A new arena could redefine Sacramento

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Last year, after scares of the Sacramento Kings relocating to Anaheim due to Sacramento having an outdated arena, the NBA and the Maloofs—family that owns the Kings—agreed to give the city one more year to approve a new arena or relocation talks would be readdressed.

Now, only a few days are left until March 6, when the Sacramento City Council votes to accept or reject a proposed term sheet for the financing of an estimated $387 million new sports and entertainment complex in Sacramento.

Over the course of the NBA’s All-Star weekend, Sacramento Mayor Kevin Johnson, city representatives, NBA Commissioner David Stern, Anschutz Entertainment Group (the proposed arena operator) and the Maloofs spent several hours each day negotiating the possible terms of the arena’s financing.

On Feb. 27, all parties agreed to a tentative deal, which includes up to $250 million from the city, mostly from the leasing of downtown parking, approximately $75 million from the Maloofs with possibly another $60-$70 million coming from them over the life of the deal, roughly $60 million coming from AEG and possibly some extra money coming from the NBA.

The proposed sports and entertainment complex has larger implications than simply keeping the Kings.

The city of Sacramento is in a catch-22 where the city is both in a reported $39 million deficit, according to the City of Sacramento’s website, and lacking a major attraction such as an updated sports and entertainment complex.

Sacramento has missed out on big name concerts and events and seen the attendance drop at Kings’ games in recent years, all completely or partially due to the outdated Power Balance Pavilion. This all results in money lost for surrounding businesses and the city as a whole.

In recent years, Sacramento has also lost out on the revenue from NCAA tournament games that the city hosted for many years.

The Kings and the Power Balance Pavilion also employ roughly 1,100 people, meaning a huge loss of jobs should the team leave town.

The fact is, if the entertainment and sports complex isn’t built, the Kings and future events will leave town. And the cost of losing more attraction and city revenue is far greater than the cost of investing in a new arena now.

Cities such as Indianapolis, Oklahoma City and Orlando are great examples of how new or updated sports complexes can revitalize a fan base and increase traffic to the city. Orlando just received the 2012 All-Star game, its first in 20 years, after building a new arena. Indianapolis received the 2011 Superbowl after opening a new football stadium in 2008.

According to Micronomics, an economic research and consulting firm, the 2011 All-Star Game in Los Angeles game was expected to generate $85 million for the city.

Now, there are only a few more days and we find out if Sacramento will be added to the list of cities with a new arena and revitalized economic opportunities.

The proposal will be available online for public viewing as of March 1, but the vote now hangs in the hands of the nine members of the Sacramento City Council.

Five more votes is all it takes to redefine Sacramento history forever.

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