The opinion editorial provided in this morning's Union-Tribune concerning the Chargers deserves a response. All opinions on this matter are important, even ones that are incorrect. That's just part of the democratic process.

The two lawyers who wrote this presumably understand the controlling document concept, that being, when you enter into a contract, and later have different memories of that agreement, you go to the contract (or controlling document) and go from there. So much of what is stated is more "he said, she said", or, "they said they would stay until 2020", etc., that you have to wonder if anyone is reading the contract. "They signed a contract through 2020", true, "with several renegotiation opportunities", which is rarely mentioned. This has become a public relations fight from the perspective of the city, to the Chargers it is simply a contract dispute.

Let's look at some of the claims...

1. Claim: According to the op-ed, the Chargers have prematurely and unnecessarily triggered provisions in their lease granting them the right to negotiate with other cities for a possible move.

   The trigger was predetermined by the contract and known for years to be available as of December 1st, 2002. After almost a year of discussion and no results, the trigger was pulled in March of 2003. We need a new definition of premature.

2. Claim: "Granting them the right to negotiate with other cities".

   Is there something new here? This was in the contract signed long ago, in the mid-1990's, that included the trigger language. Is someone surprised by this? Is the sin that the Chargers are following the path as laid out in the contract, given certain conditions, or, is the sin that the stewards of our city want to claim that they were "blind sided" and just didn't know what was in the contract?

3. Claim: According to the op-ed, the Chargers offered to eliminate the onerous ticket guarantee, but only if they are allowed to leave San Diego more easily.

   The Chargers offered to eliminate the ticket guarantee for two years in response to an offer made by a coalition of business, labor and community leaders in return only for arbitration of the trigger issue. There were no other conditions attached to the offer. If you are going to provide opinion in a public forum, you should get the facts right. The "leave San Diego more easily" part has to do with a rejection of a new stadium by the voters, which would allow an exit where the Chargers would pay as much as $40 million dollars to cover the bulk of the Bond debt. (Under the current contract they believe they can leave after this past season with a nominal payment - the offer of $40 million dollars was a good faith measure to demonstrate how serious they are about making this work).

4. Claim: The Chargers requested that the city "give" them 60 acres of valuable Mission Valley property and accompanying high-density development rights.

   WOW! The authors forgot to mention that the Chargers have offered $400 million dollars in this exchange to avoid using General Fund money (the authors just forgot that part).

5. Claim: The Chargers sued the city in Los Angeles to force action upon their requests.

   The Chargers filed a Declaratory Relief Action that provides for no monetary penalty to anyone. After 34 meetings that went nowhere, after the Mayor and City Attorney repeatedly telling the public that "we don't believe they can trigger" (implementing an ill advised strategy where you don't study the documents provided to you, thereby, always being able to "claim" that you don't believe it), and, after for 18 months of discussions and negotiations, they simply did what they said they were going to do, they filed a lawsuit and asked a judge to rule. Filed in L.A.? Yes, the contract allowed for any venue in California, but, like many city contracts, the city puts language in the contract that they later don't feel they need to abide by (Rocque de la Fuente). The Chargers did not contest bringing it back to San Diego as that would just delay getting the answer.

6. Claim: The majority of the task force believed the parties could negotiate without the Chargers forcing the issue by triggering the renegotiation provisions. However, the Chargers triggered - even before the task force report was issued. This appeared suspect because nowhere in the contract is triggering a precondition to negotiation.

   THAT'S RIGHT! A splendid bit of law work, however, after months of private discussions that went nowhere, and, no hope in sight, they triggered to start the clock that demonstrated to city hall that continued delays were no longer acceptable, a right within the contract.

7. Claim: The Chargers also have an economic incentive to end the current lease. The ticket guarantee continues only through the first two exhibition games of the 2007 season. However, the stadium rent agreed to by the Chargers continues through 2020, and could total as much as $144 million.

   Make no mistake, the city also has an economic incentive to end the current lease. With regard to the claim of the amount, it could be that much, IF the Chargers go to the playoffs in multiple years and win a Super Bowl or two, however, past history suggests it will not work that way. This is the same fallacious argument that brought us the ticket guarantee in the first place, "the Chargers will not have bad years, therefore the ticket guarantee will not matter" (famous last words).

   The flip side of the argument is that the City could also take in $30 million dollars in that same period, that is applying their past 7 year history and the $50 million dollars in deferred maintenance pointed out by the task force that the city is contractually obligated to pay. (Not counting future yearly maintenance). It also does not include the ticket guaranty that still exists and can cost the city as much as $75 million dollars over and above the cost of litigation.

So let's review;

To pursue the route of litigation we have;

1. The ticket guarantee in place which can still cost the city $75 million dollars or more
2. $5M to $10M in litigation expense?
3. The likelihood is that we lose the Chargers anyway, no $400 million dollars, no $40 million dollar exit fee.
4. All within a few years.
5. If the city happened to win, the Chargers pull the trigger next year; four more times in this contract, forcing litigation each time.
6. If the City happened to win they might pick up $144M over 13 years, or maybe $30M (depending on whose math you trust), against "today dollars" of $75 million to $100 million in potential cost to the city - either way, given the time value of money, it is a lose/lose for the city. The problem is, we don't have financially astute people running the city.
7. If the city loses, the costs will be borne by the taxpayers and all our astute politicians will be doing something different by then.

To pursue a negotiation where both sides participate under a new contract we could have;

1. $400 million dollars from the Chargers toward building a new stadium (no other city in the country has been offered this much).
2. No ticket guarantee
3. No escape clauses.
4. No triggers.
5. We take a $10 million dollar a year loser for the city (Qualcomm Stadium) to a positive revenue producer (with the right plan).
6. If the Chargers lose a public vote, they pay as much as $40 million dollars upon exit to cover the bulk of the bonds. It is hard to figure why someone would argue that the city should litigate this one. As Ron Roberts has said many times, "the scary thing isn't losing the Chargers, the scary thing is keeping them under the current lease".

Whether you agree or disagree, whether you recently sent City Hall your opinion or not, they need to hear from you. Click here to send an email to the mayor or council members. Or write the Union-Tribune editors.

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