Kings Arena Backers To Talk Financial Details With Term Sheet To Be Released Tomorrow
Backers of a new downtown arena for the NBA Kings "took a virtual victory lap through the city Tuesday -- and plunged into the nitty-gritty details of a $387 million endeavor that still has as many questions as answers," according to a front-page piece by Kasler & Bizjak of the SACRAMENTO BEE. Council members were focusing on "two key areas of the proposal: a still-evolving plan to pull $200 million-plus in upfront cash from the city's parking operations, and details of the 'term sheet' governing the arena development." The term sheet, to be released to the public tomorrow, "will spell out who provides how much money toward construction -- and how revenue from NBA games, ice shows and other events will get divided among the Kings, the city and arena operator AEG." Many of the "fine points of the term sheet were still being committed to paper Tuesday, and some of the principal stakeholders in the deal were waiting for details to be spelled out." Kings co-Owner George Maloof said, "We have a framework of a deal; we don't have a term sheet yet." Sacramento-based developer David Taylor said that to get the new arena ready for the '15-16 NBA season, "design work needs to begin within five weeks." The county Board of Supervisors yesterday "voted 4-1 to move ahead on a plan to help the city finance the project." Under the plan, the city "would get to use three county-owned downtown lots for arena parking -- and keep the estimated $2.5 million in annual revenue produced during arena events." The city would also get $1M a year in "county taxes that would be generated by the presence of the arena," for a total of $3.5M (SACRAMENTO BEE, 2/29).
MARKING THE MOMENT: In Sacramento, Matt Kawahara notes at the first timeout of yesterday's Jazz-Kings game, co-Owners Gavin and Joe Maloof "walked to center court amid a standing ovation." Gavin then "addressed the crowd." He "thanked Sacramento Mayor Kevin Johnson, the NBA, commissioner David Stern and arena operator AEG, before addressing the crowd directly." He said, "Thank you for all you do, thank you for the love that you've shown our family. We still love you, we always loved you, and we always will love you. Thank you" (SACRAMENTO BEE, 2/29). Asked how the arena deal was finalized, Gavin said, "Stern wanted it. We wanted it. Everybody stretched. AEG gave more. We gave more" (SACBEE.com, 2/28).
CAUTION FLAG: In Sacramento, Marcos Breton writes, "We've reached a dangerous portion of this saga because while almost everyone is celebrating and thinks it's over, we still don't know what 'it' is." This is where cities such as Sacramento "can get in huge trouble by agreeing to as-yet-undefined deal points that risk financial exposure." Breton: "We need specifics. How is the revenue at the new arena going to be split? How will the city replace the $9 million in parking revenue that will be funneled into the arena? Shouldn't someone raise concerns about the viability of Kings owners who already had a lot of debt and seemingly will take on even more to remain Kings owners? Going forward, do the Maloofs have the capacity to put a good product on the floor?" (SACRAMENTO BEE, 2/29).