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.

Dwight Howard was heckled by arena clean up worker during postgame workout

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Dwight Howard was a beast against the Brooklyn Nets Friday night, dropping 25 points and grabbing 17 rebounds against one of his former teams. Well, he was dominant in the first half, when he picked up a fourth foul relatively early in the third quarter Scott Brooks went away from Howard for too long, the Nets scored at will and pulled away for the win. Still, Friday was Howard’s best game of the season.

And yet he was 3-of-10 from the free throw line, so he went out after the arena closed and practiced his foul shots.

What that video didn’t show was Howard getting heckled during that workout by one of the people hired to clean up the arena. From Candace Buckner of the Washington Post.

…before hitting the showers, [Howard] returned to the main court to practice his free throws. He had missed 3 of 10 attempts during the game. So, while Howard got into a shooting rhythm, tuning out the background noise with music playing in his ear buds, a contract worker who was part of a team hired to clean around the 400 level tried to break his concentration.

“Brick!” the worker yelled, but as Howard’s shots swished through the net, he switched to: “’That’s right, Dwight! You better make them!”

While many fans would like to buy that worker a beer, it did not go over so well with the Wizards’ staff, and the man was removed from the arena.

The Wizards are 5-10 on the season with the third worst defense in the league. The Wizards’ defense is not better with Howard on the floor — he’s not the cause of their problems, but he’s not solving them either. His defense was part of the reason the Wizards thought he would be a fit.

Draymond Green to sit out Saturday, likely longer, with sprained toe

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Before the drama around Draymond Green and Kevin Durant against the Clippers, Green had missed a couple of games due to a sprained toe. Against the Clippers, he was 3-of-9 shooting and did not move like he is capable of. Then, after a one-game suspension, Green came back against the Rockets and struggled again, shooting 0-of-3 and not looking like himself.

While some will want to tie this to the Durant incident, the fact is Green’s toe needs more time to heal and he is going to get it, starting with sitting out Saturday vs. the Spurs.

Green said this after his suspension game, via NBC Sports Bay Area.

“After playing 42 minutes against the Clippers, it was pretty sore that next day,” Green said of his injured toe, and he then joked, “Thank God I got suspended. I was sore, really sore, so I sat there and iced the whole day. Did some treatment at home. … Everything happens for a reason.”

Kerr said “We decided to give [Green] some time off. Don’t know how long it’ll be.” Which makes it sound like this will be more than one game.

The Warriors are -10.5 points per 100 possessions worse defensively when Green is off the court. Combine that with Stephen Curry still being out with a strained groin and the Warriors are battling through some injuries, and suffering some ugly losses because of it, early this season.

Just a reminder, Anthony Davis is very good at basketball, dropped 43 on Knicks

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Anthony Davis went into this season wanting to be seen as the best player in basketball.

Part of that perception is team success, and while the Pelicans are a good-not-great 8-7 to start the season it’s not because of Anthony isn’t doing all he can. He dropped 43 points and 17 rebounds on the Knicks, helping spark the Pelicans comeback against the Knicks. Check out the video above.

Davis is averaging 26.5 points with a quality 56.4 true shooting percentage, plus 17.1 rebounds a game. His PER of 26.8 is sixth best in the NBA. When Davis gets some help, and the Pelicans play a little defense, this is the kind of team AD might want to stick with.

Allen Iverson: “No way Melo should retire… he got a lot left in the tank, man”

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Carmelo Anthony is in limbo now. He’s not with the Rockets, not suiting up for games or playing, but he’s still on the roster. Houston has yet to waive him because they and his agent have not yet found a landing spot for him — other teams don’t want to get into the Carmelo Anthony business right now. Maybe that changes as injuries come and rosters shift, but right now there are no takers.

It has led Tracy McGrady and others to suggest Anthony retire.

Allen Iverson disagrees, speaking to Shams Charania of The Athletic.

Iverson is right, Anthony needs to be in the right situation. I’m just not sure what that is.

Anthony, like all great athletes, wants to leave the game on his own terms. The challenge is he is no longer a top two or three player on a good team, yet he feels entitled to be put in that role (or, at least, be treated like one of those guys). ‘Melo came off the bench in Houston but didn’t like it. The problem is that’s where his game is at that point — he’s a bench role player who can get some buckets but hurts the team defensively. That limits when he can be put on the court, especially in the playoffs. Can he accept that spot on a team?

Eventually, a team is going to give Anthony a chance, and I hope that works out. I would like ‘Melo to leave the game with us remembering him as the Hall of Fame player and elite scorer that he was, not like this.