Early Reaction Is Favorable to Downtown Arena

A complex plan that would bring the Lakers and Kings to a new $200-million sports and entertainment complex next to downtown’s Convention Center won positive early reviews from several Los Angeles City Council members Saturday.

Stressing that they were still in the dark on such key issues as the city’s potential financial exposure in the deal, several lawmakers nonetheless praised the project, saying it could boost the city’s struggling core and Los Angeles’ image as a sports, entertainment and convention mecca.

“This is a very powerful scenario, a vision of what Los Angeles can once again become. It means revitalization with a capital R,” said Councilman Mark Ridley-Thomas. He predicted that the new arena would create a “sports corridor” extending from Dodger Stadium north of downtown, south along the Harbor Freeway to the Coliseum in Exposition Park.

Councilman Rudy Svorinich, head of a committee likely to be involved in the review of the project, said, “All the fine details need to be ironed out, but at first glance, I’m excited and encouraged at the proposal now on the table.”

But even as they savored a chance to show Los Angeles as a city bouncing back from disasters, economic doldrums and the loss of its only National Football League team, council members cautioned that the proposal leads into a volatile political arena--use of public incentives to lure private sport franchises.

“I’d love to have them there,” said Councilman Joel Wachs. “But I’m not about to spend L.A. taxpayer money on . . . a profit-making team who’s paying these horrendous salaries. I’d rather give it to teachers.”

As outlined in a proposal sent to city officials Friday by Los Angeles Kings owner Edward Roski, Los Angeles would provide land for the development and acquire additional properties through a $60.5-million bond issue. The bond debt would be repaid by a combination of new revenue from real estate sales, parking fees and hotel taxes generated by the arena. However, the city theoretically would be liable if revenue fell short of the $6 million a year needed to repay the bonds.

A similar funding scheme was used on the recent expansion of the Convention Center. But because of lower-than-expected income from tourism, the city has subsidized the repayment of bonds with $20 million a year in general fund money.

Cognizant of those potential pitfalls, council members said they intend to review closely the revenue projections and the city’s return for the land it would be leasing the Kings for nominal fees.

“It’s a complex financial transaction and it has to be evaluated as such,” said Councilman Marvin Braude.

Still, lawmakers noted that there are powerful reasons to assume some risk and make the deal work.

One is that construction of a major sports and entertainment complex next to the Convention Center could create a “critical mass” of commercial activity and night life that would convince a major hotel chain to invest in the area.

“It certainly offers an opportunity to turn the lights back on at night downtown,” said Councilwoman Rita Walters.

Lack of quality hotel rooms within walking distance of the Convention Center has been a problem in attracting large conventions to the expanded facility. More major trade gatherings could reduce the city subsidy now going to the center.

“My first reaction is that having such an arena and having it . . . be the anchor to bring convention-related hotels is very positive,” said Councilwoman Laura Chick. “I’m very concerned we’re never going to have the type of conventions we need without a [major] hotel.”

Another fear is the ripple effect of fumbling the arena deal. The Kings have the option of building the arena near Hollywood Park in Inglewood.

Council members believe that the chances of attracting an NFL team are linked to how efficiently the city concludes the arena project.

“We’ve had some favorable comment from the NFL” about the city’s dealings so far on the arena project, said council President John Ferraro. “There’s been some rumors that the city can be very difficult to deal with. If we can do this, it would be a very good sign.”

Councilman Nate Holden raised a cautionary note, saying he is concerned that a new sports arena would further harm the aging L.A. Sports Arena next to the Coliseum.

More consideration needs to be given to building on the facilities already in place, he said. “Otherwise we’re going to have a vacant Forum and a vacant Sports Arena. . . . It’s poor planning.”

The next step in the process will be to acknowledge receipt of the Kings’ proposal and order a detailed analysis by city officials.

Ferraro is weighing the best means of moving the project through legislative reviews, including the possibility of forming a council committee.

“It’s a project that really could go,” said Councilwoman Jackie Goldberg. “It’s a good location. You’d have no community opposition.”