The Ultimate Sweetheart Deal

MAILANDER ON POLITICS - The whole thing unfolded like a bad contemporary civics class review.

"What did the mayor know and when did he know it?" our local scribes demanded assertively.

"There are known knowns, there are unknown knowns..." the suddenly Rumsfeldesque Mayor sputtered indignantly.

Right after Anschutz Co. leaked to the Wall Street Journal Tuesday that the Denver company might sell their high-flying Anschutz Entertainment Group subsidiary whole but not wholesale—which would include all the sweat equity involved to-date in haggling with the City of Los Angeles over a bringing a pro football team and stadium to downtown—there was hell to pay in old LA.

"Huh?" the scribes wondered, suddenly shocked to learn that city contract negotiations and development deals are conducted out of public view.  “How can this possibly happen?”

Ultimately, Mayor Antonio Villaraigosa felt obliged to admit that he had known about a prospective sale of AEG for some time.  And no further questions, please.  More on why in a minute.

If it was hard to understand before this latest disclosure how, in Stephen Box’s words, “an imaginary stadium for an imaginary team” could compel so much of a city's energy and attention and media oxygen, it soon became even harder for the local chattering class to wrap their arms around the fact that the Mayor was audacious enough to claim to know about a potential sale of AEG all along.

This is indeed the way business is done in LA and indeed across the country.  You vote for your negotiators and hope for the best.  Until a final agreement is inked, it’s all pie-in-the-sky, and why bother worrying about who knew what when?

As the Mayor scrambled to reassure the imaginary fans of the imaginary team that the imaginary stadium wouldn't be affected by a sale of AEG to a new imaginary owner, Councilmembers were quick to shore up the Mayor's secret doings.  At a tightly-controlled debate among Mayoral candidates Wednesday night, none of the three city elected officials who are Mayoral candidates expressed a desire to invalidate to work on the deal to-date.  

Because after the Mayor said he has known about this phantom possibility all along, the electeds knew they couldn’t do a thing to invalidate the deal.

Among the hopefuls, only outsider candidate Kevin James expressed compunction about the deal and suggested it should be revisited.

That will be next to impossible now.  Just last week, the City was presented an “Implementation Agreement” by AEG, and that’s the key document that triggers everything—and likely triggered AEG’s surprise announcement as well, causing LA leadership so much discomfort in their britches.

Now that the Mayor has so eagerly admitted he knew all along that the possibility of an AEG sale existed—whether he really knew or not—it will be next to impossible to get the Implementation Agreement invalidated in court should push come to shove over a sale.

The Mayor, in short, has just given AEG the top legal cover possible against the City of LA invalidating the deal.

The Mayor for all his Angeleno fecklessness immediately found loyal and obliging cover in Council as well.

"At my urging, fortunately…the City will not be left holding the bag regardless of any changes in AEG's ownership or financial condition," Councilmember Paul Krekorian proclaimed to business scribe Mark Lacter, thumping his own chest vigorously for having made the deal for the imaginary team and stadium so darn bullet-proof.

What might constitute "holding the bag" of course the public has no idea, because, after all, the Mayor has just tossed away all hope of nixing the deal.

Krekorian did also point to a "freight train of stadium enthusiasm" behind the project.  As evidenced by…what, one wonders? Planning Department approval?  Try as we might, it’s hard to get excited about Buffalo-San Diego-St. Louis-Oakland team coming to Los Angeles pending four or five significant hurdles cleared.

But now AEG—the real freight train in town—has the ultimate sweetheart deal in pocket: an Agreement presented to the City of Los Angeles, Planning Department approval, and all its legitimacy testified to by the Mayor himself, with bought-off civic figures anxious to get in line to assure its legitimacy a scant week after being presented with the paperwork to the deal.

The company is now free to either fulfill the agreement itself or sell it off to someone else as they see fit—and you can bet, the second something happens that they don’t like, they’ll talk of selling again ... and again ... and again.  

That’s the way AEG rolls—like a freight train, right over pol and scribe and citizen alike.  And that’s why, at a time when billionaires are paying top dollar for sports teams, you have imaginary fans singing the praises of imaginary teams in imaginary stadiums, and the prospect of still more Hooters and other deep-fried sports bars coming to town.

(Joseph Mailander is a writer, an LA observer and a contributor to CityWatch. He is also the author of New World Triptych and The Plasma of Terror. Mailander blogs at


Vol10 Issue 76
Pub: Sept 21, 2012