The Santa Clara City Council on Tuesday approved a plan to build a $937 million stadium for the San Francisco 49ers on public land. The deal includes up to $114 million of public subsidies and must be approved by local voters next year.
Under the deal, the Silicon Valley city would build a 68,500-seat stadium to open in 2014. The 49ers would get to move to the heart of one of the richest and most economically dynamic regions in the country and would commit to stay for 40 years.
Santa Clara is a city of 109,400. It borders San Jose, and it is home to corporate headquarters for technology companies such as Agilent Technologies, Applied Materials, Intel, and National Semiconductor.
The deal is a blow to San Francisco, which had hoped to keep the team by building a new stadium at the Hunter’s Point Naval Shipyard. It may also be a blow to Oakland because Santa Clara and the 49ers have agreed to try to lure the Oakland Raiders to the new stadium to lower their costs and increase revenues.
The tentative financing plan calls for the 49ers and the NFL to provide $493 million of financing. A city-owned stadium authority would raise another $330 million through the sale of stadium-naming rights, concession contracts, corporate sponsorships and ticket surcharges. The plan approved by the City Council this week didn’t include the details of the financing the authority would use to make those revenues available for construction.
The $114 million public subsidy would come in three parts:
• The Santa Clara Redevelopment Agency would provide $42 million, in part through tax-increment financing.
• The city would form a Mello-Roos community facilities district that would include eight large hotels near the stadium site and use a new 2% transient occupancy tax to finance $35 million of the stadium costs. The Mello-Roos district would finance about $15 million of its share of the costs with bonds.
• The city would also contribute $37 million to the project by building a parking lot and by having its municipal utility relocate an electrical substation near the proposed stadium site.
Santa Clara expects to complete an environmental impact review by the end of this year and to submit the measure to voters sometime in the first quarter of 2010.