Sacramento group asks Stern to force Kings sale
David Stern has been asked to encourage the Maloof family to sell the Kings
Sacramento's most powerful business leaders signed a letter to Stern on Thursday
The Sacramento group accuses the Maloofs of not negotiating in good faith
Sacramento business leaders are asking NBA Commissioner David Stern and league owners to "strongly encourage" the Maloof family to sell the Kings so a deal for a new arena can be reached.
In a letter signed by about two dozen of Sacramento's most powerful businesses leaders and sent to Stern on Thursday, the group accuses Kings owners Joe, Gavin and George Maloof of not negotiating in good faith. It also questions whether the Maloofs have the finances - and motivation - to keep the team in Sacramento.
"We feel it is time for the Maloofs to sell their ownership of the franchise, for the good of the city and in the interest of advancing Sacramento's effort to build a downtown arena," a portion of the letter reads. "The city, the fans and the NBA deserve and require an ownership group that is fully committed to being a good-faith constructive participant in the arena process.
"And we deserve an ownership group that is not only committed to the long-term viability of the franchise in this region but also one that has the wherewithal to make it a thriving, competitive organization."
The timing of the letter was no accident.
The Maloofs were giving an update on the project to the NBA Board of Governors during its annual spring meeting in New York. It was exactly a year ago when Sacramento Mayor Kevin Johnson and the city's business leaders convinced owners - along with presenting more than $10 million of new sponsorship and ticket sales for this season to the team - at the same Manhattan hotel to keep the Kings from moving to Anaheim, Calif.
Sacramento city officials were not in attendance Thursday. Johnson, who had initially said the city had done its part and it's up to the Kings and the NBA to resolve the issue, was expected to meet with the Maloofs in New York on Friday, a team spokesman told reporters outside the St. Regis hotel. The mayor's staff had no comment on what the meeting would entail.
Family spokesman Eric Rose said the Maloofs are "saddened and disappointed" by the letter. He said the Maloofs are not selling the team and are committed to help fund the estimated $391 million arena, which would open for the 2015-16 season, pending final approval of the non-binding agreement the City Council already passed.
"We share in the community's frustration on forging a workable agreement on what is ultimately a $400 million transaction that will impact the region for many years to come," Rose said in a statement. "However, we must all remember what is at stake in the development of a new arena in Sacramento, and must insure the agreement works for all parties involved, and most importantly, the residents of the City."
Sacramento's place on the NBA map seemed secured only a few weeks ago.
Under the non-binding term sheet, Sacramento will contribute $255.5 million, mostly by leasing out parking garages around the facility. The Kings agreed to pay $73.25 million and arena operator AEG will contribute $58.75 million. The remaining gap will be covered by a ticket surcharge, advertising around the facility, the sale of public lands and a sponsorship campaign to sell bricks and plaques around the complex.
The biggest sticking point has been a dispute over environmental and predevelopment costs.
Under the term sheet, the Kings and arena operator AEG each were to pay about $3.25 million in pre-development costs with the city paying the remaining $6.5 million. George Maloof said in a phone interview that he does not believe the team should pay $3.25 million in pre-development costs because they're "playing the role of the tenant."
The NBA, which helped broker the deal, agreed to pay about $200,000 to cover the initial costs and keep the project on schedule. Whether the rest will be covered - and who will cover it - was among the items expected to be discussed this week in New York during two days of meetings, which end Friday.
The league said it will refrain from comment until after the board meeting ends.
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