Davis Rejects New Stadium Terms From Irwindale

At a negotiating session last week, Los Angeles Raiders owner Al Davis rejected new terms proposed by Irwindale representatives for financing a new Raiders stadium, according to people close to the talks.

Irwindale, seeking ways to ensure adequate financing for the $100-million-plus stadium, has been trying to get the Raiders to agree to take less than the 50% share of stadium revenue called for in the original memorandum of agreement last August that committed the team to move to the San Gabriel Valley community.

In a letter sent to Davis about a month ago, the city’s redevelopment consultant and expediter, Fred Lyte, reportedly suggested that the team agree to an arrangement whereby revenue would be used first to pay debt service to private lenders.

Splitting Remainder

Any amount left over, according to this proposal, would be split 90% to the Raiders and 10% to Irwindale. But the estimate is that this initially would mean only $4.6 million a year for the team, instead of the $12 million envisioned in the original agreement.

Another idea that has been discussed is a 75-25 split, with the Raiders getting only 25% of the revenue and also accepting new restrictions on how much Irwindale would be required to spend to provide access, parking and site preparation for the stadium.

Lyte has reportedly also suggested that the Raiders commit themselves to staying at the new stadium for 30 years, rather than the 15 originally agreed to, in order to satisfy potential lenders.

But, according to people who spoke on condition that they not be identified, Davis, at a meeting with Lyte and Irwindale City Manager Charles Martin, said last week that while he is ready to make some adjustments to help secure financing for the stadium, he is not prepared to go as far as Lyte wants and that it is up to Irwindale to come up with new proposals.

Higher Interest Rates

There were reports last month that, due to rising interest rates, financing for the stadium was in doubt and the Raiders-Irwindale deal was in danger.

“We are right at a delicate stage,” Lyte said in an interview this week. “We’re making no comment at this point. There was a meeting, but we don’t negotiate these things in the newspaper.”

A Raiders representative who was read details of the negotiating report relayed a request for comment, but no one from the team responded.

Under a Los Angeles Superior Court order, Irwindale must complete an environmental impact report on the stadium and its parking before coming to final contract terms with the Raiders and before making any decisions on financing.

Lyte observed that since the negotiations can’t be concluded at this stage, there is little pressure to reach an agreement.

One of Irwindale’s attorneys, Kenneth Adams of Washington, said last week that the environmental impact report is not expected to be completed until the fall and that construction on the stadium would not begin until early next year.

This represents a small slippage in deadlines expressed earlier for the project, which the Raiders had been saying they hoped to begin by the end of the year.

At an Irwindale City Council meeting last Thursday, some members expressed impatience with delays and the heavy costs Irwindale has sustained in defending the project against lawsuits and moves in the Legislature to stymie it.

Martin, the city manager, told councilmen that the city has spent $2 million since last August on attorneys, consultants, travel and reports to promote the stadium deal. He said that for the first time in several years this has put the city’s budget out of balance.

Meanwhile, the Raiders will continue to play in Los Angeles Memorial Coliseum, which is suing the team for $57 million for breach of contract in connection with the Raiders’ failure to build luxury boxes on the Coliseum rim.

The Coliseum Commission recently entered into a private management agreement with a business partnership, partially in hopes they might be able to mend relations with the Raiders and keep them in the stadium indefinitely should the Irwindale deal fall apart.