Sacramento’s strong bid for a Major League Soccer franchise could get competition from its own backyard.
After lying low for months, seemingly taking a back seat to Sacramento’s effort, the city of Elk Grove put its quest for an MLS team into high gear this week. The City Council late Wednesday agreed to spend $4.4 million buying a 100-acre stadium site, while city staffers unveiled the tentative outlines of an $88 million stadium finance plan.
Former Assembly Speaker Fabian Núñez, the well-connected leader of the Elk Grove effort, said Thursday that the suburb will be on MLS executives’ itinerary when they tour the Sacramento region sometime in September.
“When the MLS comes to Sacramento, they’ll visit all potential sites,” said Núñez, adding that he received confirmation when he spoke earlier this week with MLS Deputy Commissioner Mark Abbott. “They’ll come to Elk Grove, I guarantee you.”
An MLS spokesman, Sal Della Monica, confirmed early today that Abbott will visit Elk Grove while touring Sacramento. Specific dates for the tour haven’t been announced.
What’s uncertain is what impact Elk Grove’s bid would have on Sacramento’s MLS effort, which until this point has commanded center stage. Sacramento Republic FC, a minor-league club in its first season, has played to sellout crowds at Cal Expo’s Bonney Field and is negotiating a possible investment deal with the Sacramento Kings to bankroll an MLS franchise.
Abbott and other MLS officials promised to visit Sacramento after hearing a presentation at the league’s All-Star game earlier this month from Republic FC President Warren Smith, Kings President Chris Granger and Sacramento Mayor Kevin Johnson. Abbott told reporters that Sacramento “is being taken very seriously.”
Smith declined to comment on the Elk Grove bid Thursday through the team’s spokeswoman, Erika Bjork.
Núñez said he isn’t trying to disrupt Republic FC’s efforts and said the region ideally should present MLS with a unified bid. “Our best chance is if everyone’s doing it together,” said Núñez, whose group is called Northern California Soccer LLC.
But he added that his group has deep-pocketed investors, too, and Elk Grove shouldn’t be overlooked. “I want to keep Elk Grove in play as an option,” he said.
He wouldn’t identify any of his investors but added: “There are plenty of investors out there to do a deal in Elk Grove.”
Núnez has soccer connections. He is on the board of directors of the U.S. Soccer Federation, the sport’s national governing body; his fellow board members include MLS Commissioner Don Garber and Merritt Paulson, owner of the league’s Portland Timbers franchise. The former speaker said he’s been talking to MLS officials about the Sacramento area “the last six years or so, ever since I’ve been out of office.”
MLS plans to add two expansion teams in the next few years, with the decision coming as early as December. Sacramento is in the running along with Miami, Minneapolis, Las Vegas and possibly several other cities. It’s believed it would cost investors $80 million to buy a franchise and as much as $125 million to build a soccer stadium.
It’s not unprecedented for multiple investor groups from the same market to seek an MLS franchise. Two competing groups are bidding from Minneapolis, for instance. Nonetheless, sports business expert Whitney Wagoner said a relatively small market like Sacramento would probably stand a better chance if it mounted a single bid.
“If two different groups are trying to fish out of the same pond ... having them work together might be better,” said Wagoner, a sports business instructor at the University of Oregon.
Stadium location could become a big factor in MLS’ deliberations. The league likes downtown sites, and Republic FC is confining its search to a handful of locations in or immediately adjacent to the central city. The downtown railyard looks like the most likely candidate, and Smith said last week he is working on a project that relies on private financing.
Núñez acknowledged that the Elk Grove site, a farm on Grant Line Road just east of Highway 99, doesn’t fit MLS’ preference for urban locations. But he noted that plenty of MLS franchises play in suburbia. The two Los Angeles teams, the Galaxy and Chivas USA, play in Carson. The New England Revolution plays in Foxboro, Mass., more than a half-hour from Boston, and Dallas FC plays in suburban Frisco, Texas.
“Any notion that MLS only goes downtown isn’t true,” said Elk Grove Mayor Gary Davis.
Davis said Elk Grove offers advantages not found in downtown Sacramento, including easier access to legions of soccer fans in places like Stockton and Modesto.
City officials are working on a tentative deal with Núñez’s group to fund an $88 million stadium. The city, under a tentative outline submitted to the City Council on Wednesday, would borrow the funds. The annual debt load is estimated at $6.8 million for 30 years. Núñez’s group would contribute $2 million a year toward repayment, while ticket and parking surcharges would generate another $3.3 million, and an estimated $1.5 million a year in sales tax generated by the facility would cover the rest of the debt burden.
The staff report said the ticket surcharge would be $5 per ticket, while the parking surcharge would be $3. The surcharges would cover all events, not just MLS games.
Davis said the financing plan is still evolving. “The pieces are coming together,” he said.
City Manager Laura Gill, who briefed council members on the financing arrangement Wednesday, said the city is working with Núñez’s group to create a formal binding document that would be approved by the City Council if the city lands the MLS franchise.
She said a key component in the negotiations has been Northern California Soccer’s willingness to allow surcharges on tickets and parking. The effort also got a boost when the original construction plan of $105 million was lowered to $88 million.
The project would include a complex of 16 soccer fields as well as the MLS stadium. In an interview Thursday, Gill said the $4.4 million land purchase makes sense even if the MLS bid doesn’t succeed. The 100-acre parcel, now a farm at Grant Line Road and Highway 99, would be ideal for a youth soccer complex and other recreational uses.
“This is a land purchase the city has taken on regardless of Major League Soccer,” she said.