In 2020, when the Raiders football team moved to Las Vegas, they were able to walk away from a $189 million debt to Oakland and Alameda County taxpayers.
In exchange, the city and county received the team’s training facility near the Oakland Airport, assessed at $24.6 million and worth, by one account, perhaps twice that amount.
The lopsided swap raises questions about the state and federal tax treatment of the forgiven debt and the negligence of public officials who signed off on a deal that was a gross and inexcusable expenditure of public funds — questions for which local, state and federal investigations are needed.
The complex details and history of the agreements between the Raiders and the Oakland Coliseum Authority were revealed in reporter Jason Cole’s investigation published by this news organization earlier this month.
They highlight yet another example of politicians using public money to kowtow to wealthy team owners rather than devoting the funds to needed government services. Sports teams do not pay their way. They may enhance civic pride, but public subsidies are not financially justified. Not for the Raiders then — and not for the Oakland A’s now.
In the Raiders’ case, the new details add insult to the financial injury residents already suffered from the team’s departure. It has been well known that when the team most recently left the Bay Area city and county, taxpayers were stuck with a $55 million debt to finish paying off bonds floated for stadium improvements to lure the team back from Los Angeles 25 years earlier.
Now it turns out that public officials also let the team escape repayment on two loans to those same taxpayers. The loans, originally totaling $64 million, were to cover costs associated with relocating the team to the Bay Area and for building the training facilities. By the time the team left town again after the 2019 season, the debt, with interest, had grown to the $189 million.
Under a key 2005 amendment to the deal, the team was allowed to walk away from both loans in exchange for turning over the training facility. A source close to the negotiations told Cole that the amendment was structured to free the Raiders from state and federal tax obligations for loan forgiveness. However, a tax law expert tells us that the Raiders should still be on the hook for those taxes.
Thus, the first key question is whether the Raiders should have paid taxes on the loan forgiveness. The second question is whether they did. Raiders officials refused to speak to Cole. Federal and state tax and law enforcement authorities, including California Attorney General Rob Bonta, should investigate.
Equally concerning is the refusal to talk or claims of ignorance by elected officials who sat on the Coliseum Authority Board — including Alameda County Supervisor Nate Miley, former Supervisor Scott Haggerty, former Oakland City Councilman Ignacio de la Fuente and businessman Ed DeSilva — and the stonewalling by key officials familiar with the deal, including City Attorney Barbara Parker and former attorney and executive director Deena McLain.
The Alameda County Civil Grand Jury should call them in and require their sworn testimony — and then report to Bay Area residents on how this shady deal happened. And District Attorney Nancy O’Malley should launch a probe to determine whether laws designed to prevent misuse of public funds were broken.
The public is owed an explanation. And anyone who abused their authority should be held accountable.
Source: www.mercurynews.com