Editorials

New MLS team is great, but development and growth must benefit all Sacramentans

Sacramento has, once again, scored big with sports.

After five years of waiting, our city will officially get a new Major League Soccer team. On Monday, MLS officials will joined city officials to announce that Sacramento will be home to the league’s 29th team. Our team will be on the field and playing – in a brand new stadium in the downtown railyard – in 2022.

The new team means thousands of jobs and decades of economic development for Sacramento. The city estimates it could attract $1 billion of much-needed investment to our city. In return, the city had offered $33 million in “fee waivers, tax rebates, advertising rights and infrastructure financing.”

It also promised to rewrite the city’s signage ordinance to allow the team to put up five digital billboards around town, with the possible option for a sixth if the team builds a training facility and fields for youth soccer.

It seems like a great deal for Sacramento. The city will leverage a massive investment, create jobs and expand economic growth in a long-dormant area of downtown. Such investment and growth are needed in a city with serious challenges like homelessness and a lack of affordable housing.

A soccer team won’t solve all of Sacramento’s problems, but it will help spur continued development at the Sacramento Railyards. The city has ambitious plans for the former site of the Transcontinental Railroad’s terminus, including “dense urban residential neighborhoods,” a Kaiser Permanente medical center, a courthouse, shopping and a museum. The new soccer stadium would give the project a big boost.

Opinion

The new deal that MLS and the city announced this week is somewhat different than what was originally proposed, according to a Sacramento Bee story by Tony Bizjak and Marcos Bretón. For example, the new deal calls for the city to loan $27 million to the investor group behind the new team, which includes California billionaire Ron Burkle.

“The mayor said the proposed loan makes it easier for the Burkle group to finance its $200 million league expansion fee, as well as pay for increased construction costs,” according to The Bee.

The loan, which would be paid back to the city with interest, is apparently necessary to help fund new infrastructure near the stadium site. This may be true, but the sight of a city where thousands of people live on the streets loaning $27 million in public money to help a billionaire build a stadium may raise questions.

“It’s going to leverage an estimated $1 billion in private investment,” said mayoral spokeswoman Mary Lynn Vellinga. “It’s just a pittance compared to what we’re going to get in return.”

The money would come from a $91 million city reserve fund used for “risk management,” which includes things like litigation and legal settlements. It would not come directly from the city budget, and no Measure U funds would be used. Vellinga said the loan will create an incentive for faster development around the new stadium site.

Any new deal will require the approval of the City Council, so we look forward to a fuller discussion of the loan and why it makes sense. With this loan of public funds, it’s more important than ever that the city does everything in its power to ensure that this deal directly helps all Sacramentans – including those struggling to find affordable housing.

If there’s anyone who can think creatively along these lines, it’s Mayor Steinberg. He has worked tirelessly to bring an MLS team to town. Simultaneously, he’s also fought to make Sacramento into a city that commits the resources needed to address its growing crisis of homelessness.

With the passage of Measure U and his $36 million plan to reduce homelessness over the next two years, the mayor has proven his commitment to serving everyone in our city. With Sacramento now slated to acquire an MLS team, we hope he can deliver on an even larger scale than previously imagined.

Editor’s note: This editorial has been updated to reflect the fact that the mayor’s office has clarified that the $27 million loan to the investor group will be used to fund infrastructure, not to help the investor group finance its $200 million league expansion fee.

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