Negotiator for Governor Quits Football Talks

Bill Chadwick, the investment banker who has served as Gov. Gray Davis’ representative in talks aimed at securing a professional football team for Los Angeles, resigned Tuesday, stirring concern that the deal may be unraveling over the National Football League’s insistence that the project receive significant public financing.

In a three-page letter to Davis, Chadwick expressed frustration over the NFL’s position regarding public money and said he could not endorse a deal beyond what he recommended last week at an NFL owners’ meeting in Chicago. Among other things, that agreement would have secured the state’s support for issuing $150 million in bonds to pay for parking at Exposition Park and would have charged the team’s owners $2.5 million to $5 million a year in rent for use of the Coliseum.

“At this point, my financial analysis leads me to conclude that the risk/reward scenario is both reasonable and fair to all parties,” Chadwick said in his letter. “Therefore, and particularly in the absence of any formal response from the NFL, I cannot recommend that the state spend more money to cause the NFL to bring NFL football to the site of the Los Angeles Memorial Coliseum.”

Chadwick’s resignation caps a week of dashed hopes. He entered the talks earlier this summer amid high expectations that he could break the impasse in the negotiations. He leaves them days after the NFL owners met in Chicago, heard his proposal and then declined to sign it. With that proposal shelved and its architect suddenly gone, neither side now has a concrete alternative to offer.

NFL officials said they were unsure what will happen next.

“We’ll be in touch with the governor’s office to see how to proceed,” a league spokesman said.

Mayor Richard Riordan declined to comment in detail on Chadwick’s resignation, saying only that he thought that the governor’s representative had handled himself well and reiterating his position that it would be good for the city and the league to have professional football return to Los Angeles.

Still, the long-term implications of Chadwick’s resignation are mixed. On one hand, he was the state’s official negotiator, brought into the talks in part because all sides believed that if the public were to contribute, the state government was the likely source of that money. As a result, his departure sent tremors through football proponents, who worried that it was a sign of a wavering state commitment to back bonds that would help pay for parking at Exposition Park.

On the other hand, some local leaders blamed Chadwick for mishandling aspects of the talks--ignoring the views of key participants--and expressed hope that his departure might cause the NFL to reconsider its push for public financing of the stadium. If that happened, those officials said, a deal might still be attainable.

What is clear is that Chadwick’s departure further clouds the negotiations, which are mired in a dispute over how much, if any, public money should be spent on building parking spaces or a new stadium to serve the team.

“I would love to have a team,” said state Sen. Kevin Murray (D-Los Angeles), whose district includes the community near Exposition Park. “But these guys at the NFL have to get real.”

In recent weeks, Chadwick helped craft that proposed agreement between the state and the National Football League, a proposal that some insiders said represented a step forward. Some officials credited Chadwick with an innovative solution to one of the issue’s biggest stumbling blocks: how to satisfy the NFL’s demand for more than 20,000 parking spaces at Exposition Park.

Chadwick proposed having the state or some nonprofit agency borrow the money to build those structures and then repay the bonds by charging for parking, taxing tickets and skimming off other money that the team helped to generate.

But just when it seemed that Chadwick had secured a surprisingly broad consensus behind that plan, the NFL declined to sign the agreement, and NFL Commissioner Paul Tagliabue annoyed local officials by saying that the NFL wanted to see a larger public investment before it could agree to bring football back to Los Angeles.

Chadwick was surprised by that development: Just hours before Tagliabue made those comments, he and other NFL officials had told Chadwick that the NFL was prepared to sign the agreement.

“I think he feels burned,” County Supervisor Zev Yaroslavsky said.

At the same time, Chadwick irritated some of the principals in the talks. He crafted his proposed agreement without significant input from either group competing for ownership of the new franchise. Both groups were surprised when Chadwick unveiled it and saw that it contained anticipated stadium rent payments of up to $5 million a year.

What most concerns local football boosters now is that Chadwick’s departure would cloud the state’s continuing willingness to contribute to the project by backing bonds to pay for parking at the Coliseum. If the state withdraws from that idea, the project almost certainly would be doomed, some officials said.

“I think it’s a mistake for anyone to throw in the towel,” said Councilman Mark Ridley-Thomas.

Others said they hoped that Chadwick’s abrupt resignation might prompt a reevaluation of the project’s more controversial aspects. In particular, they argued that the NFL’s continuing insistence on surrounding the Coliseum with more than 20,000 parking spaces is the fundamental problem with the current discussions.

To build those spaces, Chadwick endorsed a site plan that would radically alter the look of Exposition Park. And to pay for the spaces, his agreement called for all parking revenue to go toward serving the bond debt. That would keep the new owner from being able to make money off parking, and it raises a host of potential problems in winning approval for the project’s eventual environmental impact report.

Only if that condition is reevaluated will a deal ultimately be possible, Yaroslavsky said.

“If the league wants to make a deal in Los Angeles, they can,” he said. “If they want to scuttle a deal in Los Angeles, they can. They’ve sent mixed messages.”