Arena effort gets regional business support

In what Mayor Kevin Johnson called an unprecedented event, 14 chambers of commerce from the Sacramento region announced Thursday that they support an entertainment and sports complex in downtown Sacramento.

Johnson said the backing of the regional business community, which came after a four-county bus trip for Think Big Sacramento, is a commitment to the promise he made to the National Basketball Association earlier this year in New York City that Sacramento is an NBA city and can build a new arena.

“I did not sell Sacramento, I sold our region,” he said, adding that a common commitment to a downtown sports and entertainment complex will provide a more vibrant community.

The major obstacle facing the Think Big Sacramento coalition is developing a financing plan for the $386 million arena, something that was expected from the ICON-Taylor arena development team but was not a part of the report released after a nearly four-month feasibility study.

Johnson said he is confident that a workable public/private partnership will be in place before the end of this year, in time to meet the March 1, 2012 deadline to make serious efforts to build a new arena.

“We don’t want to be in the same situation year after year, and we know that March deadline is coming up. It’ll be here before we know it,” Johnson said, adding that he is confident the self-imposed deadline of having financing options in place by mid-September will be met.

“Then, in subsequent months, the rest of September, October and November, we believe we will have a critical path of a public/private partnership … all before the end of the year. That’s our goal,” he said.

He alluded to creative funding models and “outside-the-box” thinking on the financing, but he did not give any specifics on funding options, except to address the question of a sales tax.

“No one here wants to do a sales tax,” he said. “We didn’t take it off the table, but we knew that would not fly. We learned that in 2006.”

Martha Lofgren, interim CEO of the Sacramento Metro Chamber of Commerce, said the Metro Chamber has supported the idea of a downtown arena since at least 2004, and she said regional funding is the only method that makes sense.

“One agency, one local agency can’t do this alone,” she said. “There has to be a regional effort to fund a regional sports and entertainment center.”

She added that a downtown arena will benefit the whole region, not just Sacramento.

“If there’s one thing I think we as a region need right now, it’s an economic catalyst,” she said. “We need to move forward, get the financial picture in place and get the momentum going.”

The independent report released late last month claims that the region will benefit from $7 billion in economic activity over 30 years and create 4,000 jobs.

Some in the community have been skeptical of those numbers and the actual economic effect from an arena, but Lofgren said she believes the numbers are accurate.

“You need to know this is a very thoughtful process that has led up to the announcement today of the support from all of the regional chambers,” she said, adding that the business community has had since the beginning of June to check out and verify the numbers.

Willie Pelote, assistant director for the Political Action Department of the California chapter of the American Federation of State, County and Municipal Employees (AFSCME International), said that as a representative of labor, he also believes the numbers are accurate.

“I think the mayor and his team have been very thorough in making sure that they do the research that’s necessary so when they say something to the public, the public can go and check it out,” he said. “That’s why I think the region’s going to buy into this concept … we’re looking at job creation.”

He added that he is “very comfortable” with what the finance committee – headed by former Sacramento Treasurer Tom Friery – is doing to make sure it is not being built on the backs of taxpayers.

Other chambers of commerce supporting the downtown arena are the Rancho Cordova Chamber of Commerce, the Sacramento Hispanic Chamber of Commerce, the Sacramento Black Chamber of Commerce, the Sacramento Asian Pacific Chamber of Commerce, Citrus Heights Regional Chamber of Commerce, Folsom Chamber of Commerce, Lincoln Area Chamber of Commerce, Rainbow Chamber of Commerce, Rocklin Area Chamber of Commerce, Roseville Chamber of Commerce, Slavic-American Chamber of Commerce and the Yuba-Sutter Chamber of Commerce.

Pelote said he expects a similar showing of support from labor organizations in the coming weeks.

Brandon Darnell is a staff reporter for The Sacramento Press. Follow him on Twitter @Brandon_Darnell.

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July 21, 2011 | 8:31 PM

This is why my company doesn’t belong to the Chamber. They refuse to listen and do what they want. The fact that she believes the 7 billion number speaks volumns about how out of touch with reality she is.

July 21, 2011 | 10:44 PM

I am equally dismayed and disappointed with the endorsement of AFSCME. The so-called Economic Engine report is so flawed it is useless for anything but starting a discussion or lighting a fire.

Based on my reading of the various community publications, citizens throughout the region are going to be surprised at first, then angry at this support. Very angry.

July 22, 2011 | 5:43 AM

manCaveman, what are the flaws?

July 21, 2011 | 9:12 PM

So…how much money were they willing to invest into construction of this arena?

July 21, 2011 | 9:56 PM

Yuba-Sutter Chamber is supporting this BEFORE funding is in place? Just last week I read an Appeal-Democrat story quoted a Y-S Chamber press release stating that they have NOT taken a position and would not take a position until funding is in place. It is more smoke and mirrors from someone.

http://www.appeal-democrat.com/articles/black-108474-gravitated-pinot.html?cb=1311307908

Still no money. What public resources is Johnson eyeing to throw into the pot to make this happen? We can only be sure that the public will lose and billionaires are scheduled to win, with Johnson and Taylor as the bagmen.

Still no money and still no mayor on the job. The city should be billing all of Johnson’s time and expenses to the NBA. Better yet, Kevin Johnson needs to be recalled and run out of office – now.

July 22, 2011 | 9:41 AM

The main sticking point here will be Prop 26. I’ve noticed a subtle shift in wording from Think Big; they now use the term “fees” when referring to any revenue enhancements the public will provide. They do this because they think using the term “tax” will certainly trigger a public vote requirement under Prop 26, while calling it a “fee” may not.

You really have to parse their words to catch it. Look for the word “fees”, not “tax”.

And it won’t work. A court will toss this line of reasoning. They think that if they raise the rental car tax from 5% to 10%, that will trigger a vote; while leaving the tax rate at 5% and then adding a $4/day fee on rental calls will not. I believe this approach is wrong.

They’re doing everything in their power to avoid a public vote, including the use of catchy phrases in an attempt to get around the voting requirement of Prop 26. You have to catch the larger narrative of all this to see the way they’re trying to use language to get around a vote requirement.

When a judge blocks this attempt, he or she will cite this attempt at hiding a tax hike by calling it a fee instead. But a rose by any other name… Then KJ will come out and proclaim that some activist judge has blocked a good-faith effort that 90% of us want (even though that claim is utter hogwash, if the reactions at local news outlets is an accurate indication) by blocking some “tiny” fee on “other people”. It’s the same trash that happened in Louisville and Orlando.

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Another topic: The fundamental, fatal flaw with all the reports we’ve seen so far is the rosy optimism. They can build the arena for under $400M; they don’t need dedicated parking; it will attract 3.1M new visitors and $7B (which, by the way, is an unprecedented 60% annual rate of return); and so forth. Again, it’s a “greater narrative” issue.

We’ve seen the “rosy” reports, but it is imperitive for a government to hope for the best and then prepare for the worst. I see absolutely none of that going on here. If a private entity wants to hope for the best and then prepare for the best, go for it. But as soon as you do this with government, nope. We will not do this.

Right now, they have us hoping for and preparing for the best. Huge mistake. That’s why the bonds Orlando issued for Amway Center are now in junk status, and a default is expected in late 2012. It’s a beautiful building, by the way. I won’t deny that. But Orlando is now in huge trouble.

I think now KJ will attempt to get an EIR started on the downtown arena within a few weeks. If I’m right, someone needs to stop him. No EIR until the voters okay this, period.

July 22, 2011 | 9:45 AM

Woodland newspaper had an article yesterday, too:

http://www.dailydemocrat.com/news/ci_18528420

“There are some other things that require a vote that only require 50 percent that we’re looking at,” he said, “but we’re looking to see if we can do it without having to do a huge public vote, because there are dollars out there that can be reallocated with the city and county and other places.”

Again… Notice subtle shifts in the language?

July 22, 2011 | 10:09 AM

Martha Lofgren, interim CEO of the Sacramento Metro Chamber of Commerce, said the Metro Chamber has supported the idea of a downtown arena since at least 2004, and she said regional funding is the only method that makes sense.

“One agency, one local agency can’t do this alone,” she said. “There has to be a regional effort to fund a regional sports and entertainment center.”

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My questions for Martha:

1) What if no one else is interested?

2) Why haven’t we asked San Joaquin County or Solano County, two regions that contribute far more fans to PBP than Yuba and Sutter, according to the Corridor Report, to participate?

3) Yuba and Sutter counties, according to the Corridor Report, each contribute less than 2% of the fans at PBP. How many people, on average, does that work out to?

4) How many people from outlying regions REGULARLY attend PBP events? By regularly, I mean 5 or more events per year. Are we talking dozens or thousands from Yuba? If it’s dozens, that means Yuba has no reason at all to participate. But at less than 1%, I doubt this gets out of the hundreds.

The Corridor Report is very flawed, and they know it. It’s as if they saw the numbers and balked at releasing the actual counts. They are certain that fewer than 200 people from Yuba regularly attend PBP events, and don’t want to show us the COUNTS.

I don’t care about the percentages; I want to know, on average, how many people from these various regions attend PBP events. Percentages are meaningless; 2,439 from San Joaquin County is a number that means something.

July 22, 2011 | 3:52 PM

The major flaw with the Economic Engine Report is that it does not address how much of the projected revenue is ALREADY coming into the region with Power Balance Pavilion as it now exists. Why is that?

The lack of a financing plan continues to be troublesome and let us not forget the Natomas area, a community of 100,000 residents with Power Balance Pavilion located at its core. The Natomas Chamber of Commerce is not among those currently endorsing the Think BIG Sacramento campaign.

Chamber president Ed Koop told The Natomas Buzz, “Until a formal task force is in place to focus on a long-term economic solution for Natomas, the chamber will not provide a supporting letter. I’m hopeful that will be coming in the near future.”

July 22, 2011 | 7:38 PM

The railyard site is already owned, has tenants and the contracts for some of building has already been granted. The Mayor and his cronies are holding those plans hostage to an Arena, while the contractors and tenants also get to leverage the deal. Meanwhile, no money, the Federal Gov, about to go into credit default on a “No Tax, No debt increase” ideology. There is almost no support for any public funding scheme that will have to be approved by voters. Explain how it is possible to achieve an arena with these obstacles. I don’t care how many Ethnic CoC’s you get to stand behind you, this is a sure lose scenario.

July 22, 2011 | 11:30 PM

i think we need to hear off how it’s going to be funded soon or the fan will be done with the team. in the mean while the maloof’s are hoping for a long lockout , they gave sac. 1 year to start making thinks happen , nothing so far,@ 7months left then they are free to go , as agreed. K.J. you need to make some magic now.

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