Anaheim Enjoys the Up Side of Roller Coaster

It was springtime in Anaheim but nothing seemed in bloom.

The Walt Disney Co.’s expansion plans for Disneyland had long since withered and a revised proposal appeared dormant. The Seattle Seahawks flirted with relocating to Anaheim Stadium but blew out of town after briefly transplanting a training facility at a vacant city school.

And the city’s aging Convention Center continued to show signs of wilting against more modern competition in other cities. Perhaps worst of all, in late March the California Angels were threatening to uproot themselves from Anaheim after a deal between the city and Disney died.

What a difference a few months can make. To hear city officials and tourist industry analysts tell it, by the turn of the century Anaheim could claim the title of the nation’s No. 1 resort destination.

“Things really looked worst this spring when Disney folded up their tents and said no to the Angels--that was a dark moment,” Anaheim Councilman Lou Lopez said. “But we are ready to be on top of the mountain again. We are on a roll.”

Indeed. Since its rocky spring, Anaheim secured a long-term commitment from the Angels that gave Disney control of the ballclub and Anaheim Stadium. The deal also cleared the way for Sportstown, a proposed sports and entertainment complex on 167 acres anchored by a renovated baseball-only stadium.

And last week, Disney and city officials announced the crowning glories of a $150-million expansion of the Anaheim Convention Center and a $1.4-billion companion resort to Disneyland.

“This is going to renew the luster of Anaheim as a visitor and business show destination,” said Jack Kyser, chief economist for the Economic Development Corp. in Los Angeles. “This isn’t going to be a ripple. It’s going to be a wave. The message is out that there’s an amazing new attraction and you need to come to Southern California to see it.”

The positive buzz is welcome and overdue news to city and Disney officials, who have for years mulled numerous plans to reinvigorate the blighted areas around the aging theme park and Convention Center. Officials, who previously have dealt with each site separately, realized the theme park and Convention Center must be improved--and packaged--together to compete successfully in today’s market.

Anaheim City Manager James D. Ruth labeled the twin expansions the city’s “economic engine for the future.”

But some, who worry the city’s financial health is too closely tied to Disney’s, worry Anaheim’s pledge of about half a billion dollars toward the expansion plans might be too risky. With memories of the Orange County bankruptcy still fresh, critics argue the city should not be gambling with taxpayer funds, especially to help a private company.

Others question why Anaheim is alone in laying out the financial risk when neighboring cities stand to gain as well.

“The burden should not be falling on the backs of Anaheim’s 300,000 residents when everyone benefits,” said Anaheim Councilman Bob Zemel, who contends the city has withheld key documents detailing the Disney financing deal. “It’s not fair.”

Most officials connected to the much ballyhooed plans, however, have little patience with the skeptics. The numbers tell the story, they say.

During the five-year build-out, the expansion project will infuse the county and regional economy with an estimated $1 billion annually, according to Esmael Adibi, director of Chapman University’s Center for Economic Research.

“There’s no question this is the largest single project and job generator ever in Orange County,” he added.

When completed in 2001, Disney estimates the new theme park, hotel and entertainment district will create 14,500 jobs, 8,100 of those in Anaheim. Moreover, annual revenue from the expansion is projected to be $25 million for Anaheim, $10 million for Orange County and $35 million for California, according to Disney calculations.

“From the city’s perspective, this is exactly what we need,” Mayor Tom Daly said. “This new park will be a smash hit. People from all around the globe will want to see it.”

But before travelers book their flights and officials begin counting profits, the expansion plans still require a final approval from the City Council. A council majority backs the plans, and few observers expect the same bitter divisions that consumed the five-member council during negotiations leading to the Disney-Angels deal.

The council also must OK a complex $550-million financing package to pay for badly needed street improvements, landscaping, utility upgrades and expanded parking at the Anaheim Convention Center and the second Disney theme park. The city and Disney are still fine-tuning the package, which is expected to be considered by the council within a few weeks.

The second vital link to the city’s long-term economic health is the long-awaited overhaul of its 29-year-old Convention Center. The 985,000-square-foot venue, which will nearly double in size, faces losing as much as $4 million a year in tax revenue because of lost business to cities such as Los Angeles, Las Vegas and Orlando.

Some 60 organizations have threatened not to return to Anaheim unless an enlargement project is undertaken. Some couldn’t wait. The National Assn. of Music Merchants, which drew crowds of 60,000 to Anaheim this January, recently announced its is headed to the newly expanded Los Angeles Convention Center for at least the next two years.

“At its current size, Anaheim’s Convention Center couldn’t even compete for the Republican National Convention, which is being held in San Diego,” Adibi said. “An expansion is extremely important for the city.”

Anaheim’s strategy to offer visitors a variety of entertainment options including everything from pro sports to a theme park is indicative of what cities must do to win tourist dollars, industry analysts say.

“Cities today have to invest and package their product in ways they never had to do before,” said Shawn Flaherty with the Travel Industry Assn. of America, a Washington-based promotional and research group for the $430-billion U.S. travel industry. “There are a lot of other products out there . . . but Disney has always been an excellent marketer.”

In addition to tourists, city officials are hoping the expansion attracts something that’s been absent from Anaheim since last year--a professional football team.

“I think this will increase the likelihood that a pro football team will return to our city,” said Daly, who spearheaded efforts to retain the Los Angeles Rams. “The expansion makes Anaheim and Orange County a powerful lure.”

Also contributing to this report was Times staff writer Greg Hernandez.