SEATTLE – NBA Commissioner David Stern, widely thought to be a strong supporter of moving the Sacramento Kings to Seattle, has been working to bolster efforts to keep the Kings in place.
Multiple sources suggested Wednesday that a split has emerged between Stern and team owners over the fate of the Kings. Those sources, spanning the league and governments in Sacramento and Seattle, said Stern has been quietly maneuvering behind the scenes to propel a Sacramento counter bid. They said he has been personally seeking investors to join a new Kings ownership group -- even after several NBA team owners last week indicated their willingness to move the franchise to Seattle.
Seattle investors Chris Hansen, Steve Ballmer, and Pete and Erik Nordstrom have a signed purchase agreement for 65 percent of the Kings franchise, which would be revalued at $525 million.
Sacramento has scrambled since the Seattle deal was announced in January to put together a term sheet for an arena deal and investor group to counter the Hansen-led bid. Billionaire Ron Burkle was expected to join the Sacramento effort, but dropped out of the investment group this week citing a business conflict. Burkle has an ownership stake in Relativity Media, which has a division representing NBA players.
A league source said the conflict was just one factor in Burkle's decision. Burkle “wasn’t all that fired up about this deal," the source said.
Sacramento Mayor Kevin Johnson introduced developer Mark Friedman Tuesday as Burkle's replacement, and said the league was OK with the recent developments in Sacramento's evolving counter-proposal.
Both sides made formal presentations to a select group of NBA owners last week in New York City. Sources with knowledge of both presentations said the second half of the Sacramento presentation was “poor" -- based more on “vision than fact.” Burkle was in the room for the Sacramento presentation, and Johnson said questions were asked about Burkle’s potential conflict.
A key source indicates Hansen told owners he has an agreement, as of last month, with the City of Seattle to operate Key Arena. That deal would have to be approved by the city council if league owners sign off on Hansen’s purchase of the Kings.
Sources also said Hansen has now put a price tag on potential Regional Television Network revenues in Seattle – more than $40 million a year, or more than 80 percent more than what was estimated for Sacramento in a like deal. The number was used to illustrate the support for an NBA franchise and potential to pay down debt associated with construction of a new arena.
Hansen’s team told NBA owners that is believes construction of a new arena in Seattle is further along than Sacramento's, and that there are still many unanswered questions with the Sacramento plan, according to sources. They include questions about land acquisition, financing, and the impact of California Assembly Bill 900.
An Alameda County Judge struck down the bill last week, and declared it unconstitutional. Sacramento Arena supporters suggested the law, which deals with streamlining environmental reviews of major projects, would give Sacramento an edge over Seattle.
King County Executive Dow Constantine said last week this was a key point in the presentation. Hansen told owners he believed a new Seattle arena could open in September 2015, according to those people with knowledge of the presentation. That would be earlier than previously expected. A source said a Master Use Permit could be filed as early as next week.
Several people with knowledge of the process said Wednesday that owners were impressed by the scope of the presentation, and several appeared to be leaning Seattle’s way.
However, the Sacramento Bee reported Wednesday that the Maloofs had given the competing group until Friday to come up with a matching, binding, “back-up offer." A source with knowledge of the negotiations said there is “no matching offer” and the numbers are still “way off."
A NBA spokesperson did not respond to a request for comment on today’s developments.
Both Johnson and sources close to the Seattle group said earlier this week that a league vote could come as early as next week. However, multiple people with knowledge of the negotiations said Wednesday it is still unclear whether a vote will be taken. A simple majority is needed to approve relocation, but at least 23 owners need to vote to approve the sale.