REMARKS 
  TO 
  THE 
  MAYOR’S 
  STADIUM 
  TASK 
  FORCE 
  
Mark 
  Fabiani 
  
Special 
  Counsel 
  to 
  the 
  President 
  of 
  the 
  Chargers 
  
February 
  16, 
  2015 
  

 
  
 
  

We 
  appreciate 
  the 
  enormous 
  difficulty 
  of 
  the 
  challenge 
  before 
  you. 
   
  

We 
  are 
  now 
  in 
  the 
  midst 
  of 
  our 
  14th 
  year 
  of 
  work 
  on 
  this 
  issue 
  – 
  an 
  effort 
  that 
  has 
  
cost 
  the 
  Spanos 
  family 
  more 
  than 
  $15 
  million, 
  has 
  explored 
  sites 
  all 
  over 
  San 
  Diego 
  
County, 
  and 
  has 
  resulted 
  in 
  nine 
  different 
  proposals 
  – 
  all 
  unsuccessful 
  so 
  far. 
  
 
  
So 
  the 
  Chargers 
  understand 
  firsthand 
  how 
  difficult 
  your 
  job 
  will 
  be 
  over 
  the 
  
coming 
  months. 
  And 
  at 
  the 
  outset 
  of 
  your 
  work, 
  we 
  would 
  like 
  to 
  thank 
  you 
  all 
  for 
  
volunteering 
  your 
  time 
  to 
  trying 
  to 
  find 
  a 
  solution 
  to 
  this 
  long-­‐running 
  San 
  Diego 
  
stadium 
  dilemma. 
  
 
  
Based 
  on 
  this 
  14 
  years 
  worth 
  of 
  experience, 
  we 
  would 
  like 
  to 
  suggest 
  four 
  
principles 
  we 
  hope 
  will 
  help 
  guide 
  your 
  work: 
  
 
  
! First, 
  you 
  should 
  resist 
  the 
  political 
  pressure 
  you 
  will 
  feel 
  to 
  make 
  a 
  proposal 
  
simply 
  for 
  the 
  sake 
  of 
  making 
  a 
  proposal. 
   
  
 
  
o We 
  appreciate 
  the 
  pressure 
  that 
  you 
  will 
  feel 
  to 
  find 
  a 
  solution. 
  We 
  at 
  
the 
  Chargers 
  have 
  felt 
  this 
  pressure 
  for 
  every 
  one 
  of 
  the 
  last 
  13 
  years. 
  
And 
  now, 
  in 
  our 
  14th 
  year 
  of 
  work, 
  the 
  pressure 
  has 
  intensified 
  even 
  
more 
  as 
  the 
  result 
  of 
  events 
  in 
  Los 
  Angeles. 
  
 
  
o But 
  after 
  all 
  of 
  these 
  years 
  of 
  work, 
  we 
  also 
  understand 
  this: 
  It 
  might 
  
be 
  that 
   
  -­‐-­‐ 
  despite 
  the 
  great 
  effort 
  that 
  has 
  been 
  expended 
  -­‐-­‐ 
  there 
  is 
  at 
  
least 
  at 
  this 
  time 
  no 
  publicly 
  acceptable 
  solution 
  to 
  the 
  stadium 
  issue 
  
in 
  San 
  Diego. 
   
  
 
  
o If 
  the 
  facts 
  lead 
  you 
  to 
  this 
  conclusion, 
  we 
  hope 
  you 
  will 
  say 
  so, 
  even 
  
though 
  you 
  will 
  be 
  under 
  tremendous 
  political 
  pressure 
  to 
  propose 
  
something 
  – 
  anything 
  – 
  just 
  to 
  show 
  that 
  the 
  politicians 
  are 
  trying. 
  
 
  
! The 
  second 
  guiding 
  principle 
  is 
  this: 
  The 
  Chargers 
  have 
  no 
  intention 
  of 
  quietly 
  
participating 
  in 
  any 
  effort 
  to 
  provide 
  political 
  cover 
  for 
  elected 
  officials. 
   
  
 
  
o Former 
  elected 
  officials 
  have 
  tried 
  to 
  exploit 
  the 
  Chargers 
  and 
  the 
  
stadium 
  issue 
  for 
  their 
  own 
  political 
  advantage. 
  
 
  
o It 
  might 
  be 
  worth 
  checking 
  with 
  Dick 
  Murphy 
  and 
  Mike 
  Aguirre 
  to 
  see 
  
how 
  that 
  worked 
  out 
  for 
  them. 
  
 
  

 
  

1 
  

  
  

 
  

o We 
  have 
  already 
  heard 
  the 
  talk 
  around 
  City 
  Hall 
  that 
  the 
  November 
  
2016 
  ballot 
  is 
  going 
  to 
  be 
  a 
  graveyard 
  for 
  ballot 
  measures 
  involving 
  
revenue 
  increases 
  – 
  so 
  much 
  of 
  a 
  graveyard, 
  in 
  fact, 
  that 
  the 
  
Convention 
  Center 
  expansion 
  proponents 
  have 
  decided 
  already 
  that 
  
they 
  do 
  not 
  want 
  their 
  next 
  financing 
  scheme 
  to 
  appear 
  on 
  that 
  ballot. 
  
And 
  yet, 
  that 
  is 
  the 
  very 
  same 
  ballot 
  that 
  the 
  Chargers 
  are 
  being 
  urged 
  
to 
  try 
  for. 
  
o Simply 
  put, 
  we 
  have 
  no 
  intention 
  of 
  allowing 
  the 
  Chargers 
  franchise 
  to 
  
be 
  manipulated 
  for 
  political 
  cover 
  – 
  and 
  we 
  will 
  call 
  out 
  any 
  elected 
  
official 
  who 
  tries 
  to 
  do 
  so. 
  
 
  
! The 
  third 
  principle: 
  Any 
  proposal 
  that 
  emerges 
  from 
  the 
  work 
  of 
  your 
  Task 
  
Force 
  should 
  be 
  subjected 
  to 
  serious, 
  real 
  world 
  stress 
  tests. 
  In 
  particular, 
  any 
  
Task 
  Force 
  proposal 
  should 
  pass 
  each 
  of 
  the 
  following 
  three 
  real 
  world 
  tests: 
  
o First, 
  is 
  the 
  proposal 
  one 
  that 
  has 
  a 
  strong 
  chance 
  of 
  being 
  approved 
  by 
  
two-­‐thirds 
  of 
  the 
  voters? 
   
  
 
  
" As 
  you 
  commence 
  your 
  work, 
  you 
  will 
  find 
  yourselves 
  again 
  
and 
  again 
  running 
  squarely 
  into 
  the 
  California 
  Constitution’s 
  
two-­‐thirds 
  vote 
  requirement. 
   
  
 
  
" The 
  City 
  of 
  San 
  Diego 
  has 
  just 
  wasted 
  five 
  years 
  and 
  many 
  
millions 
  of 
  taxpayer 
  dollars 
  trying 
  to 
  circumvent 
  the 
  two-­‐thirds 
  
vote 
  requirement 
  with 
  an 
  illegal 
  Convention 
  Center 
  expansion 
  
tax. 
   
   
  

 
  
"
 
  

The 
  Chargers 
  have 
  no 
  interest 
  in 
  participating 
  in 
  another 
  half-­‐
baked 
  scheme 
  to 
  attempt 
  to 
  get 
  around 
  the 
  two-­‐thirds 
  rule. 
  

If 
  the 
  funding 
  mechanisms 
  that 
  this 
  Task 
  Force 
  considers 
  
cannot 
  win 
  two-­‐thirds 
  approval, 
  when 
  such 
  approval 
  is 
  
required 
  by 
  the 
  California 
  Constitution, 
  then 
  they 
  should 
  not 
  be 
  
part 
  of 
  your 
  final 
  recommendations. 
  
 
  
o The 
  second 
  real 
  world 
  stress 
  test 
  should 
  be 
  this: 
  Are 
  the 
  Mayor 
  and 
  a 
  
strong 
  majority 
  of 
  the 
  City 
  Council 
  prepared 
  to 
  support 
  the 
  
recommendations 
  of 
  your 
  Task 
  Force? 
  
 
  
" Too 
  many 
  times 
  over 
  the 
  last 
  14 
  years 
  we 
  have 
  heard 
  the 
  
following 
  statement 
  from 
  elected 
  officials: 
  The 
  Chargers 
  should 
  
gather 
  signatures, 
  qualify 
  a 
  measure 
  for 
  the 
  ballot, 
  and 
  then 
  
campaign 
  for 
  approval. 
  We’ve 
  also 
  heard 
  this 
  variation 
  of 
  the 
  
same 
  idea: 
  If 
  the 
  Chargers 
  had 
  a 
  real 
  proposal, 
  they 
  would 
  put 
  
it 
  on 
  the 
  ballot 
  themselves. 
  
"

 
  

2 
  

 "

 
  
"

 
  

 
  
Of 
  course, 
  this 
  is 
  not 
  a 
  realistic 
  solution. 
  It 
  is 
  just 
  not 
  possible 
  
to 
  obtain 
  voter 
  approval 
  for 
  a 
  stadium 
  measure 
  of 
  this 
  type 
  
without 
  the 
  strong 
  support 
  of 
  the 
  Mayor 
  and 
  the 
  City 
  Council. 
  
This 
  is 
  especially 
  true 
  in 
  our 
  situation, 
  where 
  a 
  two-­‐thirds 
  
approval 
  will 
  likely 
  be 
  required. 
  
Therefore, 
  any 
  proposal 
  that 
  emerges 
  from 
  this 
  Task 
  Force 
  
should 
  be 
  one 
  that 
  the 
  Mayor 
  and 
  City 
  Council 
  majority 
  would 
  
be 
  willing 
  to 
  place 
  on 
  the 
  ballot 
  themselves, 
  and 
  then 
  campaign 
  
wholeheartedly 
  to 
  pass. 
  

o The 
  third 
  real 
  world 
  stress 
  test 
  for 
  any 
  proposal 
  should 
  be 
  this: 
  Does 
  the 
  
proposal 
  recognize 
  the 
  economic 
  realities 
  of 
  our 
  local 
  marketplace 
  and 
  
of 
  the 
  NFL? 
   
  
 
  
" The 
  City 
  has 
  already 
  wasted 
  hundreds 
  of 
  thousands 
  of 
  dollars 
  
on 
  two 
  separate 
  out-­‐of-­‐state 
  consultants 
  who 
  made 
  
recommendations 
  that 
  were 
  ultimately 
  useless 
  -­‐-­‐ 
  useless 
  
because 
  they 
  ignored 
  the 
  realities 
  of 
  our 
  local 
  marketplace. 
  
 
  
" For 
  example, 
  some 
  expect 
  the 
  Chargers 
  to 
  match 
  the 
  financial 
  
contributions 
  made 
  by 
  the 
  Cowboys’ 
  owner 
  in 
  Dallas, 
  or 
  the 
  
49ers 
  owner 
  in 
  Santa 
  Clara. 
   
  

 
  
•

•

 
  
"

"

 
  

These 
  owners 
  were 
  able 
  to 
  make 
  such 
  contributions 
  
because 
  of 
  their 
  ability 
  to 
  sell 
  hundreds 
  and 
  hundreds 
  of 
  
millions 
  of 
  dollars 
  of 
  Preferred 
  Seat 
  Licenses 
  (PSLs). 
   
  
 
  
Our 
  studies 
  – 
  and 
  the 
  real 
  world 
  experience 
  of 
  the 
  
Padres 
  – 
  demonstrate 
  that 
  we 
  cannot 
  sell 
  PSLs 
  in 
  any 
  
significant 
  numbers 
  here 
  in 
  San 
  Diego. 
  A 
  Task 
  Force 
  
recommendation 
  that 
  ignores 
  this 
  reality 
  will 
  be 
  
worthless. 
  

In 
  addition, 
  some 
  consultants 
  have 
  suggested 
  that 
  the 
  stadium 
  
should 
  be 
  financed 
  using 
  revenue 
  streams 
  that, 
  throughout 
  the 
  
rest 
  of 
  the 
  NFL, 
  go 
  to 
  the 
  teams. 
  These 
  revenue 
  streams 
  include 
  
naming 
  rights, 
  sponsorships, 
  and 
  the 
  like. 
  Of 
  course, 
  if 
  the 
  
Chargers 
  were 
  to 
  forego 
  all 
  of 
  these 
  revenues, 
  then 
  the 
  team 
  
would 
  be 
  fall 
  even 
  further 
  behind 
  the 
  rest 
  of 
  the 
  NFL 
  than 
  we 
  
are 
  right 
  now. 
  
 
  
And 
  yet 
  another 
  example 
  of 
  a 
  real 
  world 
  stress 
  test 
  that 
  is 
  often 
  
ignored 
  is 
  the 
  true 
  cost 
  of 
  the 
  stadium. 
   
  

3 
  

  
  
•

•

 
  
•

 
  
"

 
  

 
  
 
  

We 
  have 
  heard 
  commentators 
  say 
  that 
  the 
  stadium 
  
could 
  be 
  built 
  for 
  $700 
  million, 
  or 
  even 
  less. 
  (This 
  low-­‐
cost 
  stadium 
  was 
  a 
  key 
  assumption 
  made 
  by 
  the 
  Lazard 
  
consultants 
  hired 
  by 
  the 
  City 
  several 
  years 
  ago.) 
   
  
 
  
These 
  off-­‐the-­‐cuff 
  estimates 
  ignore 
  the 
  real 
  world 
  costs 
  
of 
  stadiums 
  now 
  being 
  built 
  all 
  around 
  the 
  country 
  – 
  
from 
  San 
  Francisco 
  to 
  Minnesota 
  to 
  Atlanta. 
  Looking 
  
around 
  the 
  country, 
  new 
  stadium 
  costs 
  are 
  coming 
  in 
  at 
  
$1.2 
  to 
  $1.5 
  billion. 
   
  
And, 
  of 
  course, 
  by 
  the 
  time 
  we 
  would 
  be 
  ready 
  to 
  start 
  
building 
  here 
  in 
  San 
  Diego, 
  today’s 
  cost 
  estimates 
  are 
  
likely 
  to 
  have 
  escalated 
  even 
  more. 
  This 
  is 
  a 
  real 
  world 
  
fact 
  that 
  simply 
  cannot 
  be 
  ignored 
  when 
  putting 
  
together 
  a 
  truly 
  workable 
  plan. 
  

In 
  short, 
  any 
  proposal 
  that 
  you 
  make 
  must 
  be 
  workable 
  in 
  the 
  
real 
  world. 
  If 
  the 
  proposal 
  doesn’t 
  meet 
  these 
  real 
  world 
  tests, 
  
it 
  will 
  fall 
  flat 
  with 
  the 
  NFL, 
  the 
  Chargers, 
  the 
  voters, 
  and 
  the 
  
financial 
  markets 
  that 
  must 
  provide 
  financing. 
   
  

! The 
  fourth 
  and 
  final 
  guiding 
  principle 
  is 
  this: 
  It 
  should 
  not 
  be 
  enough 
  to 
  suggest 
  
a 
  plan 
  that 
  might 
  succeed 
  under 
  perfectly 
  controlled 
  laboratory 
  conditions 
  – 
  
but 
  that 
  is 
  unlikely 
  to 
  succeed 
  in 
  the 
  real 
  world 
  of 
  San 
  Diego 
  politics. 
  
 
  
o Instead, 
  any 
  plan 
  that 
  the 
  Task 
  Force 
  recommends 
  should 
  be 
  one 
  that 
  
can 
  actually 
  be 
  implemented 
  by 
  the 
  people 
  now 
  in 
  elected 
  office 
  in 
  the 
  
City 
  of 
  San 
  Diego. 
  
 
  
o The 
  owners 
  of 
  the 
  Chargers 
  – 
  like 
  any 
  rational 
  business 
  owners 
  – 
  
should 
  be 
  looking 
  at 
  the 
  capability 
  of 
  current 
  elected 
  officials 
  to 
  carry 
  
out 
  a 
  plan 
  that, 
  at 
  least 
  on 
  paper, 
  may 
  look 
  just 
  fine. 
  
o Our 
  examination 
  of 
  any 
  plan 
  must 
  include 
  an 
  assessment 
  of 
  whether 
  
the 
  capability 
  exists 
  to 
  implement 
  that 
  plan. 
  
o For 
  years 
  we 
  were 
  all 
  told 
  that 
  the 
  Convention 
  Center 
  expansion 
  was 
  a 
  
done 
  deal 
  – 
  and 
  we 
  were 
  told 
  this 
  by 
  the 
  people 
  who 
  are 
  still 
  in 
  charge 
  
at 
  City 
  Hall. 
   
  

 
  
 
  

 
  

o Now, 
  years 
  later, 
  after 
  millions 
  of 
  wasted 
  tax 
  dollars, 
  the 
  whole 
  
project 
  is 
  back 
  to 
  square 
  one 
  – 
  with 
  no 
  realistic 
  solution 
  in 
  site. 
  

4 
  

 o With 
  regard 
  to 
  a 
  new 
  stadium 
  project, 
  we 
  are 
  hearing 
  rumblings 
  of 
  
another 
  ill-­‐conceived 
  scheme 
  to 
  avoid 
  the 
  two-­‐thirds 
  vote 
  
requirement: 
  Two 
  ballot 
  measures, 
  one 
  that 
  would 
  raise 
  a 
  tax 
  for 
  a 
  
general 
  purpose, 
  and 
  one 
  that 
  would 
  be 
  non-­‐binding 
  and 
  would 
  
advise 
  the 
  City 
  to 
  spend 
  some 
  of 
  the 
  new 
  money 
  on 
  a 
  stadium. 
  To 
  be 
  
clear, 
  we 
  will 
  not 
  support 
  any 
  such 
  effort 
  to 
  circumvent 
  the 
  State 
  
Constitution. 
  The 
  City 
  tried 
  a 
  similar 
  scheme 
  already 
  on 
  the 
  
Convention 
  Center, 
  of 
  course, 
  and 
  was 
  decisively 
  defeated 
  in 
  court. 
  
 
  
o The 
  Chargers 
  do 
  not 
  intend 
  to 
  waste 
  years 
  of 
  time 
  and 
  millions 
  of 
  
dollars 
  on 
  a 
  proposal 
  that 
  City 
  leaders 
  simply 
  do 
  not 
  have 
  the 
  capacity 
  
to 
  actually 
  implement. 
  In 
  short, 
  a 
  proposal 
  that 
  looks 
  good 
  on 
  paper 
  
should 
  not 
  be 
  sufficient. 
  What 
  we 
  all 
  need 
  is 
  a 
  proposal 
  that 
  our 
  city 
  
government 
  has 
  the 
  capacity 
  to 
  actually 
  implement. 
  
 
  

These, 
  then, 
  are 
  the 
  four 
  basic 
  principles, 
  and 
  three 
  real 
  world 
  tests, 
  that 
  we 
  
believe 
  should 
  be 
  applied 
  by 
  the 
  Task 
  Force. 
  
 
  
In 
  addition, 
  we 
  would 
  like 
  to 
  take 
  a 
  moment 
  to 
  describe 
  the 
  situation 
  now 
  facing 
  
the 
  Chargers 
  franchise. 
  

 
  

! The 
  Los 
  Angeles 
  and 
  Orange 
  County 
  market 
  has 
  been 
  without 
  an 
  NFL 
  team 
  
for 
  20 
  years. 
  
 
  
! Over 
  those 
  two 
  decades 
  the 
  Chargers 
  have 
  worked 
  diligently 
  to 
  win 
  fans 
  and 
  
business 
  partners 
  in 
  the 
  LA/Orange 
  County 
  market. 
  
 
  

 
  
 
  

! And 
  the 
  Chargers 
  have 
  succeeded. 
  Now, 
  fully 
  25 
  percent 
  of 
  the 
  Chargers’ 
  
season 
  ticket 
  base 
  comes 
  from 
  the 
  LA/Orange 
  County 
  market 
  (along 
  with 
  the 
  
Inland 
  Empire). 
  
! If 
  another 
  team 
  – 
  or 
  two 
  other 
  teams 
  – 
  enters 
  the 
  LA/Orange 
  County 
  
markets, 
  most 
  of 
  that 
  Chargers’ 
  business 
  there 
  will 
  disappear. 
   
  
! This 
  will 
  put 
  the 
  Chargers 
  at 
  a 
  significant 
  competitive 
  economic 
  
disadvantage. 
  

 
  
! Simply 
  put, 
  it 
  would 
  not 
  be 
  fair 
  to 
  the 
  Chargers 
  – 
  a 
  team 
  that 
  has 
  worked 
  for 
  
14 
  years 
  to 
  find 
  a 
  stadium 
  solution 
  in 
  San 
  Diego 
  County 
  – 
  to 
  allow 
  other 
  
teams 
  that 
  themselves 
  abandoned 
  the 
  LA 
  market 
  to 
  now 
  return 
  and 
  gut 
  the 
  
Chargers’ 
  local 
  revenue 
  stream. 
  
 
  
 
  

 
  

! The 
  Chargers 
  are 
  continuing 
  to 
  work 
  hard 
  to 
  find 
  a 
  solution 
  in 
  San 
  Diego. 
  

5 
  

 ! But 
  we 
  also 
  want 
  to 
  be 
  clear 
  with 
  this 
  Task 
  Force 
  right 
  at 
  the 
  outset: 
  We 
  are 
  
keeping 
  a 
  close 
  eye 
  on 
  developments 
  in 
  LA. 
  We 
  do 
  not 
  have 
  a 
  choice 
  but 
  to 
  
also 
  monitor 
  and 
  evaluate 
  our 
  options 
  there. 
  Simply 
  put, 
  it 
  would 
  be 
  
irresponsible 
  for 
  the 
  Chargers 
  not 
  to 
  be 
  taking 
  every 
  possible 
  step 
  to 
  protect 
  
the 
  future 
  of 
  the 
  franchise. 
  
 
  
Moving 
  forward 
  with 
  your 
  Task 
  Force, 
  we 
  are 
  ready 
  to 
  cooperate 
  with 
  your 
  
efforts 
  and, 
  in 
  particular, 
  to 
  assist 
  you 
  now 
  in 
  at 
  least 
  two 
  specific 
  ways: 
  
 
  
! First, 
  we 
  have 
  created 
  a 
  website 
  for 
  Task 
  Force 
  members. 
  We 
  have 
  populated 
  
that 
  website 
  with 
  electronic 
  copies 
  of 
  original 
  documents 
  and 
  other 
  materials 
  
on 
  the 
  different 
  proposals 
  we 
  have 
  made 
  over 
  the 
  course 
  of 
  our 
  14 
  years 
  of 
  
work 
  on 
  this 
  project. 
  
 
  
! Second, 
  we 
  will 
  work 
  with 
  the 
  Task 
  Force 
  to 
  arrange 
  the 
  participation 
  of 
  
National 
  Football 
  League 
  executives 
  at 
  a 
  future 
  meeting 
  of 
  the 
  Task 
  Force, 
  so 
  
that 
  you 
  can 
  speak 
  directly 
  with 
  NFL 
  officials. 
  
 
  
 
  
We 
  would 
  now 
  be 
  happy 
  to 
  answer 
  any 
  questions 
  you 
  might 
  have 
  about 
  the 
  
work 
  we 
  have 
  done 
  over 
  the 
  past 
  14 
  years 
  and 
  the 
  various 
  proposals 
  we 
  have 
  made 
  
over 
  than 
  span 
  of 
  time. 
  And, 
  once 
  again, 
  thank 
  you 
  for 
  the 
  time 
  and 
  effort 
  you 
  will 
  be 
  
devoting 
  to 
  this 
  project. 
  

 
  

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