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Faced with a year of no confirmed Rose Bowl events, the City Council Finance Committee Thursday unanimously recommended that the city assume the Rose Bowl Operating Company’s $11.5 bond service debt for fiscal year 2021, along with several million additional dollars in operating expenses.
The RBOC, which operates the City-owned Rose Bowl, had presented the City Council’s Finance Committee three possible scenarios for the upcoming fiscal year and their effects on the stadium’s financial landscape, on May 28.
The stadium’s previously planned schedule—including the 2020 UCLA football season—has essentially been wiped out by the Coronavirus pandemic and the state-mandated end of stadium-sized public events for the foreseeable future.
“The slow-down is temporary. Football, concerts, and other events will return.”
The three scenarios had envisioned an August start to UCLA football, or a Spring 2021 start to UCLA football, or no Rose Bowl events at all through June 20, 2021.
As the RBOC told the committee, six UCLA home games were the only events on the 2020-21 schedule, and now may be unlikely.
In a presentation by RBOC Board members Richard Schammell, Doug Kranwinkle, and former Pasadena City Manager Phil Hawkey, the RBOC said that some expenses have been cut with staff reductions and pay cuts, but RBOC would definitely need help with the debt load and operating expenses for the year.
Hawkey also told the committee that the RBOC might have an answer on the likelihood of this season’s UCLA football ‘in the next 30 days,” but at best those six games would likely be played without spectators.
In the presentation to the committee, however, the RBOC said that, “The slow-down is temporary. Football, concerts, and other events will return.”
The RBOC report also stated that the Rose Bowl “remains in competition with other local venues, who we understand will continue to maintain their facilities and market for business,” and that the Rose Bowl needs to maintain its staff and keep the facility in a position to return to operation quickly.
The Rose Bowl will also need staff to “rethink and plan all-new standard operating procedures for operating in a social distancing” environment,” said the report.
After some discussion on details, City Manager Steve Mermell told the Committee that the city should simply assume the debt immediately. City Finance Director Matthew Hawkesworth told the committee that the RBOC would also need several million dollars to cover monthly expenses, as well as cash to cover start-up expenses should games or events in the stadium suddenly be realized in the coming year.
The operating funds would come in the form of 30-, or 60-, or 90-day loans which would come from the City General Fund’s 5% reserve.
The Committee’s recommendation will be voted on at the next City Council meeting June 15.
On a separate matter, the Committee also heard a presentation from Risk & Insurance Administrator Arlene Gallardo, who told them that Fiscal Year 2021 insurance premiums would increase to 4,710,305 from 2020’s total premium of $3,130,643.
According to Gallardo, factors for the jump in premiums included among other issues, hardened insurance markets, social inflation, a rise in large public entity verdicts and settlements, public entity losses in California and throughout the country, as well as city exposures and a change in the city’s total insured values.
The Committee moved the item to be heard by the full council at its next meeting.
Meanwhile, while the city faces an $18 million loss in revenue in the coming fiscal year in its proposed 2021 budget of $273 million, as well as a smaller amount of Measure M transportation funding than anticipated, much of the committee discussion on Thursday was centered around a number of additional appropriations including $500k in General Fund for Youth Support and Training Opportunities, and $3,372,793 in new ESG-CARES funding for homeless services.
The final recommended budget to be voted on by the council would also appropriate $208,919 in grant funds to continue the Black Infant Health Program.
Both Councilmembers Victor Gordo and John Kennedy expressed concerned over the fact that the City’s Summer Rose intern program may not be implemented this year, and sought ways to provide an alternative program.
The City’s final 2021 budget will come before the full council in a special meeting on Monday, June 15.
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