Sacramento OKs Hefty Raiders Funding Plan

City Council members early today unanimously approved a funding plan to lure the Raiders to Sacramento, including a bond-driven $50-million franchise fee and increases in ticket and hotel taxes.

“This package gives me the assurance that I asked for back in September that if there is a shortfall, or if games aren’t played, that somebody besides the city will pay off the bonds,” Mayor Anne Rudin said.

Sacramento developer Gregg Lukenbill heads a coalition of local business groups that hope to move the National Football League team to Sacramento. They have promised to construct a $100-million 72,000-seat stadium to host the team by 1992 if the Raiders agree to the move.

The City of Oakland, where the Raiders played for more than 20 years before Al Davis, managing general partner, moved the team to Los Angeles, wants the team to return.

Under the deal approved by the Sacramento City Council, which met past midnight, a 5% tax would be levied on tickets for live performances costing more than $10 and the 10% hotel room tax would be increased by 1.5%.

Both taxes will take effect July 1, 1990, and do not require voter approval.

“In our view, this special tax is not valid until it is approved by voters,” said Patrick J. Borchers, an attorney for the Sacramento Hotel Assn., which opposed the tax. “We intend to contest the legality in court.”

The $50-million franchise fee will be provided by a tax-exempt bond issue approved by the council, part of a $93-million plan to fund the fee along with several other local projects.

The council’s action, not unexpected, marks a formal approval of the agreement worked out between the city, business interests and others during months of negotiations.