Relocation fee to L.A. could cost NFL owner & city upwards of $1 billion

Rams owner Stan Kroenke (left) is building an 80,000 seat stadium in Inglewood.
Rams owner Stan Kroenke (left) is building an 80,000 seat stadium in Inglewood.

Since the Rams and Raiders left Los Angeles in 1995, 22 of the 32 NFL teams have moved into new stadiums with all of them built at Los Angeles’ expense. That includes the Edward Jones Dome in St. Louis where the Rams moved after the 1994 season.

The cost to the City of Angels is the privilege of being the home of a franchise in the biggest and most lucrative entertainment/sports industry: the National Football League.

Los Angeles – the second largest media market in the country also known as the Entertainment Capital of the World – has always been considered an NFL market.

For the last two decades L.A.’s game has been off the field being used as leverage by the owners threatening a move to the City of Angels in the process fleecing their current cities of taxpayer dollars to build these new multi-billion dollar stadiums. This has enabled the value of all 32 franchises to climb to an average of $1.4 billion apiece. That’s a total of $44.8 billion.

The Indanapolis Colts - who parked their team plane at LAX - are one of many teams using L.A. as leverage to get a stadium deal in their current city.
The Indanapolis Colts – who parked their team plane at LAX – are one of many teams using L.A. as leverage to get a stadium deal in their current city.

That “L.A. Leverage Game” for the league is a thing of the past with all these new cathedrals of the gridiron up and running. The St. Louis Rams, Oakland Raiders and San Diego Chargers are the three remaining teams needing new buildings. The Raiders and Chargers leveraging their respective cities with L.A. can’t work because the cities they call home and L.A. are all California cities and are thus subjected to the exact same laws. It’s absolutely known that all government entities in the Golden State will not earmark taxpayer dollars towards sports stadiums. It’s just no fiscally responsible.

For L.A. to get back on the field a stadium needs to be privately funded. Enter Rams owner Stan Kroenke. He’s partnered with the Stockbridge Group in Inglewood and is going to build an 80,000 seat stadium where the old Hollywood Park Race Track sits on his own dime.  Plans are for it to be done in time for the 2018 season with the Coliseum or Rose Bowl a temporary home for a team – or teams – moving to L.A. in the meantime.

Kroenke is buiding his NFL stadium in Inglewood as part of the City of Champions Revitalization Project.
Kroenke is buiding his NFL stadium in Inglewood as part of the City of Champions Revitalization Project.

Estimates are an owner looking to relocate his team to L.A. will have to fork up a fee of half-a-billion to a billion dollars. Were that to actually happen, that cost would be passed down to the L.A. football fan paying outrageous prices for personal seat licenses; a voucher to get you a ticket inside the stadium. Then there’s parking, the actual ticket to the game as well as concessions for food and drinks that would undoubtedly be astronomical all because of this relocation fee.

A team owner willing to move his team to Los Angeles and the fans that have waited a generation to be able to attend an NFL game in their home city SHOULD NOT be subjected to a hefty relocation fee.

The 32 owners have made multi-billions of dollars using L.A. as leverage and will make a great deal more once a franchise or two calls Los Angeles home. That’s WITHOUT so-called relocation fees.

Making an owner pay a billion dollar relocation fee to L.A. pales in comparison to the multi-billions of dollars Los Angeles has netted the league over the past two decades as a leverage piece.

According to Forbes franchise values have quadrupled in the last 17 years when most of the 22 stadiums were built. The Dallas Cowboys top the list at $3.2 billion with the newly crowned Super Bowl Champion New England Patriots coming in second valued at $2.6 billion. Both play in two of the 22 stadiums built since L.A. has been without a team.

Patriots’ owner Robert Kraft purchased the team for $175 million in 1994 which is, coincidently, the last year Los Angeles was home to the Rams and Raiders.  Kraft’s franchise is now worth some 15 times his initial investment.  Thanks partly to the leverage game L.A. was forced to play.

On the field, L.A. has a rich NFL history with the Rams who called L.A. home for 49 years. They played 34 of them in “L.A. proper” at the Memorial Coliseum and the last 15 in Anaheim sharing the “Big A” with the baseball Angels.

The Raiders left their birthplace in Oakland calling the Coliseum home for 13 years before returning to the East Bay after the 1994 season. The Chargers inaugural season in 1960 was spent in L.A. before bolting south for San Diego where they’ve called home for over 50 years.

Since ‘95, if an NFL fan in Los Angeles wanted to see the likes of Tom Brady, Peyton Manning and Aaron Rodgers among others in person, a two-hour and more than 125 mile drive to San Diego, or a five-hour 370 mile drive to Phoenix or an eight-hour drive or $200 roundtrip flight to the Bay Area have been the best options for L.A. fans to see these talents in person. That’s how L.A. used as leverage has affected the L.A. football fan.

Los Angeles has made multi-billions of dollars for all 32 NFL owners off the field and has a rich NFL past on it. Waiving any type of relocation fee to L.A. would be a reward for its football fans who have gone an entire generation without a team to call their own.

 

 

 

 

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