SACRAMENTO – The Sacramento City Council voted 7-2 to approve a financial term sheet to build a new $447.7 million sports and entertainment arena in downtown Sacramento on Tuesday night.
The City Council’s decision paves the way for the usage of the city’s parking operations. In reference to the term sheet, $258 million would be used to finance the project. $189.7 million is to be paid by an investor group led by billionaire Ron Burkle.
Councilmembers Angelique Ashby, Steve Cohn, Steve Hansen, Allen Wayne Warren, Bonnie Pannell, Jay Schenirer, and Sacramento Mayor voted in favor of the financial term sheet. Councilmember Darrell Fong and Kevin McCarty voted against the proposal.
“This is a good day for Sacramento,” Johnson said. “We get a chance to keep our team and do what we set out to do with building a brand new arena. That’s sending a message to Seattle as well. We want the folks in Seattle to get a team. We wish them well, but we want to keep what’s our.”
The facility, that would be own by the city, is the anchoring tool to Sacramento’s efforts in keeping the NBA’s Sacramento Kings. The building will stand where the beleaguered Downtown Plaza currently stands.
“This will be a substantial win for our city,” said District 2 representative Allen Wayne Warren. “Our focus is to create jobs and bring businesses to Sacramento. Keeping the Kings will do just that.”
Before making her decision, Pannell said that the Sacramento Black Chamber of Commerce, Hispanic Chamber of Commerce, and Asian-Pacific Islander Chamber of Commerce was not in the room to hear the discussions. Pannell said she would like that the minority chambers to be included in future talks when it boils down to business and employment.
“But I do support it (the term sheet),” Pannell said. “I truly understand the economic value of keeping the Sacramento Kings in Sacramento.”
The term sheet includes that city will retain parking revenues from all city garages (except the downtown plaza), retain the Kings for 35 years, and the investment group controls Downtown Plaza parking garages through long-term parking management agreement. What was not included in the deal that the Maloofs back out of last year, is the fact that the investment group will be held responsible for cost overruns.
The Maloof family has already agreed to sell the Kings to a Seattle investment group led by billionaire hedge-fund manager Chris Hansen. The sell of the team is reportedly at $525 million. 24-hour Fitness founder Mark Mastrov, who is leading the efforts to counterbid the Seattle offer and keep the Kings in Sacramento, has submitted a proposal to the NBA. David Stern, the NBA commissioner has publicly said the bid is much too low and that Mastrov and his backers must increase the price.
Vivek Ranadive, a software magnate from the Silicon Valley, signed on as one of the members of Mastrov’s ownership team. Ranadive is currently a minority owner owner the Golden State Warriors. He said he would sell his interests in the Bay Area team to help pursue the Kings.
Once a hustle and bustle part of the Sacramento, the city hopes that a new sports and entertainment arena would bring life back into downtown Sacramento, particularly K Street. Doing business along the K Street corridor has severely waned over the years and year-around events would spruce it up on top of tourism. Most of the facilities near the Downtown plaza and 6th Street are vacant. Shirey told the council that a sports arena in the area would do justice in multiple ways.
John Shirey, the city manager of Sacramento, held three public forums before a preliminary agreement was made with the investors for the new arena. Actually, the deal was in its finishing stage before the last forum was held at the Sam Pannell Community Center in South Sacramento on Saturday evening.
Eye On Sacramento, a political watchdog organization, distributed an “Arena Proposal” report at City that indicates action “opponents of a publicly subsidized arena” will take should the NBA Board of governers reject the Seattle’s bid and the city of Sacramento moves on without public input.
Supporters of a new sports and entertainment arena emphasized the the needs to bring in businesses and create employment. There are roughly 800 employees at Sleep Train Arena in North Natomas who work Kings games, concerts, and other events throughout the year.
“We really have an unmatched opportunity to save 800 jobs,” said Joshua Wood, Executive Director of Region Builders. “We also can create 6,500 more in the core of Sacramento.”
Opponents of the term sheet voiced their opinions of the deal. Some mentioned the city Stockton’s financial woes, called the whales (investors) “sharks” preying on Sacramento, issues with the city budget, and signifying the that the City Council did not take a sufficient amount of time to examine the term sheet.
Jeffery Anderson, a local lawyer said he loves the Kings and hopes that they will stay in Sacramento. But Anderson also added during public comments that a professional sports team will not make an impact on Sacramento’s economy and the usage of public property should go before the voters.
“If it’s not put on the ballot it will be challenged in court,” Anderson told the City Council.
By Antonio R. Harvey
OBSERVER Staff Writer