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April 06, 2012
Kings owners fire off paperwork attacking own arena deal
The Sacramento Kings arena squabble has officially tipped over into farce, with the release of two documents this week that show the team's owners, the Maloof brothers, pushing back against the draft agreement that everyone thought they'd agreed to a month ago:
- On March 20, the Maloofs sent the city of Sacramento an 11-page "outline of feasibility concerns" (read it yourself here) that included gripes about pretty much everything: whether the city can meet its own construction schedule, whether environmental reviews can be met in time to open an arena in 2015, whether funding can be found for needed traffic and utility improvements, whether there will be enough parking, and that "the City's funding plan ... uses questionable assumptions and does not adequately account for the financial risk that the City is undertaking."
- Four days before that, the Kings' lawyer filed a seven-page public records request (read it here) demanding pretty much all communications between city officials and anyone having anything to do with the arena project since last April.
All of which is pretty much what you might expect from a muckraking newspaper or a citizen watchdog group, but not so much from team owners who are supposedly rooting for this thing to get built. One possible theory is that the Maloofs were hoping to build off the excitement of the announcement of an arena deal, then get lots of stuff changed once the plan was considered a fait accompli; another is that they've wanted to move all along, but wanted to be able to show the NBA that a deal is unworkable in order to get approval to move to Anaheim or somewhere else. (A third, I guess, is just that they're incredibly incompetent negotiators, which can never be ruled out.)
The NBA, in any event, seems eager to paper over any problems, with "sources" telling Sacramento's News10 that the league is likely to pay the $3 million in arena pre-development costs that the Maloofs say they won't pay, despite it being in the term sheet. NBA Commissioner David Stern said on Wednesday that he's "more hopeful than confident" about getting a deal done: "In a week, our owners will be coming in for meetings ... and we'll see where it's going."
There are clearly many, many ways that this deal can blow up over the next two weeks ... but then, plenty of arena and stadium plans have been rescued from the brink of disaster at the last minute. This is all going to depend on whether the Kings owners are really just trying to drive a harder bargain, or whether they're looking for an excuse to back out entirely. And, of course, whether anybody can actually find enough money to pay for the thing. Details, details...
Considering that the Maloofs torpedoed Measure Q&R in 2006 (which would have built them a new arena at the railyards completely at taxpayer expense), it's not surprising that they'll try to torpedo this one as well. They want to move to Anaheim (that's as close as they'll get to Vegas), but they weren't counting on the city of Sacramento successfully jumping through as many hoops as it has up to this point.
That they then turn around and point to the city as being the problem (instead of themselves) should not be a surprise, either, because when it comes down to it, the Maloof brothers are narcissists of the highest order.
Now, are they bad negotiators? I'll let their remaining 2% stake in The Palms resort speak to that point. However, their balking at something they had agreed to, when everybody can access and point to the document they had agreed to publicly, just indicates that they're stupid.
Posted by SierraSpartan on April 6, 2012 12:30 PM
Their 11 page letter reads like some of the negative comments on sacbee. I bet that's where they got most of their ideas.
I think they're behind STOP, too.
They're trying to leave Sac. We'll find out why soon enough.
Posted by MikeM on April 6, 2012 12:54 PM
If the Maloofs are going to continue to own the team, I'd almost say to just let the Kings go. As much as Sacramentans want to live in a "major league" city, these guys, and this team, are not worth busting the city budget for.
(1) The Maloofs are terrible businessmen, terrible citizens, and clearly do not want the team to remain in Sacramento. If David Stern wanted to do something about them, he could've done it long ago.
(2) Even if the new arena was built and the team stayed, can they ever be competitive again? The new dynamics in the NBA mean that the superstars dictate where they will play, and they don't want to play in small markets. Even the Warriors, playing in the Bay Area, a pretty big market last time I checked, can't attract any big names. Now, of course, they're the Warriors, but, still, with new ownership no one still wants to play for them. If a market like the Bay Area can't attract players, who in the heck would want to play in Sacramento?
Is it worth it to pillage the city treasury to pay for a new arena to enrich such awful people and for a team that's probably going to suck for a long, long time? I'd say no.
Posted by Justin on April 6, 2012 02:23 PM
There will be a public workshop on Thursday afternoon at City Hall in Sacramento on the arena:
blogs.sacbee.com/city-beat/2012/04/public-workshop-scheduled-for-sacramento-arena-project.html
The article points out that the Maloofs won't attend the public workshop as they will be in NYC for the NBA Board of Governors meetings.
As someone who attended the STOP fundraiser last weekend, I couldn't find any evidence of Maloof involvement and if their lawyers' writing sounds like Sacramento Bee reader comments- then these don't sound like very good lawyers.
Posted by jjo916 on April 6, 2012 02:50 PM
the three letters by the Magoof's attorney are an excellent bit of due diligence...and an excellent analysis of the entire Arena deal...
You could not find a better attorney to represent the Magoofs and assume the LA Attorney guys are very expensive
Posted by segio on April 6, 2012 08:22 PM
Geez, just let them go.
Posted by Larr** on April 7, 2012 10:47 AM
CBS 10 has removed the 11 page letter. Hmmm...Team KJ strikes again.
Posted by Cal on April 7, 2012 04:34 PM
The Maloofs questions are the same ones I posed when I first read a deal was struck.
There are far too many moving parts right now for anyone to be confident but only hopeful as Stern put it.
This will go to a vote and will go down in flames. The city is taking 9M a year from their General Fund from parking proceeds to build the arena.
9M a year? I am sorry, that has to go to a public vote.
You just cannot take 9M a year from the General Fund without taxpayer approval.
I believe the public vote will torpedo this deal as Kevin Johnson is trying to get votes for his re-election campaign and he is not thinking long term.
The Maloofs understandably have concerns as would I if I was them....especially considering the history between the team and city over the years.
Sacramento has just delayed the inevitable.....The team will be the Anaheim Royals in 2013-2014.
Posted by SBSJ on April 9, 2012 03:06 AM
The 11-page Maloof letter is gone from News10's website, but it can be found here:
www.scribd.com/doc/88339725/032012-Maloof-Letter
I doubt that one will go away in the near future.
The Council shouldn't proceed until all the points in this letter are addressed in some way.
Posted by MikeM on April 9, 2012 12:01 PM
The Council has given the Maloofs and the Mayor a lot of rope to hang themselves on this deal. I wonder if the next meeting will be the one when everyone runs out of rope. What if David Stern finds $3M to pay for pre-development costs at the NBA meeting this week? Or will the other owners want to call it a day?
Posted by jjo916 on April 9, 2012 02:03 PM
At the risk of hijacking this thread, SF:
www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/04/08/BAQB1O0653.DTL
That's a pretty expensive idea, right there.
Posted by MikeM on April 9, 2012 02:12 PM
Now the Maloofs want to "start negotiating this thing again."
www.sacbee.com/2012/04/09/4401224/crucial-meeting-looms-this-week.html
How foolish was it that the Council voted on something other than a contract? Very foolish, obviously, as it has turned out.
Posted by MikeM on April 9, 2012 04:49 PM