The Sacramento City Council is being asked to write its first big check for the development of a new downtown sports arena.
City development staff will ask the council at its meeting Tuesday night to free up $6.5 million in city cash, some of which will be used to hire a team of financial, design and legal consultants. The money is included within the $258 million subsidy the city has proposed contributing to the $447 million arena project at Downtown Plaza.
Of the funding, city staff has proposed using $1.78 million for consultants. The rest of the money would be used for the construction of the arena if a financing and development plan is approved by the council following the completion of an environmental review next year.
Most of the money being sought on Tuesday - $5 million - is from proceeds the city generated when it sold the downtown Sheraton to developer David Taylor in 2008. Under an agreement with Taylor, those proceeds must be used for downtown development. Taylor has agreed to allow the $5 million be spent on the arena.
The other $1.5 million city staff is seeking would come from the city's parking fund.
Desmond Parrington, the city's project manager for the arena, said the public contribution to the project would not change. The city plans to contribute $212.5 million from revenue bonds backed by downtown parking operations, $38 million worth of land, the Sheraton and parking fund money, and $1 million in sales tax receipts.
Parrington said the team of consultants is needed as the city begins negotiations on the "definitive agreements" of an arena financing and construction plan with the private investment team that owns the Sacramento Kings. The council approved a preliminary term sheet in March.
"We don't anticipate any major disagreements with the ownership group," Parrington said. "Given the complexity of this project, we need to bring on someone with technical expertise. We've never built an arena before. This is a new endeavor for the city and it's got to be done right."
The city manager's office has proposed spending $550,000 on legal counsel. Other contracts include $200,000 for Barrett Sports Group to serve as an arena financing adviser, $250,000 for Weston Sports and Entertainment to consult on the project's design and construction elements, and $425,000 to Walker Parking to analyze the city's parking assets.