I think they're saying it's up to the Maloofs because no one foresees the owners blocking this move. So far the only teams that have shown reluctance to support the move are the Clippers, Lakers, and I believe the third team was Dallas. The Warriors are the only real fence sitters here since they stand to gain short term if the Kings leave with only a phantom threat of a team in San Jose as the downside.

I can't see the NBA blocking this, but I'd bet the $50M covers the relocation costs.

Not quite as clear, though: The disposition of the arena in Sacramento. Someone better at reading legal contracts than I am needs to look at this, but I'd swear the 1997 "loan" transfers ownership to the City. It looks to me as though the City owns the arena and is leasing it back to the current tenants.

www.cityofsacramento.org/treasurer/public_finance/official_statements/documents/pdf/OS_List_2007%201997%20Lease%20Rev%20Bonds.pdf

Why else would the bonds be called the "ARCO Arena Acquisition" bonds, and spell out the terms of a lease between the City and the tenants?

I'm very close to 100% sure the City owns the arena already, and that the 1997 "loan" was a lie. But I'm not going to hire a lawyer to prove my case.

The Warriors have to be 100% against this move. I know Mr. Lacob said that it could be good or bad, but the Sacramento market means little compared to the possibility of losing or having to share SF/SJ when a second team moves there. If the Dubs back an Anaheim team, they'll have no political capital to try to keep one of the top 6 NBA markets (LA, NY, CHI, BOS, TOR; am I missing any others?) to themselves.

I am no lawyer, but as a matter of goodwill I have to imagine that the Maloofs will have a lot harder time getting approval from the NBA for the move if they fail to pay off the PB Pavilion loan. There will always be NBA franchises looking to move and scorching the Sacto earth seems like a dumb move (especially if they're as open to building an arena as they now appear to be).

Ben, I think they'll vote against the move, but won't be broken-hearted if it passes. I've voted in elections that way; I'll vote "no", and when it passes, I'll think, "Serves 'em right!". We've all had that feeling, I'm sure.

I think the NBA is no well into needing to contract teams. The Warriors are probably safe. We'll see.

I guess we'll have to agree to disagree, especially on contraction. There are at least 4 (and probably 5 or 6) markets that have good-to-great arenas and are ripe for teams. How many markets are the opposite? Even Milwaukee (worst arena in a MLB/NHL/NCAA market) has a great owner and a fan base that has gotten behind the team as recently as last April.

I wouldn't be concerned about the Maloofs paying back the loan. The NBA won't let them skip town and at least verbally the Maloofs have already committed to paying back the loans (though Sac is trying to get that in writing just to be sure).

As for the arena, you are correct Mike. The City owns the arena already if those documents are to be believed. What's funny is the city until recently didn't seem to know it owned the arena.

Dan, they just hired a lawyer, for $150,000, to help them interpret the contract. That amazes me.

We've always been told the collateral is the arena and a $25M piece of the team, and I'll be darned if I can find any references to collateral in that agreement. In fact, it seems to me that it says the collateral is future revenue, and should the revenue fail to materialize, that's okay, the City can operate the arena.

Also absent from the agreement is a "promise to pay", which is what they're trying to get out of the Maloofs now. But if I were the Maloofs, I'd urge the Council to read the agreement and ask them what part of the agreement they are violating.

You're also aware that the City enabled the Maloofs to fall into second position, right? There's a reason the interest rate on second mortgages is usually higher than the interest rate on firsts...

The most disturbing part of this is that it appears the 1997 Council didn't read the agreement. Makes you wonder, How many other City Councils do the same thing, to this day?

The Maloofs own Power Balance Pavilion, there are no ifs and buts about that.

They have no lease with the City since they own the Arena.

They will leave Sacramento and the city at that point will take control of the arena and the Maloofs will find a way to pay off the 25M that City gets in the the team.

That is a much cheaper solution that paying off the 76M in one shot because in that case the Maloofs still own the arena and if they please can shut down the place and hold the City hostage.

Therefore all arena events would cease and a Britney Spears concert couldn't even take place.

The City of Sacramento needs to be smart here and by letting the Kings default they can at least take control of the arena and start making some $$ from the events that take place, plus get 25M in return for their stake in the Kings.

In the long run that is the smart move by both the Maloofs and the City. Re-paying that 76M loan does not make sense for either party involved.

As for the Warriors, they know full well since all the NBA owners own the Hornets that San Jose is the next place for a team to land if the Kings move.

The Maloofs know this otherwise they would have moved to San Jose because Larry Ellison is the one man who can "bail" the NBA out of a bad situation.

He can afford to buy a team and pay any relocation fees "by himself". It is known Ellison wants to move a team to San Jose. This is the same guy who offered Howard Schultz (Sonics old owner) and blank check for the Sonics on the condition the team would move immediately to San Jose.

The Warriors are praying for the Kings to stay put in Sacramento because then the NBA would keep things they way it is right now in Northern California.

Otherwise the Warriors would reap the benefit of having a much larger TV market but that would be temporary. They want to keep the Bay Area to themselves.

As a lifelong Warriors fan I am sick of this team making money and losing every year.

Competition breeds improvement and the Warriors need competition in the worst way to evolve as a franchise.

Sid,

The name of the document is "ARCO Arena Acquision". It goes on to explain that the bonds the City is selling are to acquire ARCO arena from the "prior arena owners", and then specifies that rent collected from those tenants are the only monies to be used to pay off the bonds.

I kinda think a document entitled "ARCO Arena Acquisition" would describe a deal to acquire ARCO arena. What's your thinking on that?

I would suggest you take another look at the document.

I now have solid proof that the City of Sacramento does own the arena. It's in a letter from the City to the NBA, and describes the transaction in detail.

Right here:

www.kingsfans.com/forums/showthread.php?40608-Latest-letter-from-City-to-League-and-Team-requesting-written-assurances&p=818837#post818837

All this time, they've called it a loan. All this time, they've been lying.

Sid, please. Maloofs would've moved to SJ if not for Ellison? Ellison is the one man who can bail out the Hornets?

Los Angeles is a white hot NBA market, they have a (nearly) NBA quality arena and there is going to be an open slot on a RSN once the Lakers go to TimeWarner. There is not a chance in the world the Maloofs (or anyone else with the freedom to move, perhaps save a native for sentimental reasons) would choose the Bay Area over Anaheim.

If the Hornets go on the market Ellison may well be the highest bidder, but he'll hardly be the only rich guy looking to buy an NBA team. Leaving NOLA is a short sighted idea, anyway, and Stern knows it. There is only one other major league team there, it's awesome for destination events like the All Star game and crowds came out when they had a good team.

Neil, the more I think about this 1997 transaction to loan money to the owners of the Kings, the angrier I get. We were told that the arena was the collateral to a loan; that if the team defaulted on its payments, the City would receive the arena and $20M -- later changed to $25M when we agreed to move into a subordinate position.

Only it turns out this is not the case at all.

We sold bonds to acquire the arena, and now lease out the arena, under terms extremely favorable to the "prior owners". This is VERY DIFFERENT from the way this was presented to and by the Council.

We are now more vulnerable to a default than I think any other arena deal in this country is. Moving us into second place, a scheme in which the NBA itself participated, has left us even more vulnerable.

I'm amazed at how poorly this deal could now turn out for us. I think we're in much bigger trouble than has been presented so far. Oh, it'll only be $10/year per resident to fix this, so I suppose it's not the end of the world. But it is pretty bad.

This is about to hit the newspapers in a big way. You'll see.

You'll see.

Read the documents.

The boatload of articles in today's Bee are forging new standards of comedy. Just go to their landing page and have a ball.

The stupid is getting spread mighty thin today.

Make it stop! Make it stop!

blogs.sacbee.com/city-beat/2011/04/city-sends-letter-demanding-more-specifics-on-how-the-kings-will-repay-their-loan.html

Gee, maybe the 1997 City Council should have read what they were voting on. Ya think?

@Ben Miller- Who in their right mind would move to a 2 team market when they can move to a 1-team market?

The South Bay has a ton of corporate money and in fact is larger from that aspect than Orange County in revenue. Forget about # of fans, its about premium seat sales period.

San Jose has an arena ready and if the Kings moved to San Jose they would only be competing with 1 team who is terrible....This plus San Jose is far larger than Anaheim as a city...Not even close.

In LA, they are competing with the 2-time defending champion Lakers and a Blake Griffin led Clippers team.

How does that make sense?

The logic is that since the Kings own part of the Hornets they know full well San Jose is being left open for a Larry Ellison team. Ellison is rich beyond belief and can pay for the team himself plus a relocation fee.

New Orleans is a "dead market" after Katrina. They are bottom five in the league in attendance they just clinched a playoff spot in the WEST.

They do not have the corporate base either to support that team....Even before Katrina that was questionable.

In San Jose they would be selling out every night with the Hornets without question....Look at the Sharks.

I lived in OC during college for 4-5 years and I moved back to the Bay Area because OC is full of "yuppies" and fair weather people.

The Kings will not even get great attendance out there but their premium seating will be sold out all day long.

You obviously do not know about the demographics of the Bay Area....You sound like an OC "yuppie" to me....Trust me, I know them well.

@Mike M- Your right the city made a terrible deal back in 1997.

I read that document and the Maloofs do in fact own the arena. If the City plays hardball and force the Maloofs to cough up 76M the Arena will shut down.

No one is Sacramento will be able to see a concert or anything of the nature. Best bet is to let them default, take control of the arena, turn a profit there and take 25M from the Maloofs as a buyout from the City getting a stake in the team.