What it does
This ordinance would preclude the City from selling naming rights to Candlestick Park . The wording of this ordinance suggests it is intended to apply only to the current stadium and exempt future stadiums built on the site, however, it appears that the actual effect of the legislation could be to prevent the sale of naming rights to any stadium in that location, current or future.
Why it is on the ballot
Absent an ordinance of the Board of Supervisors, decisions regarding naming of park and recreation facilities are made by the Recreation and Park Commission. In 1996 the City entered into a multi-year contract with the 49ers to allow for the marketing of the Candlestick Park stadium name, which resulted in a five-year deal to name the park "3Com Park." The "3Com" naming right expired in 2001 and the Board of Supervisors rejected a subsequent Recreation and Park Commission contract proposal.
As part of this year's budget negotiations the Board of Supervisors approved a proposed contract with the 49ers to again market the stadium's name. An upfront payment of $3 million from stadium naming was included in the Recreation and Park Department's budget for the current year. The contract included a list of pre-approved names for the facility, such as Wells Fargo, Virgin, Macromedia, and others. Naming rights would last for the remaining four seasons on the lease or any extensions. However, a contract for naming rights has not been finalized. This measure was placed on the ballot by four supervisors shortly before the filing deadline, without public hearings or comment.
Those who support Proposition H state:
- Publicly owned facilities should not be tagged with corporate names. The outcry over the 3Com naming contract and prior Board of Supervisors opposition to a naming rights contract should have sent a message that, budget crisis or not, corporate naming is unacceptable. Only if a privately owned stadium built without public expense were built would naming be acceptable.
- Candlestick Park is an important part of the City's history and identity. Its name should be retained for this reason.
Those who oppose Proposition H state:
- The revenue from the naming rights will pay for desperately needed parks programs in the city. The money is already included in the current year's budget.
- Candlestick Park is not a park in the usual sense. The public has no access to the facility, absent purchasing an event ticket. It is rented to a for-profit, commercial entity. This makes it different from other parks, where selling naming rights would be inappropriate. It is a football stadium, which is inherently a commercialized, profit-making enterprise. A main reason professional football can exist in its current form is through the money generated through advertising, so it makes no sense to complain about commercializing an inherently commercial facility.
- The stadium will still be known as Candlestick Park by many people even if it has a sponsor's name.
The exception for a privately owned stadium is meaningless. No privately owned facility can be built on park land. A stadium could be developed by the 49ers under a long-term land lease, but the stadium would ultimately be owned by the City. This means any future stadium would need to be built without naming rights, which would make financing difficult and decrease the likelihood that a new stadium could be built.
Proposition H would supercede the authority of the Recreation and Park Commission and name the stadium "Candlestick Park." The ordinance reads, in its entirety: "The City-owned sports stadium located at Candlestick Point, at Jamestown Street and Harney Way , is hereby named and shall be referred to as 'Candlestick Park.' This ordinance shall not apply to any privately owned facility that may be in the future constructed at that location."
Although the Board of Supervisors has approved a proposed contract to market naming rights that would generate an estimated $3 million for this year's Recreation and Park Department budget, a contract has not been finalized and signed. If a contract is signed with a company before the November election, it is unlikely that this ordinance would override that contract, and the City would receive revenues from naming rights for the duration of the contract. However, this ordinance would preclude selling naming rights in the future once the contract expires.
In 1997, voters approved $100 million in lease revenue bonds to help with financing of a new stadium. The bonds would be repaid using increased tax revenue from a shopping center constructed at Candlestick Point. If these bonds were used in the future, the new stadium would have to be a public facility.
In the past, most stadiums were built substantially with public funds, but in recent years many new stadiums have been financed with larger portions of private investment. The new Giants' baseball park, for example, was funded by private investors. Marketing of stadium naming is often an important source of funds needed to make privately financed stadiums possible.
The second part of the ordinance is intended to exempt from the limitation on its name a new stadium built with private dollars at the same site, presumably allowing a new stadium to take advantage of funds from naming rights to help with construction costs. Because the current stadium is quickly becoming outdated, there has recently been increasing public discussion of the need for a new football stadium in the near future. But even a stadium built entirely with private funds might not qualify as "privately owned."
The land underneath Candlestick Park is owned by the Department of Recreation and Parks. The City can lease the land and allow a private facility to be constructed at the site, and the facility would be owned by the 49ers during the term of the lease. However, once the land lease expires the facility would revert to City ownership. As a result, it is questionable whether a facility built on City land would legally be considered privately owned since the facility would ultimately be City property.
If this measure is approved, it could effectively preclude the 49ers from ever building a new stadium at Candlestick Point. Thus, we could be immediately confronted with the problem of either finding the team another location for a new stadium or losing them to another city.
Because of the question over how this measure would affect future stadiums at Candlestick Point, the measure raises the larger issue of the benefits San Francisco derives by being home to a professional sports team. Many economists agree that the economic benefits provided by sports stadiums are not large enough to justify the huge public subsidies that were used to build stadiums in the past. However, the trend today is toward financing stadiums with far less public money.
No stadium is built entirely without public subsidy. For example, the Giants ballpark relies on roads, transit service, and other amenities that make it functional and accessible. However, professional sports teams certainly have some benefits for cities, especially when they are built substantially at private expense. Construction of stadiums and the attendant infrastructure provide jobs for residents. Additional jobs may also be created over the long term by the stadium's operations, although in many cases those jobs are only for a portion of the year while the sports team or other events occupy the stadium. Stadiums and sports teams may also raise a city's national profile, attract tourism, and help other local businesses that benefit from stadium traffic. City residents who rarely or never attend games may derive enjoyment from a team's presence by following them in the news, talking about them with friends, or through the greater sense of civic identity they provide.
Although we should be judicious about allowing corporate naming for City facilities, the present case is an exception. Candlestick Park has always been a business venue and a corporate name at such a facility is not objectionable. The revenue is needed by the Recreation and Park Department, which transfers surplus 49er rents to general operations. Any permanent ban on naming rights contracts could reduce the possibility of a new stadium from being built on that site, which could be a great loss to the City and its residents.
SPUR recommends a "No" vote on Proposition H.