Sacramento Kings Arena Deal Approved on March 6 'Is Not Going to Happen'

Roughly five weeks after financing for Sacramento's new sports and entertainment complex was approved, the deal has fallen apart.

The deal, which is non-binding, was agreed to by the city of Sacramento, the NBA and the Sacramento Kings owners—the Maloofs—during the NBA's All-Star game festivities on Feb. 27. The agreement was subsequently put up for vote before the Sacramento City Council and was approved on March 6.

Three weeks later, on March 29, it came out that the Maloofs and the city of Sacramento were at odds over who would pay the arena's $3.26 million pre-development costs. The Kings argued that since they were only tenants in the arena, they should not be responsible for those costs. The city, meanwhile, pointed out that the Maloofs agreed to pay those costs as part of the agreement that was struck on Feb. 27.

In order to keep the project moving forward, the NBA agreed to advance the city $200,000 to cover the pre-development costs until the matter could be resolved at the NBA's Board of Governors meetings in New York on April 12 and 13.

The Maloofs gave a 90-minute presentation on April 12, spelling out that the terms of the deal struck on Feb. 27 were not amicable. In an effort to keep the deal going, NBA commissioner David Stern asked Sacramento mayor Kevin Johnson to attend the meetings and discuss the matter with the Maloofs.

Johnson agreed to attend the meetings, but before he left, he fired off a letter to the Maloofs stating that they should honor the deal they agreed to and that the terms of the agreement were non-negotiable.

The Maloofs, for their part, hosted a press conference this morning (April 13) to discuss the agreement. The gist of the conference was that the agreement would have to be re-worked and, as it currently stands, would be a financial disaster for the team and the city.

As Mayor Johnson pointed out in his letter, the city is not open to re-negotiating the deal. With neither side willing to budge, the arena deal is an impasse. So much so, that Commissioner Stern said the deal is "not going to happen."

"It's not going to happen, but I can say the city has stepped up," he said. "We have nothing further to give, to cajole, to yell, or all the various ways I've tried to keep the parties on track to get what we thought was a win-win in Sacramento."

With Mayor Johnson still in attendance in New York, he's expected to meet with the Maloofs this afternoon. But given the hard-line stance by both sides, and given the Maloofs' ability to back out of the non-binding agreement, it's unlikely to be settled.

On the bright side, the Kings are slated to stay in Sacramento at least for the 2012-13 season, so there's still time to work something out. The Maloofs also reiterated today that they're committed to staying in Sacramento long-term.

So while the agreement that was approved on March 6 appears to be dead, there's still an opportunity for the sides to work something out in the future. But given the current relationship between the Maloofs and the city, it's not going to be easy. 

Read more here: http://www.sacbee.com/2012/04/13/4411658/maloofs-say-arena-plan-imperils.html#storylink=cpy