Sacramento Kings Wait On City Proposal To Privatize Parking For New Arena Funding
The Sacramento Kings are getting lots of attention in California's capital, but it hasn't been for their play. As of this writing, the Kings sat in last place of the NBA's Pacific Division.
What's putting the focus on the Kings is the way officials are trying to gather financing to build a new arena and keep the team. Sacramento Mayor Kevin Johnson, a former NBA All-Star, and others are pushing a plan to auction off the city's parking spaces to a private firm to collect around $200 million -- half of what's projected to build an arena.
Sacramento, mired in a $39 million budget deficit for the current fiscal year, would lose the $9 million a year it receives from its metered spaces and structures, according to the Sacramento Bee. The lease could run 50 years. But arena supporters point to a study asserting that a new venue would bring in $7 billion over 30 years.
The team has threatened to move if it doesn't get a new home, and officials have until March 1 to formulate a viable proposal. If they can't, the NBA has given its blessing for the team's owners, Joe and Gavin Maloof, to court other destinations. Anaheim, Calif., and Seattle, Wash., have emerged as potential suitors.
Sacramento is one of many regions under pressure to build new sports venues, continuing the debate over whether public resources should be used for privately owned teams. Under several proposals recently, Minnesota taxpayers faced the possibility of shelling out hundreds of millions of dollars to help finance a $1 billion stadium for its NFL team, the Vikings. And despite economic woes just about everywhere, other teams are also seeking new digs or expensive renovations: They include the NFL's San Francisco 49ers, St. Louis Rams, Atlanta Falcons, San Diego Chargers and Oakland Raiders, as well as Major League Baseball's Oakland A's.
The Kings have played in their current home since 1988. Although Power Balance Pavilion has the NBA's lowest capacity at 17,317, it has had trouble filling the place. Sacramento, as of Sunday, was averaging 14,924 in attendance, 24th in the 30-team league. It has stumbled through five losing seasons, following an era in which it was one of the league's best teams and regularly packed the building.
The feasibility study, commissioned by the plan's backers, determined that the new arena would bring in $157 million a year to the area, plus $6.7 million in taxes.
"Like with anything, the devil is in the details," Victor Stango, a professor of economics at the nearby UC Davis Graduate School of Management, told The Huffington Post. "Those details are particularly important because this is a long-term commitment."
A task force expects to raise part of the other $200 million needed to finance the arena through the sale of the old arena's property and new digital signage, according to the Los Angeles Times. But any talk of sacrificing public assets such as parking revenues comes at a delicate juncture. The city's school district recently approved $28 million in budget cuts that call for about 200 layoffs, and the city has had to trim police and fire service.
Neither the mayor nor the NBA responded to requests for comment.
There is also uncertainty over how privatized parking will work. Recent moves in Chicago and Indianapolis to privatize parking resulted in higher rates and have met with mixed results, according to reports.
UC-Davis's Stango said that the city would be trading one long-term asset, the parking, for another, the team -- and that "no one knows" whether the exchange is worth it.
The city council last week narrowly rejected putting the matter to a public vote in June, several months after the NBA is expecting an outline, the Bee reported. Now the city must quickly come up with a workable plan so the Kings will park long-term in Sacramento.
The meter is running.
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First Posted: 02/13/2012 10:39 am Updated: 02/13/2012 1:21 pm