Family Feud Blamed for Sidelining Stadium

A planned $525-million waterside stadium and mall complex, sold to voters last summer as a job- and revenue-generating bonanza, is in trouble. And city officials are blaming a family feud between owners of the San Francisco 49ers football team.

Things began going wrong for the project last December, when Edward “Eddie” DeBartolo Jr., chairman of the 49ers, learned that he was the target of a federal investigation into the award of gaming licenses in Louisiana. DeBartolo resigned as chairman, saying that he was innocent but needed to devote his energies to his legal defense against an expected bribery charge in the Louisiana case. His sister, Marie Denise DeBartolo York, replaced him.

Soon after the transition, the proposed 75,000-seat stadium and 1.4-million-square-foot mall--promoted by Mayor Willie Brown as a way to create 10,000 jobs and revitalize San Francisco’s poorest neighborhood, Bayview-Hunter’s Point--began to go haywire.

City officials said it became clear in negotiations with the 49ers over stadium details that DeBartolo York did not share her brother’s enthusiasm for the project. Last summer, San Francisco voters approved a $100-million public bond sale to help finance the stadium. But the rest of the financing was to come from the DeBartolos and their partners, the Virginia-based Mills Corp.

Two weeks ago, DeBartolo York made her reservations public. She shocked city officials by issuing a news release complaining that the projected cost of the stadium-mall was $175 million more than voters were told when they approved the bond sale. DeBartolo York said she has decided to slow the project down until the overruns can be resolved, but she offered no details on the reasons for the higher costs or how they could be cut.

Brown said he was mystified by the statement. There are no cost overruns on the project as far as he knows, the mayor said. He and his aides blamed the problems on family squabbles.

“It’s a lot more about in-fighting among the DeBartolo corporation and the DeBartolo family than any thing else,” said P.J. Johnston, Brown’s spokesman. “Mayor Brown is confident it will be resolved.”

DeBartolo York’s second thoughts are a serious political embarrassment for Brown, who spearheaded the 49ers’ come-from-behind campaign for the bond measure.

Brown “went out of his way and did yeoman’s duty to make sure this thing would pass,” said Sam Singer, a public relations consultant who worked on the 49ers’ campaign. “Now he is just sort of left standing there.”

Clint Reilly, a political consultant who spent $100,000 of his own money trying to defeat the stadium measure, said he is not surprised that the project is now in trouble.

“It has come out that the arithmetic of the project was highly provisional, that the ownership is at war internally and that one of the principal owners has serious questions about the wisdom of continuing,” Reilly said.

Sources close to Eddie DeBartolo say there is little likelihood that he will quickly resolve either his legal problems in Louisiana or his dispute with his sister over ownership of the Edward J. DeBartolo Corp., which the pair inherited from their father. DeBartolo York is said to want her brother to sign an agreement relinquishing control of the 49ers and his place on the board of directors of the corporation.

One day before DeBartolo York issued her statement from corporate headquarters in Youngstown, Ohio, 49ers President Carmen Policy acknowledged the tensions between the siblings. In an interview with the San Francisco Chronicle, Policy said that DeBartolo “is in the process of resolving business issues with his sister and the family corporation. . . . I think they both understand that it’s in the best interest of the family, the corporation and the 49ers to come to terms.”

Policy declined to comment for this story. His office referred calls to Steven Kay, a San Francisco attorney named to the board of directors of the Edward J. DeBartolo Corp. when Eddie DeBartolo stepped aside from the board in December. Kay did not return phone calls seeking comment. DeBartolo’s office also said he was unavailable for comment.

But sources close to Eddie DeBartolo say that DeBartolo York is dismayed by her brother’s ventures into mostly money-losing casino and card room gambling enterprises in Oklahoma, Ohio, Louisiana and California and is fed up with his lavish lifestyle.

DeBartolo York is described by associates as a more conservative, cautious businessperson than her flamboyant brother. Chairwoman of the Edward J. DeBartolo Corp., she chose to stay near the family’s roots in Youngstown, while Eddie DeBartolo moved to the pricey San Francisco peninsula of Atherton, where he built a mansion a few years ago.

With her husband, John C. York II, DeBartolo York focuses on the family’s portfolio of suburban malls, commercial and industrial properties and its three racetracks.

Two years ago, Eddie DeBartolo formed his own company, DeBartolo Entertainment, and based it in San Mateo. That company has spent millions on local and statewide ballot measures to legalize gambling in Ohio and California.

NFL Commissioner Paul Tagliabue said publicly that if the ownership issue is not resolved within the DeBartolo family, he would exercise his powers as commissioner and name one of the siblings as team owner. But a spokesman for Tagliabue said last week that the league is still hoping the family resolves its differences quickly.

But Eddie DeBartolo faces the possibility of an indictment stemming from the federal investigation in Louisiana. When DeBartolo stepped down as chairman of the 49ers in December, an indictment was thought to be imminent.

Louisiana newspapers reported then that a grand jury had sent target letters to DeBartolo and at least five others, including former Gov. Edwin Edwards. Federal prosecutors have investigated Edwards off and on for years. They allegedly were tapping his phones in 1997, when they learned of a $400,000 payment DeBartolo acknowledges having made to the ex-governor. DeBartolo and Edwards say that the payment was a legal fee for consulting. Federal prosecutors suspect it was a bribe meant to repay Edwards, who retains considerable political power, for allegedly influencing a gaming permit.

In March 1997, DeBartolo and his partner, Hollywood Casino Corp., won Louisiana’s last riverboat gambling license. They planned to build a casino and resort in Bozier City. DeBartolo later withdrew from the project.

DeBartolo denied any wrongdoing when he relinquished the 49ers to prepare his defense against the expected indictment.

Lewis Unglesby, a Louisiana attorney representing Edwards and who has represented DeBartolo in the past, said he will be surprised if DeBartolo is indicted.

But U.S. Atty. Eddie Jordan, in New Orleans, said the investigation “is nowhere near to being over.”

Brown and others who fought a bitter, expensive battle last summer to win voters’ approval for the stadium say that they are in limbo, waiting for DeBartolo’s legal and family problems to be settled.

“It is one of the tragedies of San Francisco politics,” said Singer, the consultant who worked on the 49ers campaign. “Everybody here just has this terrible sinking feeling in their stomach.”

Brown had stumped tirelessly for the bond measure, and was credited with helping the 49ers overcome a series of missteps that nearly cost the team the election. Early in the campaign, DeBartolo outraged San Franciscans by threatening to move the team out of the city if the bond measure failed. Then the team attracted national attention when campaign manager Jack Davis celebrated his 50th birthday with a raunchy bash that featured live, sadomasochistic sex acts as entertainment for hundreds of guests, including most of the city’s political elite.

Before leaving on a trade mission to Asia last week, Brown told reporters that he expected the project to continue and said he was certain the DeBartolo Corp. would issue a statement “clarifying” the January news release.

But Cindy Miller, a spokeswoman for DeBartolo York, said last week that no such statement is planned. She declined to elaborate and said that Denise DeBartolo York declined to comment on either the stadium or relations with her brother.

Johnston said Mayor Brown expects the DeBartolo Corp. to resolve its internal problems and move forward with the stadium-mall project, or sell the team to local investors and let them build.

In public statements, Brown has said that the city will not invest money in the project beyond what voters have approved. Johnston underscored that determination.

“One hundred million dollars is all the voters authorized, so that is not negotiable,” Johnston said. “Whatever is going on in Youngstown is anybody’s guess. If there is a fight going on about control . . . they’re going to have to settle it.”