New Downtown Arena

[BDP]

That's a good point. Did the team say they'd pay $50 million, still pay rent, and not request our share of revenue from other events or we'll pay $X, pay less in rent, and request their proportionate share of money on other events? Or did that stuff even factor into the negotiation...

So, how did we come up with these numbers for our new arena?

Yeah, there is a lot of just "fill in the blanks" going on at this point. So, of course, whatever anyone is predisposed to feeling about civics projects that benefit specific private parties, they're just going to fill in those blanks in a way that supports that position.

Honestly, as of right now, if we were voting on it today, I'd be like "vote for what, exactly?".

[dankrutka]

This is a business not a charity. If this doesn't pass ownership cashes out as expansion looms and valuations skyrocket.

Historically, owning. sports team has not been a business. This is an old article from Grantland about why people buy sports teams.

I find it hard to believe that OKC's ownership group would just sell after one vote didn't go there way. Surely they'd do some negotiating and call for another vote. This the-team-will-leave-if-this-fails feels like just creating leverage to win this election. And it'll probably work.

[MagzOK]

Here's a question that needs to be answered:

Has any other city provided 95% in public funding for an NBA arena?


I mentioned the Milwaukee deal where the public portion was less than 50%. I see a $1.3B arena on the boards in Philly that will be completely privately funded. The highest percentage of public funds I can find was 58% by Detroit -- and obviously, that city has very serious economic development issues, totally unlike OKC. Detroit also leveraged all types of resources, some of them federally funded.

So, how did we come up with these numbers for our new arena?

Good questions. It bothers me that there are people okay with moving forward no questions asked just to keep a team here, or anywhere for that matter. Arguing against those that are asking questions meanwhile they don't know the answers -- Just okay with writing a check or just simply continuing a tax carte blanche without knowing any of these details.

[dankrutka]

One of the primary themes of Boomtown is that OKC citizens will go for any thing. Super sonic jets (Operation Bongo), TEEMCO scams, backroom deals. Oklahomans will approve it all. It's like a democratic process is seen as rude to our corporate overlords who gifted us with basketball. More transparency is a good thing.

[BoulderSooner]

I

I think if she can frame her argument as being for the arena b.

don't get it twisted she is not for the new arena

[Pete]

One of the primary themes of Boomtown is that OKC citizens will go for any thing. Super sonic jets (Operation Bongo), TEEMCO scams, backroom deals. Oklahomans will approve it all. It's like a democratic process is seen as rude to our corporate overlords who gifted us with basketball. More transparency is a good thing.

Yes, it's a very weird aspect of our civic culture and something that I've been talking about since I moved back here.

When I was interviewing dozens of people about the TEEMCO scandal, a prominent local attorney said to me in a very matter-of-fact manner: "OKC is a great place for a scam."

It immediately resonated with me because he, like so many here, was so resigned to this state of affairs. It was and is disturbing.


Absolutely anything presented as economic development is quickly and resoundingly approved with far too little analysis or outside perspective and almost zero transparency. And as is always the case with billions of dollars of free money at stake, plenty have learned how to game the system.

[Pete]

Honestly, as of right now, if we were voting on it today, I'd be like "vote for what, exactly?".

The vote will be for a 72-month $.01 sales tax increase that will allocate at least $900 million of those public funds for the new arena.

The MAPS 4 money has already been allocated.

The lease and details will not be up for public vote and ultimately they will be handled in a similar manner: closed-door meetings to negotiate, private meetings with council members to gauge their support, then a quick appearance on a public agenda and then a near-unanimous approval by City Council.

[BDP]

In addition to comparing arenas in peer cities based on demographics, another way to look at it is cities with only one major league sports franchise. Here's the wiki info for each city's arena that only has an NBA team. Most of these are older and cheaper facilities. Golden 1 is the most recent deal:

Orlando Arena (Amway Arena):
In the agreement, the City of Orlando will take ownership of the new arena, while the Magic will control the planning and construction of the facility so long as contracting procedures are done in the same public manner as governments advertise contracts. In addition, the city will be paid a part of naming rights and corporate suite sales, a share estimated to be worth $1.75 million the first year of the arena's opening. The Magic will receive all proceeds from ticket sales for Magic games, while the city will receive all proceeds from ticket sales to all other events.[10] The Orlando Magic will contribute at least $50 million in cash up-front, pick up any cost overruns, and pay rent of $1 million per year for 30 years. The City of Orlando will pay for the land and infrastructure. The remaining money will come from bonds which will be paid off by part of the Orange County Tourist Development Tax, collected as a surcharge on hotel stays, which was raised to 6% in 2006. The Magic will guarantee $100 million of these bonds.

Memphis Arena (FedEx Forum):
It was built at a cost of US$250 million and is owned by the City of Memphis; naming rights were purchased by one of Memphis's best-known businesses, FedEx, for $92 million. FedExForum was financed using $250 million of public bonds, which were issued by the Memphis Public Building Authority (PBA).

San Antonio (Frost Bank Center):
It was opened in 2002 as the SBC Center, at a cost of US$175 million, financed by county-issued bonds, which were supported by a hotel-occupancy and car-rental tax increase and an additional contribution of $28.5 million from the Spurs.

Salt Lake City (delta Center):
Under the leadership and private financing of Utah businessman Larry H. Miller, ground was broken on May 22, 1990, and it was completed on October 4, 1991, in time for late-October basketball games, at a cost of $93 million ($200 million in 2022 dollars).

Portland (Moda center):
Construction began in 1993, and the arena opened on October 12, 1995. The arena cost US$262 million to build; construction was financed with funds obtained by a variety of sources, including the City of Portland, Allen's personal fortune, and $155 million in bonds issued by a consortium of mutual funds and insurance companies.[10] These bonds would become the subject of an acrimonious 2004 bankruptcy in which the Oregon Arena Corporation, the holding company which owned the arena at the time, would forfeit title to the arena in lieu of repaying the bonds per the payment terms.[11] Allen would later repurchase the arena from the creditors in 2007

Sacramento (Golden 1 Center)
The Sacramento City Council voted approval of public financing and other terms on May 20, 2014.[15] The total cost of Golden 1 Center was once estimated to be $507 million. The Sacramento Kings contributed approximately $284 million and the City of Sacramento contributed approximately $223 million. The City of Sacramento financed its contribution through the sale of bonds ($212 million) and parking and economic development funds ($11 million).
Construction costs of the new Golden 1 Center increased to $534.6 million due to a change in the seating configuration that moved hundreds of seats to the lower bowl and closer to the basketball court and additional features

[BDP]

The lease and details will not be up for public vote and ultimately they will be handled in a similar manner: closed-door meetings to negotiate, private meetings with council members to gauge their support, then a quick appearance on a public agenda and then a near-unanimous approval by City Council.

Which is really the part that puts the team's initial contribution in context, imo. So, I'm sure you are correct in how that will go down, but it's unfortunate and leaves a blind spot when making a voting decision.

[BoulderSooner]

and out-right manipulation to move the team to OKC .

i don't think that is a fair characterization at all ..

[Pete]

i don't think that is a fair characterization at all ..

You think they bought that team and negotiated in good faith to keep them in Seattle?

If so, you'd be the only one.

The Sordid Deal That Created The Okla. City Thunder


And Aubrey was fined $250K by the NBA for saying the quiet part out loud:

A few months later McClendon was interviewed about the Sonics by the Oklahoma Journal-Record. He said, "We didn't buy the team to keep it in Seattle; we hoped to come here. We know it's a little more difficult financially here in Oklahoma City, but we think it's great for the community and if we could break even we'd be thrilled."

[April in the Plaza]

Have any of y’all filed a FOIA request or would that be a complete waste of time?

[Pete]

Have any of y’all filed a FOIA request or would that be a complete waste of time?

For what, exactly?

They have outlined the terms and they would merely claim about the rest (like the lease or the location) that nothing has been decided.

[BoulderSooner]

You think they bought that team and negotiated in good faith to keep them in Seattle?

If so, you'd be the only one.

The Sordid Deal That Created The Okla. City Thunder


And Aubrey was fined $250K by the NBA for saying the quiet part out loud:

and if seattle had built a new arena he said that part out loud also .. they would resell it for a sweet flip .. they didn't really ask for anything different then the seahawks and mariners got .

[April in the Plaza]

For what, exactly?

They have outlined the terms and they would merely claim about the rest (like the lease or the location) that nothing has been decided.

Would be interested to see how they settled on the $50M number for ownership.

[Pete]

and if seattle had built a new arena he said that part out loud also .. they would resell it for a sweet flip .. they didn't really ask for anything different then the seahawks and mariners got .

What he said -- and what he got fined for -- was that it was always their intention to move the team to OKC.

Absolutely everyone knew this, Aubrey even said it, Schultz tried to rescind the deal... Look, I'm as happy as anyone the Thunder are here but there is no way you can honestly say the ownership negotiated in good faith with Seattle. In fact, I seriously doubt you'll find anyone outside of OKC that believes that for a second.

[chssooner]

This is $50 million, plus rent of the new arena. So whatever that lease term and amount is, that amount will be added to the $50 million.

[Pete]

This is $50 million, plus rent of the new arena. So whatever that lease term and amount is, that amount will be added to the $50 million.

No.

We are talking about the cost to build the arena.

[Jake]

Other than the fact that the deal is bad, worried this will dissuade the public from voting for the RTA when that comes down the line.

“We’re already paying a billion dollars for an arena, we don’t need no trains.”

[PoliSciGuy]

Other than the fact that the deal is bad, worried this will dissuade the public from voting for the RTA when that comes down the line.

“We’re already paying a billion dollars for an arena, we don’t need no trains.”

That's a real good point. The overall cost of the arena itself is just one of the economic impacts here. We need to look at the opportunity costs (what else could/should this money be used towards?) and downstream impact on enthusiasm for civic funding.

[onthestrip]

The vote will be for a 72-month $.01 sales tax increase that will allocate at least $900 million of those public funds for the new arena.

The MAPS 4 money has already been allocated.

The lease and details will not be up for public vote and ultimately they will be handled in a similar manner: closed-door meetings to negotiate, private meetings with council members to gauge their support, then a quick appearance on a public agenda and then a near-unanimous approval by City Council.

These are the important details imo. What are the lease terms compared to other teams. Also, what guarantees that they'll stay through 2050? If its some kind of penalty, it will need to be huge for them to break the lease. A $50 million penalty to break the lease in 2035 will be nothing when the team is sold for over $2 billion. More skin in the game from ownership is a great way to ensure they'll be here for a long time too. Just some questions that would be great to have answered.

[PhiAlpha]

What he said -- and what he got fined for -- was that it was always their intention to move the team to OKC.

Absolutely everyone knew this, Aubrey even said it, Schultz tried to rescind the deal... Look, I'm as happy as anyone the Thunder are here but there is no way you can honestly say the ownership negotiated in good faith with Seattle. In fact, I seriously doubt you'll find anyone outside of OKC that believes that for a second.

I don’t think anyone is doubting that. They proposed what was a very expensive arena at the time in Renton so that it wouldn’t get approved and they would have an excuse to relocate and say “see, we tried” which is where the bad faith came in. Though if for some reason it had been approved, I do think they would have sold the team for a profit and moved on to another option.

[chssooner]

Well, I guess it's a no from most of the OKCTalk community. Glad we got that settled.

[Teo9969]

If both of the below statements are true, then I think this is a "No" for me.

1. We have no details of the lease with the city. - Knowing that other cities have routinely gotten $200M (and a greater percentage of overall cost) would require the terms of the lease were super favorable for Oklahoma City. The problem with that presents is highlighted by Urbanized's earlier post: Owners may be looking to sell. Anyone who is about to sell a major asset is not going to lock themselves into an unfavorable lease. Let OKC pay "it's fair share" on the backend since we'd be fronting the bulk of the cost anyway.

2. Significant detail as to the "public" amenities/features are not revealed with the press package. - $1B needs to bring with it needs that have a minority usage as a result of Thunder activity. For example, certain vending sites and/or business suites are used almost exclusively for Thunder events. If OKC is going to invest $900M into infrastructure, a portion of that infrastructure needs to be used daily/weekly etc and for things that have nothing to do with the Thunder or even large scale entertainment.

If we get information on one of the above and it becomes clear this is a good deal for the city, great.

OKC is a great city way beyond the Thunder. We don't need to take significantly worse deals than other cities have received.

[chssooner]

If both of the below statements are true, then I think this is a "No" for me.

1. We have no details of the lease with the city. - Knowing that other cities have routinely gotten $200M (and a greater percentage of overall cost) would require the terms of the lease were super favorable for Oklahoma City. The problem with that presents is highlighted by Urbanized's earlier post: Owners may be looking to sell. Anyone who is about to sell a major asset is not going to lock themselves into an unfavorable lease. Let OKC pay "it's fair share" on the backend since we'd be fronting the bulk of the cost anyway.

2. Significant detail as to the "public" amenities/features are not revealed with the press package. - $1B needs to bring with it needs that have a minority usage as a result of Thunder activity. For example, certain vending sites and/or business suites are used almost exclusively for Thunder events. If OKC is going to invest $900M into infrastructure, a portion of that infrastructure needs to be used daily/weekly etc and for things that have nothing to do with the Thunder or even large scale entertainment.

If we get information on one of the above and it becomes clear this is a good deal for the city, great.

OKC is a great city way beyond the Thunder. We don't need to take worse deals than other cities have received.

It has literally nothing of note nationally, aside from the Thunder. If you can't realize that, then I don't know what to say. A person in Milwaukee or Salt Lake doesn't even know OKC exists without the Thunder.

I do wish there was a way to talk to Mayor Holt about it, and see the steps. Could always request it, but I doubt he would say yes.

But what other uses would an arena have? I want to have my "book club" meeting in the middle of the arena, and because I'm paying for it, I should totally be able to? It's for sporting events and concerts/rodeo/wrestling/etc.