Jan. 10, 2013: NFL makes onerous financial demands of Santa Clara to host a Super Bowl
Recall that in Measure J we were promised 'No Cost to SC's General Fund. No Cost to Santa Clarans. Period.'http://www.mercurynews.com/southbayfootball/ci_22350058/santa-clara-weighs-super-bowl-financial-terms-imposed
"The big economic boon from a Silicon Valley Super Bowl might not be as super as once thought.
Santa Clara officials this week began weighing whether the city can still make money from a
Super Bowl and related events after stomaching a new list of financial demands from the NFL --
including giving up huge chunks of tax revenue."
Read more on our blog:http://santaclaraplaysfair.blogspot.com/2013/01/the-nfls-extortion-of-santa-clara.htmlDec. 17, 2012: County Auditor releases audit of Santa Clara RDA.SCPF warned our city council that its actions could be clawed back.
Many citizens wrote to the city and spoke before the council in opposition to the council's actions with respect to
RDA money. The citizens were not listened to.
The RDA Audit shows that contracts were entered into which are not considered valid, bonds were sold beyond
the allowable date for selling RDA bonds, actions taken by the council are being clawed back, and on and on.
Read the Audit:
- The City's letter states that it is likely that the State of CA will issue a report requiring the transfer of City assets (which formerly belonged to our RDA) to 'fund other obligations required by the State.' The letter makes it sound like this is a state takeaway. What the letter doesn't tell you is that those 'obligations' include providing money to other local taxing entities, such as our schools and county agencies, which have been starved for decades of property tax dollars which were diverted to redevelopment projects.
- The letter states that the State is now 'trying to retroactively claim property and assets which were transferred to the City months before the state law (RDA dissolution legislation) was even passed.' What the letter doesn't say is that Gov. Brown warned that there would be a clawback provision in the RDA dissolution legislation that would be retroactive to Jan 1, 2011.
- For decades, RDAs have siphoned off local property taxes for development projects, taking property tax dollars that would otherwise have flowed to schools/city general funds/county agencies. For example, Santa Clara's RDA was siphoning off $10 million to $11 million per year in property tax dollars from Santa Clara Unified schools. San Jose's RDA was siphoning off $25 million/year from Santa Clara Unified schools.
- In addition, RDAs were intended to fight blight and remediate urban decay. Many RDAs used property tax dollars for development projects which had nothing to do with fighting blight/urban decay, such as using public dollars for professional sports stadiums.
Here's the background and what we know so far:
Santa Clarans are being asked to give their names to the City in support of the City's position, without being given all of the background information on what's going on with the lawsuit, the disposition of RDA assets, and the audit of the former RDA.
- In Jan. 2011 when Governor Brown took office, he promised that he would dissolve the 400 CA redevelopment agencies (RDAs) throughout the state. The legislation to dissolve RDAs (AB1x26) passed on June 28, 2011. The Governor had warned that actions taken by RDAs after Jan. 1, 2011 and prior to passage of the RDA phaseout legislation could be subject to 'clawback' to Jan. 1, 2011.
- The RDA dissolution legislation was challenged by the League of Cities, which represents cities like Santa Clara which had RDAs. In Dec. 2011 the CA Supreme Court upheld AB1x26. (The Supreme Court struck down AB1x27, which was a 'pay to play option' for cities to keep their RDAs.)
- Recall that Santa Clara moved RDA money and assets in the spring of 2011, including giving $4.5 million to the 49ers for 'safekeeping.' Many cities moved their RDA cash and assets to the RDA host cities themselves, and took on more RDA bonds in advance of passage of AB1x26.
- 'Clean up legislation', AB1484, was passed in June 2012 to clarify and supplement AB1x26. Among other things, AB1484 defines City/RDA created agencies, such as the Stadium Authority, as part of 'the City.'
- The League of Cities filed suit against AB1484, in part to try to stop the clawback and the distribution of RDA assets to the taxing entities - such as schools and counties. http://www.cacities.org/AB1484lawsuit
- While Cities which formerly had RDAs are on the side of the League of Cities in this lawsuit, while some Counties and School districts which have been starved of public funds by RDAs are on the side of the State.
- Here is the link to the court documents for the League of Cities lawsuit over AB1484. Type in Case Number 80001275. https://services.saccourt.ca.gov/publicdms/search.aspx
- Here's an article in the SJ Merc on what prompted the City's letter to residents: http://www.mercurynews.com/bay-area-news/ci_22037046/santa-clara-san-jose-gird-state-redevelopment-land "According to the controller, the law requires that all redevelopment assets transferred to a city, county or other public agency after Jan. 1, 2011, must be given to its "successor agency" unless the assets were committed to a third party before the law was signed. Cities argue that the state law cannot block land transfers that took place before it was signed. But the controller has disagreed in rulings on other city property transfers. The controller in August ruled that Milpitas and Morgan Hill shouldn't have transferred assets from their redevelopment agencies to the city or a newly created city economic development corporation. The controller ruled that Milpitas owed $234.7 million and Morgan Hill owed $108.4 million in redevelopment assets to their successor agencies."
- The state is currently conducting audits of the former RDA cash and assets, including San Jose's and Santa Clara's.
- To provide input to the Dept. of Finance staff who are reviewing implementation of the RDA dissolution legislation AND the 49ers lawsuit against the Oversight Board, please e-mail:
Or call (916) 445-1546.
Please do not feel compelled to provide your name to the City. Residents have not been told how our names will be used - posted on a website? Listed on a petition? Provided to the state? We don't know. Use of your name is strictly up to you.
Election Results for Santa Clara County:
http://results.enr.clarityelections.com/CA/Santa_Clara/43231/113198/en/summary.htmlSC City Council Campaign Report Card - Donations from stadium
contractors, other contractors, South Bay Labor Council, other PACs:
http://santaclaraplaysfair.org/attachments/SC%20Council%202012%20Campaign%20Donations.pdfCA State Dept. of Finance says NO to giving $34.4 million in our RDA (redevelopment) property tax dollars to the 49ers.
Recall that in August 2012 the Redevelopment Oversight Board voted 6-1 to give $34.4 million to the 49ers instead of to our schools/city/county agencies. Our own SCUSD schools superintendent voted ‘Yes’ to give the 49ers the money. Read the letter from the Dept. of Finance:
SCPF is pleased to endorse:
Dr. Michele Ryan for Santa Clara Unified School District Trustee, Area 3.
Her website is: www.ryan4board.com
WARNING - South Bay Labor Council has spent $32,000 each on Mlnarik and Davis mailers/robocalls. The City's campaign spending limit is $36,800, but there is no limit on outside PAC expenditures.
POLITICAL ACTION COMMITTEE (PAC) WARNING: Two well funded PACs are running highly negative campaigns in an attempt to control who represents us on both the Santa Clara Unified School District Board and the County Board of Education, Area 5:
Campaign finance disclosure forms show that the local SCUSD schools PAC is primarily funded by people who helped pass Measure J for the 49ers stadium and spoke before the Oversight Board in favor of RDA money going to the 49ers instead of to our schools/city/county agencies.
2012 Candidate Information. Please see smartvoter.org for unbiased candidate information and
see the left side of our home page.
For each race, we've uploaded candidate names and ballot information.
August 2012 Oversight Board Update. Once again negotiations were conducted behind closed doors in closed
- Stadium involvement concerns
- Campaign contributions from 49ers contractors
- Spouse employment concerns (potential conflicts of interest)
- Candidate consultant hiring concerns (hiring a cyberbully)
- PAC funding concerns
session. With the threat of the 49ers lawsuit to tie up the RDA property tax dollars hanging
overhead, and our schools and other agencies in desperate need of our RDA funds being held by
the County Tax Collector (RDA funds could not be distributed because of the 49ers lawsuit) the
Oversight Board voted 6-1 to give the 49ers the entire $30 million plus $4 million in interest,
distributed over the next 6 years (Note that Santa Clara Unified's Superintendent, Dr. Bobbie Plough,
voted with the majority to give the 49ers the $34 million.) Our schools/city/county agencies are supposed
to get the RDA money that is not slated for the 49ers.
Now, the CA State Dept. of Finance has to review and approve the
distribution of RDA funds by the Oversight Board. State Senator Elaine Alquist's gut and rewrite
of SB1245 solely in favor of the 49ers (to give the 49ers our RDA money in case the Oversight
Board didn't) did not go forward.
Monday July 9, 2012 Oversight Board Meeting.
The Board decided to postpone voting on the former RDA money until after hiring legal counsel.
Measure J did not guarantee the 49ers $40 Million in RDA funds
Measure J reads "Contributions to the construction costs of the stadium shall not exceed $40,000,000." Which means that any amount from zero to $40 million from our RDA satisfies what the voters approved. The RDA already spent $10 million on the stadium project. Then Governor Brown did away with RDAs so that property tax dollars could be used to meet public needs.
49ers file lawsuit to take our Redevelopment Dollars
July 2, 2012 A judge rules that there is a temporary restraining order in place until July 27, 2012, meaning that the county tax collector cannot distribute the $12 million in RDA funds being held in an escrow-type account.
June 28, 2012 The 49ers file suit in Sacramento against Santa Clara County to attempt to get our local property tax dollars from the former redevelopment agency. They want $30 million, which with interest over 15 years comes to $52 million. The Oversight Board had voted to give the $52 million to our schools/city/county/water district. The 49ers had loaned the money to the Stadium Authority knowing that the Governor had done away with Redevelopment Agencies and that the CA Supreme Court upheld the law which wiped out RDAs.
- The Oversight Board cannot be sued as per state law.
- Measure J states that up to a maximum of $40 million in redevelopment dollars would go towards the stadium. Anything from zero to $40 million dollars meets that requirement. Santa Clara has already given $10 million in redevelopment dollars to the stadium project.
- Measure J also states that neither the city nor the redevelopment agency are liable for the obligations of the Stadium Authority. It's the Stadium Authority which owes the 49ers $30 million. The 49ers loaned the money to the SA knowing that the SA does not have assets, income, or taxing authority and that the flow of redevelopment dollars could be cut off.
- Measure J campaigned heavily on money for our schools but the 49ers are now trying to take redevelopment money away from our schools.
- If the 49ers really cared about our schools, they wouldn't have filed the lawsuit. The County Auditor showed that of the $52 million in RDA dollars, $20 million would flow to Santa Clara Unified Schools.
- Does the NFL Commissioner really approve of the 49ers owners filing a lawsuit which would deprive schools of desperately needed funds? Currently, our schools have to have furlough days because of a lack of funding, class sizes have increased by 50% in our elementary classrooms, and there have been many layoffs of teachers and the loss of programs over the past few years, all because of budget cuts.
June 22, 2012 The Oversight Commitee voted 4-3 to sever the cooperation agreement between the former Redevelopment Agency and the Stadium Authority, effectively shutting off the flow of taxpayer property tax dollars to the Stadium Authority (SA.) The SA has no assets, no income, no taxing authority, and now had no access to RDA property tax dollars to pay off the $30 million loan from the 49ers. County Counsel says that the Oversight Board has the authority to terminate contracts between the former RDA and other public agencies (the Stadium Authority) and to consider the needs of taxing entities (schools/city/county/water district etc.) in making its decisions. By
June 2012 By a 4-2 vote (McLeod, Kennedy dissenting) our pro-stadium council enters into an exclusive negotiating agreement with the Joe Montana group regarding the property across Tasman from the stadium site.
April 2012 The loans are supposed to fund by the end of April, but apparently, they don't (as per the SJ Merc News.) At some point, the 49ers loan the Stadium Authority $30 million, expecting that at some future point in time, the Redevelopment Agency to give taxpayer property tax dollars to the Stadium Authority to repay the loan. The 49ers break ground apparently without having the loans funded. They start construction using the money they loaned to the Stadium Authority.
March 2012 The amount of the loans goes up by $100 million. The Stadium Authority will now take on $950 million in unsecured loans without the approval of Santa Clarans.
In accordance with AB1x26, Gov. Brown's legislation which wiped out redevelopment agencies (RDAs), an Oversight Commitee is formed to oversee distribution of RDA property tax dollars in accordance with RDA financial obligations the committee deems 'enforceable obligations.' The Oversight Committee is composed of 2 people from the City of Santa Clara, 2 people from the County, 1 from Santa Clara Unified School District, 1 from the Water District, and 1 from the Mission/West Valley College District.
March 5, 2012 A Santa Clara County Superior Court judge denies Santa Clarans the right to vote on $850 million in loans which were not disclosed on the Measure J ballot.
Feb. 28, 2012The council voted to have the City and the Stadium Authority enter into a lease agreement (this is like Santa Clara entering into a lease with itself).
Feb. 23, 2012 - The city is suing SCPF to prevent Santa Clarans from having the right to vote.
The 49ers Stadium Company (Stadco) filed a court brief against SCPF and against the Stadium Authority
seeking to have a judge rule that we should not have the right to vote on $850 Million in loans.
We've hired an excellent lawfirm and a brilliant lawyer, Matt Zinn, who is hard at work on defending
our right to vote. Our attorney filed a court brief on our behalf on Feb. 22nd. Here is the link to
the court briefs (The Stadium Authority's lawsuit, StadCo's court brief, and SCPF's attorney's
response.) Our court date is March 5, 2012.
Update Feb. 14, 2012
- By a 5-1 vote, our pro-stadium council members have forged ahead to sign the city
up for $878 Million in construction loans. Councilmember Will Kennedy dissented, saying that the council
should wait until the lawsuit is over before signing construction contracts.
Update Feb. 11, 2012 - By Jan. 17th, SCPF had gathered enough signatures to qualify
for a vote on the $850 million in loans. On January 24 the city refused to certify the
referendum petitions and authorized the city attorney to sue SCPF to declare the stadium
agreements 'not referendable,' therefore taking away our constitutional right to vote.
SCPF hired an excellent attorney.
On January 30 the city filed its lawsuit. The city's brief expressed concern that the
referendum petitions were creating a cloud of uncertainty for the lenders, and the
city asked the Santa Clara County Superior Court for a quick decision. The court set
a date of mid-June for a judge to make a decision, and required SCPF to respond
by Feb. 29th.
On February 6 the 49ers filed with the court as 'a party of interest' to ask the court to
schedule an earlier date. The attorneys (including SCPFs) met with the judge on
Feb. 7. The court granted the 49ers request, altering the schedule so the SCPF
brief is now due on Feb. 22nd. The hearing date was moved up to March 5th.
The 49ers filing states that they wanted a March 5th court date because the ballot
materials for a June election are due by March 9th. If this was a done deal, they
wouldn't be afraid that the judge will send the stadium contracts to the voters.
Why should we get a vote on the DDA?
(DDA = Disposition and Development Agreement)1) What Santa Clarans voted for in Measure J in June 2010 (pie chart on the left from the 49ers Measure J stadium campaign) does not match what's in the DDA (pie chart on the right with $850 million in loans from our Stadium Authority and Zero dollars in financing directly from the 49ers). This does not include the interest payments on the loans, which will be many tens of millions each year.
2) Many citizens voted 'yes' because they thought the stadium deal would help schools. The school district's budget reports that the schools have already started to receive money from the Revelopment Agency property tax kickback from Measure J. (Measure J did trigger an extension of the Redevelopment Agency in time, which gave the schools property tax dollars.) Unfortunately, the RDA kickback money to the schools is small in comparison with the $17 million school budget shortfall last year, and estimated $12 million school budget shortfall this year. The stadium deal, the DDA, gives nothing more to the schools. Here's the link to the school district's budget (see page 2 for the Measure J RDA property tax money information.)
3) Santa Clarans should get a vote on whether or not the Raiders can come here. Raiders games would double the amount of traffic, parking, noise and other impacts. According to Measure J, only the 49ers get to decide on whether to bring the Raiders here. Most voters were not even aware that Measure J can bring the Raiders too.
4) The DDA doesn't fix any of the parking/traffic/noise problems on the north side. No private parking lot owners have signed up to allow their lots to be used-no one knows where 22,000 cars will park on game days. People on the north side voted 'No' on Measure J.
5) And now the city has admitted that the Youth Soccer Park won't be usable by our kids on NFL game days.
6) Goldman Sachs is managing all the financing aspects. We don't want Goldman Sachs to do for Santa Clara what they did for mortgage-backed securities, the debt crisis, international markets, and Greece. Our members tell us that Goldman Sachs helped hide the debt problems in Greece until the problems became overwhelming. That country now has tremendous financial problems.
Here is the 49ers Measure J ballot. Voters did not authorize our Stadium Authority to take on $850 million, or any other amount in loans.
Here are the major problems with the DDA:
The 49ers' Stadium Disposition and Development Agreement (DDA) 'runs' to 421 pages, but it can't hide:
1. The price tag for the 49ers' Stadium is over $1 billion (DDA page 2) (not $937 million from the Term Sheet) and the increase isn't considered a 'cost overrun' paid for by the 49ers. Santa Clara's Stadium Authority will be paying that increase.
2. Stadium Authority debt will be $850 million (DDA page 2.) See our article on how the 49ers Measure J stadium ballot measure and campaign didn't bother to mention the Stadium Authority debt/loans:
3. The graphic showing the DDA financing does not list any financial contribution from the 49ers. The 49ers are contributing Zero of their own dollars for financing. Recall that the Term Sheet said the 49ers would pay for $493 Million. In the 49ers Measure J campaign citizens were told that the 49ers would pay for > $800 million (and our council members/mayor told us in the media that the 49ers would pay for 92%).
4. The Fixed Ground Rent payable to our city's General Fund is atrocious. In the first year, the 49ers will scoop out a minimum of $130 MILLION - while paying our General Fund $180 THOUSAND (DDA page 3). This is unchanged from the Term Sheet.
5. Our Stadium Authority will lose control of the stadium from August 1 through January 31 (DDA page 86) because it cannot afford to operate it year-round. (DDA pages 6-7).
6. A bled-to-death Redevelopment Agency can no longer issue bonds at 5.75% for the Stadium Subsidy, but it will be taking cash advances of over $30 Million from the 49ers themselves at 8.5% per year (pages 5 and 54). The Supreme Court has just upheld Governor Brown's decision to do away with Redevelopment Agencies. We don't know how Santa Clara is supposed to pay for the $40 Million in Redevelopment dollars promised for stadium construction by Measure J.
7. Stadium Authority debt principal, interest, and operational costs will be far more than $30 million/year. Think about the annual interest that will be due on $850 Million in loans to our Stadium Authority. Then add to that the payments for principal and stadium operating expenses (often at least $20M per year). We're easily talking > $50 million/year to $60 million/year.
8. The DDA contract is with a limited liability company (Stadco) not with the 49ers. All of the risk and liability is on Santa Clara and its agencies.
Visit the blogs, make comments, and email us with questions, too! What we don't know, we'll find out:
What can you do? You can make your voice heard:
- Speak at a Council meeting (plan on 2 minutes to speak). You will be speaking to Santa Clarans who are watching at home via Cable Channel 15 and via the internet.
and tell them that you are opposed to giving our money to the 49ers.
- Phone the Council at 615-2250 and voice your opposition to the DDA and Stadium Authority loans.
- Fax your comments to the Council at 241-6771.
and the Santa Clara Weekly
to express your opposition.
- Spread the word - Forward our newsletters to friends and neighbors.
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