Sacramento will spend $750,000 defending itself in arena lawsuit

The city of Sacramento will spend $750,000 on attorney fees defending itself against a lawsuit charging that city officials offered backroom “secret subsidies” to the Kings as part of the $477 million arena deal approved last month, officials said Thursday.

City development officials will ask the City Council on Tuesday to set aside the $750,000 to cover past and future legal costs associated with the lawsuit filed by attorneys Patrick Soluri and Jeffrey Anderson on behalf of three citizens.

A Sacramento judge ruled that the lawsuit was legally insufficient last month because it was based on a preliminary term sheet approved last year by the City Council on the arena financing plan. Soluri and Anderson amended the lawsuit on Thursday now that the financing of the arena – which includes a public contribution of $255 million – has been formally approved by the City Council.

Soluri and Anderson did not return phone calls and emails seeking comment.

Their lawsuit charged that the city contribution to the arena released to the public did not include “secret” gifts to the Kings, including city-owned parking spaces at Downtown Plaza. The suit accuses the city of fraud and is seeking to block construction.

The city has said the garages are not worth anything, partly because of needed upgrades at the site, and that the details of the arena deal have been thoroughly publicized at public meetings and in the media.

The city has hired the law firm of Meyers Nave to assist its defense of the case. All of the money would come from the general fund, which supports most basic city services.

So far, the city has spent about $500,000 on the case, according to a city staff report. That effort has included responding to Public Records Act requests, taking part in depositions of public officials and arguing at court hearings.

Councilman Jay Schenirer, who asked city staff to compile the lawsuit’s cost to the city, said there is “absolutely no basis” for the lawsuit and said it was forcing the cash-strapped city to spend money on something it shouldn’t.

“It’s $750,000 that we cannot spend on police, that we cannot spend on community centers and that we cannot spend on providing services for young people – all of which should be our priorities,” he said.

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