Mayor Kevin Johnson releases arena funding report, will the Maloofs and NBA bite?

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The plight of Kings fans, who came within an inch of losing their only major professional sports team, may be coming to a crossroads today, when the Think Big Sacramento coalition led by mayor Kevin Johnson releases their arena funding proposal to the public. All they have to do is come up with a plan to raise $387 million that keeps everyone happy. No biggie.

Sacramento Bee columnist Marcos Breton got the scoop on it, and released his report in the early morning hours on Thursday:

What is the guiding principle of Sacramento’s new plan?

That’s right: A virtual split – this time in thirds – among the private interests of an arena, the public and the arena’s patrons….

What you will see in today’s arena presentation are plans for three different funding pots to generate the $387 million or more needed to get an arena built. According to people familiar with the document, the Kings, the NBA and a private developer would contribute $91 million to $156 million in lease payments, upfront money, land and other revenue to pay for an arena.

The city of Sacramento would contribute the sale of public land, a tax on hotels and taxis, and money from items such as digital advertising and parking valued at $94 million to $123 million.

And, while residents in the six-county Sacramento region will not be asked to raise their taxes to subsidize a new arena, patrons of the venue will help pay for it. The third pot of money will be fueled by ticket surcharges, naming rights and other revenue sources that could generate $90 million to $121 million.

Kings fans and those tracking how and why the NBA operates the way it does will want to watch how the parties react to this report. Much of the Think Big Sacramento campaign has been orchestrated to a presidential degree, leaving no doubt to the positions of the heavy hitters involved – including companies such as AEG, the ICON-David Taylor group, and of course, the NBA and the Maloofs.

The Maloofs appear to be impotent in this discussion, as some league insiders have openly acknowledged that their future in the NBA will be determined by their ability to get an arena deal done.

The bottom line with this report is that the Kings and the NBA have been asked to foot a third of the cost. Whether that amount will be amicable to them given the whirlwind of interests controlling the matter is entirely debatable. On one hand, NBA owners do not want to see the league telling them what to do, and on the other hand, the Lakers, Knicks, and Bulls of the league don’t want to hear that (allegedly) broke owners can move into their backyard.

And, separately, while arena subsidy opponents scream blood murder, the reality is that top-flight cities have no leverage. They can clamor for leagues and owners to pay their own bills, but the folks in Sacramento would have to do that with an Anaheim Royals press release wiping their tears.

As for the Maloofs being able to contribute rental payments and/or in general, they recently liquidated their majority interest in the Palms Casino down to 2 percent with the option to buy back another 18 percent, in a financial transaction that could easily pave the way for another (Ron Burkle) speculator to come in and take over their team if they get elbowed out. They continue to assert their leverage, albeit with more discretion than they have used in the past, but in reality, David Stern knows where the bodies are buried. And as SB Nation’s Tom Ziller points out, the NBA has been working diligently to get an arena deal done – so they’re not going to stand for grandstanding when diplomacy is needed.

My take – we’re looking at a firm but fair offer from the City of Sacramento. They’re strapped just like most American cities, and this is their first offer. If this dance plays out like every other negotiation we’ve been witness to in our lives, expect the Maloofs and/or the NBA to say that the city’s request is ‘over the top,’ and they’ll waltz to equilibrium.

Important news: Nick Young has gotten over his fear of dolphins

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Where NBA players really make improvements is over the summer. They can get in better shape, work on their jumper, improve their handles…

Or get over their fear of dolphins.

Which is what the new Wizards guard did this summer. Remember these tweets from Young’s then fiancée a couple of years ago?

He’s gotten past that fear.

I gave these dolphins another chance we cool now

A post shared by Nick Young (@swaggyp1) on

Next, just needs to pick up a right with Golden State and show that to the Dolphins — they respect titles.

Report: Mikhail Prokhorov ‘warmed’ to selling controlling stake of Nets

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Mikhail Prokhorov bought 80% of the Nets in 2010. A couple years ago, he tried to sell his stake, but decided to keep it. Then, he bought 100% of the franchise and its arena. After last season, he said he was selling 49% of the team.

Now?

Josh Kosman and Brian Lewis of the New York Post:

Brooklyn Nets owner Mikhail Prokhorov, while focused on selling a minority stake in the franchise, has warmed recently to the possibility of offering a controlling slice of the team, sources close to the situation said.

The change of heart comes after the initial reaction to the minority stake sale was weak — and with interest in the Houston Rockets sale heating up, one source said.

The Rockets’ sale could shake out potential Nets buyers, and Prokhorov selling a controlling stake could also help. It’d cost more money than the 49% he’s offering now, but people with the money to buy an NBA team tend to value control.

This might be a good time to sell for Prokhorov, who lost a ton of money as the team paid major luxury tax for an all-in championship pursuit that flopped spectacularly. The NBA’s popularity is rising, and the league is reaping huge revenue from its national-TV contracts.

However, he shouldn’t assume the Rockets’ sale price will predict the Nets’. Buyers might prefer a good team with James Harden and Chris Paul to a bad one short on young talent after years of mismanagement. At least Brooklyn’s payroll is now tolerably low.

The big loser here: Leslie Alexander, who’s trying to sell the Rockets. The supply of NBA teams now available might have just doubled, and unless there’s no overlap in demand for those franchises, that can only drive down Alexander’s eventual sale price.

Report: Clippers paid $3.2 million – second-most ever – for draft pick (Jawun Evans)

AP Photo/Jae C. Hong
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The Warriors set a record by paying $3.5 million for a draft pick, buying the Bulls’ No. 38 pick and using it on Jordan Bell this year.

That eclipsed the $3 million spent by each the Thunder in 2010 (to the Hawks for the No. 31 pick, Tibor Pleiss) and Nets in 2016 (to move up 13 spots for Isaiah Whitehead).

So did the Clippers’ purchase of the No. 39 pick (Jawun Evans) from the 76ers this year.

Eric Pincus of Basketball Insiders:

The Clippers also paid the Bucks $2 million for the No. 48 pick (Sindarius Thornwell).

I rated Evans a low first-rounder due to his speed and drive-and-kick game, so getting him in the second round is good value. I’m not as keen on Thornwell, who’s already 22 and built so much of his success at South Carolina on being more physical than younger opponents.

But the more swings the Clippers take on young players, the more likely they are to find long-term contributors. More power to owner Steve Ballmer for greenlighting this expenditure.

Importantly, as players acquired through the draft, Evans and Thornwell will count for the luxury tax at their actual salaries. Players signed otherwise, even if their actual salaries are lower, count at at least the two-years-experience minimum.

Under the new Collective Bargaining Agreement, teams can spend $5.1 million in cash this season. That amount will increase (or decrease) in proportion with the salary cap in coming years. So, expect the previous record for draft-pick purchase price – $3 million – to fall again and again.

There’s just more leeway now for the NBA’s haves to separate themselves from the have-nots.

Jeannie Buss says she didn’t understand why Lakers signed Luol Deng and Timofey Mozgov

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Last summer, the Lakers signed Luol Deng (four years, $72 million) and Timofey Mozgov (four years, $64 million) to contracts that immediately looked like liabilities.

At worst, Deng and Mozgov would help the Lakers win just enough to lose their top-three protected 2017 first-round pick – which would have triggered also sending out an unprotected 2019 first-rounder – then settle in as huge overpays. At best, Deng and Mozgov would provide a little veteran leadership while the team still loses enough to keep its pick… then settle in as huge overpays.

The Lakers got the best-case scenario, which was still pretty awful.

They had to attach D'Angelo Russell just to dump Mozgov’s deal on the Nets. Even if he no longer fit long-term with Lonzo Ball, Russell could’ve fit another asset if he weren’t necessary as a sweetener in a Mozgov trade. Deng remains on the books as impediment to adding free agents (like Paul George and LeBron James) next summer.

Who’s to blame?

Jeanie Buss was the Lakers’ president and owner. Jim Buss, another owner, ran the front office with Mitch Kupchak.

Bill Oram of The Orange County Register:

Within the walls of the Lakers headquarters, Jeanie’s grand corner office had begun to feel like a cell. She could not make sense of the strategy employed by her brother and Kupchak. They had cycled through four coaches in five seasons and under their watch the Lakers won a combined 63 games in three full seasons. Last summer, they spent $136 million of precious cap space on veterans Luol Deng and Timofey Mozgov, who made little sense for the direction of the team.

“I just didn’t understand what the thought process was,” she said, “whether our philosophies were so far apart that I couldn’t recognize what they were doing, or they couldn’t explain it well.”

No. Nope, nope, nope. I don’t want to hear it.

Jeanie empowered Jim and his silly timeline, which made it inevitable he place self-preservation over the Lakers’ best long-term interests. That’s why he looked for a quick fix with Mozgov and Deng, who’s still hanging over the Lakers’ plans.

She deserves scrutiny for allowing such a toxic environment that yielded predictably bad results (even if family ties clouded her judgment).

That said, she also deserves credit for learning from her mistake. She fired Jim and Kupchak – admittedly too late, but she still did it – and hired Magic Johnson. There’s no guarantee Johnson will direct the Lakers back to prominence, but he clearly has a better working relationship with Jeanie than Jim did and, so far (in a small sample), looks more competent in the job.