One referendum decided last Election Day will go a long way in deciding the future of the San Diego Chargers.
San Diego voters were asked to approve public funding for a new stadium for the Chargers. Measure C would have raised $1.15 billion from increased hotel occupancy taxes to help pay for a $1.8 billion stadium and convention center annex downtown. Chargers owner Dean Spanos spent more than $10 million on the campaign to approve the measure, but only about 40% of the voters were in favor of the funding. The Chargers needed 66.7% of the vote to pass.
The vote means that there’s a good chance that the Chargers will return to their ancestral home in Los Angeles (they started life as the Los Angeles Chargers in their baby blue uniforms) and share a new stadium with the Rams—the facility is being built by Rams owner Stan Kroenke. The Rams are playing at the L.A. Coliseum until the new stadium in Inglewood is ready after 2018. The Chargers could come up with a similar deal if they choose to exit San Diego immediately after this season, or perhaps check out the Rose Bowl as a temporary home.
So what was the idea behind a new stadium in San Diego? The Chargers have been looking for a way to exit their current home, Qualcomm Stadium, since 2000. New stadiums (and the revenue from premium tickets and suites) are perceived as a sure way of bringing in new revenue.
But that’s not always the case, according to Roger Noll, a Stanford professor emeritus in economics. “NFL stadiums do not generate significant local economic growth, and the incremental tax revenue is not sufficient to cover any significant financial contribution by the city,” said Noll in an article for the Stanford News Service.
Noll said that because football stadiums are used so infrequently – two preseason games, eight regular season games and possibly a couple of playoff games – they do not realize a large economic benefit from those games alone. Realizing this, the San Francisco 49ers’ new Levi’s Stadium, which opened recently, has played host to several other events, including concerts and college football, soccer and hockey games.
“By comparison, other billion dollar facilities – like a major shopping center or large manufacturing plant – will employ many more people and generate substantially more revenue and taxes,” Noll said. (read the full article here: http://news.stanford.edu/2015/07/30/stadium-economics-noll-073015/)
The 110-page plan for the new stadium was written by the Chargers without input from City Hall, the tourism industry, their would-be neighbors the Padres or other stakeholders. Without other options to bring in revenue, the San Diego stadium plan failed overwhelmingly. The voters have spoken: Now it’s up to the Chargers’ ownership to make the next move—which may be up I-5 to L.A.