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Irwindale OKs Bond Sale to Build Raiders Stadium

September 10, 1987|MARK ARAX | Times Staff Writer

Ignoring legal and legislative challenges, the Irwindale City Council voted Wednesday to approve the sale of $90 million in bonds to build a stadium for the Los Angeles Raiders.

In a 3-0 vote, the council authorized the sale of industrial development revenue bonds, despite an emotional appeal from Murray O. Kane, a Los Angeles attorney who has filed a taxpayer's suit to halt the bond sale.

Kane, representing Los Angeles City Councilman Ernani Bernardi as the taxpayer, charged that a "band of consultants" hired by the city to put the Raiders deal together had ignored state law, because they stood to make a great deal of money from the bond sale.

Specifically, he charged that the city was attempting to sell the bonds without first obtaining an environmental impact report on the stadium--a violation of the state Environmental Quality Act.

Kane argued that a $10-million cash advance handed by the city to Raiders' owner Al Davis as part of a $115-million stadium loan was an illegal use of redevelopment money.

In asking that the council delay approval until his lawsuit could be heard, Kane said the city had also violated a state law requiring 30 days notice of intent to close a bond deal. The soonest the bonds could be sold legally is Sept. 16, Kane said.

Will Seek Order

Kane said he will attempt to halt the bond sale by seeking a restraining order today in Los Angeles Superior Court.

Miller & Schroeder, a bond underwriting firm hired by the city, said it will try to sell the $90 million in bonds today before any such court order can be obtained.

"This city, like any other city, must follow the law," Kane told the council. "They (city consultants) want to ram (this deal) down your throat."

But the council was persuaded by assurances from bond attorney Tim Sabo that no laws had been broken and that Kane's suit and a legislative challenge to the bond sale by Assemblyman Mike Roos (D-Los Angeles) would not frighten off prospective bond investors.

Sabo acknowledged in an interview after the meeting that Irwindale had technically violated the 30-day notice, but he said it will not affect the bond sale. And he said completion of an environmental impact report after the bonds had been issued could present problems if the report recommended against the stadium. But he did not anticipate that happening.

City officials have contended that there is no better use of redevelopment money than carving a 65,000-seat stadium out of an abandoned rock and gravel quarry near the Foothill Freeway.

Jim Iverson, a representative of Miller & Schroeder, said Travelers Insurance and other investors have shown great interest in purchasing the bonds.

He said, "I've seen this type of lawsuit on numerous occasions and they almost always fail."

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