Advertisement
YOU ARE HERE: LAT HomeCollectionsAeg

Cost of L.A. Convention Center wing jumps $40 million

Costlier design features raise the price tag, L.A. officials say. The West Hall is being razed and relocated to make room for a football stadium.

September 12, 2012|By David Zahniser, Los Angeles Times

The price tag for rebuilding a wing of the Los Angeles Convention Center, part of a plan to construct a downtown NFL stadium, has jumped nearly $40 million due in part to more expensive design features, two high-level city budget officials said Tuesday.

The cost of razing and relocating a section of the center increased from $275 million to nearly $315 million after city officials added an acre-sized ballroom, a new security system and improvements linking the building with a nearby outdoor plaza, said City Administrative Officer Miguel Santana.

The convention center's West Hall must be demolished to make way for the $1.2-billion stadium. City leaders want the Convention Center to attract more highly lucrative national conventions, so the addition of a 45,000-square-foot ballroom "makes sense and is worth doing," Santana said.

The cost estimates — and various financial documents for the two projects — will be reviewed Thursday by a council committee examining the stadium project. Yet two days before that meeting, Santana was still revising and correcting figures in a report distributed this week on the convention center's cost and financing plan.

As Santana produced new numbers, the City Council voted to shorten the public notification period for a Sept. 28 vote on a 35-year development agreement between the city and stadium developer Anschutz Entertainment Group. At that session, lawmakers could cast a series of other votes sought by AEG, which already operates the adjacent Staples Center and L.A. Live entertainment complex.

The notification period will be cut to 17 days from the 24 normally provided for major projects, said Chief Legislative Analyst Gerry Miller.

At the Sept. 28 meeting, the council also is expected to approve the stadium's 10,000-page environmental impact report. Such an action would start the clock ticking on any legal challenge. Under a special state law enacted for AEG's stadium, any environmental lawsuits against the project must be resolved by state appellate courts within 175 days.

That period would end in March, around the time that NFL team owners are scheduled to meet, AEG spokesman Michael Roth said. "We have been clear that we needed to conclude this stage of this very public and thorough process by the end of September and satisfy any potential challenges prior to the NFL's likely consideration in March of a team's relocation to Los Angeles," he said in a statement.

City officials said final agreements with AEG would not be executed until the company has a deal to bring a team to Los Angeles. Under the plan, the city would issue up to $391 million in bonds to pay for the new convention center, with proceeds going to cover the construction costs and interest on the debt.

Of that total, up to $268 million in debt would be the responsibility of the city's general fund, which pays for basic services such as those provided by the Police and Fire departments.

The city would rely on taxes and lease revenue generated by the stadium to cover debt payments, which would continue until 2047, according to the proposal. If revenues generated by the completed project are not enough to cover the payments, AEG will make up the difference, said Natalie Brill, the city's chief of debt management.

A second set of bonds worth up to $123 million would be the sole responsibility of AEG. Those payments would be covered by taxes produced by the stadium site and L.A. Live.

david.zahniser@latimes.com

Advertisement
Los Angeles Times Articles
|
|
|