or $18 million) going to the general fund.
That seems to be quite the specific plan for monies not allegedly assigned to a specific plan. This thing will have a problem getting on the ballot, as I think it will be decided in court just what voting majority will be required to pass this initiative.
Not True. Please force the Hotelier Scott Hermes, general manager of the Westin Gaslamp, to provide evidence for his statements:
" “We lost market share. We lost business. We lost revenue. We lost hours for workers and the city’s general fund took a hit,” he told me. "
San Diego hotel business increased. No Revenue was lost. The General Fund TOT Revenue increased.
10.5 TOT =
FY-2012 $149 million.
FY-2013 $160 million.
FY-2014 $171 million.
FY-2015 $187 million.
According to the FY-2015 Comprehensive Annual Financial Report (CAFR). Every year between CY-2012 and CY-2015 the following increased:
Total Visitors, Total Overnight Visits, Average Occupancy, Average Daily Rate, Revenue Per Available Room PAR, and Room Demand/Growth.
The CAFR also documents the full $32,235,000 in the Tourism Marketing District (TMD) Cash Reserve Fund Balances. If the 2% TMD is deemed an Illegal Tax, the one year of TMD Revenue in Cash Reserve Fund Balance will not effect the City's General Fund.
Good piece. But it is important to note that it isn't clear at ALL that the hoteliers would also support the convadium. They might but it would be a lift since in many ways the annex would have incentives to directly compete with the existing center.
For example, say you are the embassy suites management. Why vote for the annex as opposed to a TFID plan/promise that invested more of the money, for example, in improvements on your side of downtown? Ditto the hotels over in Columbia Core and Little Italy. This is especially true for hotels that are not "owned" by San Diegans but my bigger REITS who are going to take months before deciding ANYTHING.
Finally - and I guess I should have gone to law school but can someone explain to me why San Diego's Tourism marketing and Tourism improvement districts are at risk but Anaheims is not (http://www.oc-breeze.com/2014/09/28/59518_anaheim-wins-court-case-over-funding-of-convention-center-expansion/). Moreover, it isn't as if San Diego is the ONLY TMD in CA. There are roughly 40 of these things. It would seem that any legal finding that put at risk San Diego's would engender a pretty strong effort to resolve the issues in a higher court/fixes in Sacramento.
I've not seen explained anywhere that if the hotels want a convention center expansion so badly, why don't they pay for it themselves. They form a consortium to issue bonds, financed by a self assessment. Surely their high priced legal talent can make the assessment stick. It's not a government tax so the bond risk and interest will be higher, but if they really want it...
Scott, I found this part interesting: "The Tourism Marketing District came at Briggs, spending millions on lawyers and investigators to prove that he had no standing to sue ...". We know they hired lawyers, but "investigators"? Did they actually tell you that they hired investigators and put them on Briggs? If so did they happen to tell you whether that was a private firm or a media investigative team? Or do you know from some other source that they put investigators on Briggs?
This is an in-depth, informative article by Scott and he needs to be congratulated for this high quality journalist value product.
The right course of action requires cool thinking and strategic disposition which is currently AWOL. Here are the facts to consider:
1. Spanos, Briggs and Moores are some local clowns wanting to yield local power. In the grand scheme of things these are characters that would fade in history and in 50 years from now probably no one would remember their name. So, let's place them into a placeholder for now until we decide their fate.
2. It would be a horrible strategic mistake to bring the Spanos clan into a permanent place in downtown, the jewel of the city's tourism industry, because it means that the city via such miscalculation would inherit for generations the obligation to replace this stadium every 20-30 years in perpetuity. At least in MV the football aspect of SD lifestyle is segregated, contained and could be gotten ridden off via a binary (yes or no) decision. Bringing football into downtown would change the character of the city for generations and must be avoided at all costs.
3. Public funding for NFL stadia in California is a thing of the past. Ironically Kroenke has set the new California standard which dictates zero public funding for new stadia. So, for San Diego to abandon the field of battle at such critical and pivotal moment when attitudes about financing stadia are so radically shifting is the equivalent of handing to some incompetent Prusso-AustroHungarians victory at Austerlitz after winning it as Napoleon.
Bottom line: The clowns (or 3 downtown Stooges) will suffer a crushing defeat in their downtown stadium quest and SD has nothing more to do but watch the clowns make fools of themselves. This is a battle already won and Spanos has to suffer another agony of defeat before the whole thing becomes official. The hoteliers would win and should win this fabricated and contrived contest whose only value is pure public amusement. Hang in there San Diego; you have prevailed over punctuated morony.
@Dean Plassaras --Where is our buddy John Ogre/David Benz? He seems to have disappeared after the Carson "plan" went up in flames.
@Dean Plassaras That's a good summary Dean. There is little chance that the voters will be gullible enough to approve the funding of this albatross. And even if they do, there is a good chance that the courts will invalidate the process. In the end, Spanos will be left to his own devices. The Chargers will either have to stay in Qualcomm and fix it up with their own money (a la the Miami Dolphins) or move (maybe to St. Louis!).