Sacramento scrambles to save its Major League Soccer dream. Here’s why there’s hope

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The Sacramento Bee Editorial Board
·3 min read
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A Major League Soccer team in Sacramento seemed like a sure thing until billionaire Ron Burkle ditched the city at the altar and backed out of the deal last week. Now Sacramento leaders are scrambling for new investors to try and salvage a massive economic engine that would anchor the long-awaited transformation of the downtown Railyards.

On Friday, Burkle told the MLS “that based on issues with the project related to COVID-19, he has decided to not move forward with the acquisition of an MLS expansion team in Sacramento,” according to a league statement. Construction of the 20,000-person stadium was supposed to begin last year but the pandemic prompted the MLS to pause for one year.

Projected costs for the stadium have grown significantly since Sacramento landed the MLS expansion bid in October 2019. That, coupled with Burkle’s reluctance about the expansion fee to promote Sacramento Republic FC to the major league, which was once $75 million, prompted his surprise decision to drop out.

“That increased to $150 million and, on the day Sacramento was announced as the lead candidate for the 30th spot, had jumped to $200 million, a change that caused Burkle to hesitate initially,” wrote The Sacramento Bee’s Marcos Bretón and Tony Bizjak. “Meanwhile, the price to construct a stadium in the Railyards increased from less than $300 million to about $400 million due to pandemic-caused delays, as well as higher construction and materials costs.”

Sacramento is facing several difficult crises, including the COVID-19 pandemic, homelessness and a shortage of affordable housing. Securing a professional sports team may seem like a distraction, but Sacramento needs the $1 billion of downtown investment to create jobs and housing.

Opinion

The economic boom from a fully-envisioned Railyards development, which includes a new Kaiser hospital, hundreds of new housing units, shopping and a 5,000-seat venue, would pour millions of dollars into the Sacramento economy as we emerge from this devastating pandemic. The city would receive as much as $900,000 in annual revenue from the new stadium alone, and benefit from $30.5 million in annual spending, according to an October 2015 study.

Mayor Darrell Steinberg and the city council have already shown their commitment to increase spending on affordable housing, homeless services and youth programs under Measure U. A boost in yearly sales tax revenues would expand those investments.

The city already committed $33 million to finance necessary infrastructure and remove government red tape. Steinberg told The Bee his “phone is ringing off the hook” with “significant interest” from major investors. Republic FC owner Kevin Nagle said he has “been receiving serious inquiries since Friday’s news broke.”

That’s good news. The Railyards development is the largest urban infill project in the country, and would create a vibrant downtown core for future generations to enjoy. The stadium has long been viewed as the catalyst. Scrapping this project would be a gut-punch to Sacramento at a time when the city needs investment and new jobs.

Hopefully, Steinberg and Nagle can find new investors and keep Sacramento’s MLS dreams alive without asking for more taxpayer money.