Sacto would financially benefit from downtown arena

by CalWatchdog Staff | April 30, 2013 8:02 pm

May 1, 2013

By Katy Grimes

[1]

This unnatural and inexplicable push by Sacramento city officials for a downtown arena is suspicious. Without any explanation, all discussion of the proposed arena at the adjacent old rail yard stopped. Then the local media shifted right along with the city, and never asked why. Instead they started repeating the new mantra for a downtown arena.

The city of Sacramento is the biggest slumlord downtown, through years and years of downtown eminent domain and lowball building purchases. This new downtown arena would serve to conveniently improve the property values of the Sacramento Housing and Redevelopment Agency-owned properties downtown.

Not only did the local newspaper, television and radio media never ask why the city changed its push for the downtown location instead of the present location outside of the city or the rail yard, now city officials have the local media talking about how much the property value would improve. It’s just gross.

I am not opposed to a sports arena in downtown Sacramento. But I am opposed to the nearly 75 percent public subsidy by the taxpayers of Sacramento. If the developers involved in the arena deal can make a go of a new arena in Sacramento, they should. But it appears this deal can’t stand up to any financial scrutiny without the city of Sacramento bringing the bulk of the money to the table.

What kind of “development” is that? It’s a scam.

“The mayor, himself a former NBA All-Star, has scrambled to assemble a group to buy the team, convince commissioner David Stern to consider a counter offer, and get approval for the financial deal that would build a $448 million arena on the site of a shopping mall — a development many say will revitalize a problem area in its bustling city core,” ESPN[2] said.

The problem area in downtown Sacramento is entirely the fault of the city and their lousy property management. The city is responsible for driving the downtown K Street Mall area from a once-bustling pedestrian mall filled with independently owned shops and department stores, to a crime laden, blighted area replete with abandoned buildings and crazy homeless people. It sounds ripe for another publicly-funded re-do.

“How do you transfer $250 million from taxpayers to billionaires?” my friend Stephen Frank recently commented on one of my arena stories on his website[3]. “How do you become a billionaire?  One way is to have others pay for your play toys.  Is it the role of government to pay for arenas, in Stockton they paid for a parking lot for a movie theater, LA and San Fran have the Coliseum and Cow palace—while all of California is being inundated with criminals and fewer cops.”

Frank is so right.

“Arenas are nothing more that fields of schemes[4], and the joke is on taxpayers. And Sacramento is hardly a bastion of economic splendor,” I wrote in March in Sacramento arena: ‘Field of Schemes[5].’

“Despite some of the highest unemployment in the country, escalating business closures, widespread home foreclosures and short sales, and declining tax revenue, arena talks are all the rage in Sacramento.”

According to Eye on Sacramento[6], a Sacramento-based public policy watchdog group, Sacramento’s “city staff has grossly understated the total public contribution to the arena. Instead of contributing $258 million, EOS estimates that city taxpayers will be contributing $334 million to the project, representing not 58 percent of the project cost, as claimed by staff, but 75 percent of the project’s cost (not counting subsidies provided by county government or future undetermined traffic infrastructure costs.)”

Source URL: https://calwatchdog.com/2013/04/30/sacto-would-financially-benefit-from-downtown-arena/