Sacramento Stimulus Arena

April 4, 2012

Katy Grimes

It’s getting tiring pointing out that while Sacramento burns, the City Council is fiddling.

At the city council meeting last evening, several council members questioned whether Joe and Gavin Maloof, the Kings’ owners, were serious or not about partnering with the city on the arena deal. Blah blah blah blah.

The team said earlier in the week it has no intention of paying its share of pre-development costs on the $391 million project, the deal worked out a couple of weeks ago.

The council finally agreed, on a 7-2 vote, to move ahead with a $200,000 cost for pre-development work required for the arena development, as long as the NBA also agrees to fund the Maloof’s portion of the funds.

It’s only money

Despite the failure of numerous efforts in Sacramento to build sports facilities with public money, the-arena project-which-wouldn’t-die keeps getting life breathed back into it by Mayor Kevin Johnson, with the assistance of Sen. Darrell Steinberg, D-Sacramento.

It reminds me of the High-Speed Rail deal–it doesn’t matter whether I think rail is cool or whether I will ride it. The only question is who is paying for the $98.6 billion price tag–which is more than California’s entire state budget.

Sacramento’s previous arena deals have been totally discredited by the Sacramento Grand Jury  after voters refused to pass  Measures Q and R, which would have approved a quarter cent sales tax increase and directed the revenues to fund a new sports and entertainment facility.

“In an effort to obtain public financing, Sacramento City and County of Sacramento officials agreed to put the matter on the November 7, 2006, ballot as Measures Q & R” the Grand Jury wrote. “The ballot measures as written were a blatant attempt to avoid the provisions of Proposition 218 in that Measure R was listed as a general tax (requiring a majority vote) and Measure Q was for distribution of the monies from the tax. Combined, they would have represented a special tax requiring a two-thirds vote.”

Titled, “The Kings and City and County of Sacramento: Betrayal in the Kingdom?” the Grand Jury investigated the arena issue because they wanted to find out “if the City and County of Sacramento deceived their citizens regarding their dealings with the Kings.”

The answer was a resounding “yes.”


“Sports proponents continue to promote the ideology that Sacramento can transform to a ‘world class city,’ by building an arena and keeping the Kings,” the Grand Jury wrote. I’ve been critical of the level of world class city desperation by Sacramento officials and elected politicians for many years.

World class cities are not created with sports teams, and Sacramento is no different.

The Sacramento Kings have not sold out their games for many years. The demand is not there.

Without demand, the arena project will not bring more jobs to our city that are not already here. The only new jobs that may be created will be more union jobs to build the structure, which will be obsolete and out-of-date before any of the loans are paid off, or before any of the interest is paid back to the city by the Maloofs.

In 1997 the city loaned the Kings $78.5 million. The loan has not be repaid.

World Class What?

In a 2009 op ed for the Sacramento Bee, I wrote that the best definition I have found of a world-class city comes from Seattle journalist Bill Virgin, who tracks business and economic trends. He writes, “World-class business cities are those where strategic and tactical decisions are made on everything from new plant investment to developing new markets and products. They’re the cities others watch and react to. World-class business cities are not guaranteed exclusivity in producing the next wave of influential products, technologies and companies – but they’re a more likely incubator for them. And those products, technologies and companies are where new jobs come from.”

Sacramento is not strategically, tactically or decisively developing new markets or products, or putting in new plants for any industry. In fact, businesses are fleeing the city and the state. Politicians instead are obsessively focused on vanity projects, to the detriment of the other crucial segments of the economy.

World-class cities are not driven by how many restaurants you have downtown or how big your sports arena is. The big cities with the Fortune 500 businesses and companies are business friendly and defined as “world class.”

With Steinberg’s fingerprints all over this deal, it’s clearly nothing more than a ploy to provide union jobs.

Today’s politicians know that they will be long gone when the bills come due; Steinberg and Johnson included.

The Grand Jury report concluded, “The City and County of Sacramento keep pandering to the Kings. The Kings are going to make whatever business decision they are going to make.”

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