Since opening in 2014, Levi’s Stadium has brought in $659 million for Santa Clara’s Stadium Authority and added $21 million to the City of Santa Clara’s general fund, according to the Authority’s financial reports. In that time, the City’s general fund has profited by about $19 million from:
$14.9 million in non-NFL event profits — “performance rent”
$1.9 million in ticket fees
$2.1 million in ground rent
$626,000 in parking fees from Tasman and golf course parking lots
Sales tax is another benefit to Santa Clara’s general fund from stadium events. Conservatively estimated at $250,000 a year,* sales tax revenue adds another $2 million a year to increase the general fund to $21.4 million. Sales tax revenue added $454,000 to the city’s general fund this year alone.
The city has also been reimbursed from stadium revenues for $24.3 million for public safety expenses and administrative staff time since 2014.
Even without concerts, the Stadium Authority realized $68 million in 2021-22, delivering $1.1 million to Santa Clara’s general fund in the fiscal year that ended on March 30, 2022, reported Santa Clara Director of Finance Kenn Lee at the Nov. 1 council meeting.
The coming year promises to be a good one, with five concerts already on the books, which will bring an estimated profit of $2.1 million, noted Council Member Raj Chahal at the council meeting. In addition, the 49ers will be paying an additional $35,000 in ground rent. Without any increase in parking or sales tax — which is certain from the five additional events — the stadium promises to deliver over $3 million to the city’s general fund in 2022-23.
Stadium Finance 101
The Santa Clara Stadium Authority was set up as a separate public agency form the City of Santa Clara. This protects the city from liability for stadium authority expenses and debts, and protects the stadium authority from city councils diverting stadium revenues away from stadium operations, maintenance and reserves.
The contracts spell out the flow of revenue to the Stadium Authority and to the city, and the priorities for payment and account funding— sometimes referred to as the “waterfall” of payments. These obligations cannot be changed without renegotiating the terms of the contracts.
The Stadium Authority receives revenue from: ticket surcharges, seat licenses and interest payments, naming rights, sponsorships, non-NFL event profits, and the facilities and ground rents paid by the 49ers. This pays for the stadium operations, maintenance, construction debt repayment, stadium reserves and payments to the city’s general fund.
Stadium Authority revenue has averaged $82 million a year; reaching a high of $124 million in 2014-15 (due to the initial seat license sales) and hitting a low of $49 million during the pandemic.
The city’s revenue stream includes: senior and youth service ticket fees (which are capped at $250,000), 50% of non-NFL profit event profits, ground rent paid by the 49ers (also fixed by contract), and reimbursement for public safety and administrative staff costs. The city collects parking fees from the Tasman lots directly and sales tax revenue is distributed to the city by the county.
This general fund revenue has averaged $2.7 million, with the high of $5.8 million in 2017-18 and a low of $390,000 in 2020-21.
No other money can flow to Santa Clara’s general fund until the construction debt is paid off, without the agreement of the city’s business partner, the 49ers.
The Stadium Authority began with a construction debt of $653 million. As of last March that amount was down to $280 million, and it’s estimated that it will be paid off in about five years.
“That money came from the Stadium Authority,” said Council Member Raj Chahal at the Nov. 1 council meeting. “It did not fall from the sky. The stadium is making money and our residents should know that. Nobody should be saying it doesn’t make money.”
After the debt is paid off, the expense “waterfall” will still direct the flow of money, but the assumption, when the contracts were negotiated, was that any surplus flowing to the general fund. However, when the debt is retired, the 49ers also have to the right to renegotiate the facilities rent.
These contracts were approved by the city council in 2011, 2012 and 2013. Those city councils included: Mayor Jamie Matthews and Council Members Debi Davis, Lisa Gillmor, Will Kennedy, Patrick Kolstad, Patricia Mahan, Jerry Marsalli, Jamie McLeod, Kevin Moore and Teresa O’Neill.
All of the stadium financial information is available at santaclaraca.gov/our-city/santa-clara-stadium-authority. We have consolidated all the general fund revenue associated with the stadium for this report, which is not how it’s been presented prior to this year. Previous year actuals can be found in the annual budgets.
*Note: This year was the first year that the Stadium Authority financial report included sales tax information. We will update the story when we receive more information from the City.
