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Study will assess Qualcomm Stadium's long-term viability

Discussion in 'Chargers Fan Forum' started by Johnny Lightning, Aug 11, 2010.

  1. Johnny Lightning

    Johnny Lightning Go Bolts

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    By Brent Schrotenboer , UNION-TRIBUNE STAFF WRITER
    Wednesday, August 11, 2010 at 3:08 p.m.


    The city of San Diego plans to hire an outside contractor to assess the long-term viability of Qualcomm Stadium with or without the Chargers as its primary tenant.
    The evaluation might cost an estimated $150,000 to $200,000, Stadium Manager Mike McSweeney said. The selected contractor will estimate the 43-year-old stadium’s longevity and maintenance challenges, plus forecast its future operating profits or losses. Currently, the city-owned stadium drains approximately $11.8 million annually in taxpayer money, according to the city. Its operating budget this year is $18.8 million.
    “The goal is to maximize the return on investment for the taxpayer,” said Darren Pudgil, spokesman for Mayor Jerry Sanders. “It’s to determine the best use of that property. It’s a much deeper look at that facility and what’s going to be required short- and long-term to keep that facility up to par.”
    The assessment comes in response to a city audit last year that said the stadium had no formalized business plan and should aggressively pursue new revenue streams to offset its dependence on city hotel-room tax revenue. That taxpayer money could go to other city services if the stadium were able to be more financially self-sustaining.
    The stadium’s future also is in a state of flux as the Chargers pursue a new stadium with better revenue-producing capacity for the team. If the Chargers move to a new stadium in San Diego County, the San Diego State football team and San Diego’s two college football bowl games — the San Diego County Credit Union Poinsettia Bowl and Bridgepoint Education Holiday Bowl — are expected to join them at the new stadium. That would leave Qualcomm without all of its major sports tenants, a huge blow for the property after the Padres left the stadium for Petco Park after the 2003 season.
    If the Chargers leave San Diego County, the city would have to consider the viability of maintaining the stadium for the Aztecs (six home games per year) and two bowl games in late December as its major tenants. In either case, the city could decide to sell the 167-acre stadium site, redevelop it or lease it.
    The stadium, which has 37 full-time employees, has tried to expand its revenue in recent years by attracting various events including soccer matches and private parties. The stadium parking lot hosts about 200 event days each year. But difficulties continue.
    In a memo to city auditor Eduardo Luna last year, Jim Barwick, the city’s director of real estate assets, said “Qualcomm Stadium faces the same challenges faced by virtually every municipally owned stadium in America.”
    “These stadiums generally require some form of public subsidy as there simply are not enough large money-making stadium events to generate the revenue necessary to break even,” the memo said. “For Qualcomm Stadium, this situation was greatly exacerbated when the San Diego Padres departed for Petco Park. While the recommendations contained in (last year’s audit) may improve stadium administration, the fundamental financial challenges will remain.”
    Starting next year, the early termination fee for the Chargers breaking their lease with the city decreases from $54.6 million to $25.8 million. It further decreases each year after that through 2020.
    That fee represents bond payment obligations stemming from the 1997 stadium expansion. Starting next year, the city would be on the hook for the rest of those bond obligations, about $27 million.
    If the NFL team wants to leave, it must pay the termination fee and notify the city of its intent to play that season between Feb. 1 and May 1.
    Another factor complicating the stadium’s future is the petroleum contamination beneath the stadium site. No permanent construction is allowed on the site until the cleanup is completed. The city has sued Kinder Morgan Energy Partners, owners of the gas tank farm by the stadium that leaked the gas. In its requests for proposals on the stadium assessment, the city estimates that the cleanup will be ongoing at least partially for the next two to three years.
    McSweeney said the city has interviewed all the companies that have applied for the contract and plans to select the contractor within a month.
    “It’s a full facility assessment,” McSweeney said. “That would include the prospects for business in four to five years and a look at the state of the stadium then. We’re going to ask them evaluate everything from the structural integrity of the facility, to business prospects with and without the Chargers, whatever the scenarios may be.”
    Brent Schrotenboer: (619) 293-1368; brent.schrotenboer@uniontrib.com
     
  2. Lightning

    Lightning Well-Known Member

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    ...seems to me that these studies have already been done in the past....why waste taxpayers money on this again!?
     
  3. Ride The Lightning

    Ride The Lightning Join the Dark Side, we have cookies.

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    It's a fukkin dump. As soon as another stadium is built, blow it the F up and build some more more affordable housing.
     
  4. ThunderHorse17

    ThunderHorse17 Lone Wolf

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    What my first thought was. WTF do they need to do another assesment for? The damn thing is out of date and under capacitated.
     
  5. Buck Melanoma

    Buck Melanoma Guest

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    This is how money is spent when it's in the hands of politicians instead of business people. :tdown:
     
  6. Lightning

    Lightning Well-Known Member

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    No....this is how it's spent when politicians have become business people instead of public servants....How many of them do you think have ties to the companys involved in the "study"?
     
  7. Concudan

    Concudan Caffeinated Commando

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    It makes sense to me.

    You have a stadium, with or without the Chargers, it can still make money. College bowl games, high school championship games etc. The politicians are SMART for seeing if there are other organizations that would rent the place and keep it being a lucrative part of the city's infrastructure.

    Especially if the ground is contaminated, and they cant 'blow it up' and build there for quite some time...
     
  8. Lightning

    Lightning Well-Known Member

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    Once again....i know because i have been to some of the meetings in the past. This has already been studied and it is not viable. The cost to manitain and run the stadium exceeds the revenue even with the Chargers as tenants as it is. I really don't know what "other" options they are looking at, that they haven't already studied as far as other renters and events.

    ....bottom line is that they should have dealt with old man Spanos when they had the chance to get something done with him footing...at least most of the bill. Instead they are going to slow track it and wait til the clean up of the contamination is finished. then try and lure a team back after the Chargers have left by building basically the same project that Spanos suggested....staduim/business area....oh yeah and all the while they'll act like the Chargers screwed the city over.
     
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