State gives stadiums special treatment

Gov. Arnold Schwarzenegger last week may have cemented his eventual legacy as the man who brought professional football back to Los Angeles. But a better characterization might be that he gave one business a pass on having to follow laws that he otherwise vigorously supports, and, depending on how the process unfolds, that he put taxpayers in harm’s way.

In the city of Industry, flanked by union leaders, politicians, former politicians, business leaders, and hard-hat-wearing construction workers, Gov. Schwarzenegger ceremoniously signed a bill into law Thursday that is meant to rapidly advance the construction of a new football stadium to serve greater Los Angeles County. The arena has been championed by the real estate firm Majestic Realty Co. and its billionaire CEO, Ed Roski, who pledges no public funds will be used in the venture.

The bill, introduced by Assemblyman Isadore Hall, D-Compton, exempts the stadium from existing environmental regulations of the California Environmental Quality Act and nullifies a lawsuit filed by residents of Walnut, a nearby city that will likely feel the brunt of traffic increases and property value fluctuations as a result of having the stadium for a neighbor. This is only the second time in the state’s history that it has granted an exemption — the first time was also for a stadium, AT&T Park in San Francisco. And it apparently left Walnut residents with little or no recourse.

Gov. Schwarzenegger made the case for one business that we’ve been making for all businesses — that environmental mandates have grown so severe they unfairly restrict business growth and add significantly to cost. If it works for Mr. Roski, why not for Mr. or Ms. Every Entrepreneur?

Gov. Schwarzenegger also touted that no public funds would be used to build the stadium, but taxpayers beware. That was the same kind of rhetoric that surrounded AT&T Park’s construction and, in fact, no “state” funds were deployed. San Francisco’s money was used, though, to the tune of about $10 million in tax abatements and $80 million for infrastructure upgrades.

We love sports as much as the next Angels fan, but this project raises two red flags: preferential treatment that gives significant market advantage to a select few, while presenting a potential for new tax burdens for taxpayers, either directly or through subsidy.