Booga: There is a feeling among the fans in San Diego that the brunt of the work on finding a stadium location has been placed on the Los Angeles area (Carson and Inglewood). Although that sentiment warrants some consideration, over a dozen years have been spent trying to find a solution in San Diego. How would you respond to the fans that feel that way?
Mark: I can’t blame fans for feeling that way, because we have made such quick progress in Los Angeles in just a few months while making so little progress in San Diego even after 14 years of work.
What we’ve tried to explain to fans is that the Los Angeles and San Diego markets are significantly different. In LA, the market is large enough to finance the stadium out of revenues generated by the stadium. In our smaller market here in San Diego, that same type of financing solution simply isn’t possible.
But no amount of explaining will keep our passionate fans from feeling frustrated, and I can’t blame them. After 14 years of work, the fans have every right to expect more progress than they’ve seen here in San Diego.
Booga: To show the readers that you are a fan of the team, what is your favorite moment in Chargers’ history?
Mark: The epic, overtime playoff game against Miami in the early 1980s. The incredible performance by Kellen Winslow and the rest of the team. I’ll never forget watching that game – I still remember to this day that Don Criqui was the announcer. Criqui was old school.
Booga: After CSAG submitted its initial proposal regarding their plan for a stadium in San Diego, what were your thoughts regarding the work they put into devising a plan that they believe would be workable?
Mark: My thought after the CSAG report was released was pretty much the same thought I had when the Mayor announced the creation of CSAG: We are running out of time. With the pressure that Stan Kroenke and the Rams were putting on us in Inglewood, we had hoped to move forward quickly to get something before the voters in San Diego in 2015. We felt this way in January, when the Mayor created the task force, and we have felt this way every day since. And while we are pleased that the city has now assembled a good group of experts led by Christopher Melvin of the Nixon Peabody law firm, it sure would have been nice to have been working with these experts last year – or even starting in January, when CSAG was created. Waiting for CSAG to conclude, and only then starting with the experts on June 2, constituted a huge loss of time – time that we can’t get back.
Booga: It appears to some that Mayor Faulconer and his team have no desire to explore downtown San Diego as an option for a stadium. The Chargers and Dean Spanos seem to be interested in seeking a viable option in downtown. Has the focus turned to downtown, or is the team willing to find a solution at the Mission Valley site?
Mark: Yes, the Mayor and his allies in the hotel industry have made it absolutely clear that they have no interest in the downtown option. CSAG’s chair said that anyone who believed downtown was viable was “delusional.” And the CSAG reports lists reason after reason why the downtown option can’t work. With all of this, it’s hard to see how the downtown option can be revived, at least in the short term.
Booga: How big of a role do the hoteliers have in deciding whether or not a stadium could be built in downtown?
Mark: The hoteliers call the shots on many of the important issues facing the City of San Diego, and they certainly do so on the possibility of a combined stadium-convention center downtown.
Of course, most people don’t follow the machinations of the hoteliers very closely. But if they did, they would be very surprised at what they would see.
For example, for years the hoteliers have insisted that any expansion to the Convention Center be contiguous – which means that the expansion must be connected to the existing facility. The hotel lobby said that a contiguous expansion was essential because that’s what the customers of the Convention Center wanted.
Of course, the hoteliers’ plan for accomplishing this has been thwarted by the courts; the legally dubious taxing mechanism proposed for the project was decisively struck down by the courts, and several environmental challenges against the project are still pending. Through that whole process, more than four years and $10 million in taxpayer money were wasted – only for the city to come up empty in the end.
So, at the behest of the hoteliers, the City is paying for another study of Convention Center customers to re-evaluate the idea of a contiguous expansion. And I’m going to go way out on a limb here and predict that this study is going to show – as Gomer Pyle used to say on The Andy Griffith Show – “surprise, surprise, surprise!” It turns out that our customers have changed their minds and now want a non-contiguous expansion after all! And when this happens, I bet no one will call out the hoteliers for carrying out this elaborate but obvious ruse.
Booga: The NFL owners and the NFL play a bigger role than most are aware of involving the stadium issue. Can you explain to the fans what their impact means to achieving a resolution to keep the Chargers in San Diego?
Mark: Most fans probably know at this point that the relocation of an NFL franchise from one city to another requires a three-fourths vote of the owners – 24 votes out of 32 owners. From the start of our new stadium efforts 14 years ago, we have always shown the utmost respect for the process established by the NFL’s owners. We have done everything possible to keep the League fully informed every step of the way, and the requirements imposed on us by the NFL’s relocation guidelines have been at the top of our minds throughout. In short, we have been very clear on this fundamental point: We will respect the decisions made by the owners about Los Angeles and San Diego.
Booga: Can you explain how the California Environmental Quality Act (CEQA) affects the situation via the courts?
Mark: CEQA law is pretty turgid stuff, and we only know so much about it because we have paid millions of dollars in legal fees over the years to understand it – because unless you understand CEQA, you will never be able to complete a major construction project in California.
So, despite the complicated nature of the topic, I will take a shot here at summarizing what CEQA means, and why it presents such a challenge for us right now here in San Diego. But readers, please be warned: Prepare to be bored.
CEQA is the landmark California state law requiring that all state and local legislative bodies fully account for the environmental impacts of proposed legislation before the legislation is passed.
For major projects, such as an NFL stadium and a possible ancillary development, CEQA requires that the legislative body conduct a full Environmental Impact Report (EIR), submit the EIR for public comment, incorporate or otherwise account for the public’s input, and then certify the EIR. Once the EIR is certified, the legislative body is free to adopt the project. At that point, for controversial projects in California, complaining parties typically sue to challenge the adequacy of the EIR, and on complex projects the resulting litigation can stall the project and consume several years of time.
What does all of this have to do with the City of San Diego and the Chargers?
An action by the City Council to place a stadium ballot measure before the voters is a legislative act and so must be cleared under CEQA. The standard method of accomplishing this for a complicated stadium project is to conduct a full-blown EIR – a process that usually takes from 12-to-18 months from start to certification by the City Council.
Even though the Mayor Faulconer took office in 2014, the city’s leaders have as of this date not even begun an EIR on the stadium project. Clearly, then there is no longer the opportunity to complete a legitimate, legally defensible EIR in time for a 2015 vote.
To get around this problem, the city has proposed, in three formal negotiating sessions and many informal conversations, four means of circumventing the traditional CEQA EIR process:
- Legislative Exemption: At our first formal negotiation session, the city’s team said that the only way to clear CEQA in time for a 2015 vote was to persuade the California state legislature to pass a law exempting the entire stadium/ancillary development project from CEQA. No other project of this type in California has ever received such a complete exemption, and we do not believe that such an exemption will be forthcoming from the legislation in this case. In any event, an exemption passed by the state legislature in 2015 would not take legal effect until next year and so would not apply to any 2015 ballot measure.
- Categorical Exemption: There are exemptions in CEQA for some projects. At our second formal meeting, the city argued that the stadium project was exempt from CEQA because we would simply be “replacing” the old stadium with the new stadium. This argument received serious legal scrutiny both by our legal team and by experts quoted in the media, and a consensus quickly emerged that this option was legally dubious.
- Reliance on 1983 Stadium Expansion EIR: At our third formal negotiating session, the city proposed to create an addendum for a 1983 EIR that was prepared for a 7,000 seat expansion of the stadium. The city maintained that the addendum could be prepared quickly and would not be subject to public review. Once again, we concluded based on all the advice we received that this approach was legally invalid because the 1983 EIR – which is all of 20-odd pages long – had nothing to do with the construction of a brand new stadium, the demolition of an old stadium, and an ancillary development. Therefore, it would not be possible to create a legally sufficient addendum that would pass CEQA muster.
- Quickie EIR: When it became clear that the city’s first three ideas for circumventing CEQA were untenable, the city proposed to conduct an EIR in time for a January 2016 ballot measure. To accomplish this, the city would have to begin the EIR immediately, spend roughly one month writing the EIR, begin the 45 day public review process, and then take time to account for the public comments – all prior to the mid-October date when the City Council would have to vote to place the matter on the January 2016 ballot.
Preparing a full EIR for a project of this magnitude in such a short period of time is unprecedented in California, and the resulting product would be so slipshod that plaintiffs’ lawyers would have an easy time having the document invalidated by the courts.
Booga: How did the Carson and Inglewood projects avoid the CEQA process?
Mark: Citizen’s initiatives are not subject to CEQA, and both the Carson and Inglewood stadiums were entitled through citizen’s initiatives.
A successful citizen’s initiative must be sponsored by a group or entity that has the financial resources to draft the initiative, gather signatures, and manage an effective election campaign. Starting from scratch today, the soonest a citizen’s initiative could reach the ballot in San Diego, if everything went smoothly, would be April or May of 2016. Finally, there is now a move in the California legislature to close the CEQA loophole that allows citizen’s initiatives of this type, and it is quite possible, even likely, that the law will be changed before there could be a vote on a citizen’s initiative in San Diego.
Booga: Why can’t an EIR be done in a month or two, if the city is prepared to throw significant resources behind the effort?
Mark: There is an entire class of plaintiffs’ lawyers in California that exists solely to challenge EIRs and then collect legal fees from taxpayers when the lawyers win in court. No EIR is legally bulletproof, but to get as close as possible to that goal would require 12-to-18 months of serious work. It is simply not possible to do the necessary work in a month or two.
Booga: San Diego’s mayor believes that the options identified for circumventing CEQA are legally defensible. Why isn’t that good enough for the Chargers?
Mark: The city has a very different tolerance for risk than the Chargers do. For example, four years ago the current city leadership proposed a novel way of increasing the hotel tax, without a public vote, to finance a convention center expansion. Many observers, including the Chargers, said at the time that the tax measure was illegal and that it would be struck down by the courts. The city’s leadership decided to move forward nonetheless and take their chances in court. Now, five years and $10 million in taxpayer money later, the tax was declared illegal by a unanimous court of appeals and the city has no Convention Center expansion plan.
The Chargers are in no position to roll the legal dice in this way. The team would be expected to fund, at a cost of perhaps up to ten million dollars, the election campaign, the vote, and the subsequent legal defense of the vote. And even if the team prevails at the ballot box, the project would be stalled by years of litigation which the team and city are likely to lose in the end.
Booga: Why must there be a public vote? Can’t the City Council simply adopt the stadium funding plan?
Mark: A City Council vote on a stadium plan would still require CEQA clearance and a full EIR.
In addition, a City Council vote would be subject to the California referendum process, which allows citizens who don’t like what the Council did to gather signatures to qualify for the ballot a referendum invalidating the City Council’s action. Opponents of taxpayer funding for a stadium in San Diego would almost certainly gather sufficient signatures to qualify a referendum for the ballot. The entire project would then be put on hold until the next regularly scheduled election. In short, there will likely be a public vote on the stadium project one way or another. The only questions are how the matter reaches the ballot, and when.
Finally, the Mayor and a majority of the City Council and County Board of Supervisors have insisted that there be a public vote on the expenditure of any public money for a stadium. These political leaders are unlikely to reverse their positions.
Booga: The City and County of San Diego are committed to spending several hundred million dollars of public money on a stadium project. Isn’t that significant?
Mark: The City and County haven’t committed anything yet. Any expenditure of public funds would have to be approved by voters. In the case of a tax increase, a two-thirds vote of approval is required under California law.
In addition, even if there is voter approval, the City and County of San Diego are both proposing to finance the project with money from their General Funds. In the City’s case, this would likely require the sale of Lease Revenue Bonds; in the County’s case, this would require several different appropriations over a period of years. Taking money from the General Fund to pay for a stadium will generate a vigorous public backlash and legal challenges by those who believe that vital services — such as police, fire and public pensions — will be imperiled by this funding mechanism.
Booga: How badly do you want the Chargers to remain in San Diego? Or are you strictly focused on what provides the Spanos’ family with the most lucrative deal possible?
Mark: If Dean and his family didn’t want the Chargers to remain in San Diego, we would have given up long ago. There have been stadium options available in LA going back to 2003, when AEG was proposing a stadium near Staples Center. Ed Roski’s stadium site in the City of Industry was fully entitled in 2008. AEG’s Farmers Field site has been fully entitled for years now as well. If the Spanos family wanted to move the Chargers out of San Diego, the team would have been gone a long time ago.
Booga: There has been a dark picture painted of you via the media and other outlets. It would appear that some do not understand that you have a job to do, and that you must do your due diligence to weigh all options in an effort to find a successful model for a stadium. How do you respond to the critics? Or do you?
Mark: We knew we would create plenty of controversy in January that when we decided to increase the pressure on San Diego political leaders to act. But we felt we had no choice, because of the move that the Rams made in Inglewood.
So, when I speak to fans, or e-mail with them, I try to ask a simple question: If we had simply remained quiet and allowed CSAG’s work to continue until the Fall – which is the schedule that the Mayor first proposed – would our chances of solving this problem have increased, or decreased? My strong view is that if we had simply said nothing, right now we would all be sitting around and waiting for CSAG to finish work in October or November – just as the NFL owners are in the process of considering the Los Angeles question.
Of course, fans have every right to their own opinions about the wisdom of our strategy, and I have no business trying to talk them out of those opinions. But I’m comfortable with the new strategy that we pursued once our hand was forced in January by events in Inglewood.
Booga: In closing, do you have anything to say to the fans of the San Diego Chargers that gives them a true sense of hope when it comes to their team staying put in America’s finest city?
Mark: Anyone who tells you how the Los Angeles relocation process is going to play out at the NFL ownership level is engaging in pure speculation. There isn’t anyone who truly knows how the situation will ultimately resolve itself. And whatever resolution occurs is going to be impacted by important events that have not yet occurred.
Finally, a great deal might depend on how the San Diego political leadership decides to treat the NFL and the Chargers going forward. The good news here is that the city has finally assembled experts in stadium finance who might, we hope, advise a different, more sophisticated approach to the Chargers and to the NFL than the one that some of the city’s political leaders have taken so far.