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Report: Chargers Cannot Escape Contract

Economic Clause Has Not Been Triggered, Report Says

POSTED: 5:04 p.m. PDT October 25, 2002
UPDATED: 6:00 p.m. PDT October 25, 2002

The San Diego Chargers apparently have not "triggered" a clause that would allow the team to renegotiate its contract or leave town, according to a report Councilwoman Donna Frye released Friday.

She commissioned the report by Mark Rosentraub, a Cleveland State University professor who has studied the economics of professional sports for more than 25 years.

"This means the lease could be continued, and that the public sector doesn't have to do anything at all," Rosentraub said. "The triggering event can occur in any year, but it certainly takes pressure off -- in that nothing needs to be done right now."

Rosentraub also discussed the report last night at a meeting of the city's Citizens Task Force on Chargers Issues.

That group's mission is to recommend what the city could do to keep the team -- which is seeking a new stadium -- and make it palatable to its constituents.

The study "should give us a lot more clout to say if (the Chargers) want to show the triggering event has occurred, prove it," Frye said.

The Chargers contract, under which the city invested about $78 million in Qualcomm Stadium improvements, weds the team to the publicly owned stadium through 2020. But a clause would allow the team to be "shopped" to other cities in 2004 if it exceeds certain NFL salary restrictions.

In an April letter to Mayor Dick Murphy, Chargers President Dean Spanos, son of the owner, asserted that the conditions were met last season and probably would be again this season. This is the first season that could actually result in the contract being reopened.

Rosentraub's report disputes that the conditions have been met.

The Chargers, meanwhile, aren't saying much about the report, preferring instead to focus on the team's 6-1 record this season and first-place spot in the division.

"Our sole focus at this point is on the exciting season the team is having and on the team's playoff run," said Chargers special counsel Mark Fabiani. "That's all we want to talk about. We don't want to talk about the trigger."

When pressed on the apparent discrepancy between the numbers leading to Spanos' assertion and those in Rosentraub's report, Fabiani said: "That's something that will have to be addressed at some time, but that's way off in the future."

In the report, Rosentraub cautioned that the conclusions are based on the "best available data." He said the player salaries from his study are those used by the NFL Players Association.

Frye said she had no expectations about the study results.

"Am I surprised that we might have received misinformation from Alex Spanos? No, that does not surprise me," she said.

Frye said the $4,000 she is spending from her District 6 budget on the study is "a small price to pay to provide additional information to the public," and the report should help the task force make "better informed decisions."

"If this report saves the taxpayers millions of dollars, then it is well worth it," Frye said.

She said the study has credibility because Rosentraub is independent and an expert in the field.

Bonuses the team pays its players could be a critical point if the Chargers formally notify the city that conditions have been met to reopen the contract, Rosentraub said.

The city likely would want to see copies of all the player contracts -- not the aggregates used in Rosentraub's survey. The full contracts haven't been given to the city in the past, Rosentraub said.

The bonuses could be paid to different players over different spans of time, so accounting for them could make the difference in a given year.

"The Chargers, as you might expect, have an incentive to interpret the contracts so it appears the triggering event has occurred," Rosentraub said.

Under the team's contract, the Chargers could notify the city during a period that begins Dec. 1 if the team believes the trigger was met this season.

That notice would start a 90-day negotiation period with the city of San Diego, followed by a 180-day period when the Chargers could seek a deal in another city. San Diego would have 90 days to match any offer presented to the team.


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