California Memorial Stadium FAQ

April 18, 2012

Why is the Memorial Stadium project being financed?
It has always been the intention to use external financing for the renovation and seismic retrofit of Memorial Stadium. This is common practice in financing many types of capital projects, from large endeavors, such as the Memorial Stadium construction, to smaller ones, including home purchases. The Athletic Department, using non-public funds, will be able to make its debt payments through an increase in operating revenue generated from such avenues as the Endowment Seating Program (ESP) seat sales, enhanced Pac-12 media rights, the institution of a facility fee and donor philanthropy. It should be noted that, to date, the project has been financed using debt at lower interest rates and longer maturities than initially modeled.

Cal has received $31 million in cash from ESP sales to date. Does this mean the $270 million goal for the program is not realistic?
About 85 percent of ESP participants have chosen to spread their payments over time, which means they are paying annually up to 30 years. As of December 31, Cal had received $31 million in cash from ESP sales, which corresponds to a total projected value of over $144 million to be paid by the end of the payment contracts. The original goal of $270 million remains. The plan has always been for the Athletic Department to use its operating revenues to make debt payments on an annual basis over the next 30-35 years.

The $31 million received also comes four months before the reopening of the stadium. We anticipate the number will assuredly grow as kickoff for the first game of the year approaches and as the football season gets underway. The goal is to sell 90 percent of the available capacity in the ESP sections, and that goal is targeted for June 2013.

Will the campus have to account for any Athletic Department shortfall?
No central campus funds have been used to finance this project, and it is intended to be managed so that none will be. The Athletic Department and university have gone to extraordinary lengths to inform interested parties about the financing model, including posting on (see Facilities Project Summary and ESP Financial Reports). This analysis suggests that even under a highly conservative, worst-case scenario, the project does not face a financial problem until at least 2038, and that case assumes that no intervening action is taken over the next 26 years.

Did the university pledge tuition revenue to obtain debt financing at a lower interest rate?
As is standard practice for debt issuance in higher education, all forms of university revenue, including tuition revenue, are pledged. The specific types of funds used to pay the debt service for CMS are governed by the Regent's Item. This is available at: As described in the Project Planning Guide, repayment of this debt service will come from Intercollegiate Athletics' gross revenues. The source of repayment is carefully monitored.

Will the renovated stadium have a reduced capacity because Cal cannot sell enough tickets?
Great attention has been made to ensure the preservation of the historic facility, including the outer façade and bowl-shape around the field that are so important to the followers of Cal football. The redesign of the bowl within the existing structure includes ESP sections with chair seating, sections featuring benches with backs with additional legroom, and new seating alternatives and full compliance with the Americans with Disabilities Act. As a result of these upgrades, the capacity of Memorial Stadium is being reduced from 72,000 to 63,000, which is the maximum number of seats that can be accommodated in this new configuration.

Why is the cost of renovating Memorial Stadium more expensive than stadium projects at other universities, such as at Stanford and Minnesota?
The projects are not similar in scope. Nearly two-thirds of the $321 million cost for the Memorial Stadium project is associated with seismic corrections and code upgrades. In particular, the seismic issue is not a factor the other facilities have had to manage in the same manner. Additionally, Memorial Stadium is listed on the National Register of Historic Places, which adds costs to the project, and is a larger stadium than the new facilities at both Stanford and Minnesota by approximately 13,000 seats each.

Does revenue from Cal football support the rest of Cal Athletics?
Yes, Cal football has consistently generated revenue for the Athletic Department. Over the five years from 2006-10 for example, football generated at least $24 million in gross revenue and $6.9 million in net revenue each season.

Is Cal playing a Friday football game because of the need to generate additional revenue?
As part of the new Pac-12 media rights agreement that will take effect in August 2012, each conference school will regularly host games on dates other than Saturday. Cal has committed to one Friday night home game in every two-year cycle, meaning that there will be no Friday game in 2013, but will be in either 2014 or 2015.