Facts laid bare.
1. The city of Sacramento loaned the Kings $70 million plus 14 years ago. Under that agreement, if the Kings move, they would pay back the loan plus a penalty. That's $77 million right now.
2. If the Kings default on the loan, the city gets the arena and a stake in the franchise. Obviously, the $77 million is more valuable to the city than an old arena and a minority stake in a sports franchise located five hours away.
3. It's really in the Maloofs' financial interest to just default on the loan. The revenue at Power Balance Pavilion without the Kings is too small to make up the difference, and a $25 million stake in a $300 million franchise is more an annoyance than anything.
4. The city can't afford for the Maloofs to follow their financial interest, because then the taxpayers of Sacramento will be on the hook to repay investors for the outstanding loan amount (something like $67 million).
5. The Maloofs are trying to get a new loan in a new city.
6. Sacramento is pressuring the new city to withhold that loan, because granting that loan would decrease the Maloofs' financial rationale to pay back the old one.
"It's not for the mayor or anybody (in the City of Sacramento) to interfere with our business. That's what I think they're doing, and it's not right," [Joe] Maloof told The Orange County Register. "We would appreciate that they not interfere with our business."
It's pretty simple, Joe: pay the $77 million debt, and the city won't have any right to "interfere." Until then, if you're doing something to secure your financial future outside of Sacramento, the city has every right to express concern and get involved if it can.