A ‘New Coliseum’ Could Lure Impressive Payoffs

New Orleans’ economy enjoyed a huge cash infusion on Jan. 26. The Super Bowl raised to the forefront a debate taking place in cities across the nation over the propriety and extent of investing public funds in arenas and stadiums for the purpose of urban revitalization.

When I toured the Superdome a few months ago, workers were completing a major renovation project financed, as was the original Superdome construction, with a state bond issue. After authorizing the original $137.5 million for construction in 1976, the state in 1994 authorized an additional $63.5 million in bonds to finance a Saints training camp, an AAA baseball stadium and a new arena behind the Superdome, as well as the renovation of the Dome.

The meeting of the Packers and the Patriots in the Superdome meant much, much more than parking tax revenues or ticket and sales taxes. Visitors filled every hotel to capacity for at least four days (the minimum stay required by the hotels), bought every air travel ticket into and out of the airport and frequented the Big Easy’s famous restaurants, stores and attractions.

Positive and significant economic impact for cities is what critics of public support for new arenas and new stadiums downplay or conveniently overlook. In its first 10 years of operation, the Superdome had a $3.93-billion impact on the state’s economy; projections for the Super Bowl are $250 million. Super Bowls from 1985 to 1996 have been found to have direct impacts ranging from $50 million to $208 million.

Just think what would happen if we had the game of games here in Los Angeles, the most sought-after Super Bowl location in the country, according to the NFL. (Who knows, we may see a Super Bowl in Los Angeles as soon as 1998.) When more than 100,000 visitors come to town, spending $100 million to $200 million, local businesses and employment are supported throughout the region.

The City Council approval of a proposed financing arrangement to leverage private construction of an arena next to the Convention Center for the Kings and the Lakers is a significant step toward bringing NFL football to the “New Coliseum” (a new stadium built within the shell of the current facility in Exposition Park). In fact, NFL President Neil Austrian, in an address to local business and civic leaders this month, said that the league recognizes that it must be represented in Los Angeles and is not considering any venues other than the “New Coliseum.” Austrian said he is personally committed to working toward an agreement that meets the needs of both the city and the NFL.

City officials and the NFL’s financial consultant have been involved in meetings on the “New Coliseum” to develop a thorough understanding of each other’s requirements. We expect to meet for the second time with league owners in March.

Granted, prudent decisions must be made on public funds. Chasing sports pipe dreams is insupportable. But equally intolerable is downtown’s decay. That the Coliseum is not only a national monument but also a publicly owned historic sports venue is more reason for us to intelligently leverage this resource for the good of the city and the whole region.

There are two main reasons for the NFL’s interest in the “New Coliseum.” The first is its juxtaposition to the proposed arena at the Convention Center, creating a natural sports and entertainment corridor along Figueroa Street. The Community Redevelopment Agency already is studying the potential improvements for such a corridor and the resultant economic benefit to the immediate community and beyond.

The second reason is the extraordinary change in the southern anchor of the corridor, the Exposition Park-University Park complex. In Exposition Park, a $300-million renovation includes the new California Science Center (under construction) and a planned aerospace museum, learning center and aquarium. In University Park, USC President Steven Sample is well on his way toward achieving his goal of raising $1 billion by 2000 to implement a strategic plan that includes $200 million in renovation and construction. The university’s entrance is being redesigned and will face a beautiful tree-lined promenade.

NFL Commissioner Paul Tagliabue has attributed the reassessment of the Coliseum site to “a lot more information now about the rebuilding of Exposition Park.”

Constructive criticism of the use of public funds for revitalization should not be easily dismissed. But it is equally important to respect the concept of “public/private partnerships” and the necessity of investing capital to gain returns.

Is there a risk? Certainly, there are never any guaranteed profits; but we are guaranteed there will be no profit without an investment. The City Council’s 13-2 vote to approve the proposed financing terms for the new arena reflects the understanding that if we don’t lead the way to growth and revitalization, we will perpetuate the reverse direction, leading to further stagnation and ultimately toward deterioration.

With the new arena, it’s easier to visualize the Super Bowl in Los Angeles.