NBA Kings Demand Arena Opponents Post $100M Bond To Cover Costs If Project Delayed
The NBA Kings are in the midst of "defending their arena construction project against a citizens’ lawsuit," and the team is demanding project opponents post a $100M bond to "cover the 'substantial' losses the team would suffer if litigation delays completion of the arena," according to Dale Kasler of the SACRAMENTO BEE. Kings CFO John Rinehart said that "even a short delay in the start of construction at Downtown Plaza could have enormous financial consequences, pushing the entire project beyond" its anticipated October '16 opening. Kasler notes it has "long been known that the NBA has the right to buy the Kings and move them out of town if the arena isn’t open" by fall '17, or one year after the scheduled opening. The citizens’ lawsuit, filed under the California Environmental Quality Act, is "coming to a key juncture." The arena opponents are "pressing for an injunction halting the project, and a hearing on that request is set for July 25 in Sacramento Superior Court." Sacramento Treasurer Russ Fehr said that the city would lose $5.7M if the arena project "got hung up because of the litigation, and the plaintiffs should have to post bond to cover those costs." Rinehart said that the team’s financing costs would climb by $2.5M if the project "slides beyond" October '16. Also, he said the team would face “potential financial penalties due to the NBA in excess” of $1M (SACRAMENTO BEE, 7/17).