Sacramento and Seattle Focus on Arena Efforts as Relocation Decision Looms

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As the Sacramento/Seattle saga heads down the stretch, efforts are mounting up in both cities to push forward on new arenas.

In a little over a month and a half, the future of the Sacramento Kings will be decided by 30 men in a board room in New York. Their choice will however be influenced by the work (and money) put in by both cities over these last few months and years.

At the center of both bids is the necessity to build a brand new arena. The city of Seattle's rejection of a new arena in 2008 cost them an NBA franchise and the city of Sacramento's failure to build a new arena over the last decade may cost them their own.

Now though, both cities are moving forward with their own arena plans. Sacramento's is centered on a partnership between the city of Sacramento and billionaire Ron Burkle, with the intention of building an arena at Downtown Plaza. A couple days ago we heard from City Manager John Shirey as saying that his goal was to bring a term sheet to the City Council to vote on by April 2nd. Now though, the Bee's Ryan Lillis is reporting that the city is instead targeting March 26th, so as to give the NBA's Board of Governors more time to vet the plan. Shirey added that he plans to begin the formal negotiations with the Burkle-Mastrov group next week. The timeline is ambitious, but the city has experience in these types of situations; Last year, Mayor Johnson and his team sat down with the NBA and the Maloofs at All-Star weekend and negotiated a non-binding term sheet in three days. Unfortunately the Maloofs backed out of that deal a few months later, eventually leading us to the situation we are in now.

Seattle is also focusing on their own arena, a $490 million project that could house an NBA, WNBA and NHL team. King5's Chris Daniels reported yesterday that preliminary designs on the arena were approved by Seattle's Downtown Design Review Board and will head to a recommendation meeting in a few months. However, not everyone in Seattle is pleased. The Longshoreman Union (ILWU) is appealing the decision to dismiss their lawsuit last week. The suit alleges that the city of Seattle is violating State Environmental law by backing the proposed SoDo site without an Environmental Impact Study. The suit was thrown out as the city's Memorandum of Understanding was non-binding.

Not only is the ILWU appealing their suit, they are also questioning the economic studies done on the proposed arena. The company who performed that analysis has no prior experience in evaluating maritime and industrial business. Seattle Mayor Mike McGinn has asked for the company to "broaden" their study on those areas in order to alleviate the ILWU's concerns. It's unknown just how much of a threat the ILWU and other potential lawsuits are to Seattle's arena efforts.

Perhaps more costly for Seattle would be the fact that the relocation fee may be higher than previously estimated. When Clay Bennett moved the Sonics to Oklahoma City, he paid the NBA a fee of $30 million. Now a couple of reports have indicated that a number around $75 million has been floated as a fee to move from Sacramento to Seattle. Daniels reports it as does Ken Berger of CBS Sports. Both reporters speculate that this could increase the likelihood of owners approving the deal as it means more money in their pockets. That's short-term thinking, and most of these owners didn't get rich by thinking short-term. A one-time relocation fee of $75 million means just about $2.6 million to each owner, a rather insignificant sum for the millionaires and billionaires that populate the NBA Owner stratosphere (Ed. Note: ElRonToro makes a great point in the comments that this new $75 million number is actually only a $1.6 million difference per owner if we were already factoring in the $30 million).

As Aaron Bruski points out in a recent article, the league knows what's at stake in Sacramento and the value of the public subsidy the city is offering to provide. David Stern himself talked about Sacramento's subsidy and support at All-Star Weekend, while mentioning that Seattle did not offer one to the NBA during the Sonics' relocation, yet did to the NFL and MLB in recent years (Sportsnet Northwest's Art Thiel points out that Stern ignored the fact that Key Arena received a $100 million public subsidy for renovation in 1993). Bruski goes on to relay information from sources that say that if the NBA does back Sacramento over Seattle, the league will be able to use Sacramento as an example to other cities when they go shopping for new arenas.

On a quick aside, Bruski mentions that should the NBA choose Sacramento, Chris Hansen could bow out of the race rather than force a vote or start litigation. I've seen some people take this to mean that Hansen is leaning towards bowing out of this race. That's a mistake. This is only a possible scenario should the NBA choose Sacramento, and it's not unprecendented; In 2011, the Maloofs did something similar when it became clear that the NBA would not back a relocation to Anaheim.

This is still a very fluid situation. Neither city truly has an arena deal yet. Both cities are markets the NBA would love to be in, even as P.R. campaign from Think Big Sacramento push the narrative that Sacramento is a better NBA market. Both cities have ownership groups that would be welcome in the NBA fold.

In the end, I have to believe that the NBA will go with the city that has worked tirelessly to keep its asset before it disappears, rather than the city that stepped up after.

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