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An artist's rendering shows the arena – the oval-shaped building at center – proposed for the Downtown Plaza site by the investors hoping to buy the Sacramento Kings. The blue buildings at left are towers envisioned on J Street as part of a development plan to re-energize downtown.

Lawsuit signaled over Sacramento's arena plan

Published: Wednesday, Apr. 3, 2013 - 12:00 am | Page 1B
Last Modified: Monday, Sep. 23, 2013 - 8:09 am

With Sacramento about to plead its case for keeping the Kings in town, two lawyers served notice Tuesday that they will sue the city to block its deal for a new downtown arena.

Sacramento attorneys Patrick Soluri and Jeffrey Anderson, representing a group called the Coalition for Responsible Arena Development, filed a "notice of intent" to sue the city in Sacramento Superior Court. The two say the city's non-binding $448 million arena deal violates the state's constitution and environmental law.

City officials said they are confident the arena deal can withstand any litigation.

The notice was part of a last-minute flurry of activity on the eve of a meeting in New York today that could prove pivotal in the fight for the Kings. Delegations from Sacramento and Seattle will make competing presentations to a committee of NBA team owners on why their city is deserving of the team.

Senate President Pro Tem Darrell Steinberg, D-Sacramento, announced Tuesday he would join the Sacramento contingent, which includes Mayor Kevin Johnson and three of the investors bidding to keep the Kings in town. Steinberg, who has met before with NBA executives, said he's going to New York to assure league officials of the community's commitment to the Kings.

Meanwhile, Seattle's lead investor Chris Hansen announced that he received requests for 44,877 season tickets should the team relocate. That's four times as many as a Sacramento grass-roots group mustered.

Hansen and Microsoft CEO Steve Ballmer agreed in January to buy the Maloofs' controlling interest in the Kings for $341 million. Members of the Maloof family were expected in New York today, but a source said they aren't expected to attend today's presentation. Hansen is expected to play the lead role in making Seattle's case.

The leaders of Sacramento's counteroffer, software tycoon Vivek Ranadive, Southern California billionaire Ron Burkle and East Bay financier Mark Mastrov, are expected to join the mayor and Steinberg in making the presentation.

Late Tuesday afternoon, Kings fans and members of the mayor's entourage gathered at a Manhattan bar to show their support for the Sacramento effort.

"I have great faith in the mayor," said Sacramento businessman Phil Oates, part of a local group that's pledged financial support for the team. "We haven't come this far to stumble (today)."

Asked about the nearly 45,000 ticket requests announced by Hansen, Johnson's spokesman Ben Sosenko noted that Sacramento outdrew the Seattle SuperSonics during 20 of the 23 years that both cities were in the NBA.

Late Tuesday, the mayor said on Twitter that one of the Kings' current limited partners had matched the $15 million offer the Seattle group's Hansen made for a 7 percent share of the Kings being sold in bankruptcy court. Under the partnership rules, that means the partner gets to buy the share, not Hansen.

The mayor didn't identify the limited partner. But one of the partners, John Kehriotis, said he was told by Johnson that Sacramento businessman David Lucchetti is the person who is matching.

Lucchetti, who owns 1 percent of the team, declined comment.

A crucial piece in the war for the Kings – in both cities – is the development of a new arena.

On March 26, the Sacramento City Council approved a term sheet laying out the tentative financing for a $448 million arena at Downtown Plaza. The city would contribute $258 million.

Soluri and Anderson threatened litigation weeks ago, before the term sheet was approved. They still haven't said who is in their coalition and who will pay for the planned lawsuit. They couldn't be reached for comment Tuesday.

In the court filing, they assert that the city's contribution is "an unlawful gift of public funds" because there's no evidence the arena would be an economic sparkplug. Also, they claim, the vote violates the California Environmental Quality Act because the city hasn't yet conducted environmental reviews.

City officials rejected both claims. City Attorney James Sanchez said courts have ruled that public subsidies are permitted on projects that eliminate blight and create jobs. And he said the needed environmental studies would take place before the council makes a final commitment to spend money on the arena.

Call The Bee's Tony Bizjak, (916) 321-1059. Follow him on Twitter @tonybizjak.

© Copyright The Sacramento Bee. All rights reserved.



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