As always, it’s about the money. It’s always about the money.
The latest noise in the seemingly inevitable move of the Kings out of Sacramento to Anaheim is that the Sacramento City Manager sent a letter, vaguely threatening legal action, if Anaheim did not back off its efforts to lure the Kings.
In a terse letter Monday to Anaheim officials, Assistant City Manager John Dangberg said Anaheim was ignoring the “blighting impacts” that luring the Kings from Sacramento would have on the capital city. The move would cause “irreparable harm,” the letter said.
If, however, Anaheim “insists on continuing the negotiations,” the letter said, that city must require the team to honor its debt to Sacramento.
That debt is a $77 million loan the city gave the Kings in 1996.
The letter was as much a public relations stunt as anything — yet the Maloof brothers (who own the Kings) reacted angrily.
Here is what Joe Maloof said:
“It’s not for the mayor or anybody (in the City of Sacramento) to interfere with our business. That’s what I think they’re doing, and it’s not right,” Maloof told The Orange County Register. “We would appreciate that they not interfere with our business.”
Here is George Maloof to the Sacramento Bee.
“It is interfering with our business,” he said. “We’re going to take every measure possible to protect ourselves. We have no intention of leaving that town without paying our debt. For someone to imply that we are not going to pay our debts, it’s wrong, it’s ridiculous.”
First a word of advice to the Maloofs: Shut up. Do not say another public word until you are on a podium in Anaheim and then only speak glowingly of Sacramento. You can be frustrated with the city and the inability to get a new stadium there, but don’t open your mouths and sound bitter. You are screwing fans in a small market to move to a big one, you cannot win the PR game. You are going to look bad here, whether your reasons for moving are legitimate or not. Whether it works in Anaheim or not. You are moving from Northern California to Southern California and those to markets already don’t like each other. Just don’t aggravate the situation.
Really, for Sacramento this is about the money. They want their $77 million back. If you default on the loan the city gets a $25 million stake in a team (estimated to be worth $293 million by Forbes). A share the city doesn’t want and would be forced to sell, maybe taking more of a loss.
Sacramento had financial reasons to defend itself here, to send off the letter. Much of it was bluster and PR — playing to their audience of pissed off fans who feel their civic pride being attacked — but the financial concerns are real because defaulting on the loan makes financial sense to the Maloofs. They get a $50 million or so swing by defaulting on the loan. So Sacramento’s concern here is legitimate.
The least you can do is pay that loan off to the city on your way out the door. Even if you have to borrow money from a billionaire in another city to do it.