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Sacramento Kings owners and their attorneys told media Friday that not only was there never a solid deal with the city for a new arena, but – if the mayor isn’t willing to negotiate – there never will be one.
“The mayor said he’s not negotiating? Then he killed the deal on his own terms,” team owner George Maloof said at a press conference in New York. “It’s over.”
The morning press conference opened with Kings attorney Barry McNeil giving a detailed timeline of events in the “arena saga,” starting with the Maloofs’ initial proposal to move the Kings to Anaheim in 2010.
“We want to demonstrate to you that the Kings have exercised their best efforts over the past 12 months to get a new arena built,” McNeil said. “The Kings and the NBA have done all they can to create the best deal possible.”
McNeil said the agreement reached in Orlando between the city of Sacramento, arena operator AEG and the team owners was non-binding and all parties were aware that there were numerous issues to be worked out.
George Maloof said he sent the NBA – which was negotiating in the deal on the Maloofs’ behalf – an email listing at least 13 points of contention the team owners had with the proposed term sheet.
The list included concerns about pre-development costs and the city’s assumed revenue projections for the project.
“The terms of the deal that we were presented with (on Feb. 19) were insulting. It’s clear that we did not have a deal there,” Maloof said.
In an email response dated Feb. 29, NBA representatives told the Maloofs that several of the owners’ desired changes to the deal would be agreeable to the city, however, “They say they cannot put the provisions into the document for political reasons,” the email stated.
McNeil said that the term sheet posted by the city and voted on by the City Council March 6 did not include any revisions from the team owners – despite having received the detailed revisions from the NBA the day before.
“The City Council saw a term sheet that was inaccurate and largely irrelevant,” McNeil said. “They voted on a term sheet that they assumed we had agreed to.”
Economist Chris Thornberg, a partner at Beacon Economics, said he was hired by the Maloofs to review the city’s economic impact report on the new arena – and the results of the review were disappointing.
“The revenue projections and estimates for this agreement are highly overblown,” Thornberg said.
Thornberg questioned the basis for the financial assumptions in the report, largely because it relied on a “rosy” economic picture.
“This project would put the city right on the edge of fiscal disaster,” he said. “There is very little room for error.”
Mayor Kevin Johnson and NBA representatives were not at the press conference, however, in an open letter to the Maloof family Thursday, Johnson expressed his concerns about the Maloofs’ intentions.
“Any representation that a deal was not reached is simply not consistent with the perspective of every other party to the negotiation nor the actual statements of the family,” he said in the letter.
“Under no circumstances will the city make material adjustments to the current terms of the deal,” he said. “Put simply, we have done our part.”
Johnson agreed to meet with the Maloofs Friday in New York City, but in his letter Thursday he said there should be “no expectation” that the deal is subject to further negotiation.
When asked about the scene at the Kings game March 6 with team owners and Johnson on the court, shaking hands and celebrating after the City Council voted to move forward, George Maloof said it didn’t mean they had a solid deal.
“No, there were still negotiations to be done,” he said. “Everyone knew it.”
Read Johnson's letter here.
Melissa Corker is a staff reporter for the Sacramento Press. Follow her on Twitter @MelissaCorker.