Nunez' Group Agrees To Sweeter Terms For Elk Grove in MLS Stadium Proposal

August 26, 2014 | The group led by former California Assembly Speaker and current lobbyist Fabian Nunez has agreed to allow the City of...

August 26, 2014 |

The group led by former California Assembly Speaker and current lobbyist Fabian Nunez has agreed to allow the City of Elk Grove to get a piece of the action should the city be able to attract and build a soccer stadium for a Major League Soccer (MLS) club.

Nunez's group, Northern California Soccer, LLC, (NCS) which has been in an exclusive agreement with Elk Grove since December, 2011, has agreed to allow the city to add a surcharge to admission tickets and parking fees should the city build a stadium according a staff report released yesterday. The report is part of an added agenda item on city council's special meeting scheduled for 5 p.m. tomorrow.
Mayor Gary Davis believes Elk Grove's youth
soccer participation and suburban location make
it well-suited for an MLS team and stadium.

The city's actions come on the heels of an announced September visit to Sacramento by the MLS. Sacramento's Republic FC, of the United Soccer League, has garnered national attention for its sellout crowds in its inaugural year of existence and is a candidate to become an MLS club. 

While the Republic FC's success has not gone unnoticed, Sacramento Mayor Kevin Johnson has said that although he would welcome an MLS team, Sacramento is not in the position to finance a soccer stadium. Even though Sacramento has the urban core sites the MLS desires, Elk Grove Mayor Gary Davis has repeatedly said suburban Elk Grove is the ideal place for an MLS club and should seek to hammer out an agreement with Sacramento Republic FC owner, Warren Smith.   

According to the report, after further negotiations between the city and NCS, it was agreed the city would be permitted to levy $5 and $3 surcharges to admission tickets and parking fee respectively. The surcharges are expected to generated about $3.3 million annually for the 18 MLS matches, two non-MLS matches, eight concerts and 15 other sporting events that NCS also agreed to organize. 

This enhanced revenue, added with the approximately $1.5 million in additional sales taxes that are estimated to be generated citywide by the soccer stadium, would put the operating surplus at $6,680 dollars after the second year of operation.

On the cost side, the original total estimated funding needs were said to be $120 million. Citing the experiences of other MLS stadiums, the city now estimates the revenue bond issuance would be $88 million. 

The report also says that interest rate would be 5.5-percent versus the 6.7-percent in earlier estimates, which would lower annual debt service cost from $8.6 million to $6.8 million.

Voter approval is not needed for the city to issue revenue bonds. 


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Anonymous said...

This is sooo laughable. MLS is NOT going to be looking at EG for a MLS location and Warren Smith would laugh in Mayor Davis'face. Sacto has the investors...we just have a council with childhood dreams and zero business expertise except for Mr. Hume.

We need to get this council on Dr. Phil...maybe send them to Padre Island for some counseling before they bankrupt us.

Still got that $1 M. dollar railway's that working for us??

Anonymous said...

Love that fitting! Best he sticks with making chili and grinding coffe beans, thinkin' that's his calling.

The Big Boys will chew him up and spit him out...serve his head on a platter.

MAYOR DAVIS & Counci...It's JOBS..JOBS..JOBS! No playee until we get JOBS!

Anonymous said...

Wouldn't you love to be a fly on the wall in a meeting with Warren Smith and Gary Davis and Steve Detrick? Detrick has now split from Pat Hume on this issue.

Neither Detrick nor Davis have the celebrity status of a Kevin Johnson, though they think they do; and if both start making the same kind of demands they do from the dais, can you imagine Smith's reaction?

Yep, the Elk Grove City Council continues to be the butt of the jokes in the region. And they only have themselves to blame!

Anonymous said...

Is the thought that the 100 acres the city is buying near a freeway off ramp the potential stadium site?

Anonymous said...

A sweeter deal...LMBO. Just goes to show you that Nunez and his co-horts had EG exactly where they wanted them. So our adding another $3-$5 to the ticket prices works in exactly what way for us? That's not giving us anything...we still take the gamble while they walk away smiling. Are we really that gullible and think they gave us something?

Anonymous said...

Revenues of $3,300,000
Debt Service of $6,800,00

THE CITY WILL BE IN THE HOLE BY $3,500,000 each year

Why in the world should the taxpayers take on the risk and end up losing over $3,500,000 each year.

Way to go.

Stockton II

"The surcharges are expected to generated about $3.3 million annually for the 18 MLS matches, two non-MLS matches, eight concerts and 15 other sporting events that NCS also agreed to organize."

"The report also says that interest rate would be 5.5-percent versus the 6.7-percent in earlier estimates, which would lower annual debt service cost from $8.6 million to $6.8 million."

Anonymous said...

Let me say this once for Mayor Davis, the City Council and people of Elk Grove who may be fooled by your elected leaders:


Not for your lack of trying or anything against your city, but because MLS DOES NOT WANT SUBURBAN STADIUMS. The best and ONLY chance at our region getting an MLS team is if a stadium is located in downtown Sacramento, in the urban core, close to mass transit and population and workers and MLS' target demographic of twenty-somethings.

By continuing to pop up as an alternative to a downtown stadium is to be swindling the people of Elk Grove. It is simply NOT A POSSIBILITY. You are actually HURTING the chances of Sacramento getting an MLS team by creating this discussion instead of uniting on a single, best plan.

For the good of everyone who loves soccer, PLEASE, STOP talking about Elk Grove landing an MLS stadium - it simply will not happen!

Connie Conley said...

This is basically my written public comment on this agenda item:

If members of the Elk Grove City Council are going to push for this soccer stadium, the Council needs to leave it up to the people to vote for it. That way, it would be the "will" of the people and not the "will" of the Council. That would be right and just!

After all, going $88 million dollars in debt should have consensus from the people who are going to pay for it: The residents of Elk Grove!

No Revenue Bonds!

Anonymous said...

The days of MLS settling for suburban stadiums was 10 years ago.

MLS has now caught onto the Millennial demographic. And they like the downtown urban lifestyles. Not soccer mom bedroom communities.

The Railyards in downtown next to the metro transit hub is where the stadium needs to be. Lets hope that it works out. Cause if the owner of Real Salt Lake is correct, MLS is stopping at 24 for a little while. It could be a decade or more before Sacramento even gets another shot.

Like Warner has said. It's now of never.

Anonymous said...

I think it is no coincidence that 99.5 acres are bring purchased by the city (land located OUTSIDE of our city limits) for future "park and open space". I call Bull@hit on that one. If you read the "findings" attached to the agenda item, it goes on to read about how this land will generate revenue with hotel tax and sales tax on various vendors. Doesn't sound like park and open space to me. It surely sounds like the land for the MLS soccer stadium. So, let me get this tax dollars pay for the land that is outside of our city boundaries, then I have to re-pay to use the land via ticket and parking fees? Double taxation? Not to mention the city is mis-directing the public over the real purpose of those 99.5 acres 99 acres of parks and open space, really? How stupid do you think we are? I believe your soccer negotiations required that you have a stadium plan in place. Is this part of that requirement? All this time and money wasted because MLS will never come to EG. Kevin Johnson won't allow that to happen...never, ever, ever. Mayor Davis, stop wasting staff time, efforts and city funds (my tax dollars) on this ridiculous idea of yours. How about some soccer fields for the kids that can be multi-purposed for rugby, lacrosse and football. Work with CCSD and get our family soccer fields built.

Terry Malloy said...

Anon 12:25, after reviewing the consent calender item for the land purchase,I essentially agree the city is being less than honest with us, to say the least.

Having said that, why are they being so deceptive? Yes, we could use the competitive soccer fields for the various soccer youth and adult leagues, not to mention the out of town visitors who might come for tournaments etc.

Mayor Davis and City Council members - please give up on the MLS delusion and just get those fields built. Chasing the MLS is just delaying the fields our kids needed 15 years ago. Keep chasing that f#c#ing stadium and the kids that are 8 and 9 year old's will be young adults before we have the competitive fields.

We coulda had class. We coulda been a contender. We coulda been somebody, instead of a bum bedroom community, which is what we are, let's face it. It was you city council!

JeffO said...

Totally agree with you Connie, the citizens should have to vote for the stadium. It's too big a decision to be left to council.

The planning commission made a smart move by narrowing down the aquatic plan to just the competitive piece. Time to follow suit with the stadium, lose the MLS stadium and focus on a mixed use public sports complex.

Connie Conley said...

Thank you Jeff. There are a lot of us who have advocating for the sports complex for many years.

Our group even held a town hall meeting several years ago on this very subject. It was a SRO meeting with most of the youth sports groups on the panel and in agreement.

Another missed opportunity. Our city could have had those fields years ago, booking tournaments, putting money in the local economy and more.

But alas. . .no!

Anonymous said...

Look for the Sphere of Influence application to be renewed if this purchase is approved.

Anonymous said...

It's time to reset Elk Grove. Get all them crooks out of council. PROJECT ELK GROVE RESET!!!!

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