A HUGE part of the 49er stadium campaign was based upon how great the stadium would be for the SCUSD. A lie, but it was certainly effective. Now the 49ers have a opportunity to be gracious and accept their small defeat, they reveal their parasitical and litigious nature once more.

Yes, the Measure J stadium campaign touted 'money for the schools' because the RDA would legally be required to give a kickback to the schools.

Neil - you missed the real issue here that can be seen by reading all of the documents. The loans were supposed to fund two months ago. They haven't funded yet. Why? Well, besides the poor sales of psls and no sale of naming rights yet, and the downgraded credit rating of the banks loaning the money for the project, both the private lenders and the NFL require a gift of public funds to secure the loans. (Why $30 million matters so much to hundreds of millions in loans is not clear.)

They're stuck right now, not getting the $30 million is apparently holding up getting the $950 million and the $200 million. IF you read the 49ers attorney's letter on the city's website (attached to last Friday's oversight board agenda) you'll see that they're having a conniption fit over not getting public funds. Despite what they're saying to the press about full steam ahead, the lack of RDA dollars really does seem to have put a monkey wrench in the works.

And this lawsuit just shows that our schools were used by the 49ers to win their campaign. They really don't care at all about our schools.

It also shows that any community that hosts a NFL team opens itself up for lawsuits anytime the team doesn't get its way.

Banks can be extremely picky about the overall LTV and how any funding "gap" (which is typically like half the project in something like this) is filled. You pull out some of that gap funding and the whole deal unravels because it isn't actually profitable other than the public largess.

A bank isn't going to loan you $950 million on a project you are going to lose $100 million on because you won't be able to pay it back...unless you get a $200 million handout to offset your losses.

Neil - There may be a reason the banks have not funded the loans. Banks may see legal problems collecting the debt. Read on.


The Stadium Authority (SA), a Joint Development Authority authorized by State law and Measure J, was created between the City and the Redevelopment Agency. Since February 2012, the Redevelopment Agency no longer exists.


Anticipating this, on June 28, 2011 City Council amended Measure J by adding a new member to Stadium Authority and adding Claus 17.25 to City Code (the words of the city attorney were "The Bayshore North Project Enhancement Authority would now like to amend the Joint Exercise of Powers Agreement to be added as a party to the agreement and as a member of the Stadium Authority.").


The City lawyer noted at the time: "Chapter 17.20 SCCC does not prohibit the addition of a new member to the Stadium Authority." Neither Measure J nor State law mentions successor, surrogate, or additional members.


By law, any change to Measure J needs approval of a vote of the people of Santa Clara. That has not happened. Therefore, since February 1, 2012, all contracts with the Stadium Authority are null and void because the Stadium Authority is no longer a legal entity. As such, the Stadium Authority may be committing fraud by continuing to enter into potentially illegal contracts.

There was NEVER a commitment of $40 million to the 49ers! Measure J (which the 49ers WROTE!) specifically stated that "The Agency investment will not exceed a total of $40M" [the "Agency" refers to the City of Santa Clara's Redevelopment Agency. That Agency was already GONE when the 49ers 'advanced' the funds to the Stadium Authority (again, NOT the City, nor County of Santa Clara). The 49ers KNEW the RDA money was 1) based on possible FUTURE incremental tax money (NO ONE has the money available today); 2) and that is was GONE because ALL RDA agencies were dissolved! The 49ers' loan documents are not worth the paper they are written on! And, were declared unenforceable by the Oversight Board. They are tasked to identify and insure that PUBLIC money is used for the PUBLIC good and that the possible receiving agencies are NOT HARMED. $30m TO THE 49ERS takes away millions from deserving State/County agencies. The 49ers tried an end run to lay claim on something that they KNEW was gone already.

* They do not have a valid claim against the CITY of Santa Clara. [Stadium Authority is NOT the City of Santa Clara - it is a separate agency with NO ASSETS at all]
* They do not have a valid claim against the COUNTY of Santa Clara. [Not a party to anything relating to the Stadium]
* They do have a valid claim against the STATE of California either ... the State Supreme Court has already upheld that RDAs can be dissolved just as they were created. No leg to stand on there either for the 49ers.

If this is an example of the 'good corporate partners' the 49ers are ... GO AWAY and stay in San Francisco. Get over it -- you KNOW you do not have a leg to stand on. Kiss the money goodbye - your HAIL MARY failed.

The banks must know something we don't about how the fundraising is going. The loans haven't yet funded and the 49ers made a big deal about needing the court case to be over with by the start of March so that the loans could fund in April.

Santa Clarans aren't privy to what the numbers really are for personal seat licenses sales, but they seem to not be going well based on season ticket holder statements in the news and on blogs and fans who are complaining that they are repeatedly being hit up by the 49ers sales team. Fans have also said that psl prices have dropped (for the same seats) which makes it sound like the 49ers are having trouble selling them.

There's been no news about selling naming rights.

The whole idea of using the stadium as collateral for the loans (which is what Santa Clarans have been told) has been ridiculous - a building is only worth as much as someone is willing to pay for it; it isn't worth what the construction cost is. No one would be willing to buy Santa Clara's stadium when the only money making venture will be a football team that will get 100% of all NFL revenues plus 50% of all non-NFL revenues.

This is the first 100% debt financed stadium. That model has never been used anywhere else.
I guess now we know why. It's a house of cards, and it's falling down around them.

Hopefully this forces a renegotiation that pushes the 49ers into a shared stadium with the Raiders.

Uff. No, slinger61! Bad, bad, BAD, slinger61!

What really needs to happen here is for an elected body to follow the will of the voters, not to twist a vote into something it wasn't.

This funding scheme is radically different from what the voters approved, and sorry about the whole RDA-thing, but the rules changed. The real story is that this needs to be voted on again, and that the thing the government implements resembles the thing the voters approve.

If that means Raiders -- fine. But them coming along tomorrow or in 20 seconds from now does not rescue this deal.

End-rant.

Either way at the end of the day, the 49ers will probably still have a new stadium in Santa Clara with the team making up the $30 million if those funds are not restored. Plus, attorney fees if any litigation is required.

The 49ers are arguing that the will of the voters was to give $40 million in RDA funds for the stadium project.

The actual language of the ballot measure was that the amount of RDA funds was 'not to exceed $40 million'. Any amount of RDA funds, from zero to $40 million, meets that criterion.

And Governor Brown, in a speech in which he addressed his goal to do away with RDAs, used the Santa Clara Stadium project as a textbook example of the abuse of redevelopment funds and why RDAs should be done away with. The Supreme Court in CA already upheld the law doing away with RDAs. That law includes the provisions cited by the oversight board when it severed the contract between the RDA and the Stadium Authority, cutting off the flow of public funds from the RDA to the stadium.

I'd expect in the court hearing for the County Counsel to bring up the issue she discussed in front of the oversight board - that the Stadium Authority was set up to 'wash' funds between the RDA and the 49ers, in effect to circumvent redevelopment law. 'Wash' sounds a lot like 'money laundering' to people here in Santa Clara.

It's good to know that in any future court hearing, the city of santa clara attorney, Ren Nosky, wants to make sure the stadium mob is in attendance, because it, ahem, adds so much to the democratic process.

What I don't get Matt is why the 49ers are making such a stink about this. The Yorks certainly must have a lot more in $30 mil in an account that cover for this. They will still make hundreds of millions from the a new stadium.

"...why the 49ers are making such a stink about this. The Yorks certainly must have a lot more in $30 mil in an account that cover for this..."

They want "other people's $$$'s" for a risky scheme, not their own - that's how big league sports works these days.
Just wait until the cost overruns start piling up, they'll try to stick taxpayers with that no matter what they say.

Mike, we all know this will not be voted on again. That's a given, the 49ers got most of what they want and will now try to litigate the rest.

Santa Clara is screwed, regardless of the $30 million. At this point it's only about minimizing the damage.

$200 million in additional G-4 funds from the Raiders would be very helpful. Another $100 m to $200m in psl money would be nice too.

If our elected officials would do Their Jobs, they would look at this crooked Scheme of a Stadium Project, & put a HALT to it! The Governor, and AG of California should be ALL over this crooked deal, & the York Family.

It "Ironic" that the 49ers are arguing that the voters voted for the 40 Million dollars to be given to the City of Santa Clara, and should be listened to. But when the voters of Santa Clara said, "THIS IS NOT THE DEAL WE VOTED ON IN JUNE OF 2010"....THE YORKS & THE ELECTED OFFICIALS REFUSED TO LISTEN TO THE VOTERS!

The 49ers should just turn around and let themselves get screwed over by an illegal seizure of designated funds? Ridiculous.

For the record, if it was the other way around I would feel the same way. If it was money that had been promised to school funding and the board suddenly decided to loan it to a private company it would be just as ethically incorrect.

The County has an obligation to follow the law. Period. Otherwise we might as well hand over our voting privileges, carry residency papers, and stand in bread lines.

“[The 49ers] should have seen this coming and prepared for it.” This is moronic and the equivalent of saying that one should expect government to back out of deals illegally and blindside people they’ve worked with in good faith. So, basically, when government screws you over, it’s the fault of the person/entity being screwed for believing they wouldn’t be. This is so backwards as to defy basic tenets of moral action. “Hey man, you shoulda known I was about to punch you in the face. The fact that I’m a known face-puncher is enough for the blame to be transferred from me to you.”

So, it’s bad to sue your hosts, but your hosts can spit in your face all they like as long as they have power trips? What kind of terrible reasoning is this, Lowell?

All I read in your article is that the 49ers and Joe Public should be “good citizens” by allowing their government to walk over them. What about criticizing the County for blindsiding the 49ers and doing this without any warning? What about them blatantly disregarding the will of the voters? What about the continued theft of the American public by the politicians who are supposed to adhere to the will of the people they represent but then back-out of that commitment and then get praised for it because they cushion the blow with promises of “thinking of the children!”?

I’m sorry, but this is simply a high profile example of the continued political corruption and backhanded tricks that this country is drowning in. I hope the 49ers sue the hell out of the County, win + with damages, and the County residents decline to re-elect these representatives that refuse to follow the will of the people for their own whims of do-goodery that are almost always public showboating.

And by the way, I agree that the redevelopment programs that were for blight had run their course and should have been discontinued, but that doesn’t mean you back out of commitments already agreed to. At the absolutely very least the County needed to approach the 49ers about working out a more amiable resolution if they were that desperate for the money, but they didn’t, instead just kicking their “good citizens” in the shin without warning after they already moved into the neighborhood.

I feel like the 49ers have walked over the city for the past five years. It's a novel experience to see them feel a little bit of pain for once. Actually in my view, I've lived through a lot of political corruption (such as a bought election, outright lies in debates, etc.) in this small city for far too long. (BTW Unlike the real "Jed" I'm not fortunate to be able to live in Los Altos--so this really matters to me).

It seems to me that the 49ers are the ones "desperate" for this dough, This gives me a sense that a few years down the road they are going to be very tough to deal with when disputes about stadium maintenance (or other matters) come up. Of course the question is whether anyone on the council/SA will ever "push back" on future 49ers demands--I'm very doubtful.

My understanding is that the county counsel believes they are on solid legal ground taking their action. They are following the current law. The county aren't the 49ers "hosts", so they aren't being "rude". They are doing what they think is best for their constituents as a whole. Anyone who has a beef about this should take it up with Governor Brown as he's the one who changed the law.

The reason so much has been made of this issue is because its affecting the 49ers stadium. However, the stadium isn't the only project affected by our state government changing the redevelopment law(s). How many other affected projects are receiving so much notoriety? I guess if you're a billion dollar organization, and you're receiving taxpayer subsidies, you can garner sacred cows in government. I'd be pleased if the stadium project unravels so that my city doesn not end up like Stockton.

Where's "Jed"? I was sort of looking forward to his return and this time telling us what he really thinks...

The Residents of Santa Clara, should DEMAND to see the signed Bank Loans for the Santa Clara Stadium...As of this date this stadium has yet to be funded, what is the hold up???

With your "brown nose" Mayor & City Council Members, who do not look out for the residents, but for the 49ers...Be Warned, and Demand to see the Secured, Signed Bank Loans!

And btw, if you read the SJ Mercury News Spin, it appears that the Judge upheld the restraining order for the RDA, and will rule with the 49ers...I just hope that the residents of Santa Clara will be on the horn to Lizanne Reynolds Counsel for the County of SC, telling her to take it all the way to the Supreme Court of California! That money belong to the County of SC, not the 49ers.

What bothers me is that the county apparently didn't even send representation to yesterday's hearing. If they aren't going to put up a fight, that $30 million will be going to the 49ers.