http://sacramento.bizjournals.com/sacramento/stories/2004/11/01/story8.html
Fargo has reservations about latest arena finance plan
Kelly Johnson, Sacramento Business Journal, 10-29-04
Sacramento Mayor Heather Fargo says she has reservations about county Sheriff Lou Blanas' embryonic plan to finance a new arena for the Kings by accelerating development in North Natomas.
Some colleagues on the City Council are also withholding judgment, although several say the private financing plan is promising.
Last month, Blanas outlined a plan on behalf of landowners who control up to 10,000 acres of undeveloped property. They would give 20 percent of their proceeds from future property sales to a nonprofit to help build a new arena, plus support arts and youths' programs. In exchange, their land would get developed years earlier than it would otherwise.
Sports observers say the Kings will need a new arena by the end of the decade, but two previous efforts to pay for a new Sacramento venue -- in the downtown railyard, and later at 7th and K streets -- have collapsed during the past two years from the high cost, public opposition or requirements that the Kings' owners pay much of the tab.
The main problems with the Blanas plan, Fargo said, are that expediting development there could undercut key development projects closer to the central city.
Also, whenever the area in question is developed, the city should make the land-use decisions, she said. Not the county.
"We need to separate the land-use decisions from the arena issue," Fargo said.
Other council members are interested.
One yes, several maybes, no nos: "Right now I'm for checking out any and all plans" that serve the best interests of the city and region, said Councilwoman Bonnie Pannell. "This is just another plan we're exploring."
But Natomas should be developed before growth heads farther north, she said. "We need to complete what we started."
The Blanas plan appears well thought out, Councilman Steve Cohn said, and he's open to the idea of private financing.
His sense of Blanas' plan is that the north-area land would be annexed to the city before it was developed.
The plan isn't a problem, he said, if it follows the joint vision the city and county agreed to in 2002 for annexing the 10,000 acres to the city and sharing tax revenues.
Likewise, Pannell would prefer the land to be in the city when development begins.
"If all of that can be done without other strings attached, I think people will be supportive," Cohn said.
"I'm cautiously optimistic," Councilwoman Lauren Hammond said. "The city of Sacramento emphatically does not believe in public financing for an arena.
"I'm intrigued by it," she continued, saying much more needs to be worked out. Any accelerated development in the joint vision area, she said, cannot "disrespect or harm North Natomas."
Building an arena alone doesn't justify faster growth to the north, she said. Enough money must be raised to fund charities too; she prefers after-school programs for middle and high school students.
Councilman Jimmie Yee has no reservations. "I think it's a great idea," he said.
"I understand what the mayor is saying." But the land wouldn't be developed overnight, he added. "It's not tomorrow. We're talking probably 15 years from now. Look how long Natomas has taken. It's taken us 20 years."
Councilman Dave Jones said he is waiting to hear more about Blanas' proposal.
There's much more to know, Councilwoman Sandy Sheedy said. "It sounds interesting. I really need to know what are the parts of this puzzle."
Is the county willing to annex the land to the city? Do developers support the plan? Will voters want this?
"The bigger issue is," Sheedy said, "has anyone spoken to the Kings?"
Councilmen Ray Tretheway and Robbie Waters could not be reached for comment for this story.
"It's the only alternative on the table right now," Fargo said. But she said it isn't the only option for funding an arena.
Blanas' group has the ball: Fargo, who said lately she has been focusing on ballot measures important to the city, said the city's lack of fiscal strength keeps it from moving forward on an arena funding plan.
"Yeah, it would be really great to have this, but how do we do it? It's like wanting a Mercedes when you can afford a used Pontiac."
She's giving Blanas and other proponents of the Natomas plan time to work on it. She said that group still needs to talk to the Maloof family, who owns the Kings.
"There's nothing new to update," sheriff's spokesman Sgt. R.L. Davis said this week. "They're still continuing to meet."
After the election, Fargo said, she can re-initiate arena talks. She isn't thinking along any timelines, even as rumors persist that other cities are courting the Kings.
Maloof Sports & Entertainment hasn't given the city any deadline for a plan to replace Arco, she said. "They have not been threatening at all in their conversations with us."
Fargo said she has had no formal discussions with the Maloof organization since August. That's when Maloof executives objected to the council's decision, in a ballot measure then being considered, to cap public financing for a new sports and entertainment arena at $175 million.
Since then, Maloof executives have avoided public comment on arena issues.
Money and locations: If Blanas' plan gels, the arena could still end up downtown, Fargo noted. That's her preference, though other locations could work.
"Our financial interest goes down if it's not downtown," she said.
If money were no object, Cohn said he'd like a downtown venue. But money matters, so the amount raised would dictate the arena location.
Trying to keep the Kings makes sense, Fargo said, because the NBA team is important to the city and region.
Even with the sheriff's plan, processing the land entitlements could take at least three to five years, and selling the land could take another 10 or 15 years.
Some city officials, according to people familiar with the discussion, are mulling whether to ask voters next year to approve the land development and other terms of the financing. The initiative would call for a bridge loan -- possibly $300 million to $500 million -- to finance the arena's construction until fees from the sale of the Natomas land pour in to repay it.
Fargo has reservations about latest arena finance plan
Kelly Johnson, Sacramento Business Journal, 10-29-04
Sacramento Mayor Heather Fargo says she has reservations about county Sheriff Lou Blanas' embryonic plan to finance a new arena for the Kings by accelerating development in North Natomas.
Some colleagues on the City Council are also withholding judgment, although several say the private financing plan is promising.
Last month, Blanas outlined a plan on behalf of landowners who control up to 10,000 acres of undeveloped property. They would give 20 percent of their proceeds from future property sales to a nonprofit to help build a new arena, plus support arts and youths' programs. In exchange, their land would get developed years earlier than it would otherwise.
Sports observers say the Kings will need a new arena by the end of the decade, but two previous efforts to pay for a new Sacramento venue -- in the downtown railyard, and later at 7th and K streets -- have collapsed during the past two years from the high cost, public opposition or requirements that the Kings' owners pay much of the tab.
The main problems with the Blanas plan, Fargo said, are that expediting development there could undercut key development projects closer to the central city.
Also, whenever the area in question is developed, the city should make the land-use decisions, she said. Not the county.
"We need to separate the land-use decisions from the arena issue," Fargo said.
Other council members are interested.
One yes, several maybes, no nos: "Right now I'm for checking out any and all plans" that serve the best interests of the city and region, said Councilwoman Bonnie Pannell. "This is just another plan we're exploring."
But Natomas should be developed before growth heads farther north, she said. "We need to complete what we started."
The Blanas plan appears well thought out, Councilman Steve Cohn said, and he's open to the idea of private financing.
His sense of Blanas' plan is that the north-area land would be annexed to the city before it was developed.
The plan isn't a problem, he said, if it follows the joint vision the city and county agreed to in 2002 for annexing the 10,000 acres to the city and sharing tax revenues.
Likewise, Pannell would prefer the land to be in the city when development begins.
"If all of that can be done without other strings attached, I think people will be supportive," Cohn said.
"I'm cautiously optimistic," Councilwoman Lauren Hammond said. "The city of Sacramento emphatically does not believe in public financing for an arena.
"I'm intrigued by it," she continued, saying much more needs to be worked out. Any accelerated development in the joint vision area, she said, cannot "disrespect or harm North Natomas."
Building an arena alone doesn't justify faster growth to the north, she said. Enough money must be raised to fund charities too; she prefers after-school programs for middle and high school students.
Councilman Jimmie Yee has no reservations. "I think it's a great idea," he said.
"I understand what the mayor is saying." But the land wouldn't be developed overnight, he added. "It's not tomorrow. We're talking probably 15 years from now. Look how long Natomas has taken. It's taken us 20 years."
Councilman Dave Jones said he is waiting to hear more about Blanas' proposal.
There's much more to know, Councilwoman Sandy Sheedy said. "It sounds interesting. I really need to know what are the parts of this puzzle."
Is the county willing to annex the land to the city? Do developers support the plan? Will voters want this?
"The bigger issue is," Sheedy said, "has anyone spoken to the Kings?"
Councilmen Ray Tretheway and Robbie Waters could not be reached for comment for this story.
"It's the only alternative on the table right now," Fargo said. But she said it isn't the only option for funding an arena.
Blanas' group has the ball: Fargo, who said lately she has been focusing on ballot measures important to the city, said the city's lack of fiscal strength keeps it from moving forward on an arena funding plan.
"Yeah, it would be really great to have this, but how do we do it? It's like wanting a Mercedes when you can afford a used Pontiac."
She's giving Blanas and other proponents of the Natomas plan time to work on it. She said that group still needs to talk to the Maloof family, who owns the Kings.
"There's nothing new to update," sheriff's spokesman Sgt. R.L. Davis said this week. "They're still continuing to meet."
After the election, Fargo said, she can re-initiate arena talks. She isn't thinking along any timelines, even as rumors persist that other cities are courting the Kings.
Maloof Sports & Entertainment hasn't given the city any deadline for a plan to replace Arco, she said. "They have not been threatening at all in their conversations with us."
Fargo said she has had no formal discussions with the Maloof organization since August. That's when Maloof executives objected to the council's decision, in a ballot measure then being considered, to cap public financing for a new sports and entertainment arena at $175 million.
Since then, Maloof executives have avoided public comment on arena issues.
Money and locations: If Blanas' plan gels, the arena could still end up downtown, Fargo noted. That's her preference, though other locations could work.
"Our financial interest goes down if it's not downtown," she said.
If money were no object, Cohn said he'd like a downtown venue. But money matters, so the amount raised would dictate the arena location.
Trying to keep the Kings makes sense, Fargo said, because the NBA team is important to the city and region.
Even with the sheriff's plan, processing the land entitlements could take at least three to five years, and selling the land could take another 10 or 15 years.
Some city officials, according to people familiar with the discussion, are mulling whether to ask voters next year to approve the land development and other terms of the financing. The initiative would call for a bridge loan -- possibly $300 million to $500 million -- to finance the arena's construction until fees from the sale of the Natomas land pour in to repay it.
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