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Federal Financing for Los Angeles Sports Park

Friday August 12th, 2016   •   Posted by Craig Eyermann at 6:24am PDT   •  

Coliseum-Front-Edited-1-of-1-1500x991 Last May, the City of Los Angeles decommissioned its Memorial Sports Arena, lowering three flags that had flown over the facility — those of the United States, California, and Los Angeles County and City — for the last time before making way for a new $250 million sports development in Exposition Park.

But there’s a problem. Neither Los Angeles City, County, or the State of California have enough money to realize the dreams of the project’s planners. So they’re turning to the federal government to finance the remaining $22.5 million that they haven’t been able to come up with between themselves. The Los Angeles Daily News reports:

The Los Angeles City Council agreed Friday to apply for a $22.5 million federal loan to help fund a sports museum, conference rooms and other facilities next to the Los Angeles Football Club’s 22,000-seat soccer stadium in Exposition Park.

City officials say these facilities, which are part of the plans for the $250 million stadium project, face a funding gap that can be bridged with a loan from the U.S. Department of Housing and Urban Development.

With the council’s unanimous vote Friday, the Economic and Workforce Development Department will be able to move forward on seeking a loan under HUD’s Section 108 program.

According to Los Angeles Councilman Curren Price, here is what is being asked of HUD, the U.S. Department of Housing and Urban Development:

The $22.5 million HUD loan would only go to the facilities being built next to the stadium, which include a sports museum, meeting and conference areas, retail and dining space, and a culinary academy, Price said.

The HUD Section 108 program is typically aimed at supporting projects that will either alleviate poverty or build affordable housing.

In this case, since the larger $250 million project is fully contained within the existing boundaries of Exposition Park, which has no residents and where no affordable housing will be built, it’s really tough to see why HUD’s Section 108 program should be the go-to lender for bankrolling the remainder of the project.

This case shows some evidence of the problem of mission creep in the federal government’s spending programs, which are stretched beyond their original missions, to provide things that are increasingly unrelated to their original purpose. That stretching is done because it’s easy, not because it’s right.

In a saner world, if the Los Angeles City Council really needed to locate a culinary academy at its new sports complex and the city itself didn’t have the money to build and operate it, wouldn’t it make more sense to get funds from the state’s Department of Education? Or perhaps from its Employment Development Division? Or if you really had to involve the federal government, from the Departments of Education or Labor? Why not let HUD focus on succeeding at its core mission without diverting its resources?

It’s not like we don’t have legislators to write laws to set up dedicated programs that are limited to specifically fulfill this kind of need if it is something that the public believes is really needed. That’s something that is essential to keeping control of spending.

If the City Council is successful in its application, it means that $22.5 million will not be available to go to projects where the affordable housing that HUD is supposed to promote might otherwise be built. Los Angeles, it’s worth noting, has a fairly serious affordable housing crisis.

It’s the Council’s call to decide whether it is more worthwhile to borrow from the federal government to fund a sports museum, retail and dining space, meeting and conference areas and a culinary academy, than to support affordable housing. It is the call of the people of Los Angeles to hold them accountable if they are wrong.

Featured Image:
Los Angeles County Supervisor Mark Ridley-Thomas

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August 2016