Sacramento city manager John Shirey finally released the city’s long-awaited term sheet with the local group that wants to buy the Sacramento Kings on Saturday night — conveniently, almost exactly 72 hours before the council meeting that they hope will vote on the deal, which requires 72 hours’ notice. And so of course I had to stay up late reading it, and commenting about it all over Twitter.
I’ve gotten a couple of nights’ sleep now, and had a chance to consult with some other arena finance experts (Stanford’s Roger Noll, for one), so let’s get down to analyzing what’s in the latest arena financing plan, and what isn’t. But because embedded tweets are fun, let’s use those as conversation pieces:
Tips on how to read term sheet: Blah blah blah blah when do we get to the part about the money?
— Field of Schemes (@fieldofschemes) March 24, 2013
Most of the document released on Saturday night can safely be ignored, since it’s about the history of the Kings saga, and how Sacramento wants to build a “first-class venue for sports, entertainment and cultural events … and blah blah blah. The question everyone wants to know is: Who would be paying for a new Kings arena, and how?
#SacKings term sheet asserts parking $$ to pay off $212.5m in arena debt, plus $3m+/yr in "surplus net revenues." Doesn't show math, tho
— Field of Schemes (@fieldofschemes) March 24, 2013
The first piece of the Kings financing puzzle would be for the city to raise $258 million to pay off 58% of the arena construction cost. (The other $189 million would be paid off by the Kings’ new owners.) $45.5 million would be covered by the sale of city land and a couple of other small subsidies (a construction sales tax kickback, for example), leaving $212.5 million. That money would come from diverting future parking revenues from city-owned lots downtown to a nonprofit corporation, which would in turn use them to pay off $212.5 million in bonds.
That’s all fine and dandy, and pretty much the same deal that Sacramento proposed in last year’s term sheet, only there it would be a for-profit company paying up front for the parking revenues. And the city apparently feels confident that this money would be enough to pay off not only the annual payments on $212.5 million in bonds (probably around $13-14 million a year), but produce an additional $3 million a year left over—
If parking $$ isn't enough, Sacramento would use hotel-motel taxes to fill in the gap.
— Field of Schemes (@fieldofschemes) March 24, 2013
Okay, not all that confident, then. Or at least, the city doesn’t think bond buyers would be that confident, so they’ve come up with a backup plan just in case the parking revenues go south.
The prospect of the parking revenues coming up short is a doozy, though, because of:
How lost parking revenues be paid back? By counting anything city gets from new arena – ticket tax, rent, sales tax, parking – towards that.
— Field of Schemes (@fieldofschemes) March 24, 2013
Some of that money would actually being paid back by the Kings — there’s $3.7 million from a 5% ticket tax, for example, which would come off the top of the team’s ticket sales, plus another $1 million in “profit sharing,” though given that the “profits” would actually go to pay for the city’s arena debts, Sacramento wouldn’t actually be sharing in anything.
But also notice that “parking” is one of the items being used to repay the lost parking money. That’s right — Sacramento is expecting so much new parking money to flow from this arena development, that there will be enough parking money to pay back $3 million a year the city from giving up parking money. Or in tweet form:
Bingo. @Jasonfin So are they paying for the arena with parking $$ and than filling the general fund back up with more parking $$?
— Field of Schemes (@fieldofschemes) March 24, 2013
And how does the term sheet come up with that calculation that parking revenues will rise enough to leave $3 million in extra cash after paying off the bonds? (Actually $3.6 million, because another $625,000 is supposed to be provided by “city parking revenues from [arena] events,” which is just another category of the same thing.) Here is the entirety of the “city parking revenues” explanation in the term sheet:
The Public Parking Finance Model will be structured in such a way to provide $3 million annually to backfill the City’s portion of the General Fund revenue.
And that’s it. No charts of future parking revenues, no citations of how the revenue figures were arrived at (beyond that these are considered “conservative assumptions”), no explanation for how the arena project would result in a cornucopia of parking money even after razing 1,000 existing city parking spaces to make way for the arena and giving another 2,700 to the Kings for free. Just “don’t worry, the money will be there” — and if it isn’t, it’s back to the hotel tax, a pool of money that has been bouncing around between $10 million and $20 million a year, and which currently goes to fund general city services.
Okay, so the city thinks that it can take $9 million in current annual parking revenues, get rid of half the parking spaces it currently owns, and end up with enough money to pay off $13 million a year in bond payments and still have $3 million a year left over? That’s not inconceivable, is it? After all, downtown parking revenues will inevitably rise over time, especially if you plunk an arena down to replace a failing mall, so maybe if you squint just right…
Except for one big problem: The term sheet proposes that parking revenues are going to soar past $9 million in the future, but then only comes up with — oh, wait, forgot to do it this way:
Also, projects parking $$ to rise over time, but only replaces the $9m the city gets now, not what it would get in future.
— Field of Schemes (@fieldofschemes) March 24, 2013
Get the sleight of hand here? It’s a bit like figuring out what you can afford to pay for a house by counting on your paychecks getting larger for the rest of your life — but then figuring out how you’ll pay for your living expenses by only basing it on your currentincome. If Sacramento parking revenues would otherwise be, oh, I don’t know, $15 million a year in the year 2030, then the term sheet should be explaining how it would be repaying $15 million a year by then — but it doesn’t.
The only way the city could magically pay for everything using parking revenues, then, is if the arena itself more than doubles the amount of money the city earns from each of its downtown parking spaces. Which is … possible, I suppose? There’s really no way of knowing, because the term sheet doesn’t provide any methodology at all for explaining why it thinks this; it’s just more assertions that the money will be there, quit asking about it.
And that, ladies and gentlemen, is your new Sacramento Kings arena deal: The city would give the Kings $258 million toward the project, but would come out breaking even because they’d take $9 million a year in parking revenues, cut that in half, multiply it by some unexplained method, and come out with at least $16 million a year as a result. Or to put it another way:
@EricRutty It's amazing in an Underpants Gnomes kind of way. So long as you agree that $9m/year + ???? = $258m, it's awesome.
— Field of Schemes (@fieldofschemes) March 24, 2013
Okay, so for Sacramento taxpayers, this looks like not the safest deal in the world, and stands a good chance of having to dip into the current general fund, via those hotel tax revenues. (If you’re looking for a “How much will this cost Sacramento taxpayers?” figure, by the way, a la my Seattle calculations, sorry, no dice — the term sheet doesn’t provide enough information to even come up with a guesstimate.) But what will the NBA think of it? After all, they’re not going to care how Sacramento pays for an arena, so long as the city is guaranteeing to fund it somehow — if Sacramento is proposing to pay it off by selling off the firstborn child of every resident (happy Passover, by the way!), that’s no skin off their nose.
What is potentially a snag here: What the Sacramento city council will be voting on, as soon as this Tuesday, isn’t actually this financing plan. Rather, it’s just a nonbinding term sheet for a financing plan, which means there will be need to be another council vote down the road to actually approve the money. And while a positive council vote this week would certainly be a good sign for the NBA, the league is going to have to be at least mildly concerned that if it rejects the Kings’ move to Seattle in April, this Rube Goldberg scheme of a finance plan could be discovered to be unworkable before it came to an official vote, and then everyone would be back where they started.
This term sheet isn’t all bad for Sacramento — or, I should say, it’s not all bad for Sacramento Kings fans hoping that the team will stay put despite the Maloof brothers’ January agreement to sell it to a Seattle buyer group. Mayor Kevin Johnson did get his term sheet done under the gun, just in time for a council vote this week, and it’s very possible that it will pass, especially since the council will only have a couple of days to read and digest it. (Though as I hope I’ve just shown, it shouldn’t take more than a couple of days to see that it’s filled out with locusts and tape.) So maybe, just maybe, the NBA will accept the city’s commitment to write a $258 million check and figure out where the money will come from later, and decide to reward it by rejecting the bird-in-the-hand it has waiting for it in Seattle.
Then all Sacramentans have to figure out is how to pay for it. Hope they really like parking.
I think something you wrote on Twitter distilled it well: All the NBA likely cares about is whether Sacto will write a $258 million check. The interesting thing IMO is that this term sheet makes it look like they just might.
Was Sac already getting parking revenue from the Natomas/Arco site making it more of a wash to get any revenue from downtown parking ?
Also, that 1M a year profit sharing is a guaranteed minimum that rises by CPI. It’s kind of like Hansen’s $1M a year in rent, which doesn’t rise by CPI or any other means for 30 years. The profit sharing can always be described as “if there’s $20 mil a year in profit from operating the arena, the city would get 5.5 mil of that.” It’s the missing 2nd step of underpants profits, big brown revenue projections. It fills in the hole already dug, similar to Hansen’s rent actually.
ChefJoe, not sure where you’re seeing that the $1m rises by CPI — from what I can see, the term sheet just says “Guaranteed annual payment of no less than $1 million.” If the arena turns more than a $7 million annual profit — unlikely, since the Kings will probably skim any profits off the top — then the city’s revenues will increase, but otherwise it looks like just $1m a year in perpetuity.
Also, another big difference between this and the Seattle deal is what happens in case of shortfall. If Seattle revenues aren’t sufficient, Hansen’s rent goes up. If Sacramento revenues fall short, the city dips into the hotel revenue pot.
KJ’s strategy is becoming clear. (Others have already mentioned it before on this forum). He is just trying to buy time. All he is hoping to do is have the BOG’s vote against Hansen. How he will pay for the arena will be figured out later, because then they will have a lot more time to figure it out, at least that is what he thinks, I assume. Contrary to popular opinion, there are actually a lot of moderately intelligent people in SAC city hall who know that this term sheet is a bunch of nonsense. But that does not concern them. If Hansen’s deal gets rejected, then they can figure things out later. They need time, and time is what they are fighting for.
Ben, this is more than just NBA caring about $258M. The real question is – Can Sacramento even afford an NBA team? Sure they may raise the money now to build an arena, but what if the city goes bankrupt later? SAC’s economy is already one of the worst in America. Would people continue to choose to pay high prices for tickets and parking for the next decade or two? Not to mention that NBA has been unable to secure a decent TV deal in this market. Compare all this to Seattle – Top 12 market, one of the 10 fastest growing cities, healthy economy, 8 fortune 500 companies, and an area generally considered flush with cash (present company excluded). Sure, in the short term, they will like SAC’s larger contribution, but the forecast will include not just this year, but the next two or three decades.
It’s the “Operating Profit Allocation – Waterfall” on pg 32 of your link. That’s where the $1M in repayment from operating profits is more elaborated. Hated reading the first half of the document so went straight to the actual terms.
If you want to know how Sac came up with parking figures and paid attendance receipts, just assume they’re using last years projections. They haven’t had enough time to create new ones.
And if you want to know why those are too rosy, read the Beacon report, starting on the bottom of page 6.
http://www.scribd.com/doc/132252743/Beacon-Report-RE-Arena-Costs
Aha, there it is, thanks, ChefJoe. That’s a bit better, then, but still we’re only talking a present value difference of maybe $15 million, tops.
But, yes, Sacramento is putting a lot more future city revenue/current assets on the line with this deal compared to Seattle. One could argue (if there’s any economic benefit to public funds for sports) plugging a half-vacant mall with an arena for the only pro team in town looks better than a 4th pro team in Seattle a few blocks away from the site of 2 or 3 larger sports stadia.
Have you ever visited Sacramento? I have, many times.
It’s a lot of dingin’ around to save a mid level hump of a pro basketball team for an armpit of a city in the middle of some farmland for fans who don’t care about it and don’t want to pay for it.
In the NFL we have a saying about stadiums: “If the public won’t pay, we’ll move away.” Preferably to the VLAFP (Virtual Los Angeles Football Palace), heh heh.
I do like this parking ramp angle, though. We never though of that one. I wonder how big a parking ramp you’d need to finance one of our gold plated wonders? Hmmm….. I’m seeing the world’s first 30 story parking ramp next to a new stadium in … Los Angeles! YESS!!! Zoning that one should be easy.
I love it….Greed is good! As I said in “Wall Street – Money never Sleeps,” Take a buck, shoot if full of steroids and call it leverage…steroid banking. This is a new form of moral hazard.
Chef Joe…if one could argue that there is an economic benefit for a sports team why would it be significantly different between Sacramento and Seattle. There is little evidence that sports fans in Seattle all support the same teams and therefore lose that money (which only goes to the team anyways) and filling the gap in the winter months would only serve to supports a more heathy business district than one that had a vacant venue 5 months out of the year.
I have no problems with the math or the validity of any of the projections made by these esteemed professionals! These professionals hired by Sacramento to produce these reports and projections have been thoroughly vetted by the Easter Bunny and his associates, the Elves, working for Chris Kringle at the North Pole. I do not know what else anyone could possibly need?
Myk, there’s this guy .
http://blog.sonicsrising.com/who-would-do-that/#comment-29233
Much respect to Carmichael Dave coming through here (assuming it’s the real one of course)
We’ve exhausted about every possible discussion in regards to E, relocation, etc, but I do genuinely hope there’s a way that both cities can be happy, even if it means someone has to wait a few years.
That being said, I’m so ready to get 4/3 and 4/18 over with. No matter what happens, this whole ordeal has been too draining. I just want to know if I should start putting aside some money for Sonic tickets or if I’m going to have to wait a while and give it to the Seahawks in the meantime
But, no, that G. Propheter 2012 study “ARE BASKETBALL ARENAS CATALYSTS OF ECONOMIC DEVELOPMENT?” basically found that in modern times, the best situation for an NBA arena was to go into a town without any other pro sports teams.
Doesn’t Sacramento already owe 50M on the parking garages that has to be repaid? I think I remember reading that? If true, that will have to be covered somehow.
@Bob, the city does indeed owe debt on the parking garages ( I do not know the exact amount offhand). That is why the bonds will be interest only in the first few years. After the debt is paid off, the payments will start to kick in.This is why the investors will be signing up for 35 years instead of the typical 30 years.
There’s one element of the term sheet that I certainly expected to see addressed, and that is compensation to the existing business owners in this four-block parcel for the arena. The term sheet map doesn’t show it well, but the bulk of the K-L/6th-7th block is owned by Macy’s — not the City or the mall owner. That’s the physically largest example of this that I know of.
Also, a number of smaller business hold leases in these four blocks. What sort of compensation should they receive? Macy’s the largest single example in these blocks, but I’m sure there are others (24 Hour, it turns out, recently paid a lot of money to convert space from a Hard Rock to a gym).
I can’t find the term “overrun” anywhere in that document. $447M isn’t anywhere near enough for that location, in my opinion. We need to know who will pay the difference.
I’m not impressed with the current loan refi terms, either. They want to secure it with the 85 acres in Natomas. It already IS secured with the 85 acres in Natomas. I cannot see how they’ll swing that.
The Bee article today says it could take 1 year to set up the structure for this. Ultimately, that’s why I think the BOG will never even get to considering this Sacramento term sheet, even when it passes tomorrow. It could actually pass 9-0 now. I can see how it could. They don’t want to hear in a year from now that Sac couldn’t raise $212M in bond sales, and they’re still short — and meanwhile, $447M was too low an estimate after all.
The BOG would be out for blood in a year from now if they deal in Sac blew up, and I think it easily can. So they’ll never seriously consider it, even when we pass this tomorrow. No, not “if”; WHEN.
Just don’t party too hard, arena proponents.
I now see the overrun clause. Private developer.
Just wanted to correct myself.
Wait, you can’t refinance something and keep the same security on the loan ? I thought they just had new bonds issued at whatever the current terms are and frequently used the same security.
If I refinance my house does that mean the bank gets my house and I need to have another house to offer as security ?
I dunno, if the mall is failing there might be a bunch of properties that would love to find a buyer. I wouldn’t be surprised if there were some rules regarding a certain percentage of the mall property being occupied to continue to keep the place open.
Did Macy’s ever settle this issue in Sac ?
http://www.bizjournals.com/sacramento/print-edition/2012/07/27/foreclosure-filing-aims-macys-building.html?page=all
Macy’s, which declined to comment, still has a lease on the building at 600 K St. and is expected to continue operating in it.
The parties directly involved are keeping mum on what happened, and only a few property documents provide basic information about the foreclosure last month.
Documents indicate that the landlord owed $8.3 million on the 171,000-square-foot building. The building was put up for auction with a starting price of $5.3 million, but there were no takers.
It’s questionable, ChefJoe, because the 1997 loan was based on revenue-anticipation bonds. This new collateral is 85 acres that cannot be used for an ESC.
I think the original $90M valuation based on anticipated revenues was a bit high. Basing it now on land-only that the term sheet acknowledges would be on land that cannot be redeveloped until the flooding issues are resolved is very optimistic.
Sounds like they sell the land (~$20M), possibly provide a lockbox of ESC revenues, and get new bonds issued to provide the ability to pay the rest. I don’t see pg 20 saying anything about what security (beyond the lockbox), it just says “adequate”. Land value probably not high enough to be adequate (especially if they’d like to sell it).
1997 City Lease-Revenue Bonds (Loan):
Existing bonds will be retired. City will issue new 30-year bonds to retire existing bonds upon the Investor Group providing satisfactory security and collateral for the loan which may include an ESC lockbox on revenues among other items to be determined. The Investor Group would have the right to utilize proceeds of the sale of the 85 acres of land at the site in North Natomas as well as other sources to pay down the current balance of the 1997 bonds and reduce the principal amount of new bonds to be issued. Furthermore, a 5% ticket surcharge will apply to all events held at Sleep Train Arena and the revenue from that will be used to retire the 1997 bonds.
ChefJoe: Ever seen “The Producers”?
That’s what this sounds like to me. There is only so much revenue to distribute. So let’s make sure everyone gets their 50% cut.
Ultimately, the general fund has *no* guaranteed protections at all if all the rosy predictions about parking revenue do not come true.
At least with the Seattle deal, if the revenues fall short, the developer is on the hook for that via increased rent.
I wonder if the Sac “Negotiators” even tried for that sort of common sense backstop for the lost parking funds.
I dunno, some pretty reputable guys think Seattle’s arena will have some real difficulty penciling out in the long term with the modest public subsidy.
http://www.slate.com/articles/sports/sports_nut/2012/08/seattle_sonics_arena_is_chris_hansen_s_promise_of_a_no_strings_attached_sports_facility_too_good_to_be_true_.html
It seems like Sacramento’s locked into trying to save a team with a all-too-high price tag. You have to play the hand you’re dealt and KJ seems to be making the most of it… at least he’s also getting rid of a blighted mall in the city and doing something that might attract some parking revenue. The last person to say “no, you’re promising us too much money” is probably not the commissioner of the league.
Regarding the Macy’s parcel; officials have said Macy’s will not be affected, and will stay where it is. The parcels expected to be needed for the arena are small, and part of a failing mall, the money required for that is not expected to be anywhere near a significant sum. As far as the 24 Hour, Mastrov founded 24 Hour (he’s since sold it for a hefty sum) but I imagine if the site is needed he could use his existing business relationship to make sure it goes through and everyone is happy on that front.
The reason for refinancing the current loan tied to the Natomas site is that the collateral for the loan is not worth the value of the loan itself. Sleep Train Arena is nowhere near worth the loan, because of this the city wants to pay it down for a few years (5% surcharge on all events at arena) and refinance it with the investor group putting up a new form of collateral. This loan in particular is very complicated in its current form. The city is just the middleman, and actually owns the arena and leases it out to the Maloofs. A big part of this deal is the city trying to protect themselves on that front, as Maloofs/Hansen could just default on the loan and it’d be a net win for them (Although I am sure the NBA would ensure that doesn’t happen as it’d be a PR nightmare).
Seattle has a publicly subsidized arena proposal, and now Sacramento has a publicly subsidized arena proposal. Debate the details of the proposals all that you wish, in the end they are both publicly subsidized arena proposals; and they both suck.
ChefJoe: I said in that article that the Seattle arena would have trouble penciling out for *Hansen*. Seattle is much better protected than Sacramento in their proposal — not perfectly, mind you, but much better.
Sure Neil, Seattle has more protections than Sacramento, provided the local politicians would actually use them rather than cave to a team owner who found themselves losing money in their binding lease. My impression (as someone who lived in Columbus OH before Seattle) is that once the foot is in the door and the public owns an arena of limited use, the trap is set.
So are you suggesting that if the Seattle arena revenues fall short, Hansen will refuse to pay the additional rent required in his contract, and rather than sue him, the council will say, “Never mind, we got this”?
Yes, I think Seattle would do such a thing once you get 10 years out and nearly all the people who approved this thing have moved on. Bennett seemed to have only a few speed bumps along the way has he moved a team with years left on the lease and plenty of other sports owners have done so before.
With politicians, it becomes the same old “did you let the team go on your watch”. Truth be told, I don’t think Seattle can support so many pro teams at a healthy state. Take a look at what the Seattle Center wrote about what the Clink and Safeco did to sink the KeyArena and Sonics (they suggest it was the suite sales being divided/less in demand). http://www.seattlecenter.com/admin/fileout.aspx?thefile=846
For all the hoopla, I don’t see many people accounting for the KeyArena becoming more of a drain (nor, for that matter, any local news about KeyArena’s future which was something the Council said would be pinned down before any future votes on the MOU/financing).
Looks like they have “another whale.”
http://www.sacbee.com/2013/03/25/5292226/sacramento-bid-to-keep-the-kings.html
I really scoff at this, though. It just makes it look like they’re in chaos.
I still haven’t seen a reason the BOG would decide it has to reject the Hansen bid. They need to find something wrong with the Hansen offer.
They, unofficially, rejected the Vancouver Grizzlies sale to Bill Laurie because he wanted to move the team (with a commitment to Vancouver for two more seasons based on the expansion agreement) and he had the purchase deal structured with a $50M bonus when the relocation happened.
http://sportsillustrated.cnn.com/basketball/nba/news/1999/09/23/grizzlies_sale_ap/
Commissioner David Stern voiced his personal opposition to a relocation, citing the league’s record of not having any franchise migrations since the Clippers moved from San Diego to Los Angeles in 1984.
“It’s my goal to see the Grizzlies stay and succeed in Vancouver,” he said.
The decision on whether to allow the team to move, however, would ultimately be made by the league’s Board of Governors. Of the league’s 29 owners, only 15 would be needed to approve a relocation. A three-quarters majority would be needed to approve the sale.
“It’s not unprecedented for an NBA team to move, but on the other hand when you place a franchise someplace you ask the fans to make a certain commitment to the team,” Stern said. “And it’s not inappropriate for the fans to expect the team to have some commitment to them.”
and Laurie paid more money to be let out of his purchase agreement before it was voted on by the BoG.
A better article describing some of the pre-BoG meetings on Vancouver/Laurie that are where things were allowed to unofficially die.
http://static.espn.go.com/nba/news/1999/1026/134094.html
Ok, calmed down a bit. Neil, you’ve studied far more stadium/arena deals than I. The Seattle one is one of the private/public arena deals that has put the most risk on the arena operator, and seems to have the most security. Maybe it’s going to set precedents that will stand for a long time. The thing is, I’m not familiar with other deals that started out with so few (but the operator believing) the finances would work out, setting a really high value for team acquisition, and then following through on a deal with a 30 year lease with the potential for losses both professional and personal. I’m highly skeptical, because I’ve seen NHL deals that went ahead with private ownership (against a public vote) ultimately need to get bailed out by the public.
Do you have any idea of the maximum length has an arena operator has taken yearly losses on their lease terms and been cool with it ? I don’t think Hansen could afford 30 years of losses/additional rent of the size the city’s spreadsheet projects and don’t see why he’d be giving the personal guarantee if Ballmer was the one who could afford the operating losses.
Couple of things:
1) Yes, I think that the Key Arena is a big concern, and the main reason why this deal could be more costly for Seattle than the rough break-even that it appears at face value. I honestly don’t see any way that Key stays in operation for very long, which means either they’ll need to raze it and put up something else, or spend money to downsize it so it’s competing for different kinds of shows, or something similar. Either way there could be more costs there.
2) As for what happens if Hansen is losing money, the most worrisome parallels are probably the Target Center in Minneapolis and the Nationwide Arena in Columbus, each of which were privately owned and got public bailouts because the owners said they were losing money and the team was suffering. But there are certainly some arenas that were built largely with private funds that didn’t demand bailouts — Bradley Center, whatever the arena is Boston is called these days, a couple of others. Hansen could end up making money on the arena, or could end up losing money and decide to sell to someone else at a loss, or all sorts of other things that people do when their businesses aren’t as lucrative as they hoped. But declaring bankruptcy and walking away from an investment is a big step, and — even if someone might threaten it in order to get a bailout — not one that is done lightly.
And, really, what are you going to do? The problem in Columbus and Minneapolis wasn’t that the city was on the hook for stuff in the original lease deal and the teams refused to pay; it was that the team owners cried poverty, and local elected officials said, “Oh, okay.” Unfortunately, it’s part of hosting a sports team: No matter what kind of stadium or arena deal they have, they can always turn around and try to make new demands. You simply need to have eternal vigilance on the part of both local elected officials and the citizenry, and hope that’s enough.
http://seattletimes.com/text/2018743205.html
Hansen has plans to help convert the key arena in the future to something else that would benefit the city.
Well, you have two cities that are ready to go on paper. Give an expansion team to Seattle, and the hypocrites there can pretend to be a moral highground. Sac. keeps its team, and the league finally gets to 32, which is where it was headed all along. Seattle for one expansion, Montreal, Pittsburgh, somewhere in Virginia, somewhere in Missouri, Louisville for the other. Not going to happen though, in my opinion. The Kings are toast.
Hansen has plans to do some minor renovations to Key so his team can play there until a new arena is done. Beyond that, nobody has really studied what can be done with the thing.
Supposedly they’re studying options on the KeyArena… I wonder if that study will actually be done before the April BoG or the time Hansen starts waiving around transaction documents to actually get paid for his land.
Afterall, the April-released Seattle Review Panel had a due diligence checklist that included things like.
http://www.seattle.gov/arena/docs/FINALArenaReviewPanelReport.pdf
-(3rd party) Review of investor business model
-Review financial strength of investor group (all investors had to be known and evaluated)
-Evaluate Key Arena operations to ensure long term viability
I’m sure they’ll get around to those things eventually.
http://www.seattle.gov/arena/docs/120516PR-keyArenaProposal.pdf
This is the proposal Hansen had gotten from Comcast-spectacor’s people (the same people involved in the Virginia Beach planning… come to think of it).
Mike, Seattle fans are hypocrites? Are you saying that as a fan of Rochester/ N.Y/Cincinnati/ Kansas City/ Omaha/ Sacramento Kings. I hope not.
As a Seattle fan, I would reject the idea of an expansion team. I don’t mind being called a hypocrite (because really, who isn’t?). Hansen has a signed agreement with Maloofs and should get the Kings. If/When SAC gets its house in order and has a standing new arena ready to host a team, then they can ask for expansion. Their term sheet is a house of cards. They should PROVE to everyone that they have the revenue streams to support a team/arena, not just put it on a phony piece of paper. Why should Seattle have to wait more years? We have already waited five. Let SAC wait now. We are a better market in every sense of the word anyway. SAC was lucky to have the Sacramento Kings in the first place (sorry I meant the Rochester/ N.Y/Cincinnati/ Kansas City/ Omaha/ Sacramento Kings)
No Griffin, I’m not a fan of the freakin’ Kings. In your opinion, Seattle is a better market in every way. In my opinion it is going to be the fourth or maybe just maybe the fourth team of five in a city with a much higher cost of living than Sac. I think if you put it all together, Sac is the better place for the Kings. But hey, they’re yours. Enjoy. Your argument really makes little sense to me. The fact that they have moved a lot in the past, makes it okay for you to do to them, what someone from Oklahoma did to you? See, that’s what hypocrisy is. Would you not have supported the Bucks or the Bob’s Cats if they became the Sonics? Doubtful.
One last thing. I’m an old, fat, bald-headed guy, and this will be the second time in my lifetime that the Kings have moved, and the first time that I can remember. Yeah, they’ve been moved in the past when the league was drawing 500 people a night, and thought of like the MLS is today, but not much recently.
First of all, you continue to point out our hypocrisy, as if we care. I have already said we don’t mind being called that. Everyone on this forum is a hypocrite, including, (gasp), you.
Secondly, you know how Seattle is a better market? Because some very smart businessmen in Seattle believe that Kings in Seattle are worth $525M and some very smart businessmen in Sacramento do NOT believe that the Kings are worth the same in Sacramento. Go look at the offers. THAT is how Seattle is a better market.
Rich men will pay a lot for status symbols, toys and hobbies. Look, I’m not saying that they aren’t going to make money. Geeze, I could get rained on again, or go watch the Sonics. I’m sure they will support the new Sonics, they supported the old ones. Sacramento supported the sorry Kings, can’t say the same for Seattle and the sorry Mariners. I can’t speak for everyone in the world about hypocrisy. As for myself, I go to the same job that I’ve had for a long time everyday, and after that finally ends, I go home eat, pat my daughter on the head, listen to my wife say stuff, go to sleep and start the cycle again. I’m sure I have some hypocrisy going on in some area, but I’m not sure exactly where. If I get to retire someday, I’ll have more time for it.
“Sacramento supported the sorry Kings”
hmmmm….Well Mike, SAC is sorry now and they are last in attendance. I hope no one ever “supports” me that way.
“can’t say the same for Seattle and the sorry Mariners”
And yet, Mariners choose to stay in Seattle and not go to Sacramento. I hope that tells you something.
I love this argument. “SAC is a better market for Kings because they are the only game in town. Seattle would be bad because they have all these other great teams and is such a nice city with so much stuff to do”. May be you can explain why all of these “other teams” are in Seattle in the first place and not in Sacramento. Here is a clue: SEATTLE IS A BETTER MARKET.
Top 12 market, one of the 10 fastest growing cities, healthy economy, 8 fortune 500 companies
According to wiki (bastion of truth and knowledge), Seattle has a current metro population of 3,552,157. Sacramento has a current metro pop. of 2,196,482. Now, if you count the Sounders (which I will do here because it aids my argument) and a potential NHL team. Seattle will have 710,000 people to support each of its five teams. Sac. has over two million to support one team. As you said earlier, and I do not disagree, Seattle is a larger, more important area, that already has lots to do. That’s why it is called over-saturation. But, look man, you’re right I’m wrong. I’m sure they could support all five, if it was just something that they wanted to do. More power to them, and to you. I’m not going away mad, just going away.
griffin, many of us (I include myself here) have been saying for a long time that the way to attract pro sports is to build a corporate base. Sacramento hasn’t done this. If you want your pro team to play in the Franchise Tax Board Arena, then we’re your guys.
This really is where the NBA has changed in the last 30 years. The salary growth has made it so teams simply cannot rely solely on ticket sales. You now need a great media market and great corporate support. Those are now required elements. The Kings largest sponsor appears to be a car dealer near Folsom, and another in Placer County.
Sacramento has neither corporate support nor a great media market. And I feel sorry for us in that way. We’d be a better place to live if our government tried novel ideas to attract corporations. There are Bay Area companies that would love to move here, if they ever heard of us. For Bay Area travelers who go to Tahoe for the weekend, they don’t even drive through Sacramento; they use a bypass.
That’s the real problem; our government isn’t trying to attract and retain the right sort of entities. Without corporate support, pro teams are doomed in Sacramento. Getting the Qualcomm Brothers doesn’t count, either.
Mike, even that has a caveat. The Kings are not the only pro team in the market. I cannot go one block in this town without seeing a Raiders, 49ers, Giants or A’s shirt.
We are in that market. Plenty of people in Sacramento do not give one rip about the Kings; they’ll follow only the San Francisco Giants.
Tickets to see the Warriors will be really hard to get next year. 80% of Kings fans will abandon the NBA, but the other 20% will try to latch on to the Warriors. You may not like that, but there it is.
I like the Kings, but never stopped liking the Warriors. This simply will not be an issue for me.
Don’t dislike it, Mike. The truth is the truth.
Mike, there is more to a market than the sheer number of people living in an area i.e. personal income, unemployment rate, growth rate, corporate base, and taxes, to only name a few. Trust me. Sports owners are not stupid (or not as stupid). If they thought that Sacramento presented a better opportunity than Seattle, they would be there.
I hope you don’t go away. You make good points . Don’t take this the wrong way.
griffin, I did my own little mental checklist on the items you named, and I got “Seattle, Seattle, Seattle, Seattle, Seattle and Seattle.”
What’s my score?
If I’m not mistaken, this proposal follows the “waterfall” method of allocating profits according to a set formula.
How come these deals never allocate profits in proportion to the amount of capital provided?
I know, Griffin. The thing is, how many teams can one place have, before it has too many? Or not too many, maybe, but so many that another large market like Sacramento may not look bad in comparison, if it is the only game in town. Why do you downplay that so much? It has worked well in Salt Lake City, Portland and so far OKC. Seattle has the Huskies, the Redhawks (is that what Seattle U is called?) AAA baseball in the suburbs, MLB in the city, minor league hockey and basketball teams, NFL, MLS and now the NBA again, and probably the NHL at some point. Sacramento has the Kings, AAA baseball and the Sacramento State Hornets. I’m not going to cry when the Sonics come back, because in the end it will probably be better for basketball, which is something that I enjoy. But, Sacramento is not a backwater, even if people by-pass it. If it were in any state other than New York, Florida, Texas or California, no one would doubt that it were a major city.
Sacramento will borrow money to be paid back with future parking revenues and will backfill lost general fund money with future parking revenues. So, we’re banking on the assumption that the city will be awash in lot’s of new parking revenue. Anyone ask if other entrepreneurs or the City of West Sacramento build its own low priced lots for those willing to walk across the bridge to go to the games if Sacramento charges a lot for parking, thus undercutting Sacramento? Mayor Cabaldon is licking his chops. Also, there’s the assumption that hotel taxes will be brought in to backfill the general fund. Since hotel tax revenue already contributes to the general fund, would there be a plan to backfill lost hotel tax revenue? But oh yes, there are promises to further develop downtown with new hotels and office space in a yet undetermined date. I remember Stockton contributed a ton of redevelopment funds to build a hotel next to its arena. If memory serves me right, the original owner was foreclosed upon. Sure, developers could work their magic on city-owned land, but that land should be sold to the highest bidder- not given away to induce a business partner to do a deal. And SW, you are correct, we do elect officials to make “good” decisions. But good decisions involving hundreds of millions of dollars are rarely made when elected officials adhere to artificial deadlines, when they hold three public meetings without anything to present, and when the public and city council have less than 72 hours to review a proposal. I have no faith in our city government. They’ll approve this thing in another pep rally, I mean City Council meeting tonight. It’s sad but my hope lies with the NBA to reject this proposal based on the uncertainty of when the city and private investors will pull the money together to start building the arena. The Seattle group had its term sheet done several months ago and their owner already has the parcels he needs. But the Council won’t recognize that they will approve a shell game in the guise of a Rube Goldberg device.
@Jason: I’ve always heard the phrase, “Assumptions are mothers of all F-ups.” Now we get to see one in the making! :)
Neil, sorry my eyes are getting tired from the scrolling. Maybe I missed it.
Have you done any analysis on the way Sacramento plans to channel the funds through a Non-Profit vs. the way New York channeled theirs? Thanks!
Here’s a scenario exercise for everyone:
Pull up a map of California online. Sacramento now has their brand new arena and it is a beauty. You are a central California concert promoter and have been contracted by your client to book an arena for a three day concert in a location that would appeal the fans. This concert will have two major artists who’ve one multiple Grammy awards performing each night and starting price for tickets is $125. The concert needs to be sold out on all three days, otherwise, you won’t get your $500,000 bonus. You will need to market this, so it will give people this the incentive to want to come. As you look at all the cities in central California that have arenas, ask yourself which cities would be ideal. I know my first order of choices, but I’ll let you decide.
No, Mike. Sacramento isn’t the only large city in the region. That’s the problem.
We are also in the territory of the Giants, A’s, 49ers, Raiders, Cal, Stanford, St Mary’s, Santa Clara, Sharks.
Seattle is the biggest city in that region. Sacramento is a small island in a much larger region.
Even watching the Warriors national game last night, I was disgusted at the number of Laker fans at Oracle.
Oh yeah Griff, why would you be against an expansion team? I know it is unlikely to happen, but if Sacramento had ducks in a row, and Seattle did as well, why would anyone choose the Kings over expansion, if it were an option? And, I know it likely won’t be. As long as the league didn’t screw you, the new Supersonics, like it screwed the Raptors and Grizzlies in 1995 and didn’t allow them to draft first, even if they won the lottery, then the new Seattle expansion team could do well as quickly as turning the Kings around is going to take. Demarcus Cousins is your best player. You better draft well.
John:
Even with a brand-new Sacramento arena, I’d have to begin and end my list, based on your tight criteria, to Oracle. Once SF gets their arena built, no act will feel the need to go anywhere but that SF arena.
That Vallejo-to-SF ferry service is awfully convenient.
You’re right, M. I can’t disagree with anything you’re saying. I am willing to admit, I don’t understand California. It’s more like a country than a state, has more people than Canada. Sac. is not a major city, compared to others in California, others just a scoot away. If Sac. loses the team, they may never get one again. It’s kind of like Buffalo. Nobody knows it exists, because it is overshawed by larger places. If Green Bay ever loses the Packers that is it for them. If they were to get another team, there is another city in the state that is at least on the national radar, even if it is because of the Brewers, Bucks and Dahmer. I wish you the best out there.
All of this, though, still misses an even larger point:
Dangberg has publicly stated that all the mechanisms the City needs to pull this rabbit out of their, um, hats, will take about one year to put together.
Honestly, the BOG isn’t going to wait around a year to watch us F that up.
“One year, and it still might not work? You know, we might revisit expansion in about five years.”
According to some tweets by Sacramento Bee reporter Tony Bizjak, the City Treasurer will present a risk analysis at tonight’s City Council meeting on the arena and Councilman Jay Schenirer will be participating and voting via Skype, as he’s vacationing in Morocco right now. Maybe Morocco is the place to see the additional parking revenue, a nice cafe with a little extra hashish in the Hukka ought to do the trick.
Michael McCann believes Seattle is still ahead, with Sacto closing in. Sacto has a better arena deal (in terms of public $$$) but Seattle has the stronger bidders. I could see Hansen/Ballmer offering the Maloofs a little more to close this deal. My prediction still stands. Seattle get’s the Kings and Sacramento get’s in good position for an expansion or relocated franchise. #HereWe2018
“Have you done any analysis on the way Sacramento plans to channel the funds through a Non-Profit vs. the way New York channeled theirs?”
It’s a similar setup as far as the bonds go, but with one huge difference: If the Sacramento parking revenues run short, the hotel tax money kicks in. That’s good for buyers of hypothetical Kings arena bonds, since they don’t have to worry about them going into default, but not better for Sacramento taxpayers.
Jason, I think it can be argued that not having the risk analysis published 72 hours before this meeting is a Brown Act violation. It’s possible, but I still think the Brown Act is kind of vague. I can see the argument that a simple statement like, “Item 14: Discuss an arena” is really all that’s needed. They can then publish the telephone book as material, if they chose to (this would result in a vote against, though).
There is now some talk of a delay until Thursday to vote on this. I’m still miffed that one of the members plans to participate in this debate and vote on it from his vacation in Morocco. I’d say, No, he’s absent.
I actually can see a 4-4 vote if that happens, which could be why KJ is considering a delay. The absent member is seen as a solid yes vote on this.
This piece raises some interesting questions about how the new arena would effect parking in Downtown Sacramento, http://www.sacramentopress.com/headline/66669/Arena_Plan_Puts_the_King_in_Parking.
MikeM: My thoughts first priority is also San Francisco and probably San Jose next. People love the city by the bay and much, much more attractive. I can’t vision people buying $125 tickets to drive to 100 miles to Sacramento, pay for parking and just get a one night thrill in a downtown area that only has no major attraction.
Sacramento seems a bit like Long Island as a market: decent size, but not easily accessible to anything else that isn’t a bigger metropolis. And not so much in terms of corporate presence for selling ads and suites.
“Oh yeah Griff, why would you be against an expansion team”.
1. Because expansion means waiting. And Seattle is done with waiting. It is a better market period. It should no longer have to wait. Sacramento’s turn to wait now.
2. There is a signed agreement between Hansen and Maloofs. This agreement was struck by willing parties. The team belongs to Hansen. Period.
Someone has yet to convince me how you can make an offer for something that is no longer for sale. What is happening here is non-sense. That is why there is no way in hell Kings don’t come to Seattle. This is Stern’s way to “identify the money” in Sacramento. If he doesn’t play along, he can’t identify who is willing to spend how much. Now he has done just that. Sac may get an expansion when the arena is built and ready to go, but if NBA wants into Seattle, this is the best shot they have. Hansen may stick around but things can change politically arena wise. NBA will want to take the bird in the hand.
Neil, access to Sac is not an issue. I-5, I-80, US 50, CA 99… I can get to Berkeley in 90 minutes.
It’s just that tourists are done in about 4 hours. It’s not bad for foreign visitors for about that long.
For people who live here, there’s plenty to do. This is just my thing, but the cycling here is great, and as a result, we have an unusually high number of pro cyclists living here. But that’s not for everyone.
I just came back from Yosemite, but that’s me getting out of Dodge again, isn’t it.
MikeM: I’m not saying there’s nothing to do in Sacramento, or in Long Island for that matter. I’m saying that just as Long Island has water in three directions and NYC in the fourth, Sacramento has not a whole lot in three directions and the Bay Area in the fourth. So there’s no greater megalopolis to draw from, unless you think people in Hercules would rather go to Sacramento than San Francisco. (I have friends there. They wouldn’t.)
Again, that doesn’t make it a terrible market. Just a smallish one by NBA standards. Though I do think that it’s a legitimate question whether it’s better to be the big fish in Sacramento or one of many fish in Seattle — probably the latter because of cable TV money, but it’s at least arguable.
Griffin: “Someone has yet to convince me how you can make an offer for something that is no longer for sale.” One of the joys of owning a pro sports franchise is that you can’t sell it until the league tells you that you can sell it. Until the NBA signs off on the Hansen purchase, it’s just an offer.
***********************No, Mike. Sacramento isn’t the only large city in the region. That’s the problem.
We are also in the territory of the Giants, A’s, 49ers, Raiders, Cal, Stanford, St Mary’s, Santa Clara, Sharks.
*****************
Please don’t ever link your generic Sacramento up with the Bay Area and it’s teams. The Bay Area is the greatest place to be and has the greatest sports teams and fans. All Bay Area born and bred.
Sacramento and the Bay Area are complete opposites in everything. People in the Bay Area don’t go near Sacramento,. They don’t want, and they don’t talk about it.
Sacramento is more like a flat midwestern town that has no personality. Sacramento has to import anything of authenticity.
Please stop connecting your delusional Sacramento with the Bay Area. People in the SF Bay laugh at your city. Enjoy your 100 degree heat in the Summers, while the Bay will be in the 60’s and 70’s.
Hopefully in the future, California will finally be divided up correctly and the Bay Area can put a wall between the generic city known as Sacramento.
San Francisco is supreme is all things.
Enjoy your River Cats, Mountain Lions and Hornets- THOSE are your teams!!!
PS
The Warriors are heading to a nice Bay location in San Francisco and will have an even better venue then before.
You really think people are going to travel 125 miles to watch the deplorable Kings in a Down Town generic location as opposed to Beautiful San Francisco??
lol
Am I going to have to add attacks on urban areas to personal attacks on the banned list?
Try to tamp down the vitriol before posting, people.
I’d be willing to wait 2-3 more years for an expansion team. One of the few nice things about being a Seattle fan is that all of our teams (up to this point, anyway) have been expansion, not taken from another city. Not many other places in the West or the South can say that (including Sacramento).
If expansion was a real option, I mean. I assume if it was, Hansen would have pursued that instead.
Is this NBA franchise worth more in Sacto or in Seattle? The folks who have that answer are the bidding groups. If Ranadive and the Sacto whales are not willing feel that a Sacramento franchise is worth less than a Seattle one, then the NBA would go with Seattle, even assuming if Sacramento has a better arena deal. If the Sacramento Kings are ultimately worth say, $600M by the time is through, imagine how the owners of the Lakers, Knicks, and Celtics would feel. I could see Sacramento being used as a bargaining chip to get other cities to kick in more $$$.
I understand your point of view, Griffin.
Neil, a correction/explanation on Sacramento hotel tax revenues. The city rate is 12%. Of the 2% is for the general fund (about $3 million), the 10% remainder goes to the community center fund, most of it to cover the huge operating losses on the white elephant convention center on the east end of downtown. There’s not much hotel tax revenue to backstop the arena subsidy before running into its use to backstop the convention center subsidy. Given the unrealistic revenue projections, as economist Chris Thornberg laid out last year (http://www.thecaliforniafix.com/thecaliforniafix/2013/3/25/will-sacramento-buy-a-pig-in-a-poke) and the certainty that parking revenues won’t cover the arena debt (the city’s own budget shows the parking fund operating at a loss now and into the future) and the limit on how much hotel tax is available for backstop, it’s hard to believe that there’s any sucker big enough to buy the bonds in this deal.
There’s going to have to be another backstop, then. Because you’re right, nobody’s going to buy these bonds unless there’s a reasonably unlimited pile of money ready to pay them off.
Mark, I didn’t know the convention center was such a money loser. If you adopt the same logic as the pro-arena folks, the convention center should have attracted world-class events to help make Sacramento a world-class city. I guess the events that the Convention Center get’s aren’t world classy enough. And besides, wouldn’t the Convention Center compete with a new arena, possibly exacerbating its losses.
Oh, convention centers are almost uniformly disasters from an economic development standpoint. See:
https://www.fieldofschemes.com/2005/01/21/843/convention-centers-the-drug-of-the-nation/
Ah, gee, I guess that means I have to toss my 49ers/Giants collection.
Am I banned from following those teams now, Neil?
If I had the power ban people from following football teams, the world would be a very different place.
Well, Jason, the convention center wasn’t world classy in its original form. It didn’t bring in enough people to fill the Hyatt hotel the city had subsidized (it was built by original Kings owner Gregg Lukenbill and went bankrupt.) So the city resolved to do a world classy expansion of the center. The economic analysis showed it would create a ton of jobs (although when you divided the number of jobs into the expected payroll, the average wage was just over the minimum.) When the Bee was a real newspaper, we opposed it, but we were denounced by the Big Think types and the downtown welfare developers. The result has been about as world classy as most of these things are, as Neil points out: big losses. It turns out that, given a choice, convention goers prefer San Francisco or San Diego to Sacramento. Who would have guessed?
Here’s some additional analysis for you to read:
http://eyeonsacramento.com/2013/03/an-eye-on-sacramento-report-on-the-arena-proposal/
I wish this was in a slightly more readable format, but given that this group had so little time to edit this report, I think I’ll survive.
This should be the 89th comment.
Can we hit 100?
That Eye on Sacramento report not only recalculates the total subsidy at $334m (counting the value of the free parking spaces and some free billboards), but it also notes that the hotel tax money is only slated for the convention center until the debt on that is repaid.
So there’s one potential way for the nonprofit to tap the general fund as a backstop: If there’s a shortfall in the early years, borrow against the future hotel tax money that will start to flow once the convention center is paid off. You should be able to redirect just about as much money as you want from the general fund that way.
Yeah, yeah, use the VISA to pay AMEX. That’s always a good plan.
Sacramento council hearing is on now, btw:
http://sacramento.granicus.com/MediaPlayer.php?publish_id=26
Like I said, Sacto is nowhere. It’s farmville. It’s the NBA equivalent of the Columbus Blue Jackets. No one ever heard of it or them. If it wasn’t the state capitol, no one would even know it exists. It’s relevant to the Bay Area like Dover, Delaware is relevant to New York City.
I do like this parking ramp scam, though, gotta admit. Are you getting my meaning, catching my drift? Or am I being obtuse?
As a former Columbus resident, I take offense at that. Columbus, the city developed later than Cleveland and Cincinnati and has put their focus on the Buckeyes due to the other cities having pro teams. The Columbus Chill did really well and was a very hot ticket in town. Thing is, I’d like to believe Columbus observed what other ohio 3C cities went through with pro sports subsidies and established a good history of rejecting them when placed on a ballot. That doesn’t mean owners haven’t worked around that, though.
Perhaps I need to require use of a <sarcasm> tag.
But I really want to see if the FoS servers can handle a 100 comment post (and how it handles it) so I’m going to comment on that KeyArena use.
Hansen’s local PR man, Rollin Fatland, has been involved in a group that wants to turn the Seattle Center site (where the KeyArena is) into parkland, Friends of the Green. He’s not Hansen, but as a former King County deputy exec/lobbyist/Hansen’s local spokesman, i doubt he’d be encouraging the alternate build sites at the KeyArena or Memorial Stadium location. As a possible irony in the notions of stadiums attracting development, Fatland used to live down in the Pioneer Square area near the stadiums… before he moved, in 2007/2008, to a few blocks South from the Seattle Center.
http://friendsofthegreen.wordpress.com/about/
Wow, giving equal time to pro and opposed, despite a 3:1 ratio… KJ must not have gotten the NBA’s packet on how to run these hearings.
I think KJ meant equal time per speaker. So 2 minutes each for the 13 opposed, then 2 minutes each for the 45 in favor.
I have no idea what this guy is talking about, but he has an awesome moustache.
Apparently he’s this guy: http://www.newsreview.com/sacramento/tuesday-night-live/content?oid=9359570
Ok, now it’s looking like the Seattle council meetings. Cheers, angels, and sports emotion/pep rally mode.
I’m going to presume the guy talking about the Thunder and OKC being put on the map knows he’s trolling Seattle fans.
I can’t tell if Mac Worthy just loves kicking the Sac city council or if he’s Sacramento’s version of Seattle’s Stand UP America guys. They like to talk about enslaved populous too… less focus on the hispanics.
http://www.youtube.com/user/StandUPAmericaVideos?feature=watch
I’ve never heard speakers spam council hearings before. Does this go on a lot in Sacramento?
Wow, KJ really did cut short the pro speakers.
The Sacramento deal really is nothing but smoke and mirrors. Like I said in the other thread they have only one goal… to buy time. They want to find a way to get past the relocation vote in hopes that a miracle will happen down the road. The problem is that Sacramento is a dying market. California is going bankrupt and Sacramento is a Government town. As a TV market it is tapped out. Selling the NBA on where it is today doesn’t look so bad, but over the next few decades it won’t be growing, at least not at a rate like Seattle.
The Seattle Market is growing. It is a hot bed for high tech growth and the 2040 plan shows growth off the charts. The TV Market will bring in at least 10 times the Sacramento market. Yes Sacramento has the “advantage” of being a “one horse town” but 100% of a smaller pie isn’t as good as a smaller percentage of a much larger pie, one growing every day.
Not that this is going to come down to comparing the two markets, the decision will be made on the merits of the Hanson deal. As long as there are no fatal flaws in the proposal the league will approve it. There is just no way they open the Pandora’s box of telling an owner that bringing a flawless deal might end up rejected.
They also will never choose perpetuating the drama over a nice clean cut and dried end of story. There is one thing everyone agrees to, the Maloofs are unpredictable, and with $30 million of Hansen’s money they could just flip them the middle finger and keep owning the team for several years before they run out of money. In the meantime they can shop for a great deal that relocates the team somewhere else with a much sweeter arena package.
For Sacramento this is a case of “Careful what you wish for”. What a night mare it would be to have that team there for several seasons with owners who openly despise the city and its leadership. At some point the league would let them move just to end the agony.
I must have dozed off during Cohn’s rambling and then asking that all the bullet points of the deal be re-read into the record. Bruski says Cohn was calling you out Neil. https://twitter.com/aaronbruski/statuses/316771047888273408
Passed 7-2, not a huge surprise. The wheels will fall off next Wednesday, though.
Nah MikeM, Mr Cohn said that he’s been through all the other public-private partnerships with the maloofs and kings even before the maloofs. This deal is going to be the one that proves that Sacramento can walk and chew gum at the same time, and will be the model for future public-private partnership deals. Also, Neil, sorry to get your hopes up but Cohn didn’t actually mention you specifically. Unlike the other council members that felt they needed more time to study the (75% recycled) deal, solicit reviews of the projections, etc… he knew all the important terms and was ready to vote.
I heard the “model of public-private partnerships” line before I dozed off. Also “a true win-win.” Clearly my mere math cannot withstand the might of these clichés.
I would have loved to have someone answer Eye on Sacramento’s question: How exactly is Sacramento going to nearly triple its parking revenues while cutting the number of parking spaces in half? Repeating that this is a “conservative projection” without showing how they came up with the numbers isn’t really reassuring.
how anyone can listen to a pedophile like Kevin Johnson, who paid money to a teenager he showered with to keep her quiet, is beyond me…I would not let him on my acreage let alone in my house…the guy oozes slime…
The is NO business in Sacramento…everybody lives off the government dole in one form or another…it is a way of life there…private enterprise is located on the periphery or down the corridor to SF…
“There’s no there there”…lacks any retail downtown and only very small shops in what they call midtown which is actually another street of low rise stuff downtown…
The entire deal is a suburban slum until you hit the fringes of the Foothills or cross over to Davis…
Hell the Governor, Scharzenegger and now Brown don’t really even live in Sacramento (LA, Oakland Hills)
The meeting as all meeting for the City feature the government free loaders…either elected, government employees or “private” developers who are on the government dole…it ain’t Boise, Spokane, Eugene, Seattle, Portland, SF, LA, San Diego, Vancouver BC or even Vancouver WA…
that’s the reason this farce has continued so long…