Why Chargers will never leave L.A.
Despite early struggles, the franchise is destined to stay there for the long haul
Before they even moved to their new home in Los Angeles this year, the former San Diego Chargers knew they were destined to have the lowest home attendance in the NFL in 30 years.
That’s what they signed up for when they picked StubHub Center as their temporary new home —a soccer stadium that seats
27,000.
They could have pushed instead to share a temporary home with the Rams at Los Angeles Coliseum, which seats more than
90,000. But they didn’t in part because they knew their first years in L.A. wouldn’t be easy. And no matter how bad it’s been so far for the Chargers (1-4), they also know there’s no going back to San Diego, their abandoned home of
56 years.
“That ship has sailed,” said Marc Ganis, a sports consultant who has worked with NFL owners and has helped other teams relocate to new cities. “You never say never to anything, but boy, this is as close to that as we could get right now.”
Despite speculation about the Chargers having relocation remorse, there are at least eight reasons they aren’t going back, at least for a long time, according to those with direct knowledge of the Chargers relocation and the contracts involved.
1. THE FLIP TAX
Chargers fans in San Diego have a dream scenario. They’d like Chargers chairman Dean Spanos to sell the team to a new owner — a savior who would return the team to San Diego and build a stadium with his own money. But that’s also a pipe dream, partly because Spanos has shown no interest in it and partly because of penalties the NFL would levy on him — penalties that are a condition of getting a $200 million stadium construction loan from the NFL. Such transfer fees discourage Spanos from “flipping ” the franchise for profit soon after relocation — 20% of the gross sales price of the franchise through
2020 and 10% from 2021 through
2025, according to terms reviewed by USA TODAY Sports. The penalty decreases by 1% per year through 2035.
2. EXPECTATIONS
Television talk show host Jimmy Kimmel showed a skit last week that poked fun at the Chargers’ low attendance and said they “miss San Diego” and “really (messed) up” by moving to Los Angeles uninvited.
It was funny, but in reality, the Chargers knew it would be like this at first.
Even with a sellout every game, the Chargers would have had the lowest average home attendance in the NFL since at least 1997, when the Houston Oilers temporarily moved to Memphis and averaged 28,028 before permanently moving on to Nashville, according to STATS. Before that, a few teams averaged about 27,000 at home during a 1987 season that included a players strike and replacement players.
Thirty years later, the Chargers are averaging about 25,000 a game at StubHub and are getting drowned out by fans from visiting teams. That might not get better at their next home game Oct. 22 against the Denver Broncos.
Yet if they expected significantly better ticket sales, they could have pursued sharing the larger Coliseum, whose commission president told USA TODAY Sports last year that it was open to hosting both the Chargers and the Rams. The Chargers opted for a more intimate experience instead at StubHub, in part because they knew they had to build their brand in Los Angeles first.
3. 2020 VISION
This move always was about the future beyond 2020, when the Chargers are scheduled to share a newly constructed $2.6 billion stadium with the Rams in nearby Inglewood. That stadium is being built and sold based on two teams playing there for 10 games a year (two preseason, eight regular season). That includes deals involving stadium naming rights, sponsorships and luxury boxes — all based on 20 NFL games, not 10. A $200 million NFL loan to the Chargers also is part of the construction budget. Removing the Chargers from this equation would create a mess that’s hard to untangle for the Rams, the NFL and others.
4. THERE’S NOWHERE ELSE TO GO
After several years of trying, Spanos left San Diego because he couldn’t get a new stadium built in San Diego. He said he needed taxpayer support for it, but voters rejected that in November. Without a new stadium, there’s SDCCU Stadium (formerly Qualcomm Stadium), which is 50 years old and headed for closure by the city of San Diego after 2018. Smaller new San Diego stadium proposals for pro soccer and San Diego State football are in the works, but none have been approved.
5. THE RELOCATION FEE
After 2018, the Chargers are to begin paying installments on a $650 million relocation fee — for the right to move to Los Angeles from San Diego. That’s money that goes into the pockets of other NFL owners. Those owners would not want to see those payments canceled so Spanos can make another uncertain attempt for a new stadium in San Diego.
6. THE CHANGEABLE NARRATIVE
Kimmel and others might joke about the bad optics of this relocation so far. But if the Chargers are 4-1 instead of 1-4, would reporters be asking the NFL about the Chargers moving back? Would StubHub Center have attracted a couple of thousand more fans to fill out the picture of success? When asked last week, NFL vice president of communications Joe Lockhart dismissed the notion of the Chargers possibly moving back to San Diego. “The only place I’ve heard that, is that I’ve seen it on the Internet,” he said.
7. ATTENDANCE FLUCTUATIONS DON’T MATTER THAT MUCH
The league knew there would be attendance challenges in Los Angeles, where the Raiders and Rams ranked 24th and 28th out of 28 NFL teams in home attendance in 1994, the last time the area had two NFL teams at once, according to STATS. But the NFL primarily makes its money from media rights deals, including television, and shares it with its teams.
Locally, teams earn and don’t share revenue from lucrative luxury boxes, sponsorships and naming rights. That’s what the Chargers’ and Rams’ new stadium is being built to attract in Los Angeles and why they both moved to the nation’s second-biggest media market.
8. LONG-TERM FRANCHISE VALUE
Over time, the Chargers are projected to increase in franchise value and make more money in Los Angeles than they would in San Diego, according to Vanderbilt sports economist John Vrooman.
Ganis said it’s important not to “use an example of a few games to try to extrapolate out for 30 years.”
At the same time, he said, the Chargers could do themselves a favor if they want to avoid more speculation and bad optics.
“It would really behoove the Chargers to start winning,” he said. “They know this. It’s an obvious statement, but there’s that old saying: ‘ You never get a second chance to make a first impression.’ ”