Photo: Courtesy of LA Stadium
Billionaire Philip Anschutz’s plan to build an NFL stadium in downtown Los Angeles could leave city taxpayers on the hook for millions despite his insistence that no public go towards the project.The Anschutz Entertainment Group subsidiary behind the stadium will not provide any additional guarantee for $350 million in municipal bonds it plans to use to finance part of the development, Bloomberg reports. The company – L.A. Event centre LLC – has said it will cover any shortfall but that “no private credit enhancement” will support the bonds.
Bloomberg notes that the deal stands in marked contrast to Anschutz’s Staples centre project. The arena – home to the Lakers and the Kings – was partly financed by $45.6 million in municipal bonds backed by a bank-issued letter of credit from Anschutz.
Without some kind of bank or corporate insurance, Los Angeles could end up having to make payments in the event that stadium revenue falls short. Given that Los Angeles still doesn’t have a football team, this could be a very risky endeavour for the cash-strapped city.
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