Anaheim votes to fund Kings' move

March 29, 2011 

ANAHEIM - It's pretty much up to the Maloofs now.

In a move that probably assures the Kings will relocate, the Anaheim City Council approved a $75 million incentive plan Tuesday designed to lure the NBA team from Sacramento. A series of 5-0 votes came as Sacramento officials all but conceded the team is gone. Although the city had hinted a day earlier that it would sue Anaheim, Mayor Kevin Johnson said Tuesday he was fine with the Kings' departure as long as the team owners, the Maloofs, repay a $77 million debt to the city. Indeed, during the Anaheim council meeting, officials didn't mention a harsh letter they had received from Sacramento Assistant City Manager John Dangberg, demanding Anaheim halt its courtship of the Kings. Instead, a celebratory mood prevailed, and a packed crowd of business leaders applauded the council vote. "Walt Disney always said, if you can dream it, you can do it," Anaheim City Councilman Henry Sidhu said. "Anaheim took a giant step closer to bringing an NBA team to Anaheim and the Honda Center," said Mayor Tom Tait. In an interview after the vote, Tait deflected questions about Sacramento's harsh tone, saying, "The relationship between the Kings and Sacramento, that's none of my business." Asked about hurting Sacramento basketball fans, he added: "For almost 20 years, Anaheim has been trying to get the NBA here. Most teams come from another city. That is the nature of professional sports." Mayor Johnson said he was "very disappointed, not surprised" by the Anaheim vote. He said Sacramento will continue to press ahead with a feasibility study on a new sports and entertainment arena. The more pressing concern for city leaders was the search for assurances the Kings wouldn't leave without paying off their city loan. Minutes after the vote in Anaheim, the Sacramento City Council voted to set aside funds to hire a law firm to make sure $77 million owed by the Maloofs is repaid. "The mindset of the city is to make sure that they fulfill their obligation," Johnson said earlier in the day. "And if they do that, then I don't want a messy divorce, I don't want to be a poor sport about it, it's their decision. "And quite frankly, if they don't want to be here, then I'm going to be OK with (them moving) and I think our community will be OK with that." Gavin Maloof, one of the co-owners, had no comment on the Anaheim vote. But Monday, two of the Maloof brothers, Joe and George, said the family would pay the debt. "We have no intention of leaving that town without paying our debt," George said. Billionaire to finance deal The Maloofs have until April 18 to ask for permission to move. The NBA board of governors, consisting of team owners, likely would vote on the request in September. Past relocations have been approved by landslide votes. Johnson said the Maloofs told him Monday "it's not a done deal in Anaheim" and that if the team stays, "we will be back with a renewed commitment and vigor." As negotiations proceeded in recent weeks, Anaheim officials had avoided identifying the Kings by name in documents and public comments. That changed Tuesday, when council member Kris Murray praised the Maloofs and said, "My heart does go out to the Sacramento residents." Although Anaheim is issuing the $75 million in bonds, the deal is really being financed by Henry Samueli, the Orange County billionaire who manages the Honda Center and owns its hockey team, the Ducks. The city is involved because it owns the arena. But in effect, Samueli is loaning the money to himself, with the city as a conduit. The $75 million will go toward arena renovations and other costs, including an NBA relocation fee. Two thirds, or $50 million, will be loaned to the Maloofs. The council also amended the Honda Center lease to accommodate an NBA tenant. Before the vote, Anaheim business leaders stepped to the podium to congratulate council members for pulling together a deal that doesn't cost taxpayers anything. The new team "will create thousands of jobs...millions and millions of dollars for our local economy," said the Chamber of Commerce's Todd Ament. By contrast, Sacramento officials Monday, in their warning to Anaheim, said the Kings' departure would cause urban blight, in possible violation of California environmental laws. Tuesday, despite Johnson's conciliatory language, they pressed forward with that argument. Sacramento City Attorney Eileen Teichert sent Anaheim officials a letter contending Natomas would be devastated without the Kings. "Restaurants, bars, and businesses already weakened by the region's prolonged recession may fail, leading to many additional 'board ups' of vacant properties in Sacramento," she wrote. But environmental lawyers told The Bee the city would have a hard time using the blight argument to block the team's move. Waiting list for new fans Assuming the team leaves, the Maloofs will have to pay the city of Sacramento $77 million - the balance due on a 14-year-old loan, plus a penalty. If the Kings leave without paying the debt, they would forfeit Power Balance Pavilion and a $25 million stake in the team. But the city would have to pay the $77 million debt to bondholders who financed the loan - and the assets left by the Maloofs might not be enough to cover that debt. Sacramento City Treasurer Russ Fehr said the Maloofs' assurances Monday that they would repay the debt were "encouraging," but city officials want something more definite. State Senate President Pro Tem Darrell Steinberg, D-Sacramento, said Tuesday he would consider carrying legislation that would prevent the Kings from moving if they don't pay. Meanwhile, a group of private attorneys from Sacramento mounted an effort to block the relocation. Attorney Jeffrey Dorso, in a letter to Anaheim city officials, contended the Anaheim council violated state law by approving a bond issuance that takes effect right away. State law requires a 60-day waiting period before the bond vote takes effect, he said. That delay would give people opposed to the move time to launch a ballot referendum to repeal the bond vote. Opposition from Sacramento seemed to have no impact in Anaheim, where the Honda Center announced, shortly before the vote, that it would start a waiting list for NBA ticketbuyers "due to the increased number of calls and emails being received from fans." By contrast, the Kings haven't mailed out season-ticket renewals - something that normally would happen by now. "We will update everyone on the process as soon as we can," spokesman Mitch Germann said. Call The Bee's Tony Bizjak, (916) 321-1059.

Modesto Bee is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service