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Future of NBA arena subsidies, market comparisons to decide Kings’ fate

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As Sacramento Mayor Kevin Johnson has been advertising for the past month, we did indeed get confirmation of the identity of his ‘whales’ at his State of the City address on Thursday.

Reiterating parts of his four-part plan that included bringing together a local ownership group, finding big equity investors (whales), putting together a downtown arena deal, and demonstrating the value of the Sacramento marketplace – Johnson would announce that 24 Hour Fitness founder Mark Mastrov and billionaire Ron Burkle would put in a bid to keep the Kings in Sacramento.

“With all due respect to Seattle, I do hope they get a team someday, but let me be perfectly crystal clear, it is not going to be this team,” said Johnson.

Johnson also announced that former Kings great Mitch Richmond would join the local ownership group and that the city’s proposal would include an option to return WNBA basketball to Sacramento.

Sources close to the situation told PBT that the framework of the offer delivered to the NBA on Friday was very close to Seattle’s $341 million offer for a controlling 65 percent interest in the club. NBA spokesman Tim Frank confirmed delivery of the offer on Friday, the day of the deadline.

Over the next month Sacramento will continue to iron out the details on a public subsidy and arena deal locally with the Sacramento City Council, which will ultimately vote on a term sheet to be delivered to the Board of Governors in time for their April 18-19 meeting.

Sources tell PBT that the Sacramento offer will be conveyed by the group to the NBA’s joint committees in charge of reviewing the situation on or around April 1. It is expected that Seattle’s group will also meet with that committee around that time, though no meeting has been publicly acknowledged.

According to sources, the two issues that will drive the conversation is the league’s strategy for securing arena subsidies in the future, and the impact each market will have on team revenues and the league’s financial model as a whole. Also under consideration are timelines to deliver an arena, ownership groups, and the precedent the league could set by blocking an owner from selling to a group of their choosing.

The league blocked a sale of the Minnesota Timberwolves to a group headed by boxing promoter Bob Arum in 1994, but a well-placed source told PBT that the league views this transaction as “unprecedented,” citing that never before has the league relocated from a city that has supported its team both at the gate and with public subsidy dollars.

The Maloof ownership group reportedly has “little to no leverage” in NBA’s decision-making process. They also reportedly owe the NBA in excess of $100 million on a line of credit they’ve used throughout their ownership. If called in, the family’s financial woes could give the league an opening to use the ‘Best Interests of the League’ clause, similar to the way Major League Baseball removed Dodgers owner Frank McCourt.

Sources do not expect the Maloof family to push back on the league’s decision to back either Sacramento or Seattle, citing the prohibitive costs of an antitrust lawsuit, and the potential for the family to lose a chance to cash out in Sacramento or Seattle.

The issue of market comparisons between Sacramento and Seattle is cloudy, but sources expect Sacramento to be competitive in that area because it has one major sports team in their No. 20 TV market, while Seattle could have six major sports teams in its No. 12 TV market. We will cover this in a bit more detail later in the next few weeks.

While details about Sacramento’s ownership group are a bit hazy at this time, it has been expected that Mastrov would be the front man. The more private Burkle reportedly would focus on the development of the Downtown Plaza location. Sources indicate the duo will share in the ownership of a potential deal, though it’s unclear what those percentages will be. Both owners have been vetted by the NBA, and Mastrov finished second in the Golden State Warriors bid that recently went to the Joe Lacob group.

While Seattle’s Chris Hansen-Steve Ballmer group has enormous wealth, another well-placed source speaking to PBT under condition of anonymity said the league is happy with both ownership groups and not to expect a deal to hinge on any comparison between them.

If a showdown comes to the owners’ deciding vote, some sources hinted at a scenario in which the league tells the Hansen group that they’re going to choose Sacramento – allowing the Hansen group to bow out gracefully and avoid a divisive ownership vote.

Should the league favor Sacramento, sources say the work the city has done to fight for its team and the narrative it will give the league to sell to future cities in arena negotiations will have played a critical role in the NBA’s decision-making process.

Seattle’s deal contains a greater percentage of private funds due to local initiative-91 requiring public funds to return a guaranteed profit, which is a trend the league wants to avoid.  On the other hand, Sacramento’s deal fits the public-private model the league is selling to cities, with a larger public subsidy going toward a new state-of-the-art building in a downtown revitalization effort.

We will cover that issue in greater detail in the coming weeks.

In order to keep their team, Sacramento will need eight votes out of 29 other owners to block the transfer of ownership to Seattle’s Hansen/Ballmer group.

Report: Sacramento Kings reach one-year deal with Ty Lawson

INDIANAPOLIS, IN - APRIL 23:  Ty Lawson #10 of the Indiana Pacers celebrates against the Toronto Raptors during game four of the 2016 NBA Eastern Conference Quarterfinal Playoffs at Bankers Life Fieldhouse on April 23, 2016 in Indianapolis, Indiana.   NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Andy Lyons/Getty Images)
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Ty Lawson said that wherever he signed, “they’re going to get me for cheaper than I feel I’m worth … I feel like I’m overlooked in free agency.”

That lucky team — at least in Lawson’s mind — is the Sacramento Kings.

They have reached a one-year deal with him, reports Adrian Wojnarowski of The Vertical at Yahoo Sports.

Lawson bounced between Houston and Indiana last season, and struggled at both stops — he shot 39.3 percent last season with a far wbelow replacement lever PER of 9.7. He was better in Indiana than Houston.

Lawson also brings the baggage of a couple of DUIs in recent years and a reputation as a partier — including showing up to practice with alcohol on his breath. That hurt is free agent prospects, and is something Lawson denied to The Undefeated.

But I’m not a person out here like everyone thinks that I’m drunk all day. No, I don’t do that. A lot of my friends, we go out and celebrate. But I’m not that person in the morning getting drunk before practice. I think there is a big misconception about what everybody thinks. That’s what I basically tell them. I keep it honest.

The Kings will start Darren Collison at the point, but Lawson should get a decent run as a backup. Lawson is a solid playmaker and has a spot up shot, when he is right.

What the 28-year-old Lawson also will get is another chance — he hasn’t impressed in his past few stops and if that doesn’t change his NBA career could end soon.

Watch 50 top clutch shots of last NBA season

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There are 1,230 NBA games in a season, and decent amount of those come down to which team executes better in a close game late. (By the way, the best teams don’t win the most close games, the best teams have the most blowouts and aren’t in as many close games.)

What that means is there are a lot of game winners, a lot of clutch shots every season. The folks at NBA.com compiled them for you, and what else do you have to do on a Sunday night but watch 13 minutes of them.

Yes, there is plenty of Stephen Curry and Russell Westbrook in this one, but the clutch shot of the season belonged to Kyrie Irving.

Jason Terry chose Bucks because he wants to play, not just mentor

OAKLAND, CA - APRIL 27:  Jason Terry #31 of the Houston Rockets dribbles the ball against the Golden State Warriors in Game Five of the Western Conference Quarterfinals during the 2016 NBA Playoffs at ORACLE Arena on April 27, 2016 in Oakland, California. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, user is consenting to the terms and conditions of Getty Images License Agreement.  (Photo by Ezra Shaw/Getty Images)
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Jason Terry has talked about reaching out to multiple teams, including contenders, during free agency before settling on the Milwaukee Bucks. When he talked about why the Bucks, he spoke of believing in what Jason Kidd was building.

There may have been another reason: Minutes.

From Gery Woelfel of the Racine Journal Times:

Some NBA officials contend he signed with Milwaukee and rejected overtures from a handful of teams, including the reigning NBA champion Cleveland Cavaliers, because of potential playing time.

“He wants his minutes,’’ said an NBA executive, whose team had shown some interest in signing Terry. “He didn’t go there (Milwaukee) to sit on the bench.’’

Terry’s agent denied this, saying he wanted to be part of the Bucks.

If minutes was a key part of his decision, so what? Guys choose teams for money (usually), wins, to play with friends, lifestyle, and weather, plus other reasons — how much run they get is in that mix. It’s never just one thing. And playing time matters.

No doubt Terry will get run with the Bucks behind Matthew Dellavedova, although Giannis Antetokounmpo with the ball as point guard is what is going to make this team fun to watch.

Report: Other league executives don’t expect DeMarcus Cousins to stay in Sacramento

SACRAMENTO, CA - FEBRUARY 26:  DeMarcus Cousins #15 of the Sacramento Kings stands on the court during their game against the Los Angeles Clippers at Sleep Train Arena on February 26, 2016 in Sacramento, California. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Ezra Shaw/Getty Images)
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The vultures have been circling.

Other teams have called Sacramento GM Vlade Divac since the day he took office to inquire about the availability of DeMarcus Cousins — however, only George Karl took those calls and tried to run with it. The Kings know they have a franchise player, the best traditional center in the game right now, in Cousins and that is hard to come by. While it may not be easy — Cousins has always been demanding of those around him — they need to make it work.

Enter coach Dave Joerger, the guy who had success with difficult personalities in Memphis and got that team to the conference finals a couple of times.

Cousins has this season and next on his deal, and around the league the conventional wisdom is he bolts when this contract is up (hence the trade calls). Here is what one executive told Zach Harper of CBSSports.com.

“They’re fooling themselves if they think he’s sticking around,” said one league executive. “The good news for them is his value will always be high. There isn’t a point of no return in which you’re not getting high value for him. Teams will bid against each other in the trade market. Maybe [Cousins] doesn’t go for the biggest money in free agency but you’d love to have that card to play.”

The Kings aren’t giving up on being able to keep Cousins. They hope Joerger, the Olympics experience, some winning, a new building, and a trip to the playoffs will have Cousins thinking Sacramento is his home, where he wants to stay and build something.

I’d be surprised if the Kings seriously considered any move before next summer. But if Divac and company get the sense after this contract that they may not be able to keep Cousins — and let’s be clear, up to this point the organization has given him little reason to put his faith in them, Cousins is not unreasonable here — they have to make a move. This is not Oklahoma City where they can just turn the team over to Russell Westbrook, if Cousins goes it’s a rebuild in Sacramento (for a team that hasn’t made the playoffs in a decade).

Celtics fans (and the rest of you convinced Cousins is coming your way), you need to wait it out. This is not going to be some quick move this summer.

But the vultures are circling.