Los Angeles officials endorse framework deal for an NFL venue
LOS ANGELES // A Los Angeles council committee voted last night to endorse a tentative framework agreement with a private developer that wants to build a 72,000 capacity NFL stadium on the city's convention centre campus.
The 4-0 vote by members of the council's special temporary committee on stadium-related issues sends the non-binding memorandum of understanding with Anschutz Entertainment Group to the full council for a final vote next week.
Councilman Bill Rosendahl said before the vote was taken that the agreement was the result of tough negotiations with AEG, which had originally proposed a plan that would have required the city to take on more risk.
"The partnership is moving in the right direction," said Rosendahl, who co-chairs the committee.
The agreement calls for the issuance of US$275 million (Dh1.01 billion) in tax-exempt bonds for the relocation of a convention centre hall to accommodate the proposed $1.2bn American football venue.
AEG agreed in the proposed framework to break $80 million of the $275 million in debt into a special type of bond that is financed with a tax on its nearby properties such as Staples Center and the LA Live entertainment complex and puts the facilities on the line if the company does not pay.
The agreement also requires AEG to extend a series of financial guarantees over the course of the project as a safeguard against shortfalls and other risks.
If the full council approves the framework deal, members will vote later on separate definitive stadium-related agreements, such as its development and financing deals and its clearance under California state environmental regulations.
Most council members have voiced guarded support for the stadium proposal in previous hearings.
AEG spokesman Michael Roth had no immediate comment after the vote.
AEG's stadium plan is one of two competing proposals to bring the NFL back to Los Angeles some 16 years after the Rams and Raiders left the United State's second-largest market.
Warehouse magnate Ed Roski's Majestic Realty Co has permits in place to build a separate 75,000-seater stadium about 15 miles east of Los Angeles, in the city of Industry.
Neither proposed site has secured a team.
Published: August 4, 2011 04:00 AM