NFL owners have coalesced around charging a relocation fee of between $500 million and $600 million for each team that moves to Los Angeles, two key sources said. Three teams are eyeing L.A., with at most two getting the nod to move.
The fee decision is not set in stone and could change, but the sources said owners generally agreed to the range soon after hearing from the league’s outside adviser, PJT Partners, last month.
“It’s a minimum of $500 million and could go higher,” said one of the sources. PJT did not recommend the figure but provided an analysis that gave the owners comfort with the amount.
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The NFL’s timeline for relocation approval could aid David Peacock’s efforts in St. Louis.
Photo by: TIM BOMMEL / MISSOURI HOUSE OF REPRESENTATIVES
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The numbers are generally in the range of where many thought the fees would land.
“The numbers don’t surprise me,” said Amy Trask, the former Oakland Raiders president. “Part of the issue is over what period the money is paid out over — five years, 20 years?”
The figures also suggest the teams looking to relocate are expecting significant returns from a relocation.
Take the Carson, Calif., proposal of the Raiders and San Diego Chargers. That is slated to cost $1.6 billion, and so at least another $1 billion could be added on in cost.
“It comes back to looking at stadium projections,” Trask said. With such fees, she added, “You better take a hard look.”
Rams owner Stan Kroenke is better suited to weather such a fee, she added, because his project includes retail and residential development, while Carson is a football-only project.
Some outside observers expressed surprise that the NFL had not explicitly tied the fee to a percent of increased profit.
“I thought there would be in effect profit participation by claiming the improvement in financial performance,” said Bob Caporale, chairman of sports adviser Game Plan.
However, given the sources said there is a minimum $500 million fee, anything over that amount perhaps could be tied to increased profits.
Owners would not pass the relocation fee until they vote on a proposal. The three teams can apply for relocation between Jan. 1 and Feb. 15.
The owners are expected to take up the issue in that time frame, though it could stretch into March and perhaps as late as April. While that late a time frame would give the teams little space to introduce themselves to Los Angeles, it would give the current host cities more time to develop stadium proposals that could keep their teams.
The St. Louis stadium task force, for example, has been trying to persuade the city’s board of aldermen to pass funding legislation. Task force co-chairman David Peacock said that might not happen until mid-December, while others have suggested even longer. If owners don’t vote until the late-winter/early-spring time frame, that could give St. Louis, for example, more time to develop its plan.
The next full owners meeting is scheduled for Dec. 2 in Dallas. There the league will brief owners on the latest on L.A. and the three host cities, though no votes are expected.
