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Guest Opinion | Felicia Williams: Restructure the Rose Bowl to Support Itself and Generate a “Social” Profit for the City

Published on Monday, June 20, 2022 | 5:00 am
 
Councilmember Felicia Williams (File photo)

With a $30 million deficit projected over the next 5 years, the Rose Bowl needs a more stable financial structure to continue for the next 100 years. The new structure will likely involve an investment from the City’s General Fund, which should be accompanied by increased transparency and accountability of taxpayer dollars, and a requirement that the stadium serve all of the people in Pasadena equitably. This is just the start of a much-needed community conversation.

In the current fiscal year, the City’s General Fund paid $12 million to cover the Rose Bowl’s debt, and the Federal government provided a $10 million grant for shuttered venues to pay operating expenses. As a result of this taxpayer infusion, the Rose Bowl managed to lose only $198,000 this year instead of the projected $7.4 million loss.

However, unlike the many small businesses in Pasadena that closed their doors due to major losses and the 6,000+ residents who lost their jobs, the Rose Bowl senior staff received full bonuses of $100,000 – $150,000 each. Unlike our City staff who provided essential services during the pandemic with minimal pay increases, the Rose Bowl General Manager received a whopping 22.5% pay increase and 20% bonus. The last 7.5% pay increase and $72,000 bonus were approved 14 days prior to the General Manager retiring.

Shouldn’t we all be tightening our belts during a pandemic? And, the taxpayers are out $12 million that could have been spent on streets, services, the Central Library, or other things that improve our citizens’ quality of life.

Why is there such a big disconnect between our City and the Rose Bowl? In what alternate reality does a business that loses money and requires a taxpayer bailout declare the year a success for full bonuses? That alternate reality occurred in the 2008 financial crisis when AIG received a taxpayer bailout, reported the biggest loss in corporate history, then turned around and paid $165 million in executive bonuses. In the end, the Federal Reserve was able to break up AIG and sell off the pieces at a profit for the taxpayers.

Unfortunately, the City can’t sell the Rose Bowl, and it probably wouldn’t sell at a profit. But . . the City can create a more stable financial structure where the users of the Rose Bowl pay to support it more than the taxpayers. We can also ensure the stadium operates at a “social” profit to the residents. I’ll get to the social profit in a minute.

On the revenue side, examining things like Arroyo parking fees, removing the $1.50 cap on the ticket Admission Tax, and upgrading Brookside Golf Club are preferable to the proposed boutique hotels, mini golf, amphitheater, and other development in the Arroyo that are highly risky. A deep dive into the operations side and cost saving measures, like aligning staff salary structures with other entities that receive a Calpers pension (and is a pension still appropriate for a private non-profit?) is also critical.

A merger of the Rose Bowl and Convention Center should also be considered not only for operational savings, but as two strong assets that could support a restructuring of the debt secured by hotel taxes driven by both entities. And, that same Sports & Convention Authority could manage all City assets making it more efficient to book anything in the City. An acquisition of the Pasadena Playhouse and Ambassador Auditorium would be the icing on the cake (hey, we can dream big, can’t we?!).

Now, for the social profit. As a City-owned asset, we need to ensure that the Rose Bowl serves everyone in the City, not just the people who can afford a ticket or luxury box. After all, its purpose in the Code is to “return economic and civic value to the City”. Local hiring, local business contracts, high school graduations, little league games, you name it. Creating a new, financially sustainable structure for the Rose Bowl will not only ensure the stadium’s longevity, it will protect the taxpayers and reconnect the stadium back to the community it was built to serve.

Felicia Williams is the City Councilmember representing District 2 and has a background in public policy with an MBA in Finance. She can be contacted at https://www.cityofpasadena.net/district2/

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