Arena Deal Hits Deadline, But Work Continues Behind the Scenes

It’s a possibility that a bill that has already been introduced, but thought to not be able to be passed by either (or both) houses, can be re-written to address the arena deal. This is casually known as a gut-and-amend bill because a current bill’s language is scrapped, and then amended to include something else.

one of is smart enough to pay attention to all this! Nice work.

This is intelligent, well-reasoned, and thought-provoking, but I’m going to “rec” it anyway.

To see a little bit of what I’m talking about, read this interview of Cal Expo Board Chair Gil Albiani by blog Bleed Black and Purple from 5/7/10. Here’s one quote in particular from Mr. Albiani, regarding the separate study that Expo is looking at to sell some of their land and build a smaller fairgrounds on the current site, that convinces me that the size issue in Natomas will be worked out:

There is 350 acres. If you cut the fair down to 200 acres, it gives you 150 acres that you could develop to generate revenue to improve the 200 acres. That is being studied right now.

200 acres is pretty close to 185 acres, no? If they’re serious about cutting the fair down to 200 acres at the current site, they don’t scare me much by saying that 185 acres in Natomas is not big enough. Something that I forgot to mention in my previous comment regarding the size of the fairgrounds is that the Expo study suggesting the Arco site is too small includes all of the space that the horse track takes up at the current site. Albiani mentions in the interview that Cal Expo is willing to give up the racetrack as long as they recoup the $2 million that it brings them annually. Not a big deal. No racetrack plus less sprawling parking space equals a much smaller fairgrounds footprint.

Albiani also talks a bit about the additional land adjacent to the Arco site that he’s got his eye on to give Expo a better “window” onto Arena Blvd, which is what I think most of the wrangling going on is really about. Again, all parties involved can see that this plan can be a very good thing for them, they’re just trying to work out just how good. As Mr. Albiani says:

Just because we have a separate agenda, doesn’t mean we can’t all row the boat in the same direction.

Let’s be realistic here. Why in the world would Cal Expo agree to move to a site half the current size with a bunch of flat land with out even a single tree or viable fair building. There is nothing there except an old arena up on a hill. That’s not a fairgrounds and to make it a fairgrounds would take millions of dollars and time. If there is enough money in the Cal Expo land to build an NBA quality arena and a new fairgrounds from scratch, why in hell would Cal Expo just not sell/develop a 10-15% of their current site and stay put. They don’t need $500 million to renovate the exisiting fairgrounds. Geez, I’d be willing to bet $25 million would do wonders to the current site. I love the Kings and the Fair but this deal is a non starter for the Fair.

The deal has the arena going to the railyards, Cal Expo going to Natomas, and the current Cal Expo land being re-developed.

Start by reading this, a good article on the basics of the plan.

Building a replacement for Arco on the current Arco Park footprint is still hypothetically an option, and was one of the other plans proposed to the City (the City has since decided to move forward exclusively on the Convergence plan, but if the Convergence fails at some point there may still be a chance to shift efforts to one of the other plans, if they appear feasible). What made the Convergence plan stand out amongst all of the proposals was that everything had been figured-out to make it work, though as you say it is complicated and involves more parties and moving parts than you would like to have at work in something like this. The major advantage of this plan is that there is major private financing for the development lined-up, based on the potential returns of the investment from the land at the current Cal Expo site that is to be developed. That’s a huge carrot to lure private financing that isn’t there for the Maloofs to use to convince investors to help them build an arena in Natomas (assuming the Maloofs aren’t able to invest the 500 million-ish on their own, and assuming that they would not be able to get much public assistance).

The City would donate their chunk of land next to the railyards on which to build the arena. The Maloofs would then lease the arena for $300 million over 30 years, at which point the arena is fully owned by the city. The Maloofs would also pay off the remainder of what they owe on the old loan from the city. As to your concern about the community being set up for failure, I’m not really sure what you’re getting at. The city has some land by the railyards, and the rest of it is privately owned. There will be some kind of development at some point, after decades of figuring on what to do with all that land and how to do it. The Convergence plan would give us a shiny new arena with a professional team tenant for at least 30 years and all of the development around it that is spurred by the presence of the arena. Without the Convergence plan, we maybe get a Walmart and a bass fishing superstore to go along with the new transit hub that is planned on being built there either way. If the Convergence is agreed upon and moves forward and then somehow fails or stalls at some point, as you fear, then I assume the City still maintains control of it’s railyard land and the privately-owned land there eventually gets developed with something else. Maybe the failure of the Convergence plan would delay the building of a sparkling new downtown Walmart and waste a few million dollars in consultant fees, but it seems to me to be worth the risk. Again, I’m not really sure what you’re afraid of with this.

Finally, possibly the best part of the Convergence plan is that it does NOT need to go to the voters. The City Council will have to designate the current Cal Expo land as a special tax zone so that tax revenue from the new development there could be used to fund the building of the new Cal Expo in Natomas, so there would probably be a few contentious City Council meetings packed with NIMBY-types who would honestly rather have the Walmart and the fishing store than the arena anyways, but the actual vote should be no problem.