Darrell Steinberg to introduce bill to force Kings to repay loan

#1
The legislation would state that "no California city can sign a lease with a professional franchise unless that franchise has paid off its existing debt to another city."

"Some might think that has something to do with our Sacramento Kings. It might, but the policy is really what is important to me," Steinberg said in an on-air interview.

"California, we're one state. We shouldn't have one city picking off another."

http://www.kfbk.com/cc-common/news/sections/newsarticle.html?feed=172730&article=8390674

http://blogs.sacbee.com/capitolaler...to-kings-repay-loan.html#mi_rss=Capitol Alert

Every little bit helps. :)
 
#2
The legislation would state that "no California city can sign a lease with a professional franchise unless that franchise has paid off its existing debt to another city."

"Some might think that has something to do with our Sacramento Kings. It might, but the policy is really what is important to me," Steinberg said in an on-air interview.

"California, we're one state. We shouldn't have one city picking off another."

http://www.kfbk.com/cc-common/news/sections/newsarticle.html?feed=172730&article=8390674

http://blogs.sacbee.com/capitolaler...to-kings-repay-loan.html#mi_rss=Capitol Alert

Every little bit helps. :)
As much as I disagree with everything Darrell Steinberg does, this makes a ton of sense.

It would be so stupidly unfair if they were able to leave Sacramento w/o paying back that loan and just "giving" Arco back to the City and giving the city a more or less worthless (until sold) stake in the Kings.
 
#3
As much as I disagree with everything Darrell Steinberg does, this makes a ton of sense.

It would be so stupidly unfair if they were able to leave Sacramento w/o paying back that loan and just "giving" Arco back to the City and giving the city a more or less worthless (until sold) stake in the Kings.
Plus, wouldn't that stake then take them down to less than 50% ownership? This is all getting very interesting.
 
#4
Plus, wouldn't that stake then take them down to less than 50% ownership? This is all getting very interesting.
Yes - it is getting interesting. The Maloofs are very much resembling homeowners who would choose to just "walk" from their properties instead of meeting their obligations.

The only difference here is that this is public money we're talking about on both sides of the equation. The Kings walking away from a 77 million dollar PUBLIC FUNDS obligation in Sacramento, and accepting PUBLIC FUNDS in Anaheim.

They can cry all they want about wanting the city out of their business, but when you accept corporate welfare, you can't say a damn thing.
 

Capt. Factorial

trifolium contra tempestatem subrigere certum est
Staff member
#5
"Some might think that has something to do with our Sacramento Kings. It might, but the policy is really what is important to me," Steinberg said in an on-air interview.
Not that I find this development a problem, but this line...yeah, I'm not believing that one, not one bit. It's a Kings-saving bill, period.
 

pdxKingsFan

So Ordinary That It's Truly Quite Extraordinary
Staff member
#6
I think its a logical bill but yeah it is totally a Kings saving bill. But California has a bit of a history with its cities bidding against themselves to try to lure sports teams from each other and it only results in upping the ante for everyone so I do think it is appropriate long term as well.
 
#7
Not that I find this development a problem, but this line...yeah, I'm not believing that one, not one bit. It's a Kings-saving bill, period.
Of course, but as this bill needs to be pushed through the proper legislative process, it's in Steinberg and the bill's best interest to maintain some type of facade that other legislators (and their constituents) stand to benefit in some regard from its transition into law. A Sacramento-centric campaign, however obvious it may be at the core, would be less likely to garner state-wide support in the Senate.

Is anyone familiar with Steinberg's past success with personally introduced legislation? How high should we get our hopes up?
 
#9
How quickly can this be pushed through legislature? I'm thinking that the Kings will try to get relocation passed before this goes to a vote. And if they do, I don't think they can be forced back to Sacramento if the league has already granted permission to relocate. Or am I wrong?
 

Glenn

Hall of Famer
#10
How quickly can this be pushed through legislature? I'm thinking that the Kings will try to get relocation passed before this goes to a vote. And if they do, I don't think they can be forced back to Sacramento if the league has already granted permission to relocate. Or am I wrong?
If they get relocation OK'd, does that mean they have to move no matter what or can they decide they don't want to leave? I suspoect the latter. No legislation can beat the NBA vote.
 
#11
It's basically to force the Maloofs to pay their bills rather than walking out on California business commitments only to profit on another California area. So he basically says that this company (MSE) should not turn their backs on one deal they have only to make money on another deal (all of which being in CA). This kind of thing can only hurt California, while the Maloofs profit.
 
#12
I am cautiously encouraged that Senator Correa is doing something other than gloating in this article.

Perhaps Senator Steinberg is really onto something with his proposed legislation.

http://www.ocregister.com/common/printer/view.php?db=ocregister&id=295145

O.C. lawmakers: Bill a threat to NBA Kings' move


By BRIAN JOSEPH


SACRAMENTO – Don't buy those season tickets just yet, Anaheim basketball fans. The leader of the California Senate says he's introducing legislation that could stop the Sacramento Kings from moving to Orange County.
Democrat Darrell Steinberg, a former Sacramento City Councilman and arguably one of the three most powerful officials in California, announced Tuesday that he intends to introduce a bill this week that would prevent a California city from signing a lease with a professional sports team if that team has outstanding debts with another California city. The Kings owe the city of Sacramento $77 million.
"This is pure business here," Steinberg said on KFBK radio in Sacramento. The Kings are "making a cold business decision. The city has the right to protect its bottom line."
For weeks, the Kings have been exploring a potential move to the Honda Center, where the Anaheim Ducks play. On March 29, the Anaheim City Council unanimously approved $75 million in bonds to make the arena ready to host an NBA team, and to help pay for the Kings' relocation costs. The owner of the Kings, the Maloof family, has until April 18 to file for relocation with the NBA.
The city of Sacramento has asked the Maloofs for a written guarantee that they will pay back the $77 million if they leave for Anaheim. The Maloofs say they'll pay their debts – if they ink a deal to move. That answer makes Sacramento officials nervous, Steinberg said.
"The Maloofs, in fairness to them, have always paid their debts on time," Steinberg said on KFBK. "But this is a changed circumstance. And if they are going to leave – of course, we hope that they're not going to – but if they do leave, then I think it's important that we protect the city's financial interest. The city, in this difficult economic time, can't afford to absorb $77 million."
Orange County lawmakers said Tuesday that they thought Steinberg's arguments are weak – Sacramento already has a repayment agreement with the Kings – but added that the senator's bill could pose a threat to the team's move.
"Darrell's looking to blow up the deal through legislation. And he just might do that," said Sen. Lou Correa, D-Santa Ana, whose district includes much of Anaheim. "I believe (the bill) will have some chilling effects on the transaction."
Steinberg has "a lot of clout," said Assemblyman Chris Norby, R-Fullerton, whose district also includes part of Anaheim. The senator has the power to push the bill through.
"I can't see him getting a lot of support," Norby said, "but you never know."
Norby said Steinberg's bill could impact other cities that are looking to bring in professional teams, which could turn some legislators against his proposal. Also standing in his way are lawmakers who see the Kings' potential move as an entirely private transaction.
"Legislation should not be used to address issues that are already addressed in a private contractual obligation," Correa said. "It's not the Legislature's business to be addressing such a private, arms-length transaction," he said.
 
#13
I am cautiously encouraged that Senator Correa is doing something other than gloating in this article.

Perhaps Senator Steinberg is really onto something with his proposed legislation.

http://www.ocregister.com/common/printer/view.php?db=ocregister&id=295145



O.C. lawmakers: Bill a threat to NBA Kings' move


By BRIAN JOSEPH


SACRAMENTO – Don't buy those season tickets just yet, Anaheim basketball fans. The leader of the California Senate says he's introducing legislation that could stop the Sacramento Kings from moving to Orange County.
Democrat Darrell Steinberg, a former Sacramento City Councilman and arguably one of the three most powerful officials in California, announced Tuesday that he intends to introduce a bill this week that would prevent a California city from signing a lease with a professional sports team if that team has outstanding debts with another California city. The Kings owe the city of Sacramento $77 million.
"This is pure business here," Steinberg said on KFBK radio in Sacramento. The Kings are "making a cold business decision. The city has the right to protect its bottom line."
For weeks, the Kings have been exploring a potential move to the Honda Center, where the Anaheim Ducks play. On March 29, the Anaheim City Council unanimously approved $75 million in bonds to make the arena ready to host an NBA team, and to help pay for the Kings' relocation costs. The owner of the Kings, the Maloof family, has until April 18 to file for relocation with the NBA.
The city of Sacramento has asked the Maloofs for a written guarantee that they will pay back the $77 million if they leave for Anaheim. The Maloofs say they'll pay their debts – if they ink a deal to move. That answer makes Sacramento officials nervous, Steinberg said.
"The Maloofs, in fairness to them, have always paid their debts on time," Steinberg said on KFBK. "But this is a changed circumstance. And if they are going to leave – of course, we hope that they're not going to – but if they do leave, then I think it's important that we protect the city's financial interest. The city, in this difficult economic time, can't afford to absorb $77 million."
Orange County lawmakers said Tuesday that they thought Steinberg's arguments are weak – Sacramento already has a repayment agreement with the Kings – but added that the senator's bill could pose a threat to the team's move.
"Darrell's looking to blow up the deal through legislation. And he just might do that," said Sen. Lou Correa, D-Santa Ana, whose district includes much of Anaheim. "I believe (the bill) will have some chilling effects on the transaction."
Steinberg has "a lot of clout," said Assemblyman Chris Norby, R-Fullerton, whose district also includes part of Anaheim. The senator has the power to push the bill through.
"I can't see him getting a lot of support," Norby said, "but you never know."
Norby said Steinberg's bill could impact other cities that are looking to bring in professional teams, which could turn some legislators against his proposal. Also standing in his way are lawmakers who see the Kings' potential move as an entirely private transaction.
"Legislation should not be used to address issues that are already addressed in a private contractual obligation," Correa said. "It's not the Legislature's business to be addressing such a private, arms-length transaction," he said.
Interesting. Correa's response sounds similar to Joe's when the letter was sent to Anaheim. It would appear some feathers are being ruffled.
 
#15
I'd like to hear some opinions from legislators hailing from areas that don't have a direct interest in this matter. Obviously the Senator and Assemblyman in that article would resist against Steinberg's bill, but are others actually wary of the precedent it could set here? If anything, it would protect the interests of California cities in the future not named Los Angeles or San Francisco.
 
#17
The legislation would state that "no California city can sign a lease with a professional franchise unless that franchise has paid off its existing debt to another city."

"Some might think that has something to do with our Sacramento Kings. It might, but the policy is really what is important to me," Steinberg said in an on-air interview.

"California, we're one state. We shouldn't have one city picking off another."

http://www.kfbk.com/cc-common/news/sections/newsarticle.html?feed=172730&article=8390674

http://blogs.sacbee.com/capitolaler...to-kings-repay-loan.html#mi_rss=Capitol Alert

Every little bit helps. :)
Strange language. It can be interpreted to mean that CA may have trouble attracting teams from outside the state. I'd want the clause to say that, "no California city can sign a lease with a professional franchise unless that franchise has paid off its existing debt to another California city if one is owed". Or you could word the original clause to say that the clause only applies where only California cities are involved.

Still, what is the statutory penalty if the Maloofs don't pay? This is usually a contract matter, but Steinberg is trying to turn it into something else.
 
#18
Ya and the funny part is the last sentence because it's not a private transaction these are public funds.
Well, the funds are actually private funds loaned by the investors who purchased shares of the bond. The city guarantees loan repayment to the bond holders.

It is interesting. There will be revenue from the arena for a while that could be applied to the loan repayment. The loan is also ahead of schedule on loan repayment. I am curious to see how this all works out, if the Kings leave. The Maloofs say they'll pay the city back.

We'll know soon enough and won't have to speculate anymore.
 
#19
Well, the funds are actually private funds loaned by the investors who purchased shares of the bond. The city guarantees loan repayment to the bond holders.

It is interesting. There will be revenue from the arena for a while that could be applied to the loan repayment. The loan is also ahead of schedule on loan repayment. I am curious to see how this all works out, if the Kings leave. The Maloofs say they'll pay the city back.

We'll know soon enough and won't have to speculate anymore.
Your key statement here is that the City guarantees loan payment to the bond holders, which makes the funds public.

No-one can complain about anybody getting into anybody else's business because they have a massive public funds loan they're probably going to go deadbeat on, and they're going to accept more public funds moving to Anaheim.

It would be a colossal disaster to the NBA if they were allowed to do this without fully making good on the loan. As much as I politically disagree with Steinberg on just about everything, this bill just makes plain sense. Why would we allow a professional sports franchise accept public funds from one city in California only to leave behind a large unpaid debt in another?
 

Glenn

Hall of Famer
#20
We'll know soon enough and won't have to speculate anymore.
Let it happen soon. It caused a brief (pun) tightening of the shorts in OC. We're throwing everything but the kitchen sink at this issue and I love it. I'm working on the sink but my back hurts and doubt if I could get it out the front door. No stone should be left unturned.

Love it!
 
#21
Well, the funds are actually private funds loaned by the investors who purchased shares of the bond. The city guarantees loan repayment to the bond holders.

It is interesting. There will be revenue from the arena for a while that could be applied to the loan repayment. The loan is also ahead of schedule on loan repayment. I am curious to see how this all works out, if the Kings leave. The Maloofs say they'll pay the city back.

We'll know soon enough and won't have to speculate anymore.
The money maybe private, but the bonds are a public fund. They use the city's credit and authority to issue them.