The Virginia Beach city council gave its nonbinding agreement last night to move ahead with talks for a new $426 million arena, which is no real surprise, given that it’s nonbinding, and they’ll get a chance to vote on any actual deal once there’s one to vote on. But it does mean that Comcast-Spectacor can go back to the owners of the Sacramento Kings and say, “No, seriously, are you actually going to move here and what would it take to get you to do so?” which is kind of an important question.
As for how this arena would be paid for, Mayor Will Sessoms presented this new framework, according to WAVY-TV:
- $195 million from the City of Virginia Beach
- $35 million from Comcast-Spectacor
- $150 million from State of Virginia (including moving costs for a sports team and initial construction)
- $46 million borrowed
Um, er, yeah, you guys know that money that’s borrowed has to be paid off somehow, right? So who would be paying off the $46 million? Guys? Anyone?
Actually, how any of it will be paid for is still, generously, a work in progress, with proposals including everything from a 1% hotel tax hike (which would generate enough to pay for maybe $40 million of the total) to a $2 per ticket “arena development fee” (which would generate … let’s generously say 150 events a year, average 10,000 people per event, that’s about $3 million a year, covering maybe another $50 million in costs). Presumably Comcast would pay some rent as well, but still we’re talking about a massive funding gap. In other words, we’re still back where we were in August: There are developers willing to build an arena in Virginia Beach, as soon as somebody else figures out how to pay for it.