-Photo by Terry Miller
Investors Sought for Rose Bowl Construction Shortfall of $35 Million
By Terry Miller
It was suggested in other media outlets that Chinese investors seeking to immigrate to the United States could possibly help bail out the Rose Bowl’s construction’s staggering $35 million overrun and get a Green Card as a thank you gift from the feds.
In 2010 Pasadena City Council approved a $152 million financing plan for a major renovation of the Rose Bowl stadium. It is the largest investment in the history of the 90-year-old iconic structure. The renovations were to improve public safety; enhance fan experience; maintain the national historic landmark status of the Rose Bowl Stadium; develop revenue sources to fund the project and other long-term improvements; and enhance the stadium’s facilities. The financing plan includes lease extensions that will ensure UCLA will play its home games at the Rose Bowl stadium through 2042 and the Rose Bowl Game will be played there through at least 2043.
With an eye to 2014 at the BSC Championship games, the Rose Bowl is going to be very much in the public eye and financing this latest development is very much in the forfront of all concerned with the project.
With $35 million needed to complete the project, officials feel this may be the solution and it could be signed sealed and delivered fast. No monies are coming from the General Fund, therefore private investors are crucial to the completion of this project.
Andrew Green, Finance Director for the City oif Pasadena told the Independent on Wednesday that the investment source they are seeking under the EB5 program is just one option and that that program is not soley Chinese based investment, “it’s foreign investment” he said.
Green was quick to point out that even if EB5 is used, this doesn’t guarantee an investor a green card, but certainly helps steer them in that direction. Mopreover, the EB5 program would ensure a fast track to financing.
Recently, a private group known as the Legacy Connection collected approximately $8 Million for the renovation but what kind of dent this puts in the ever-growing costs is unknown.
The Immigrant Investor Program, also known as “EB-5,” was created by Congress in 1990 to stimulate the U.S. economy through job creation and capital investment by foreign investors. Under a pilot immigration program first enacted in 1992 and regularly reauthorized since, certain EB-5 visas also are set aside for investors in Regional Centers designated by USCIS based on proposals for promoting economic growth.
However the EB5 investors must invest in a new commercial enterprise, which is a commercial enterprise. The Rose Bowl is not actuallyu a new enterprise which brings this use into question. However, it seems that maintenance and upgrades would qualify for such EB5 standards by creating a new lending entity, according to Andrew Green.
Established after Nov. 29, 1990, or Established on or before Nov. 29, 1990, that is:
1. Purchased and the existing business is restructured or reorganized in such a way that a new commercial enterprise results, or 2. Expanded through the investment so that a 40-percent increase in the net worth or number of employees occurs
Commercial enterprise means any for-profit activity formed for the ongoing conduct of lawful business including, but not limited to:
A sole proprietorship, Partnership (whether limited or general), Holding company, Joint venture
Corporation, Business trust or other entity, which may be publicly or privately owned
This definition includes a commercial enterprise consisting of a holding company and its wholly owned subsidiaries, provided that each such subsidiary is engaged in a for-profit activity formed for the ongoing conduct of a lawful business.
Pasadena PIO, William Boyers said “It is our understanding that the Rose Bowl work is considered to be a new project that meets the EB5 standards.”
Boyer continued to say that the city of Pasadena is looking at all potential funding for this project’s completion, not solely Chinese investment, as has been suggested. “The city is not actively seeking Chinese investment at this time” according to Public Information Officer, William Boyer.
Finance Director Green told Beacon Media that a Bridge Loan and foreign investments could create a new lending entity which would be well within EB5 guidelines.
Here’s a run-down of the next phases of the project which is the largest the City of Pasadena has ever been involved in.
PHASE II (2012) of the Rose Bowl Project:
North press box wing and center section (continues through 2013), North tunnels 7A and 15A, Field-level entrances and exits, Field wall restoration and installation of new field-level advertising panels, New south restrooms and south restroom building remodels
PHASE III (2013)
South-press box wing and escalator tower (construction begins January 2012), Concourse improvements (concession stands/restrooms/entry gates/perimeter fence), North tunnels and concrete deck repair/waterproofing
The $160 million renovation broke ground in January 2011. The extra costs are largely due to construction bids coming in higher than anticipated. Finance Director Andrew Green hopes to present his recommendations and a proposal to council in mid July. With an eye to bid out in August or September, this would be consistent with the plan for completion date of 2014.
The renovation is the largest investment in the iconic stadium’s 90-year-old history.