The National Football League's demand that Los Angeles put up more public money to bring a pro football team to the Coliseum is outrageous and should be rejected out of hand.
As it will be. There is zero chance that more public money will be put up by any city, county or state agency, beyond the promise of $150 million in state revenue bonds to build parking structures near the Coliseum.
But the real question is: What is the league's problem? If the NFL wants to have a team in Los Angeles, to gain the advantage of Southern California's large television audience and fan base, it should award a franchise to businesspeople willing to put up the investment and get on with it.
The league is already assured of a welcome by political and business forces in Los Angeles, who joined with Gov. Gray Davis in presenting a plan for parking and other amenities to the NFL in meetings in Chicago on Wednesday.
Los Angeles businessman Eli Broad, a billionaire several times over, has agreed to lead an ownership group for a new team.
Yet league Commissioner Paul Tagliabue, a lawyer by profession, voiced objections. Without more public money, a new Los Angeles team could not be "competitive," he said, under conditions that foresaw profit of $25 million to $28 million a year.
Prospective owner Broad also said the projected profit was skimpier than would be acceptable in any normal business deal. Broad has urged public support "at no net cost to the taxpayer" to bring a new team. Such public support, which could take the form of public loans to defray the cost of stadium construction, would lighten the investment burden on Broad or other potential owners.
But the profit issue is somewhat of a phony. NFL franchises, and all sports teams, are not purchased for the promise of annual profit but for their rapid and considerable appreciation in value.
In just the last few years, prices for NFL franchises have gone up dramatically: The Washington Redskins changed hands this year for $800 million, a new Cleveland Browns franchise went for $530 million last year. As recently as 1995, the Tampa Bay Buccaneers set a record price for any sports franchise with a price of $192 million.
The proposed Los Angeles team is to be valued at $900 million--more than four times the Tampa Bay franchise price. Such enormous price appreciation occurs only with works of art--a phenomenon that renowned collector Broad would be familiar with.
