EdBoard: Oops, Santa Clara Did It Again – Opinion
Like Britney Spears with her habit of breaking hearts, Santa Clara has a habit.
Like her, we like to flirt: with being a big city. We love having big-city assets — an Olympic-caliber swim center, a convention center, a billion-dollar NFL stadium — but we don’t like making commitments to maintain them. Now we’re doing it again with Levi’s Stadium.
The city’s approach has always been pay-as-you-go, City Manager Jovan Grogan reminded the city council last October, and that “only works when you have cash.” But the city has no cash and the bills are overdue.
Santa Clara’s unfunded infrastructure backlog nearly reached $600 million last year. The bond passed in 2024 only covers $400 million of that. And at the demand of Mayor Lisa Gillmor, it excludes the entire stadium/convention center district — the part of the city visitors are most likely to see.
Sunnyvale made a different choice. It doesn’t build without funding in place years in advance for construction and maintenance — precisely why Sunnyvale has no stadium and no convention center. Instead, Sunnyvale has a city hall that’s an architectural gem. That’s not an accident. That’s fiscal discipline.
Exhibit A — The International Swim Center
Built in the late 1960s, the ISC has long outlived its 25-to-30-year design life. For decades, city councils were regularly warned the center was on course to becoming a useless hole in the ground.
SPONSORED
In January 2024, swimmers arrived at the swim center only to find a sign saying it was closed “until further notice” when the county shut it down because of the swim center’s deterioration. “Significant deferred maintenance” had led to “significant challenges” in keeping it open, the city manager told the council.
You needn’t be a structural engineer to understand how neglecting maintenance ends up costing more. If you don’t fix the leaky shingles on your roof, you won’t just have a leaky roof: you’ll have a rotting house.
Exhibit B — The Convention Center
The Santa Clara Convention Center was profitable under Chamber of Commerce/Vistors Bureau management.
So Mayor Gillmor and then-city manager Deanna Santana decided that although things were working, they nonetheless needed fixing. A goal of Gillmor’s since the 1990s — when her conduct caused the Mercury to dub her “looney” in an editorial — the council fired the Chamber/CVB in 2019 and brought in new management by one of Santana’s legion of cronies.
Since then, even excluding the pandemic years, the center has been a money loser; getting minor fixes and fresh paint when much more is needed. And Gillmor made sure it will stay that way by excluding the convention center and stadium area from last year’s bond measure.
Exhibit C — Oops, We’re Doing it Again with Levi’s Stadium
Now the city’s doing it again with Levi’s Stadium. Instead of a five-year capital plan, the stadium authority chose to approve just one year’s worth of improvements, failing to earmark enough for capital projects. Albert Gonzalez summed it up: “Have we underfunded the capital expenses for the stadium? Yeah. We have.”
It’s true that admitting there’s a problem is the first step toward solving it, but in Santa Clara that’s often the last step, too.
The reserve is laughable for the stadium’s value.
Generally accepted standards for maintaining big public buildings say an owner should be setting aside somewhere between 2 and 4% of a building’s value every year to keep it in good repair — more, if repairs have been neglected.
For a stadium worth well over $1 billion, that’s about $20 to $40 million a year. Santa Clara is putting aside $3 to $4 million annually. And remember, that isn’t money from the city’s general fund. It’s money that’s generated by stadium authority revenue — money that Gillmor’s been trying to divert into city coffers for the last 10 years.
And it gets worse. The budget shows the stadium’s dedicated repair fund dropping to just $609,000 by next summer. That’s why the stadium authority had to shuffle nearly $6 million out of another account just to cover this year’s projects.
Indeed, the organization of the stadium project 15 years ago was an exercise in penny-wise, pound-foolishness.
Instead of appointing a separate stadium authority whose sole fiduciary duty was running and maintaining the stadium, the city chose to make the city council the stadium authority board. The point of setting up the Stadium Authority as a separate public agency is protecting it from city councils diverting stadium revenues away from operations, maintenance and reserves. When the council is also the stadium authority board, the fox is running the henhouse.
Meanwhile, the 12-year-old stadium’s major systems are wearing out and, according to the most recent report, “nearing end of life.” It’s the swim center all over again — warnings ignored, maintenance skipped and a bill that grows while the city looks away. Except this time the asset is worth a billion dollars.
Previous EdBoard Posts:
EdBoard: Hey, Glen, We’re Listening
Truthish-ness and Truth – Opinion
Mayor Gillmor Must Own Her Role in ISC Failure – Opinion
