Arena Lawsuit

[whozit]

Not sure if this needed a new thread or not, but since it has to do with public perception and the background of someone who is a major bank-roller of the STOP campaign I thought it might be interesting.

Breton's idea of STOP's battle plan:

http://www.sacbee.com/2014/02/09/6140473/marcos-breton-arena-foes-fraud.html

And an interesting read of someone (not Hansen) who is bankrolling STOP:

http://www.sacbee.com/2014/02/09/6140539/why-agribusinessman-is-bankrolling.html

 

[Section 101]

Not sure if this needed a new thread or not, but since it has to do with public perception and the background of someone who is a major bank-roller of the STOP campaign I thought it might be interesting.

Breton's idea of STOP's battle plan:

http://www.sacbee.com/2014/02/09/6140473/marcos-breton-arena-foes-fraud.html

And an interesting read of someone (not Hansen) who is bankrolling STOP:

http://www.sacbee.com/2014/02/09/6140539/why-agribusinessman-is-bankrolling.html

Marcus missed a big question. He should of asked how much money he's received from farming subsidies.

 

[whozit]

Marcus missed a big question. He should of asked how much money he's received from farming subsidies.

Who Breton? The second story was written by someone else. The guy funding STOP claims he hasn't taken any subsidies and won't take Social Security. I probably shouldn't have posted that second story, it's too ripe for politics. I put it there as an interesting read on an opponents mindset.

 

[whozit]

I find it interesting that in the first article it is brought out how STOP is using a smear campaign but at the same time:

R.E. Graswich ‏@REGraswich 16m
STOP bases itself on "direct democracy." Yet phony initiative is funded indirectly -- by outsiders.

I'll take a bet that the other side is saying the same thing. Hansen was absolutely an outsider with bad intent but this other guy from just outside city limits? Pot calling Kettle?

 

[Glenn]

If the city should be barred from subsidizing the arena, all income generated by the city and private entities as a result of the arena should be sent to the builders of the arena. Not sure how to do that. Perhaps something simple like a CITY SUBSIDY would be the easiest way of doing it.

There is no argument that the city does not benefit from an arena. Putting a dollar value on that may be impossible.



Edit: people may tell me to calm down as this is no big deal but it's like going into the 4th quarter with a 20 point lead. It is not a sure win. When the arena is built, I will breath easy. I must say this is a beautiful arena and as I love gadgets, I look forward to the gadgets Vivek and company come up with. I think just as Gay may be that one step that shoots this team into the next bracket, so also will this arena do the same thing for Sacramento. I have been a long time complainer about the immense hickdom of Sacramento but this will change that attitude. (Imagine a small town Minnesotan calling ANYONE a hick!) I'll try to put the GPS of my hometown on my profile and giggle away.

 

[Livinthedream]

The arena situation is political. When a weak political activist group does something to gain headlines, a strong political figure typically comes in and hijacks the cause for their own personal gain. This is what Hansen and this guy Rufer has done.

Glenn, you're right. Nothing happens in a vacuum. There is a symbiotic relationship between government, business and the community. Even Rufur will benefit when this arena gets built.

 

[Glenn]

Before I go on a tangent, I need to be reminded of something. What exactly is the subsidy? Isn't it income derived from parking lots who might be empty if there was no arena?

Rufur's objection has to do with his political orientation and that has nothing to do with the dollars and cents of the deal but because he would be against any governmental subsidy of anything. The fact he doesn't complain when the city subsidizes hotels and the like is a curiosity but I need kennadog's input on this. It's been my impression that the city subsidizes darn near everything big built and there is never a public vote. Am I right?

 

[JB_kings]

STOP has allowed anyone with money to hijack their arena vote issue for their own purposes. Rufer is just the latest who is using this for his political agenda. Hopefully the judge will uphold the city clerk decision soon and the rest of this will just fade away.

 

[Livinthedream]

Before I go on a tangent, I need to be reminded of something. What exactly is the subsidy? Isn't it income derived from parking lots who might be empty if there was no arena?

Rufur's objection has to do with his political orientation and that has nothing to do with the dollars and cents of the deal but because he would be against any governmental subsidy of anything. The fact he doesn't complain when the city subsidizes hotels and the like is a curiosity but I need kennadog's input on this. It's been my impression that the city subsidizes darn near everything big built and there is never a public vote. Am I right?

You are right. Subsidies are standard. The arena is high profile and Rufer wants credit for opposing it. He cares not about the people or the city.

 

[Capt. Factorial]

Before I go on a tangent, I need to be reminded of something. What exactly is the subsidy? Isn't it income derived from parking lots who might be empty if there was no arena?

The "subsidy" is about $258M. Of that, about $46M comes from land that is being given to the Kings. That is what I would consider the "true" subsidy. Then there's the pseudo-subsidy, which is the remaining about $212M. That money is going to provided by a bond sale, and the bonds will be paid off by parking funds. Those parking funds currently go into the general fund, but the city is going to spin off a separate political entity that will bring in all of the parking funds and pay off the bonds with those. You'll notice that under this plan, the general fund loses the parking funds, which is about $9M per year. This loss is going to be "backfilled" by arena-related revenue - this includes ticket surcharges and some parking, as well as possessory interest taxes on the arena and a few other arena-related revenue streams. The important things here are that the backfill comes entirely from arena-related revenue streams that would not exist without the arena being built, and that the city has used conservative projections to make the projections that they will not lose money in any year of the financing (I can't remember if it's 30 or 35 years). There are a few years that are very tight between about year 5 and year 10 (if I remember correctly) but after that even the conservative projection shows a considerable profit for the city.

And you know what? Even if a few years we do have a rough time on the projections and we come out short, it's only the shortfall that the city is effectively "subsidizing". What if the revenues fall short? the naysayers ask. Well, if during one year the revenue projections fall an entire $1M short (that's more than 10% lower than projected in any case) then the city is on the hook for...$1M, not the full $212M + financing (as the naysayers would make it sound like).

 

[korsen31]

Well, considering that the arena ultimately belongs to the city, you can even argue that the subsidy come from the Kings. The city spends up with a $448m ESC after spending $258.

 

[Section 101]

The "subsidy" is about $258M. Of that, about $46M comes from land that is being given to the Kings. That is what I would consider the "true" subsidy. Then there's the pseudo-subsidy, which is the remaining about $212M. That money is going to provided by a bond sale, and the bonds will be paid off by parking funds. Those parking funds currently go into the general fund, but the city is going to spin off a separate political entity that will bring in all of the parking funds and pay off the bonds with those. You'll notice that under this plan, the general fund loses the parking funds, which is about $9M per year. This loss is going to be "backfilled" by arena-related revenue - this includes ticket surcharges and some parking, as well as possessory interest taxes on the arena and a few other arena-related revenue streams. The important things here are that the backfill comes entirely from arena-related revenue streams that would not exist without the arena being built, and that the city has used conservative projections to make the projections that they will not lose money in any year of the financing (I can't remember if it's 30 or 35 years). There are a few years that are very tight between about year 5 and year 10 (if I remember correctly) but after that even the conservative projection shows a considerable profit for the city.

And you know what? Even if a few years we do have a rough time on the projections and we come out short, it's only the shortfall that the city is effectively "subsidizing". What if the revenues fall short? the naysayers ask. Well, if during one year the revenue projections fall an entire $1M short (that's more than 10% lower than projected in any case) then the city is on the hook for...$1M, not the full $212M + financing (as the naysayers would make it sound like).

Actually, be definition the Kings are subsidizing the city's ESC by paying for parts not in the lease and the city trading land for the ESC land. In order for the city to be subsidizing the Kings the Kings would have to own the building.

 

[Warhawk]

Actually, be definition the Kings are subsidizing the city's ESC by paying for parts not in the lease and the city trading land for the ESC land. In order for the city to be subsidizing the Kings the Kings would have to own the building.

Exactly the point I keep trying to make to the Sacbee guys on twitter! The City will OWN the land and the arena building. There is no "subsidy" when you are paying for something you will own! Whether they will make money on it every year is a different question (better answered by others than myself), but that is no different than buying an office building to lease out the space. Does that mean you are "subsidizing" the tenant who is on a 35-year lease?

 

[whozit]

Exactly the point I keep trying to make to the Sacbee guys on twitter! The City will OWN the land and the arena building. There is no "subsidy" when you are paying for something you will own! Whether they will make money on it every year is a different question (better answered by others than myself), but that is no different than buying an office building to lease out the space. Does that mean you are "subsidizing" the tenant who is on a 35-year lease?

And I think this is what the guy Rufur is missing. What is it? Can't see the forest because of the trees or can't see the trees because of the forest or both? Politics blind ........... both sides. Rufur is essentially local and funding the losing side on this and apparently he has a history of putting his money where his mouth is. Personally I can respect that even if I disagree with his position, what I don't respect is the character assassination that Crown Downtown performed last night even if I agree with their position on the arena and what it means for downtown Sacramento. Hopefully it doesn't happen again 'cause there really wasn't any need to go there.

 

[Glenn]

Rufur's position is political. That's it. We aren't supposed to discuss politics but it is his position as a Libertarian that effects his position. I don't think he is pure on other construction jobs but on this one he is pure as best I can see.

Sacramento has always operated as a representative democracy just as the State and Federal government work. We elect officials who make decisions for us. Now he wants a direct democracy where the people vote on everything. The city would be brought to a halt.

 

[LPKingsFan]

Exactly the point I keep trying to make to the Sacbee guys on twitter! The City will OWN the land and the arena building. There is no "subsidy" when you are paying for something you will own! Whether they will make money on it every year is a different question (better answered by others than myself), but that is no different than buying an office building to lease out the space. Does that mean you are "subsidizing" the tenant who is on a 35-year lease?

I received housing from my law school in a school-owned apartment building in Manhattan, and paid much less than my peers who lived in non-school-owned buildings. I always considered myself to live in "subsidized housing," although that may not have been technically correct.

My guess would be if the tenant is paying less than "market value" in rent, you could make an argument that the landlord is "subsidizing" the tenant. Of course, an arena is not any old apartment, building, and you can't just find other tenants willing to pay more. And what's the "market value" of rent on that land otherwise? It depends on how the city chooses to use it, I guess.

 

[whozit]

I received housing from my law school in a school-owned apartment building in Manhattan My guess would be if the tenant is paying less than "market value" in rent, you could make an argument that the landlord is "subsidizing" the tenant. Of course, an arena is not any old apartment, building, and you can't just find other tenants willing to pay more. And what's the "market value" of rent on that land otherwise? It depends on how the city chooses to use it, I guess.

Considering that at least some of the property is vacant tells a lot. The mall went from 210 million to being bought for 22 million tells volumes on what downtown land is worth without development. STOP wants the city to use post-arena estimated (guesses) valuations on the land not what it is worth now. STOP is using a shell game.

 

[whozit]

Rufur's position is political. That's it. We aren't supposed to discuss politics but it is his position as a Libertarian that effects his position. I don't think he is pure on other construction jobs but on this one he is pure as best I can see.

Sacramento has always operated as a representative democracy just as the State and Federal government work. We elect officials who make decisions for us. Now he wants a direct democracy where the people vote on everything. The city would be brought to a halt.

Is that what he wants or is it more closely to simply just no subsidies? His political position seems to be more on what economic model we should be using. War makes strange bedfellows.

 

[Glenn]

Is that what he wants or is it more closely to simply just no subsidies? His political position seems to be more on what economic model we should be using. War makes strange bedfellows.

He is a Libertarian so the idea of having a direct democracy is part of it. No lawsuit is pure as to the issues. Bring up every issue and see if anything works. I'll get back to you on the Libertarian issue.

BTW, I doubt if it makes any difference who funds it. National politics certainly don't care who funds each election. The money comes from anywhere and everywhere.

 

[whozit]

He is a Libertarian so the idea of having a direct democracy is part of it. No lawsuit is pure as to the issues. Bring up every issue and see if anything works. I'll get back to you on the Libertarian issue.

BTW, I doubt if it makes any difference who funds it. National politics certainly don't care who funds each election. The money comes from anywhere and everywhere.

I agree on money and politics, hence my comment on war making strange bedfellows.

 

[Mike0476]

And I think this is what the guy Rufur is missing. What is it? Can't see the forest because of the trees or can't see the trees because of the forest or both? Politics blind ........... both sides. Rufur is essentially local and funding the losing side on this and apparently he has a history of putting his money where his mouth is. Personally I can respect that even if I disagree with his position, what I don't respect is the character assassination that Crown Downtown performed last night even if I agree with their position on the arena and what it means for downtown Sacramento. Hopefully it doesn't happen again 'cause there really wasn't any need to go there.

When a guy wants to fund the anti group based on the fact that he wants to market his ideas (political, etc.) and said the arena will be built on his terms, you're damn right I'll go after him with facts.

There's no character assassination when facts are used.

 

[whozit]

When a guy wants to fund the anti group based on the fact that he wants to market his ideas (political, etc.) and said the arena will be built on his terms, you're damn right I'll go after him with facts.

There's no character assassination when facts are used.

Facts from nearly a quarter of a century ago? I don't have anything nice to say about STOP. Crown Downtown is better than that or at least I hoped they/you were. Every side has "facts" that they will spin to their advantage if at all possible. I was disappointed in your response, simple as that. You gave him more attention than he deserved.

 

[Mike0476]

Facts from nearly a quarter of a century ago? I don't have anything nice to say about STOP. Crown Downtown is better than that or at least I hoped they/you were. Every side has "facts" that they will spin to their advantage if at all possible. I was disappointed in your response, simple as that. You gave him more attention than he deserved.

This is a political battle. And facts are facts.

 

[Warhawk]

I don't think that there is any "character assassination" involved here. A few quotes from the Sacramento Bee on the contributor's stated political views and the reasons why he is contributing to this sham from STOP does not rise to that level by any means, at least in my view. Isn't that the reason for the uproar over Hansen's $$$ - where is the money coming from and why?

 

[whozit]

This is a political battle. And facts are facts.

And the end justifies the means, doesn't it? Up to this point as far as I could tell, you took the high road. IMHO, you didn't in this case. This wasn't Hansen, this was a Sacramento county resident who just wasted a large chunk of change. I am sure Crown Downtown took money (such as donations for shirts, tickets, ext.) no matter how small from people outside the city limit. If so, what is the difference? STOP's lawsuit is now in the courts and hopefully the courts will rule according to the law and if so should be the end of them in terms of the arena.

I hate politics. And the dirt. Disappointed.

 

[korsen31]

I received housing from my law school in a school-owned apartment building in Manhattan, and paid much less than my peers who lived in non-school-owned buildings. I always considered myself to live in "subsidized housing," although that may not have been technically correct.

My guess would be if the tenant is paying less than "market value" in rent, you could make an argument that the landlord is "subsidizing" the tenant. Of course, an arena is not any old apartment, building, and you can't just find other tenants willing to pay more. And what's the "market value" of rent on that land otherwise? It depends on how the city chooses to use it, I guess.

Fair point, but then the city still wouldn't be subsidizing the ESC. The city would be building the ESC with funding contribution from the Kings, then leasing back at a discount. Effectively, a leaseback agreement with some backloading.

In any case, unless the value of the ESC is zero after 35 years, and the city gets ZERO revenue from it during the entire time, the city's net contribution is well south of $258m.

 

[Gary]

The end? What about appeal after appeal after appeal? They won't give up until it's built and games are being played. They have nothing better to do than make life miserable for everyone else. So I try to give them a little bit of it back when I can.

 

[Livinthedream]

I don't like politics either. But bringing up political behavior is as clean as it gets. None of what I read about Rufer was personal.

Remember that Rufer wants his political ideals front and center. That's why he's spending the money. He's not ashamed of his politics, so why should we be afraid to say it?

 

[korsen31]

Considering that at least some of the property is vacant tells a lot. The mall went from 210 million to being bought for 22 million tells volumes on what downtown land is worth without development. STOP wants the city to use post-arena estimated (guesses) valuations on the land not what it is worth now. STOP is using a shell game.

You hit the nail on the head. To calculate the city's contributions based on valuations that assumes an arena being built, while at the same time arguing against the building of said arena, is disingenuous and illogical at best. Though with STOP, it's hard to tell where the incompetence ends and the malice begins.

 

[Mike0476]

And the end justifies the means, doesn't it? Up to this point as far as I could tell, you took the high road. IMHO, you didn't in this case. This wasn't Hansen, this was a Sacramento county resident who just wasted a large chunk of change. I am sure Crown Downtown took money (such as donations for shirts, tickets, ext.) no matter how small from people outside the city limit. If so, what is the difference? STOP's lawsuit is now in the courts and hopefully the courts will rule according to the law and if so should be the end of them in terms of the arena.

I hate politics. And the dirt. Disappointed.

Rufer is a Sacramento County resident who is pushing his political agenda. He doesn't like subsidies and that's fine. But the moment he said he is doing this to market his ideas (his political views) and that the arena will be built on his terms, that right there tells you all you need to know about him. At that point he's fair game.

All three major money benefactors (Hansen, Rufer and non-union group) are in it for their own agenda and not for Sacramento. Notice none of them have a real plan as a back up. You can't tell me renovating the current arena or 100% privately financed is a real back plan.

Nothing we said about Rufer was made up or not true.

As far as money goes, yes we did receive money from those living in the city limits, county limits and every where else around the world.

Since we're on the subject of money, those of us with the group have also spent thousands of dollars for the cause. I don't have the numbers in front of me but I will speak for myself but I have personally put in over $10,000 to fight the good fight. Let's not forget all the hours we have volunteered our time because unlike STOP we did not get paid to do what we have done and will continue to do.

The difference is we are doing what we feel and believe is the right thing to do for Sacramento.

Will the court hearing on Feb 21 be the end? Don't be surprised if they file an appeal and fire off more lawsuits. Their game is to delay.

I don't care for politics. I'm not a political person. But this is a political battle. Has been since day one but the noise has been pumped up.

All last summer and fall we spent hours walking the streets and at the Farmers Market. We were yelled at and even poked at by supporters of the opposition. Yeah it's ugly out there in the real world away from the safety of a keyboard.

You're entitled to your opinion but on this we will agree to disagree.