Former Mayor Darrell Steinberg gave the city a sporting gift on his way out the door. The city needs to decide whether to accept Steinberg’s present or return it.
The gift is a term sheet for a minor-league soccer stadium in the Downtown railyards.
In theory, the proposal paves the path for a public-private partnership between Republic FC and the city to build a 12,000-seat soccer grounds in a former toxic waste dump.
Months of negotiation await. Nothing may happen. But the deal is tempting.
The yards’ forlorn eastern corner holds no promise for commerce or homesteads. The land sits abandoned almost three decades since Southern Pacific ceased operations and sold to Union Pacific, which hammered the final rusted spike into the city’s railroading history in 1999.
Now the soccer team and its new majority owner, Wilton Rancheria, dream of a $227 million stadium where leaky, belching locomotives once roamed.
Wilton Rancheria is a tribe that owns a casino in Elk Grove. Those 2,100 slot machines mean the soccer team can cover debt service on stadium bonds.
But sports investors always try to minimize financial exposure. Here’s where the city comes in—a partner in risk erasure and cost reduction.
Under Steinberg’s plan, the city will reimburse Republic FC for at least $42 million in infrastructure costs.
The former mayor boasts the city won’t write a check for $42 million. Technically, he’s not lying. But over time the city will give Republic FC $42 million and more.
Instead of writing a check, the city will funnel money to the team through a gimmick called an Enhanced Infrastructure Financing District—a governmental smokescreen that distributes property taxes from a specific site.
This infrastructure financing district is 220 acres of old railyards, with potential to generate $518 million in property taxes over 45 years. Republic FC grabs the first $42 million.
That’s not all the soccer team gets. The city throws in $3 million for police and emergency services over 10 years. And the city lets Republic FC build seven digital signs without rent or fees. Also, City Hall helps the team win construction grants.
The signs and grants pencil to an extra $9.7 million for Republic FC.
Why would the city bother with a minor league soccer team and has-been mayor?
Soccer and Republic FC are bizarre obsessions with Steinberg. He tried to negotiate the team’s elevation to Major League Soccer, but failed when he couldn’t conjure hundreds of millions of dollars needed for expansion fees and a big-time stadium.
With hours ticking down on his second term, Steinberg faced the humiliation of leaving City Hall with no legacy project and zero policy accomplishments beyond a couple of sales tax hikes, which he and his City Council partners squandered.
Steinberg was never a big soccer fan. Our kids played on the same team as teenagers. Darrell was tranquil on the sideline, often on his phone, quiet and supportive—never an obnoxious youth sports parent.
My guess is Steinberg and the City Council are haunted by Mayor Kevin Johnson’s ability to build Golden 1 Center and stop the Kings from moving to Anaheim or Seattle.
Steinberg was in the state Senate when the NBA drama played out. He was tranquil on the sideline, often on his phone.
Republic FC is a minnow compared to the whale at Golden 1 Center. The city’s two public-private sports partnerships, Republic FC and Kings, have nothing in common.
The city owns Golden 1 Center and contributed $223 million in construction bonds. Private developers own the railyards. The soccer team will buy the land and build the stadium.
It’s nice having Republic FC around. But a minor league soccer team isn’t critical to the city’s pride and identity.
Still, here’s why I like the stadium proposal:
I’m tired of seeing an empty toxic wasteland along North B Street. A tidy little soccer pitch is better than nothing.
R.E. Graswich can be reached at regraswich@icloud.com. Follow us on Facebook and Instagram: @insidesacramento.
