The “term sheet” before the Sacramento City Council on Tuesday night for a proposed soccer stadium reads a lot like the one for the downtown arena now under construction.
But the situations are far different – and that should make council members and taxpayers much more comfortable.
The big one is that unlike for the arena, the city isn’t being asked for a sizable new public subsidy. The $180 million stadium would be privately financed and built – if Sacramento Republic FC succeeds in moving up to Major League Soccer.
City, state and federal governments, however, have invested $270 million to prepare 94 acres of the abandoned downtown railyard for development. When that cost is divided, it totals $46 million for the 16-acre stadium site. It’s good that City Hall publicly disclosed that figure early.
Another difference is that the 25,000-seat stadium is aimed at attracting a new major league team, not at keeping an existing one from leaving. So there’s not the crushing pressure the City Council faced on the arena, with the prospect of losing the Kings.
The term sheet is a good-faith agreement that outlines the final, definitive deal if MLS awards Sacramento a team.
So it’s an easy call for council members to approve the term sheet as a show of support for Republic FC as it makes its case for an MLS franchise, including at an owners meeting on Saturday.
While preliminary and nonbinding, the term sheet is a good-faith agreement that outlines the final, definitive deal if MLS awards Sacramento a team. For instance, the club would cover design and predevelopment costs and any construction budget overruns, as well as reimburse the city for event security. If the club builds parking decks on nearby city-owned land, it would split revenue with the city.
For its part, the city pledges to assign the planning, engineering and other staff to secure all the necessary permits and environmental approvals to keep the stadium on schedule to open by March 2018. The stadium could host other entertainment and cultural events; the city says it would complement Golden 1 Center, scheduled to open next October.
The development fees, tax revenue and other benefits from the project would start giving the city a return on its railyard investment. Finally and none too soon, all the publicly financed infrastructure is starting to pay off. A new county courthouse is planned on the southern edge. Kaiser Permanente plans a hospital to anchor the northwest corner. UC Davis is thinking about building a world food center.
The soccer stadium would anchor the northeast corner, and better yet, wouldn’t suck up more public money. There are plenty of soccer fans to support a MLS team, but there certainly isn’t a surplus of cash for the city’s many other needs.