Wednesday, March 20, 2013

49ers' Stadium Subsidies: Making our General Fund Whole

Dear Santa Clarans,

If you caught Tuesday evening's Stadium Authority Meeting Agenda posted last Friday night and its media coverage, you would have seen a total capitulation in our Stadium Authority's bid to host Super Bowl L or LI.

Miami, a metropolitan area of 5.5 million, pushed back on some of the very demands that NFL Commissioner Roger Goodell made of Santa Clara when he visited us back in January.  Miamians said that they weren't going to give up any of their hotel taxes in order to host a Super Bowl.

Those negotiating for our Stadium Authority sprang into action.  As both the Agenda Report from Friday and the local news coverage made clear, those in charge of our bid to the NFL said that Santa Clara would leave all of that, plus waivers of the Youth/Senior Ticket Fee and the Off-site Parking Charges on the table for the NFL to snatch up.

But those hotel taxes are still a part of an $11 million revenue stream vital to our city's General Fund.  No one on our Stadium Authority and City Council had any business even considering such a thing.   Tuesday evening, I presented this one slide before the Santa Clara Stadium Authority and the City Council:

After all, a promise is a promise, even if Council made it over six years ago.

At any rate, I learned shortly after this, in Chambers, that during the day on Tuesday, the San Francisco Super Bowl Host Committee finally stepped up where the NFL itself would not.  There is now at least an agreement in principle that our city's General Fund will lose nothing because of what still remains a rather pathetic cave-in to the NFL's demands.

I was impressed but not terribly surprised that the Bid Committee and City government could move that fast.   As it turns out,  I was required by the City of Santa Clara Policy and Procedure Manual to submit the slide above in advance to City Hall so that it could be checked for compatibility with the equipment in Chambers.   This I did at 1:18 am Tuesday morning, a good seventeen hours in advance of the Special Session.

For whatever reason today's events unfolded the way they did, this resident is grateful.  But why bother?  350 hotel rooms in Santa Clara, let for a week with the 9.5% Transient Occupancy Tax waived, could amount to a mere $30,000 to $50,000 in losses to our General Fund.

Well, we've had no Fourth of July fireworks display in Central Park in 2011 or 2012 because our City's Government has lacked the $65,000 to $80,000 needed for it.   A resident learned that the City was spending about $10,000 to provide Santa Clara Police escorts for the 49ers on our dime.

Now, staffing the new Northside Library will cost the General Fund about a million dollars a year, and if we choose to finally rebuild the International Swim Center, we'll stretch to provide the $700K per year it will cost to operate it  (See the 2012-13 City Budget here , pp. III .)

In other words, $50K here and $50K there, and in no time at all, you're talking real money.

But the real reason why Santa Clara Plays Fair took this up was that the promise above had already been broken by our City Council two years ago, nearly to the day.

It was on March 15, 2011, that the Council voted the very SB 211 amendment which would take $19.5 million out of our General Fund over time by a diversion of  RDA money.  It may be called an irrevocable act on behalf of a now-defunct RDA.  But it was still done in order to grease the subsidy of Jed York and his stadium, and it is very much a real General Fund loss - as today's giveback almost was.

Two years ago, by the way, "make our General Fund whole" were exactly the words of Santa Clara Plays Fair.  Tuesday evening in Chambers and in the media, we were grateful to learn that City Staff agrees with us.

Thanks for all of your support,

William F. "Bill" Bailey, Treasurer,


Saturday, March 2, 2013

49ers' Stadium Subsidy, Schools Money in One Pot - Who Knew?

Dear Santa Clarans,

In the wake of the dissolution of Redevelopment Agencies in California, every city has its own story, no doubt about it.  In a nutshell, this is ours:

Our former RDA couldn't subsidize the San Francisco 49ers to the tune of that original $42,000,000 without extending its own authority to hand your property taxes over to the team.   But our Council did just that in February of  2011 when they first proposed abolishing the debt-incurrence time limit for our RDA.  This was the so-called "SB 211" amendment.

The claim at the time was that this would enable the RDA to issue low-interest bonds to pay back cash advances from the 49ers.  Click on Agenda Item 6B here to see the video and get the reports.  The same claim was made when the SB 211 amendment was finally passed on March 15th, 2011.

Now, fast-forward to the City Council meeting of June 7, a mere eighty-four days later.  In that meeting, surprise!:  We learned that there was no way that the RDA could possibly issue any bonds at all.  The RDA would be stuck paying the 49ers for their "Agency Advance" at an interest rate of up to 8.50% - using our property taxes to do it.

See page 5 of the "Committee of the Whole" report here :

By the time of the dissolution of the RDAs with AB 1x 26, the San Francisco 49ers had managed to suck over $10,000,000 out of our RDA.   But now, both the remaining subsidy for Jed York and property taxes to support Santa Clara Unified Schools have ended up in the same, identical "Redevelopment Property Tax Trust Fund," or RPTTF.   The Oversight Board of the Successor Agency is responsible for payments from that fund.

A majority on that Oversight Board - and the California State Department of Finance as well - have rightly refused to recognize the stadium subsidy to the 49ers as equal to needed funding for SCUSD schools.

Well!  Furious that they cannot bleed that last $30,000,000 out of our property taxes, the 49ers are suing the Oversight Board - and they've gotten the courts to stop payments to any other Agencies until they get payments to themselves.  One original estimate (5/3/2012) actually called for the Oversight Board to pay the 49ers more than $52,000,000 over time!:


How on earth did a plum payment to a millionaire NFL team owner end up in the same pot as the money we need to educate our children?  By what arrogant stretch of entitlement do the 49ers justify holding the entire RPTTF hostage and in making the Oversight Board responsible for acts of Sacramento?

Ask a 49ers Stadium Booster - if they voted for Measure Jed on June 8, 2010, then they voted for exactly the outrage above.**

We'll know more on March 22nd, when 49ers v. Oversight Board is heard in the Sacramento Superior Court.  Please stay in touch, and ask questions.  What we don't know, we'll do our best to find out.

Thanks for all of your support,
William F. "Bill" Bailey, Treasurer

49ers v. Oversight Board:   Case 34-2012-80001192 may be searched here . Pull down for "Civil," check "CCMS," then enter the case number.  Smile.

**If you do ask a 49ers Stadium Booster, please don't settle for any weasel words.  That "Agency Advance" was amply covered in the June 8th, 2010, language for Measure Jed, §7.4(c).  I'm reading my old Sample Ballot now as I write this.  It was one of a myriad of reasons I voted a flat "NO" on Measure Jed then.