David Aldridge has been one of the few national reporters who has been writing pretty consistently about the Sacramento-Seattle situation. Yesterday, he wrote a very balanced article featuring perspectives from both sides summing up the story so far with the crucial NBA meeting that both cities are participating in on Wednesday.
However, I don't wholly agree with one premise of the article. Aldridge states:
But if owners elect to keep the Kings in Sacramento, how can they ever expect Seattle to put a group together again as impressive as the one headed by Hansen and Ballmer, who've done everything the league has asked them to do -- and done it quietly?
Chris Hansen and Steve Ballmer aren't going anywhere, should the NBA vote deny their bid for the Sacramento Kings. Hansen is too dedicated, focused, and most importantly, invested in bringing the NBA back to Seattle. Hansen has spent tens of millions of dollars buying land for a new arena. Ballmer could lose 99 percent of his wealth and still be among the 1 percent. Should Seattle lose out on the Kings, there is absolutely no way they'll stop chasing a team, either by buying and moving one or through expansion. They'll be No. 1 on the NBA's list of buyers each and every time someone is up for sale.
But for Sacramento, this is the last chance for the NBA. Mayor Kevin Johnson has moved mountains to bring together a coalition of investors that most didn't believe could be assembled for a small market like Sacramento. Ron Burkle, Mark Mastrov, Vivek Ranadivé and the Jacobs Family: these are people that the NBA would love to have join their ranks (not that they wouldn't love Hansen-Ballmer as well). More importantly, they're willing to do what the current owners of the Kings have not: invest in a new downtown arena. Relocation has only ever been a threat for Sacramento because of the lack of a new arena. Since the early part of the century, the need for a new arena in Sacramento has been known, but no real progress was made until Kevin Johnson became mayor.
A little history on Johnson's efforts: Johnson has overseen three attempts by the city of Sacramento to build a new arena since being elected in 2008. The first was a complicated land swap deal that was ultimately rejected by the Cal Expo Board in 2010. Funnily enough, it was this failed arena attempt that spurred Blake Ellington, James Ham, Tom and I to found Here We Stay shortly after, although we didn't really ramp up the grassroots until the threat of relocation to Anaheim became real.
The second arena attempt came after Johnson successfully lobbied the NBA against a move to Anaheim (although there is a lot to be said of the unwillingness of the NBA to move a third team into a crowded SoCal market). In a recent L.A. Times piece by George Skelton, Darius Anderson (the local developer who helped bring Ron Burkle aboard) said of K.J.'s speech to the Board of Governors:
"I've never seen a more organized, articulate and compassionate speech" than Johnson's to the NBA owners, says lobbyist, investor and sports junkie Darius Anderson. "He played on every owner's heartstrings."
Numerous reports indicate the NBA was very impressed with Johnson, but they also wanted to make sure his promises weren't just hot air. The NBA sent Clay Bennett, head of the relocation committee, to Sacramento to talk with the corporate sponsors who had pledged $10 million in sponsorships should the Kings stay. The NBA was so enamored with Johnson that they sent representatives (one of which was Chris Granger, Executive Vice President of Team Marketing and Business Operations) to help with the team's marketing as well as to help broker an arena deal between the Mayor, AEG and the Maloofs. Again, the arena deal was central to Sacramento's efforts to keep the team. It was all but certain that should an arena deal not come to fruition, that the NBA would allow the Maloofs to move.
After months of negotiations, all sides reached an agreement on a non-binding term sheet during last year's All-Star Weekend in Orlando. A couple weeks later, the city council approved the term sheet by a margin of 7 to 2. Gavin Maloof was at the meeting and even thanked the city council. Just a month later, he sat silently as his brother George Maloof trashed the arena deal, Kevin Johnson and the city of Sacramento, effectively killing any hope of Sacramento's arena plan moving forward and putting the Kings future once again in doubt.
After that it was a waiting game. For years we were told that the Maloofs would NOT sell the team. One of the Maloof family's biggest complaints with Mayor Johnson was when he told the NBA Board of Governors that Ron Burkle was willing to buy the team and build an arena to keep the team in Sacramento as the Maloofs were trying to move to Anaheim. So we waited, sitting through an ultimately toothless attempt by Virginia Beach to poach the Kings, until surprise, surprise, the Kings were sold to Chris Hansen and Steve Ballmer for a whopping franchise valuation of $525 million.
Unperturbed, the Mayor and his team began immediate work on Sacramento's counter-offer, assembling a team of investors and more importantly working on an arena deal, Johnson's third. This time, the city chose the Downtown Plaza and had more financially stable partners. Gone were the excessive demands of the Maloofs. AEG and the NBA (who was willing to loan the Maloofs the entirety of their share of the previous arena plan) didn't have to join in because Sacramento's private investors had the financial wherewithal to contribute a lot more. Last week, the city AGAIN approved the arena term sheet 7 to 2, while improving on the last arena deal in most aspects.
So back in the here and now, Johnson and his team head to New York to pitch their case, and it's a strong one, as is Seattle's. But this is merely Seattle's second chance, with the book still yet to be fully written should things not go their way in April. For Sacramento, this is the last chance. If the NBA approves the sale and relocation, Sacramento will likely never see NBA basketball again. The fan support is here now. The political will is here now. The $$$ is here now. Without the Kings, all that disappears. The all-important arena deal would most definitely die once and for all without a core tenant and the politicians, already so jaded by this decade-long saga, won't see the point in trying again when they were rejected despite meeting every demand. The incentive for the whales to invest in Sacramento will be gone, and they won't likely stay to try to buy and move another team as Seattle did. Expansion wouldn't likely even be an option for us without a new arena.
But if the NBA should choose Sacramento, it keeps open a bevy of options.
As I mentioned earlier, Hansen and Ballmer aren't going anywhere, and this means a lot for prospective NBA owners who are looking to possibly sell their team. I've seen a lot about how good it is for the league to have the Kings be valued at $525 million because it raises everyone else's value up. If there's anything I've learned in this process, it's that a team is only worth as much as someone is willing to pay for it. The Kings got that price because they're available to be moved and there's a city available with the will and the money to make them move. It doesn't seem likely to me that just because the Kings sell to Seattle for that $525 million valuation that all of a sudden someone will want to buy the Bobcats, Bucks or Pacers (just random other small market examples) for $500+ million unless they had an incentive to do so. Aside from Seattle, I don't see any other huge deep pockets or markets that are clamoring for an NBA team so desperately.
Another big factor is the public subsidy game that is incredibly central to any arena effort in today's professional sports world. The lack of a subsidy is why Seattle lost their team in the first place, although for the sake of fairness, KeyArena had just received an $100 million renovation subsidy a decade prior. Since then, Seattle has been used as an example of what will happen should a municipality not comply with the NBA's demands. It's an ugly reality but a reality nonetheless. But Sacramento HAS complied with the NBA in almost every way. Sacramento would be a shining example for the NBA to point to whenever they need more money for newer arenas.
Expansion still remains on the table as well. An expansion team in Seattle would be the most equitable solution to this current mess, but it's likely only an option in Seattle, not Sacramento, for reasons I've listed above. We've heard numerous times that the NBA isn't likely to consider expansion as an option, despite there really being no good reason for them not to.
Aldridge concludes his piece by saying:
How can the NBA turn its back on one of its most loyal cities?
How can the NBA turn its back on one of the best potential ownership groups ever put together?
The problem remains, of course, that the above two sentences apply equally to Seattle and Sacramento. And one of them is nonetheless going to have to soon live with the rejection.
As I've laid out above, denying Seattle now isn't the NBA turning its back on them. Rather it's rewarding Sacramento for doing everything they've been asked to keep their team, while encouraging Seattle to keep doing what they're doing, safe in the knowledge that one day they'll be compensated with a team of their own.