Sacramento officials and the owners of the Kings yesterday announced that they were postponing the release of a huge pile of documents — seriously, that’s what the Sacramento Bee article says, a “huge pile” — on the team’s final arena deal, so that they can “spend more time to perfect the provisions and details.” I.e., it’s not ready yet, it’ll be ready when it’s ready. This is a little bit of a problem, since the Sacramento city council is set to vote on the deal on May 13, and proposals are legally required to be made public 10 days before a vote, meaning the huge pile will need to emerge by no later than tomorrow if the Kings don’t want to risk a delay in the council decision.
Cosmo Garvin of the Sacramento News & Review, meanwhile, has taken a look at the bits of the deal that have been released so far, and contrary to initial reports that it would be slightly better for the city than the original deal since the Kings would pay more rent, he says it could actually be even worse than the initial plan. His reasoning goes as follows:
- The city would have to pay $21.9 million a year in debt service, compared to $17 million a year in the original plan, because projected interest rates have risen from 5.75% to 6.75%.
- The team’s rent would rise only from $4.7 million a year to $6.5 million a year, though that latter figure would increase further starting in 2020. And the team would no longer share profits with the city, meaning that $4.7 million could have turned out to be more in time.
- The city’s added cost of $4.9 million a year is more than the team’s added annual contribution of $1.8 million. By a huge pile of money.
I’m not entirely sold on Garvin’s argument — I’d like to see a present-value comparison of the old and new rent payments over time, for starters, and you know what I think of profit-sharing deals and the machinations that teams can use to avoid paying out on them. Still, that interest-rate hike is a huge hit, and is definitely going to make it harder for Sacramento to cobble together enough money to pay its arena bills each year. Maybe the council should identify a hospital it can sell, just to be safe.