Football Stadium Could Generate $41 Million in Tax Revenue - NBC Southern California

Football Stadium Could Generate $41 Million in Tax Revenue

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    NEWSLETTERS

    Football Stadium Could Generate $41 Million in Tax Revenue
    This rendering shows the proposed Farmers Field, which would be built in downtown Los Angeles.

    A proposed downtown football stadium and expanded convention center would generate about $41 million a year in net tax revenue, according to a report released Wednesday.

    About $22 million of those taxes would go to the city, according to a report summary authored by Bruce Baltin of PKF Consulting USA, a firm hired by Anschutz Entertainment Group.

    Los Angeles County and the Los Angeles Unified School District would each take in more than $6 million. Most of the rest would be divided between the state and the county's transportation authority.

    A second AEG commissioned study found that the projects would bring 14 new conventions per year to the city by 2016.

    The report contends that added conventions would boost the number of exhibition-related hotel room- nights from 270,000 to 551,000.

    An estimated 2,400 new downtown hotel rooms would generate about $175 million for the city's economy, the study contends.

    "We think the assumptions of new hotels is reasonable,'' said Baltin, who provided fiscal analysis for the city on the Marriot-Ritz Carlton hotel adjacent to L.A. Live and the Wilshire Grand Hotel project.

    The reports come as the city is nearing the end of negotiations with AEG on the terms of a proposal to build a $1.3 billion event center that would include a new football stadium and convention center hall. A memorandum of understanding that contains the financial framework for a deal is expected to be released next week.

    AEG originally proposed to fund the design and construction of the new convention center building with as much as $300 million in city-issued bonds, but city officials have warned that the terms of the deal may have changed during private negotiations.

    City Council members have sought to persuade a skeptical public that no city tax money would be used to repay the bonds. AEG proposed to make the payments with rent from the football stadium, ticket, parking and signage revenues, and future increases in revenue from the proposed new convention center.

    The Metropolitan Research and Economics study released Wednesday provides the first publicly released evidence the project could cover the debt service.

    "In the unlikely event that near-certain revenue sources such as property taxes are not generated, financial mechanisms must be in place to ensure there is no general fund exposure from the bonds,'' Council President Eric Garcetti said in a letter sent Tuesday to Chief Legislative Analyst Gerry Miller, who is representing the city in negotiations with AEG, and City Administrative Officer Miguel Santana.

    At least 50 percent of all new revenues generated directly by the project must go to the city's general fund, Garcetti said in a list of principals he wants to see in the agreement. He said he also wants any lease with an NFL team to be at least as long as the term of the bonds.

    The full City Council plans to discuss the draft MOU during a special meeting July 29.