Ben Margot Associated Press file, 2012 Cal unveiled renovated Memorial Stadium last Sept. 1 to glowing reviews. The school hoped to sell high-priced tickets to pay for the stadium upgrades and a new training center, but sales lagged.

Cal crisis looms if revised plan to pay for stadium fails

Published: Tuesday, Jun. 25, 2013 - 12:00 am | Page 6C

Cal's renovated football stadium and glistening new training center opened to rave reviews last fall, but the risky plan to pay for the facilities fared as poorly as the team itself.

The Bears hired a new coach, Sonny Dykes, to fix the on-field product. More importantly, they've implemented a new strategy to avoid fiscal calamity.

If the financing plan fails, the most expensive facility upgrades in college sports history – $474 million – could cripple Cal athletics over time by draining tens of millions of dollars from the operating budget.

"If it doesn't settle itself out in the next few months, I fear a disaster," said Stanford economist Roger Noll, an expert in stadium financing who has consulted with Cal's faculty budget committee on the issue. "They took a really big shot."

Cal planned to finance the projects through the sale of 40- and 50-year rights to about 2,900 high-priced seats at renovated Memorial Stadium. But with sales lagging – only 64 percent of the premium seats have been sold – the school abandoned its June deadline to secure commitments for the long-term equivalent of $272 million.

The school is $120 million short of that goal.

The revised plan reduces Cal's reliance on selling high-priced tickets and attempts to generate $5 million to $10 million per year from previously untapped sources, such as renting out empty space in the stadium to the Haas School of Business.

But in a troubling sign, Cal officials have tentatively earmarked for long-term debt service more than $50 million that would otherwise have gone to athletic department operations over time.

Their revised financing plan includes $2.5 million annually in television money from the College Football Playoff, which begins in 2014, and millions from the sale of local media sponsorships.

"What they're doing with the football playoff money is a bad sign," Noll said. "They're pulling from one pocket and putting into another."

Bowls – The Holiday Bowl in San Diego and Kraft Fight Hunger Bowl in the Bay Area announced six-year agreements for Pacific-12 and Big Ten conference teams to meet starting in 2014.

The Fight Hunger Bowl will move from AT&T Park to the 49ers' new Santa Clara stadium in 2014.

The Associated Press contributed to this report.

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