Change in Arena Agreement: A Good Deal Just Got Better : City Hall, however, must avoid poisoning the atmosphere

What had been a good deal for Los Angeles in a proposed basketball and hockey arena downtown could soon become a great deal. But political grandstanding by Councilman Joel Wachs and continuing silence from some other public officials could make this the last great development deal here for years to come.

Last week, developers of the proposed sports arena reportedly decided to sweeten their agreement with the city. They already had promised to cover the facility’s construction costs, estimated at $240 million. The new guarantee would require the developers to also pick up 100% of the city’s tab for repaying $70 million in bonds for site preparation--about $6.8 million annually for 25 years--if a planned city surcharge on tickets was ruled illegal under a recently passed statewide ballot proposition or if city revenues from the arena fell short for any other reason.

The decision to guarantee the public costs came after much diligent behind-the-scenes work by council President John Ferraro. The decision also was no doubt influenced by Wachs’ announcement Thursday that he will campaign for a ballot initiative requiring voter approval of any professional sports project involving public financing. Wachs has been a loud and persistent critic of the arena project from the start because, he says, of the risk to taxpayers.

That risk was always small and greatly outweighed by the benefits the facility offers the city. The popular Kings and Lakers promise to lure fans from all over Southern California. Spending at the restaurants and shops planned as part of the project would bring additional tax revenue to city coffers. And the whole enterprise should lift the economic pall that hangs over the scruffy neighborhood around the Los Angeles Convention Center. The Convention Center is host to thousands of visitors each year, and the fate of that area should be of concern to anyone who lives or does business in Los Angeles.

Despite the advantages--and in the absence of any other viable plans to rescue that decaying neighborhood and revive the ailing Convention Center--Wachs has mined a vein of legitimate skepticism about public funding for sports facilities. Some cities have indeed discovered that their spanking new sports stadiums held hidden and expensive surprises.

But with the developers now offering to pick up the entire tab, if need be, taxpayers should be reassured. Wachs should be satisfied as well and sensibly declare victory and drop his initiative. But he says he’s not going to, vowing instead to file papers Tuesday to place his measure for voter approval on the June ballot.

His persistence is now nothing more than self-aggran- dizement and could kill the arena deal altogether. In recent weeks, the developers have responded to valid public concerns about the secrecy that initially surrounded the financing agreement and the risk to taxpayers. Continued churlishness from City Hall could well prompt them to throw up their hands and look elsewhere to build a new home for their teams. Who would blame them? If that happens, forget about rebuilding the historic Coliseum, renovating Dodger Stadium or virtually any other big project. No sensible developer would choose to run such a political gantlet--not for a project downtown, not for a project in the San Fernando Valley, not for a project on the Westside or the Eastside or in South-Central. How City Hall finally handles this project will speak volumes to those considering a major development anywhere in Los Angeles.

Our elected leaders have learned from the experience of other cities to be cautious. Now they need to learn another basic rule of urban development: Without vision and prudent risk, there will be nothing but stagnation. Farsighted Angelenos and city officials will back this project.