Will Seattle billionaire Chris Hansen drastically overpay for the Sacramento Kings?

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News of billionaire Chris Hansen striking a deal with the Seattle City Council hit the wire late Monday night, as the sides have agreed to a framework on an arena deal that moves them a few smaller hurdles away from becoming an NBA-ready city (courtesy of Chris Daniels of King 5 in Seattle).

In a bit of twisted irony, the city that had its team stolen away will now set its sights on any available team, and there is no team that is more available than the Sacramento Kings, who nowadays have a different rumored destination every week.

This most recent news solidifies Seattle’s place on the top of that list, though they still need the Maloofs to sell, and they still have to outdo Sacramento. Neither task should be considered a slam dunk, or even likely at this point.

The idea that Sacramento could lose its team, of course, is a black eye for the league as the city has supported its team in every conceivable way, including where it counts financially and at the ticket gate. The only reason we’re having this discussion is because the Maloof family, internal squabbles aside, doesn’t want to be there.

Their roots are in New Mexico, Los Angeles, and Las Vegas, and being broke in relative NBA owner terms they’re looking for a short-term infusion of cash, which they hope to find by moving the team to another city that will both build them an arena and also let them keep the profits from it.

Cities such as Virginia Beach, Louisville, Vancouver, Kansas City, and the like are potential candidates if anything because they’re willing to pay to be on the NBA map. But the math starts to get fuzzy because the markets are smaller than Sacramento, and the Maloofs end up no better off than they were in Sacramento over the long haul.

That, and the NBA doesn’t really want those markets, at least not at the expense of Sacramento, where the league enjoys the No. 20 sized TV market without interference from other sports leagues. When you factor in the public relations hit of moving the team – it’s hard to see the league supporting a move and to date we have not.

Even when considering a larger market like Anaheim, the league isn’t falling all over itself to allow a move. The NBA blocked the Maloofs’ relocation attempt last year after Sacramento mayor Kevin Johnson raised over $10 million in untapped sponsorships at the drop of a hat and promised a viable arena deal. Things seemed to be moving along reasonably well and a deal for a new arena was agreed to in principle during All Star weekend in Orlando.

But that was before George Maloof created a how-to-guide for burning bridges in Sacramento. He torched the deal live on public television in a tirade for the ages, and any goodwill that was leftover at the league offices was probably lost. Commissioner David Stern has used measured words in describing the arena situation since then, and none of them have painted the Maloofs in a flattering light.

In fact, the commissioner would probably like to see the family sell the team, but as usual the issue comes down to money, antitrust law, and the other 29 owners that one day will be negotiating with both the league office and their home city about something.

Aside from not wanting anybody to tell them what to do, owners want the right to move their teams to the cities they feel they can make the most money in. Leagues don’t like to allow this as it creates a number of problems, and the courts have found that the intersection of those opposing ideals lies in the concept of a relocation fee. Relocation fees are the amount that a league can charge to indemnify parties that are damaged by an owner’s decision to move.

The law is much more detailed than this, and the case law that has been favorable to relocating owners isn’t an exact match to the situation in Sac, but one thing is clear – neither party wants to land in court over this.

And that’s why the Kings arena situation has been allowed to play out, to the detriment of the league’s image, and as an affront to the other 29 owners that one day will have to negotiate with their municipalities.

While it’s unclear right now what impact the Maloofs’ apparent bad faith dealings in Sacramento will have on other team owners seeking public subsidies, a small shift in public sentiment could cost the league and its players tens of millions of dollars and a large scale shift could put the billion dollars the league has received in subsidy back on its balance sheet.

But even with the Maloofs’ name now toxic inside the league and out, to the point it’s being pulled off the signage at the Palms, the league cannot afford a bad ruling in an antitrust case. Aside from treble damages the Maloofs would seek, which are significant, a bad ruling would be held over all sports leagues’ heads by owners wanting to play franchise free agency.

The best hope for the league has always been to see the issue play out on its own, with the Maloofs realizing that they have no options besides going back to the city with its hat in its hand, or selling the team outright.

And with Seattle standing in the on-deck circle and doing what they need to do to land itself an NBA franchise, the question on everybody’s mind is whether or not Hansen will be able to drastically overpay for the Kings.

The Maloofs owe about $70 million to the city of Sacramento and well over $100 million to the NBA, and a sales price in excess of $400 million is needed to give the 43 percent stakeholders an easy way out of Dodge. Considering the franchise is valued at $300 million by Forbes, which is a generous valuation, Hansen would need to hope that the bump of moving to a larger market in Seattle and owning land near the arena would justify the Maloofs’ likely asking price.

But more importantly, when you factor in a relocation fee, which sources tell me will be assessed to give Sacramento buyers a fair shot at buying the team, Hansen could be looking at $500 million or more to buy the Kings. After paying $300 million and counting to build an arena, that’s approaching a billion dollars to get in the game.

It’s possible that the man known for his patience will wait for a less toxic situation to pop up, and it’s fair to wonder now if the league would reconsider expansion now that multiple cities have expressed interest in NBA clubs.

As for Hansen’s involvement with the Kings, he said weeks ago that he had not made an offer to purchase the Kings after a local report emerged saying otherwise. If he decides to make a play for the team, and assuming the Maloofs are ready to cry uncle, it probably puts Sacramento on notice that it’s time to formalize an offer to buy the team.

Sources on the city’s side have indicated that they have more than one buyer lined up, and ultimately Seattle’s progress could force some sort of endgame here. If the goal is to sell for the Maloofs, then they will likely have squeezed the best sales price out of Sacramento that is possible, and anything close to a Seattle offer (after the relocation fee) will likely be supported by the league.

If the Maloofs still don’t want to sell, they’ll continue to play the dating game with other cities and the league will continue to deal with a public relations nuisance. The family will not get a different arena deal in Sacramento, and any talk of renovating the unrenovatable Arco Arena with public funds has been met with collective laughter both inside and outside of the city.

Even if the Maloofs can find a sweetheart deal somewhere else, it’s unlikely that they’ll have the clout to force a move the league doesn’t want. Sure, they may have some antitrust law on their side, but they probably can’t afford the lawsuit and even if they win, they’re left in a place where they’re not wanted. They don’t have the fortitude of antitrust victor and deceased Raiders owner Al Davis. And other than George, they want to be wanted.

In Sacramento, the framework for a deal exists not just for the Maloofs but for any owner that wants to pick up the ball and run with it.

The deal that was struck between the city, arena giant AEG, and the NBA is still considered a good deal by each of those parties, and the only thing that would theoretically change are the owner contributions. In a concept the Maloofs cannot come to grips with, if a new owner wants to pay more for arena construction they can enjoy more of the profits.

Unlike anywhere else in the country, including Seattle, an agreement can be reached in Sacramento under the current terms and design could start within about a month according to sources.

As usual, though, the story goes right back to the Maloofs and whether or not they’re ready to face the music. They can’t do nothing, as Arco Arena is dilapidated and barely up to NBA code. They’ll eventually need to do more than polish the concourse floors.  Eventually, they’ll either need to take the Sacramento offer, try to make something out of nothing in an unlikely move out of town, or sell the team.

And when the music stops and the only thing left to do is sell, will Hansen or any other buyer want to drastically overpay for this particular franchise to the extent that Sacramento can’t match the offer?

Until these questions are answered or the Maloofs are nudged out the door with greater efficiency, Sacramento Kings fans have to endure the same fears that plagued Sonics fans before their team was ultimately ripped away.  And that’s just not right.

JJ Redick appears to use racial slur toward Chinese fans

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Chinese New Year was February 16, and now we’ve rolled over to the Year of the Dog. The NBA has a huge presence internationally in China, and so its video partner across the Pacific put together a compilation video of NBA players wishing people a happy new year.

The only problem? In one cut of the video that has been making the rounds on social media, Philadelphia 76ers guard JJ Redick appears to use a racial slur aimed at those of Chinese descent.

The instance is absent from the official video, but a reaction-style YouTube video captured a different edit of the Year of the Dog video with Redick still in it. Redick appears to say, “I just wanted to wish all the NBA c—k fans in China a very happy Chinese New Year.”

Redick responded on Twitter, saying he was simply tongue-tied.

It’s difficult to judge intention from a distance, but the result is certainly disappointing. Even with Redick’s apology, it seems possible he’s contacted by the league office as part of a disciplinary inquiry.

Adam Silver says change to 1-16 playoff format has gotten “serious consideration”

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LOS ANGELES — Going into this season, continuing off the recent past went the Western Conference has been deeper in talent than the East., there was a lot of discussion among fans and media about switching to a 1-16 playoff format that ignores the current conference system.

The league has always balked at that — there is tradition, the conferences play an unbalanced schedule so it’s not a fair matchup now, and travel is an issue — but things have gotten more serious, NBA Commissioner Adam Silver said during All-Star weekend.

“That is something that’s gotten serious attention, not just recently, but over the last few years at the league office,” Silver said in an address to the media. “I think, as I’ve said in the past, the obstacle is travel, and it’s not tradition in my mind, at least. It’s that as we’ve added an extra week to the regular season, as we’ve tried to reduce the number of back-to-backs, that we are concerned about teams crisscrossing the country in the first round, for example. We are just concerned about the overall travel that we would have in the top 16 teams.

“Having said that, you also would like to have a format where your two best teams are ultimately going to meet in The Finals, and obviously, if it’s the top team in the East and top team in the West, I’m not saying this is the case this year, but you could have a situation where the top two teams in the league are meeting in the Conference Finals or somewhere else.

“So we’re going to continue to look at that. It’s still my hope that we’re going to figure out ways.”

There is no vote scheduled, no change on the immediate horizon.

The idea of teams playing a more balanced regular season schedule, then having the best 16 teams in the playoffs, is appealing. This season, the Finals should be the Warriors and Rockets, a matchup of the two best teams. Instead, it will be the Western Conference Finals.

Fixing it is not simple. If travel is the concern — having something like the Golden State and Philadelphia in a 2-2-1-1-1 series that drags out in the first or second rounds (if the playoffs started today we would get Boston vs. Portland) — there is no easy answer, short of a Star Trek teleporter. Faster travel across the nation is not on the immediate horizon.

As Silver said, the only real answer would be to build the potential for more time into the schedule. However, the NBA is already starting in mid-October and running through June, how much longer are they really willing to go?

The obvious answer is reducing the number of games, but we know that’s not happening. Don’t expect much of a change here.

Adam Silver: Discussions about one-and-done rule ongoing, change not likely soon

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LOS ANGELES — Nobody likes the one-and-done rule. Not the NBA owners, not universities, not players, not anyone.

It’s also not likely to change soon.

The NBA and players’ union are discussing the issue — along with NCAA representatives — NBA Commissioner Adam Silver said. But the sides are not near a deal to make changes, whatever they are.

“In terms of the NBA, we’re conflicted, to be honest…” Silver said in his annual address to the media during All-Star weekend. “So we’ve had some meetings with the Players Association where we’ve shared data on success rates of young players coming into the league. We’ve talked a lot about youth development in terms of whether we should be getting involved in some of these young players even earlier than when they come into college.

“And from a league standpoint, on one hand, we think we have a better draft when we’ve had an opportunity to see these young players play an elite level before they come into the NBA.

“On the other hand, I think the question for the league is, in terms of their ultimate success, are we better off intersecting with them a little bit younger? Are we better off bringing them into the league when they’re 18 using our G League as it was designed to be as a Development League and getting them minutes on the court there?”

Right now an NCAA commission, headed by Stanford President and former secretary of state Condoleezza Rice that is looking into this issue and is expected to make recommendations this spring that the league will look at, Silver said.

He added that another consideration is jobs for veteran players — if the NBA went back to a rule that allowed the drafting of 18-year-olds, it could squeeze some veterans out of the league to create roster spots.

While the NBA appears headed eventually toward some version of the “baseball rule” — players can be drafted out of high school but if they go to college they need to stay two or three years at least — don’t expect changes soon.

“So we’re not by any means rushing through this,” Silver said. “I think this is a case where, actually, outside of the cycle of collective bargaining, we can spend more time on it with the Players Association, talking to the individual players, talking to the executive board and really trying to understand the pros and cons of potentially moving the age limit.”

 

Lakers’ Channing Frye has appendectomy in Cleveland

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LOS ANGELES (AP) — Lakers forward Channing Frye has undergone an appendectomy.

The team announced Saturday that its new acquisition had the laparoscopic procedure Friday night in Cleveland.

The Lakers say Frye will be re-evaluated after he returns to Los Angeles next weekend.

Frye was spending the All-Star break in Ohio with his family. He was with the Cavaliers before being traded to the Lakers on Feb. 8 along with Isaiah Thomas in exchange for Jordan Clarkson and Larry Nance Jr.

Frye is averaging 4.8 points and 2.4 rebounds per game this season. He has appeared in one game for the Lakers.

“I’m pretty sure (now) that i got my appendix removed I’ll be able to dunk at least 3xs a month now!” Frye tweeted, with the hashtag ItWasWeighingMeDown: