Sacramento City Council Considers New Kings Arena Deal
SACRAMENTO (CBS/AP) - Sacramento's City Council is scheduled to consider a wide-ranging deal Tuesday night that's designed to finance a new arena and keep the NBA's Kings from moving to Seattle.
The panel is to vote on a package that would use parking fees from events at the new downtown arena.
City officials reached a preliminary agreement Saturday with the investment group that hopes to keep the Kings from moving, but the late negotiations leave little time for council members to study the proposal before the vote.
Opponents have argued that the city should not be paying to subsidize billionaires.
Sacramento is hoping to block a bid by group that has a pending purchase agreement to buy the Kings from the Maloof family, move the team to Seattle and restore the SuperSonics name. That group, led by hedge-fund manager Chris Hansen and Microsoft Chief Executive Steve Ballmer, has had a deal to acquire a 65 percent stake in the team for $341 million since January.
The Sacramento investment group includes Silicon Valley software tycoon Vivek Ranadive, 24 Hour Fitness founder Mark Mastrov and billionaire Ron Burkle, co-owner of the NHL's Pittsburg Penguins. Sacramento Mayor Kevin Johnson announced late Monday that Paul Jacobs, CEO of the international technology company Qualcomm, has also agreed to become part of the Sacramento bid.
While they have united to buy the team, whether the NBA would allow them to stay hinges on a deal to replace the aging Sleep Train Arena in the suburbs four miles north of downtown.
Johnson, a former NBA all-star, said the deal would avoid new taxes and ensure a net impact to the city's general fund. Johnson has the ear of NBA Commissioner David Stern, but he must convince other team owners not to approve the move.
The new $447 million arena would be built on the site of the Downtown Plaza, an aging shopping mall whose tenants have fled to the suburbs, taking sales tax revenues with them.
Johnson said Monday that the term sheet for the arena deal includes a long-term deal to keep the Kings in the city. He said a new arena would revitalize the west end of downtown and bring new businesses to the area.
The city of Sacramento plans to contribute $258 million to the $447 million project, mostly from money earned from leasing parking garages and land. The other $189 million will come from the investment group.
Attendance would have to reach at least 1.4 million for an average 152 events annually for the financial deal to work, assistant City Manager John Dangberg told the Sacramento Bee.
He called it a conservative estimate about equal to what the aging Sleep Train Arena north of town attracted when the Kings were more competitive.
