Tag Cloud
Tuesday, June 18, 2013
The Arena - How It Can Work
by John Gladding, published on January 31, 2011 at 4:57 PM
Storyline: The Arena - How and Why it Can Work
Loading images
If you have lived in Sacramento for any length of time, you will know that Arco Arena (excuse me, Power Balance Pavilion) is on borrowed time. Though it is only 25 years old, the arena was built "on the cheap" - a short term solution for the Sacramento Kings while the city could figure out a long-term solution. Well, my friends... that day is here. The City Council is trying to devise a way to pay for a $600 million arena in a faltering economy. No small feat, but it's not impossible.
What's Wrong With Arco
Arco Arena, while acceptable for many fans - is not acceptable by modern standards. Several notable event promoters such as Beyonce and the NCAA March Madness tournament committee have gone as far as tell us they will never play in Sacramento again. The concourse is narrow, luxury suites are few, and simply stated, the place is a barn compared to other cities. Arco is a hard sell to any basketball player who is used to playing in newer facilities - the Maloofs do what they can, but if we want the Kings to attract talent - we have to offer more than the incredible nightlife of Old Sacramento.
Who's Paying: How it Would Work
Estimates at building an arena vary, but $600 million is the most common number to the costs involved. The Maloofs have already stated they will lease for 30 years at $300million. That's half. Naming rights can fetch up to $60million. $240 million can be paid through a tourism tax. Yes... a tax.
Before you put on the brakes, let's take a visit to Orlando. Orlando used to play in a similar arena to Sacramento - it was built in 1989 and just wasn't meeting the needs of today's fans. They passed a tourism tax on hotels and rental cars to help pay for the new arena which was just opened. Taxpayers are technically paying for it - but not those who live there. When you as a Sacramento resident visit Orlando, your vacation dollars help pay for this arena. For Orlando residents, it's practically a free arena.
Think it can't happen in California? Think again. The San Franciso 49ers' new stadium in Santa Clara is being financed through a tourism tax as well. Tourism taxes are quite popular in most cities, yet Sacramento has not capitalized on it.
Who Would Get The Revenue From the Arena?
In Orlando, The City of Orlando collects revenue from non-NBA games, while the Magic get all the NBA games. There's no reason a similar deal can't be struck here. The Maloofs still benefit because they could have a better facility to draw NBA talent and can sell more luxury boxes to corporate sponsors; however the city of Sacramento doesn't lose out on revenue at the other 200 events a year. What's more, a better facility means an instant attendance boost and a major selling point to attracting (and retaining) NBA talent.
Traffic
A new arena downtown in the railyard would be built near light rail and right off the freeway. It's more centrally located for many, including most who live south of the city and on the 50 corridor, where they would drive 10 less minutes than Arco. Traffic was a concern for AT&T Park in San Francisco as well, and they have handled it very well.
The Natomas issue
I realize a new arena downtown will be a major blow to Natomas. Many restaurants in the area rely on this regular traffic to drive business. However this may be our last chance at building an arena. If the Natomas crowd puts up a public fight on the arena, it could kill the whole project - and bring down the Kings with it. Natomas is a strong community… there is no reason they can't concentrate on building a theme park or another large facility on Arco land. Please support the arena, no matter where it's built.
Money that Could Be Spent Elsewhere
I have heard quite a few cries about an arena for billionaires being built, while it could be better spent on homeless, police, or schools. I would argue that without an arena and without the Kings, I honestly doubt Sacramento will magically lose these problems. In fact, without the Arena and the Kings, I would argue this city would be far less desirable for businesses to move to - for the lack of entertainment would make Sacramento undesirable.
I ask all of Sacramento to give this one a shot. If it comes to a tourism tax, what do we have to lose? You may come up with some reason why you don't like it, but you have to see the bigger picture... is it really worth losing the Kings over? Is it really worth not having a major venue for first-class entertainment in Sacramento? Let's not cut off our nose in spite of our face - we have a great opportunity to cement this city for generations. Let's get it done!
Flag Article As:
Conversation Express your views,
debate, and be heard with those in your area closest
to the issue.
Leave a Comment
Sports stadiums are a terrible investment. They are amongst the worst things you can spend money on. Have you ever met someone who said "I moved to city X for the basketball team" who doesn't play for that basketball team? Have you ever met a company exec who said "You know, I'm in New York for the Knicks, not Wall Street."
I lived in Seattle when the Supersonics left town. It made zero difference to the local economy. None.
Sacramento and Austin, Texas are similar sized cities. Austin is a bit bigger, whereas the Sacramento metro area is a bit bigger than the Austin area. Both are state capitols. Austin has no sports teams. Yet, Austin is the headquarters of companies from Dell to Whole Foods. Austin punches above its weight as much as Sacramento punches below. Why? Maybe because Austin invests in being an interesting place with a world-renown music scene instead of luring the Kings. It's cheaper and it's much more effective than a basketball arena.
Sacramento without the NBA is a pit. Sacramento with an NBA team is a pit with a basketball team.
And if Seattle can pay for a Billionair from Microsoft's arean aka Quest Fild and we also payed for a Muliti Billion dollor corparations fild AKA Safco Fild. Then I don't see why we couldnt Pay for a new NBA Arena. And it is very much a good Investment to make it will help our economy and the people in the area. It provides entertainment for the people of Washington State. And i can tell you many people wish they would of voted for a new arena. And if u go out there and ask ppl will say they would vote yes in a heart beat to bring our nba team back. U clearly have no idea what ur talking about and Im a Kings fan have been and always will be. So im pro Tourism Tax I'd pay it when Im up there to see my team play.
A Sports and Entertainment complex that focuses on events 365 days a week similar to what complex operators are doing in Kansas City and what Oklahoma City did before eventually landing the Thunder would continue the momentum in our downtown core. Especially if the Sports & Entertainment complex is put where the current Westfield Downtown Plaza site is located. This would really kill two birds with one stone. The complex needs to be flexible and have more than one professional team playing in it. Think of the possibilities of having pro hockey team, pro indoor soccer team, pro basketball team, and Division 1 college basketball tournaments all along with major entertainment acts and concerts. This complex should not be built around the Maloofs and believing that they must be involved in order for things to work out. The complex should financially make sense. That means minimal public subsidy other than donation of city owned land and creative revenue sharing of parking that results in a gain in revenue for the City. This would be in contrast to revenue going to the Maloofs as currently setup at Arco. The plan for the complex should allow for other uses on the Westfield site such as retail, housing, higher education, parks, amenities, etc. The plan for the complex should address the Maloof's $60 million plus existing debt and include a development plan for what to do with the existing Natomas site to keep it "as good" if not better than how it currently is so that the residents of Natomas are not negatively impacted.
Sacramento is not a pit. Its Midtown has experienced a renaissance over the past couple decades of restaurants, retail, art, culture, urban living, and more. We are the City of Trees, friendly and welcoming to the Gay & Lesbian population, have world class bike trails, rivers, and more. During the worst economic climate seen in a very long time we are still seeing exciting redevelopment projects being completed and moving forward. We are still seeing people trying everyday to make our city better. Think of the economic impact of having 10-20,000 plus people each night pour out onto our quickly developing K St and downtown after an event. Think about them consuming, living, and breathing our downtown prior to an event. I think about what AT&T Park has done for SOMA or what Petco has done for the Gaslamp Quarter of San Diego and think with proper planning and a focus on the financial we can do even better and improve our downtown core that much more.
Although the expense of building a new arena may cost a few dollars, the long term negative effects of NOT building one, given how long we've taken to (not yet) accomplish this, will be much more severe to the region. One good player left Cleveland, and the whole city was upset and angry... The Kings leaving Sacramento would be a LeBron-Cleveland scenario on steroids.
There are a lot of people that are not into sports and could care less if the team stays. I, myself, am not into theaters and plays, and don't see myself ever spending my money on tickets. But I understand what the arts mean for a city, and how happy they make others. Knowing that, I do not decry the actions of the city, giving MY tax dollars to support a new theater on H Street.
As for Natomas - I think there are many solutions but Natomas shouldn't be throwing roadblocks if it's not in "the plan". They'd have probably 5 years to find a major tenant - theme park, golf course, major employer, etc... my point is that the public needs to be supportive of this project. It's not just Natomas who has a stake in this, all of Sacramento does if it is unsuccessful.