Larry David
Starter
The league has a very easy was of resolving this. They can simply maintain the status quo and take KJ off the clock. They can’t make the owners agree to a deal, but they can tell the Maloofs unequivocally, as long as the city is negotiating in good faith, you can’t move.
Stern doesn’t have to throw the Maloofs out of the league next week. He doesn’t have to risk asking his owners to back a city over one of their own. He just sits back with that wry smile and says, “Look, it took us 10 years but over a few months we’ve closed 90% of the ground.” The league is going to advance you the $ 3 million in predevelopment costs, and you won’t have to pay that or AEG’s share if the arena isn’t built. Now, go back to the table in Sacramento. But know that 2015 is not a make or break deadline for the league, and we’re not going to let you move the team for at least two years.”
This takes KJ off the clock. It allows the city to continue to get all of their ducks in a row on parking and other things, and frankly, they appear to need a little extra breathing room. While things could change in the interim, the city’s parking money, AEG’s desire to make money here, and the county’s parking garages seem firm. Even assuming there is a “break ground” deadline on any of federal funds that assist with the infrastructure surrounding the area, the city and Taylor should be more than capable of working and starting those projects “separately” in a way that dovetails and don’t damage the larger framework.
You know who doesn’t have time. The Kings. The 1997 loan is relatively the same size because it was almost exclusively interest payments for a long time. Well, that’s about to change. There is a reason they are making a mountain out of the 2015 open date. The team needs the city to refinance that loan at a better rate and over a longer term. They aren’t going to raise payroll until they set foot in a new building, and fans will continue to leave in droves as the team is run like the A’s.
Right now, the Maloofs have two threats on the table that give them some leverage. First, they can TRY to move the team. Second, they might be able to dump the arena and loan onto the city if they move. If Stern tells the team, “Look – we’re not picking a side here, but if you think you can tearfully announce a deal in Orlando, celebrate with the mayor at half court, and then turn around and declare an impasse and leave town, that’s just not going to happen. It’s not in the best interest in the league. I really want this resolved quickly, but that’s up the parties and out of my hands. In the meantime, as long as the city is negotiating in good faith and has a reasonable offer on the table, you can’t leave. If you are stuck at the table for two more seasons, that’s up to you. Unless there is a major change in the city’s conduct, we’re not even revisiting this issue for a year. And there is no way we’re ever letting you destroy the city’s’ budget by dumping Arco on them. In the meantime, I really hope you can close this deal. Good luck boys”
At which point, the playing field between the city and team are flat. The Maloofs can’t afford to keep playing at Arco or alienating their fans with the fact it’s now their fault the deal isn’t getting closed. And KJ can’t wait forever because the makeup of his counsel or other relevant factors could change. A deal would be done sometime in 2012, probably in six weeks.
The NBA gets to keep Sacramento, they might get to drop the Maloofs in a way that defensible in court. On the face of the deal, they just gave the city more time. The unspoken reality is the Maloofs can take the fair deal now or risk going broke and complexly destroy the resale value of thier franchise fighting over a few million dollars. Either way, the league wins. Either way, the team stays here.
Stern doesn’t have to throw the Maloofs out of the league next week. He doesn’t have to risk asking his owners to back a city over one of their own. He just sits back with that wry smile and says, “Look, it took us 10 years but over a few months we’ve closed 90% of the ground.” The league is going to advance you the $ 3 million in predevelopment costs, and you won’t have to pay that or AEG’s share if the arena isn’t built. Now, go back to the table in Sacramento. But know that 2015 is not a make or break deadline for the league, and we’re not going to let you move the team for at least two years.”
This takes KJ off the clock. It allows the city to continue to get all of their ducks in a row on parking and other things, and frankly, they appear to need a little extra breathing room. While things could change in the interim, the city’s parking money, AEG’s desire to make money here, and the county’s parking garages seem firm. Even assuming there is a “break ground” deadline on any of federal funds that assist with the infrastructure surrounding the area, the city and Taylor should be more than capable of working and starting those projects “separately” in a way that dovetails and don’t damage the larger framework.
You know who doesn’t have time. The Kings. The 1997 loan is relatively the same size because it was almost exclusively interest payments for a long time. Well, that’s about to change. There is a reason they are making a mountain out of the 2015 open date. The team needs the city to refinance that loan at a better rate and over a longer term. They aren’t going to raise payroll until they set foot in a new building, and fans will continue to leave in droves as the team is run like the A’s.
Right now, the Maloofs have two threats on the table that give them some leverage. First, they can TRY to move the team. Second, they might be able to dump the arena and loan onto the city if they move. If Stern tells the team, “Look – we’re not picking a side here, but if you think you can tearfully announce a deal in Orlando, celebrate with the mayor at half court, and then turn around and declare an impasse and leave town, that’s just not going to happen. It’s not in the best interest in the league. I really want this resolved quickly, but that’s up the parties and out of my hands. In the meantime, as long as the city is negotiating in good faith and has a reasonable offer on the table, you can’t leave. If you are stuck at the table for two more seasons, that’s up to you. Unless there is a major change in the city’s conduct, we’re not even revisiting this issue for a year. And there is no way we’re ever letting you destroy the city’s’ budget by dumping Arco on them. In the meantime, I really hope you can close this deal. Good luck boys”
At which point, the playing field between the city and team are flat. The Maloofs can’t afford to keep playing at Arco or alienating their fans with the fact it’s now their fault the deal isn’t getting closed. And KJ can’t wait forever because the makeup of his counsel or other relevant factors could change. A deal would be done sometime in 2012, probably in six weeks.
The NBA gets to keep Sacramento, they might get to drop the Maloofs in a way that defensible in court. On the face of the deal, they just gave the city more time. The unspoken reality is the Maloofs can take the fair deal now or risk going broke and complexly destroy the resale value of thier franchise fighting over a few million dollars. Either way, the league wins. Either way, the team stays here.
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