Relocation, lawsuits and the mess that lies ahead for Sacramento
Fans remain optimistic that the Kings will stay in Sacramento, but history shows the owners’ are likely thinking otherwise.
The Maloof family does not want to be in Sacramento.
Think about anything you have ever wanted like a job, a relationship or to take a trip. If you want nothing else than to get hired, fall in love, or travel, you don’t give up. You take risks and you figure out a way to make your dreams happen.
The owners of the Sacramento Kings have shown none of that here.
Go back to every single arena deal the Maloofs and city have discussed and each instance, the Kings owners have pulled out at “go time.”
Once the Maloofs kissed the Railyards plan goodbye last month, it left NBA Commissioner David Stern choosing his words carefully.
“I’m protective of the Kings’ rights to do what they can,” Stern said from New York City after the league’s Board of Governors meetings. “[The deal] made the owners of the Kings incredibly uncomfortable…this was not a transaction they wanted to go forward with. That’s their right.”
When have they truly wanted to go forth with a plan?
Admittedly, not all of the deals have been great, but at least the local politicians have put in effort after effort to create some kind of traction towards building a new arena.
There was the 2010 Convergence Plan, known as the three-way land swap that involved the Railyards, Cal Expo and Natomas. It died a few months after the NBA backed the idea brought forth by developer Gerry Kamilos. While Mayor Kevin Johnson was not in favor of the undertaking because of the large dependency on a housing recovery, it was clear the Maloofs really had no interest in paying $10 million a year for three decades. The Cal Expo board eventually put the final stake in the deal.
There were also Measures Q & R in 2006. The initiatives would have raised $1.2 billion through taxes with $472 million of that money to be used for an arena. Just like 2012, a “term sheet” in that deal was nothing more than a waste of time as the Maloofs claimed the real details were yet to be decided. They took their ball and went home before it went to the voters.
In 2004, the Maloofs pulled out of the Blanas-Tsakopoulos arena proposal in Natomas because they did not agree with the 50-50 split. Two years prior, the Kings owners felt the payments to cover the loans were too high and too much of the responsibility fell on them. This was dead before it even got any real traction.
The actions by the Maloofs this spring were nothing more than another stitch in the pattern.
Which is why the retrofitting of Power Balance Pavilion is a smoke screen.
Councilwoman Angelique Ashby said after the deal fell apart, “It was made very clear there was no funding at the Maloof and NBA level that could go into Natomas. I was shocked when (the Maloofs) said that, as they were the ones who have said they didn’t want to stay in Natomas.”
But apparently the wrinkled Arco Arena has somehow aged to perfection, like a fine wine from the Napa Valley. Not quite ready in the previous decade, it appears that we all just needed to wait until 2012 to upgrade the leaking pipes and duct-taped seats.
Not buying that? Didn’t think so.
Built for $40 million in 1988, various contractors have gone on record in recent years backing the notion that the square structure would be better served demolished than with a new facelift.
Maloof chatter about Natomas again is all a diversion to help turn public opinion against the city and its efforts so that the family can finally rid themselves of Sacramento.
Brace for it now so you are not surprised next spring.
The Maloofs will file for relocation for the 2013-2014 season.
These antics spewed out in front of you are all to build a case to the rest of the league and then to a court of law. Yes, in front of a judge inside a real courtroom, but let’s first begin with fellow NBA owners.
The Maloofs knew with Commissioner Stern strongly backing the Mayor on the latest arena deal that they’d need to take another approach.
George Maloof tried to claim the agreement to build the $391 million Railyards project was a “bad deal for the city”, despite what two separate city consultants told the council or how the NBA’s own financial experts felt about the financing sources.
When that failed to gain traction, the public relations pitch was to feast on the unhappy residents who want to keep the current arena in their backyard. In the aftermath of the downtown plan crumbling like a dry muffin, George Maloof hinted by phone that “maybe Natomas would be the best option moving forward.”
Mayor Johnson has reiterated time and time again that the city is not interested in putting up any money to help the Maloofs with Power Balance Pavilion.
“If they choose to renovate on their own and use private dollars, that’s certainly their prerogative,” Johnson said on April 13th from New York City.
That “no,” is exactly what the Maloofs were counting on.
They need to show fellow league owners that they have made an effort and that the city that has become uncooperative. The Maloofs can then say they offered a cheaper solution, but the city pulled back.
With this public relations campaign already heading toward its own death bed, the Kings owners are going to need a tougher strategy to be granted relocation.
Insert the lawyers.
The family has someone with forty years of experience in anti-trust suits waiting to strike. Attorney Barry McNeil is no slouch and may be a formidable foe to Commissioner Stern and the league’s legal team.
The Maloofs’ lawyers have sought email and phone conversations between the NBA and Sacramento all in an effort to build a case against the league if the owners attempt to block the move to Anaheim.
There is no doubt this will get much uglier before it gets prettier.
The brothers have said repeatedly they are “not interested in selling,” but the rest of that sentence should likely read with the team in Sacramento.
It appears the family hopes that the move to Orange County will drastically increase the value of the franchise. Forbes lists the Kings at around $300 million, which will not go far enough with the owners allegedly $205 million in debt.
When asked if the family was meeting with Anaheim to resurrect a deal, George Maloof said “Absolutely, 100 percent no. I would never do that,” adding, “It isn’t in the works.”
However it is apparent while the Mayor and city staff were busy constructing a deal and working with NBA brass on the parking lease proposal, the Maloofs were behind the scenes creating a back-up plan if the city couldn’t pull through on its promise. George Maloof admitted over the phone that when they inquired about costs in November, relocating the Kings would come at a price tag of $150 million.
Those discussions with league officials, he said, have not been revisited in recent weeks.
It was that potential relocation fee that got Anaheim Ducks owner and Honda Center operator Henry Samueli involved in a loan last year to help the Maloofs move the team to Southern California.
George Maloof said their “financial woes have been overblown” in the public, but if the family had the cash, it is unlikely they would even consider a loan from Samueli who is thirsty for an NBA team of his own.
Best case scenario for Sacramento
The Maloofs bid to move the team is rejected in the spring of 2013 by league owners. The ensuing legal fight the following year ends in the NBA’s favor and with the appeals process exhausted, the Kings crawl back to the Capital City in what would redefine awkward situations.
Boxed into a corner with revenues not able to cover expenses and their lifestyle, the brothers come to an agreement to put the team up for sale.
A new owner swoops in, a familiar arena deal begins again downtown and the Kings open the season at the Railyards sometime in 2017.
And the worst case scenario?
The league’s owners don’t want to engage in a legal battle, say “Sorry, Sacramento” and the Maloofs somehow come up with a way to pay off the Donald Sterling and Jerry Buss camps down in Los Angeles.
There is no crystal ball here, but there is a reason history lessons are given to school-age children. Not applying those same teachings to the arena issue will simply end in heartache.
George Maloof said he and his brothers asked themselves while coming back from New York, “What have we done wrong to deserve this pounding (from the public)?”
Here is the answer no one else on your payroll will give you.
It’s not what you have done; it is what you haven’t done.
If the Maloofs truly wanted to stay in Sacramento, they wouldn’t have hired people to ensure the deals falls apart; they would have found the best of the best to make sure an arena in Sacramento did happen.
When you want something bad enough, you go to great lengths to get it, not avoid it.