Stadium leases last decades, and the last time Anaheim had the opportunity to make a deal for Angel Stadium, some critics say the city didn’t ask for enough from its hometown baseball team.

Now that city and Angels officials are negotiating a new lease in earnest to beat an end-of-year deadline, the big question is what’s a fair deal for the long-term use of what one observer called “Anaheim’s most valuable asset”?

Who makes money?

How much rent the team might pay and how much the city would share in revenue from parking, concessions and other money makers would be a great place to start talks, said Paul Kott, a longtime leader in local real estate.

“We want this to be an attractive agreement for them,” Kott said, but added, “For too many years the city of Anaheim has not gotten much return on their investment.”

For Orange County Communities Organized for Responsible Development, or OCCORD, and Unite Here Local 11, a labor group that represents some stadium staff, a deal that clearly spells out benefits to residents and workers is key.

They want “a fair and open and transparent process” with community input, and provisions that ensure new stadium district housing will include affordable units and that stadium workers will get fair wages and benefits, Andrew Hauserman, OCCORD’s director of organizing, said.

And paying some rent would be good.

“We think if (Arte Moreno is) using a publicly owned stadium he should be paying fair rent, just like all the renters in Anaheim have to,” Hauserman said.

The Angels paid $87 million toward stadium renovations in the 1990s, which was considered a lump-sum rent payment. But critics see a missed opportunity for an annual contribution to city coffers.

It doesn’t help that an annual six-figure city obligation for stadium upkeep and the high thresholds for when the team begins sharing revenues meant Anaheim ended up losing money in four of eight recent years. The city’s stadium earnings have swung between a nearly $1 million profit in fiscal 2009-10 and a $440,000 loss in 2015-16.

The Angels are one of two Major League Baseball teams (along with the New York Yankees) that have sold more than 3 million tickets every year since 2003 – Anaheim’s share of $2 per ticket kicks in after 2.6 million seats are sold.

Rental income and revenue-sharing aren’t the only way Anaheim benefits financially, city spokesman Mike Lyster said. The Angels’ presence also brings the city ancillary revenue, he said. Sales taxes in the Platinum Triangle – which includes two newer craft breweries across from the stadium – has about doubled in the past five years.

But several experts said a good lease deal needs to go further than vague references to how baseball fans’ spending at restaurants and shops puts money in the city economy, and it should clearly spell out the benefits to all parties.

“You really can’t afford to make a mistake by saying ‘We’ll figure it out,’ or ‘It will be good for business,’” said David Carter, a sports business professor at USC’s Marshall School of Business. “That kind of stuff just doesn’t really fly anymore.”

A key deal point in a new Angel Stadium lease will likely focus on whether the ballpark will be renovated or replaced, and how upgrades will be paid for. Opened in 1966, it’s the fourth-oldest in Major League Baseball and reportedly needs $130 million to $150 million in maintenance and repairs.

The city is expected to offer to sell or lease parking lots on the 155-acre site for development of restaurants, shops and homes, and the team could reinvest in the stadium with the cash those new projects would generate.

“Those sorts of mixed-use developments are all the rage in professional sports now,” Ballpark Digest publisher Kevin Reichard said, adding that the Atlanta Braves built a new ballpark and surrounded it with a movie theater, hotel, specialty market and more, and it has generated more tax revenue than predicted.

Late last year, Anaheim struck just such a deal with the owners of the Ducks hockey team for the long-term use of the Honda Center and the sale of city-owned parking lots that the team will develop. The agreement keeps the Ducks in town through at least 2048, lowers the revenue-sharing threshold for arena revenues and gives the team management of the ARTIC transit station, which had been a drain on Anaheim’s budget.

The 16 acres of Honda Center parking lots were appraised at $10.1 million, or about $630,000 an acre (a parking requirement pushed the price down), but other nearby properties have sold for significantly more.

In 2014, LT Global paid nearly $2 million an acre for a 14.8-acre chunk next to Angel Stadium. Ducks management has acquired a handful of parcels near the arena for future development, including nearly 20 acres of bare dirt at about $1.23 million an acre and a 23-acre office park whose per-acre price was $5.4 million.

Sharing the benefits

In Major League Baseball, plenty of teams pay rent to their ballpark’s owner, but the money is often used in the near term to pay back stadium construction debt, Reichard said.

This could be one way to structure an Anaheim deal selling the stadium parking lots, Kott said, with the team making regular “mortgage” payments to the city.

Whether or not they get regular rent checks, cities do ask for and get direct and indirect benefits from their sports venue deals, Reichard said. Minneapolis’ Target Field is being paid for by a sales tax that also helps fund city parks, libraries and youth sports facilities. Seattle’s T-Mobile Park agreement requires the Mariners to pursue hiring a diverse workforce and to provide a set number of discounted tickets for low-income fans.

To avoid being stuck with an empty stadium that’s still carrying construction debt, cities have begun adding relocation penalties to ballpark leases. In the Seattle lease, the Mariners’ owner must cough up $20 million if the team is sold to someone who’s not local.

Some have suggested a deal known as a community benefits agreement.

One was forged in 2001 between Los Angeles and AEG, the developer of the L.A. Live entertainment district. Anaheim officials have compared the anticipated development around Angel Stadium and Honda Center to L.A. Live.

Leland Saito, a USC sociology professor who has studied the L.A. Live agreement, said it has been touted as a national model for such deals.

Both the developer and residents saw its provision for hiring local workers as a success, he said. In the deal, AEG also pledged to contribute funding for 120 affordable homes, several childcare centers, a public park and community center, and job training programs.

Other community benefits agreements for major developments have included living wage provisions, money for new or upgraded community facilities, and hiring preferences for women- and minority-owned businesses.

Close involvement of groups representing neighborhoods and labor unions – one of OCCORD’s asks – was key to making the L.A. Live agreement work, Saito said.

Community support also helped win city leaders over, and it may have averted legal challenges that would have delayed the project. “It’s hard to quantify the cost of avoiding a lawsuit, but that’s a very important benefit,” he said. In Anaheim, motivated opponents could seek to slow or block city approval of development plans for the stadium site.

Benefits to the community that owns a stadium or other such venue don’t always flow through local government.

Angels spokeswoman Marie Garvey declined to comment for this story, but a 2017 tax filing by the nonprofit Angels Baseball Foundation shows it made charitable grants totaling nearly $1 million that year, supporting the local Boys & Girls Club and Alzheimer’s Association as well as a food bank, literacy program and services for at-risk youth.

The team has been an essential partner in helping Anaheim’s Boys & Girls Club serve hundreds of children every day, club Executive Director John Machiaverna said.

Regardless of whether baseball teams are money makers for their community, he said, at their best they can promote goodwill and a sense of unity in their hometown, he said.

“There are things more important than money, and community bonding is one of those things that in today’s society is really needed.”

What’s a fair return?

Anaheim officials have commissioned a new appraisal of the 150-acre stadium property, which in 2014 was valued at up to $245 million with the ballfield in use and up to $325 million if developed for some other use. Kott, the real estate agent, believes it could be worth $500 million or more today – conservatively, a return on that could be about $10 million a year for the city, he said.

Anaheim Councilman Jose Moreno, who’s been a vocal critic of city subsidies for private business, said the council should steer clear of sweetheart deals for the Angels and stay clear-eyed about maximizing the stadium property’s value in negotiating a new lease. The resulting revenue could boost funding for city services, he said.

Moreno also wants to see Anaheim added back into the baseball team’s name. While there’s no easy way to calculate what it’s worth, a prominent spot in the name could offer valuable marketing and social media exposure – and its absence has been a sore spot for some local fans.

After 30 years as the California Angels, the team was renamed the Anaheim Angels in 1997. Not long after businessman Arte Moreno purchased the team in 2003, he changed its handle to the Los Angeles Angels of Anaheim, prompting Anaheim to file a lawsuit that ultimately failed and cost the city $4 million; today people typically mention L.A. or no city at all when referring to the team.

The Honda Center deal explicitly pledges the hockey team will continue to be called the Anaheim Ducks.

Ultimately the City Council will decide what constitutes a fair return on the city’s asset, but experts say Anaheim appears to be in a strong position going into talks with the team.

Neil deMause, coauthor of “Field of Schemes,” a book about public financing of sports venues, said part of the Angels’ value – which Forbes estimated at $1.8 billion last year – comes from the Southern California TV market, making it unlikely the team would move far afield. He doesn’t consider recent overtures from Long Beach a serious threat because a proposed stadium site there is so small.

Anaheim officials are adamant they want to keep the baseball team, but USC’s Carter said if the Angels left it wouldn’t break the city’s economy. Being a global tourist destination with robust convention business and an iconic theme park “gives them greater leverage than most other similarly situated cities,” he said.

As for baseball fans, while a fancy new ballpark would be nice, they’re often mainly looking for stability, said Chris De Benedetti, a reporter who has covered the more than two-decade saga of the Oakland A’s and attempts to relocate the team or build a new Bay Area stadium.

“I think the majority of people just want the fighting to end,” he said. “They want to know where the team’s going to be for the next 40 years.”

And what about Angels fans? Some of them feel the same way, said Judee Stapp, a Placentia resident who is president of the 150-member Angels Booster Club.

She’d be fine with fixing up the existing stadium, she said, but if the team prefers a new one, that’s fine, too.

“We just love the team. We don’t want to see them move,” she said. “We like them right where they are.”