City Council OK’s Rose Bowl 2023 Deficit Budget Plan

The City Council unanimously approved the fiscal 2023 budget plan for the Rose Bowl Operating Company which shows a projected loss of $2.8 million.

The loss would be covered by the RBOC’s operating reserves,

“The fiscal year 2023 budget projects that RBOC will be able to pay all operating expenses, debt and capital needed without an investment by the city,” RBOC Board President Steve Haderlein told Councilmembers Monday afternoon.

This fiscal year, the city contributed over $9 million to cover the Rose Bowl debt, according to the RBOC report.

According to Jens Weiden, Chief Revenue Officer for RBOC, the RBOC was able to “perform well,” during the 2021-2022 fiscal year. He said the projected net income improved by approximately $11.6 million from original pandemic projections.

Weiden reported that this year, the RBOC secured a five-year contract with AEG to increase minimum rent by $1 million per year, ensuring $15 million in guaranteed revenues for the RBOC over the next five years.

For this fiscal year, 14 ‘displacement events’ — any event with an expected attendance of 20,000 people or more —will be held at the stadium. (By City ordinance, only 15 displacement events can be held every year without Council approval.)

The fiscal year 2023 recommended budget reflected 22 major events — made up of 8 music festival events and 14 other displacement events including football, concert and soccer events.

Events at the stadium are expected to generate $47.038 million in the next fiscal year.

Additionally, RBOC is expecting to receive debt service subsidies amounting to over $3 million and golf complex operating revenues of $9.5 million.

“The good news we’re coming with of doing better in FY 2022 and doing better in FY 2023 than when we came to you last May, is good news but it’s still a loss. It’s not sustainable,” Weiden said. “Even due to our best efforts down in Central Arroyo, there’s still more that needs to be done and that’s why we are here today.”

He assured the public that RBOC is doing what it can to look for ways to increase its revenues.

During the special meeting RBOC officials presented the Stadium complex’s five-year strategic plan. Its objective seeks the Rose Bowl stadium’s long term viability.

The plan’s presentation was led by strategic management consulting firm CAA Icon President Dan Barrett.

Barrett reported the RBOC five year plan is founded on the RBOC continuing to host national and international events to generate direct and indirect economic impact, prioritize community events, operate the stadium and golf course in a fiscally responsible manner to meet its current and future financial obligations, identify potential third-party partners for funding and minimize general funding requests.

Particularly, the RBOC is asking the city to authorize, in a pre-development phase, revenue-generating opportunities such as the creation of a Family Golf Center, the establishment of a Campus Marque/Sponsorship Program, the potential increase of Transient Occupancy Tax and the imposition of a potential citywide parking tax on paid parking spaces, among other recommendations.

Aside from the above-mentioned, the RBOC is also considering in the future physical improvements that will potentially generate net return such as converting limited suites into loge clubs, the creation of a sky bar/rooftop, the creation of a performing arts stage and the creation of a new ice complex with two indoor full-size ice sheets.

It is also considering the conversion of a portion of the golf course to soccer, tennis and track and field facilities as well as the establishment of the Pasadena Sports, Convention and Hospitality Authority, among other potential fund generating programs and projects.

“There’s opportunity for us as we have this discussion to incorporate in the long term-thinking about the possibility of passing a Sport, Entertainment and Hospitality Authority that will help us to create synergy to market and brand all of these assets together and work together, whether it’s the museums, the convention center, the auditorium or the business districts – to brand and market together Pasadena as the great destination that it is,” said Mayor Victor Gordo.

“Pasadena is at the point where we should be thinking about this in a more global way in terms of creating synergies with all these community assets and city assets,” he added.

The City Council did not act on the recommendation of the RBOC but gave the staff direction to come back for another full City Council discussion before the city comes up with a direction on the five-year strategic plan.