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.

Tiago Splitter announces retirement

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Tiago Splitter was so effective in his role for the Spurs during their playoff run to the 2014 title – 19.1 PER, .239 win shares per 48 minutes, +7.5 box plus-minus. It gets forgotten, because he twice lost his starting job that postseason.

Limited by a late start in the NBA and injuries, Splitter’s prime was short and ill-timed. He was a traditional center just as those were going out of style.

But for moments in the right matchups, he provided a major boost to a championship team. That was the peak of a seven-year NBA career.

HoopsHype:

Tiago Splitter announced his retirement at the age of 33 in an interview with SporTV.

Splitter just couldn’t get healthy. He missed 150 games over the last three years with the Spurs, Hawks and 76ers.

Drafted No. 28 in 2007, Splitter remained overseas for a few years and built hype and intrigue. He signed with San Antonio and started alongside Tim Duncan for a couple years. The Spurs later dumped him on Atlanta to clear space for LaMarcus Aldridge – a sign of Splitter’s success. He earned about $47 million in his NBA career.

J.J. Redick apologizes for saying what sounded like a slur for Chinese people

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76ers guard J.J. Redick explained saying what sounded like a slur for Chinese people – he was tongue-tied. But he didn’t actually apologize, and that bothered many.

Now, he’s getting that part right.

Redick:

Maybe Redick really did just stumble over his words. Based on the inflection, it certainly sounds possible.

Maybe he thought he was being funny then got caught.

He’d respond now the same way now either way. Maybe it’s just unfortunate he’s caught up in this. Maybe he’s using plausible deniability to get away with something.

I don’t know, but it’s good he apologized. People can apologize for accidents, and it usually helps make everyone feel better and move on.

Adam Silver: ‘Sounds like’ NBA All-Star draft will be televised next year

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NBA commissioner Adam Silver said the point of the All-Star draft wasn’t to create a new TV event, but a better All-Star game. He even pointed out Stephen Curry favored not televising the draft this year.

But All-Star after All-Star – from captain LeBron James to last pick LaMarcus Aldridge – expressed a comfort with the selections being known. Good thing, because most of the draft order leaked, anyway.

So, will the draft be televised next year?

Silver, in an interview with Ramona Shelburne of ESPN:

I was misinterpreted the other day, because people thought I was diming Steph by saying he didn’t want to televise it. I have no idea whether he wanted to televise it. What he said after the decision came not to televise it, he said let’s give it a chance to see if it works, and then if it works, then we’ll televise it. So, I said I agree with him. But I don’t know whether he was for or against it.

By the way, I’ll take as much responsibility. When we sat with the union and we came up with this format, we all agreed, let’s not turn something that’s 100 percent positive into a potential negative to any player. But then maybe we were overly conservative, because then we came out of there, and the players were, “We can take it. We’re All-Stars. Let’s have a draft.” So it sounds like we’re going to have a televised draft next year. But I’ve got to sit with LeBron and all the guys in the union and figure it out.

Overly cautious is right. This year was a missed opportunity. But the more important thing is getting next year right.

It sounds as if the NBA will.

Twitter reaction All-Star pre-game, Fergie’s national anthem vicious, priceless

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LOS ANGLES — In an intensely polarized nation, few things unite Americans anymore. Sunday night the NBA and its All-Star Game broadcast gave us one of those unifying forces — a pre-game run-up so bad it was universally panned.

The NBA is lucky the new format seemed to work and we had a dramatic, actual basketball game to talk about, helping us move on a pre-game show that, to put it kindly, simply did not work.

It started with a roughly 20-minute singing and dancing skit that was supposed to be about comedian Kevin Hart’s journey to being an NBA player (I think that’s what it was, anyway, it made as much sense as the movie “Wild, Wild West”). It felt forced, was not funny, and just dragged on and on. Even a Kardashian thought this was terrible television.

And that wasn’t even the worst part of the pregame, nor the part that sparked the most outrage online.

Fergie’s sexy, slow, bluesy rendition of the national anthem became the lightning rod.

Charles Barkley joked on TNT that he “needed a cigarette” after the Black Eye’d Peas’ singer’s performance. Shaquille O’Neal jumped in quickly to defend her (“Fergie, I love you. It was different. It was sexy. I liked it.”) as the broadcast quickly pivoted away from that topic.

Twitter was not so kind, and Draymond Green‘s face caught by camera’s during the anthem became a quick meme.

Twitter had a field day with Fergie’s rendition.

Now, let us never discuss this All-Star opening ever again. Please.