First of all, why is this so important to the citizens and City of Seattle?

Are the streets and sidewalks all fine?
Schools?
Social services?
Infrastructure?

Because if these (and many other civic needs) aren't taken care of, the LAST thing our City should be worrying about is an arena for a bunch pituitary cases (and their wealthy benefactors). Priorities, folks.

"Traffic fixes are required in the Sodo area, and the Port of Seattle and its neighbors, including the Hansen group, should get on the city's case to d"emand them. The Hansen group should not be expected to pay for them.

They will create more traffic but are not responsible for mitigating it? Right there, you have the problem. Why do these people get all the benefits of the City's help and yet the City's comes out with less?

"We could reaccept and support an NBA franchise, however, run by what appear to be straight-up guys and fans in their own right such as Hansen, Ballmer, et. al."

Or, we could tell these sports fans that if it's their childhood dream to own a basketball team and they have grown up to be wealthy - spend your own money.

And you know that Hansen and Ballmer are all "straight-up guys" because...

I'm thinking what you know is that they are wealthy and have high-powered jobs. Ever heard of Jack Abramoff? Same stats a few years back.

I cannot believe the energy going into this effort when there are so many other issues facing our city.

I cannot believe that multiple other professional sports teams are not enough for some people.

And I really cannot believe that the citizens of Seattle are going to be the ones who are going to come out ahead and NOT be the ones holding the short end of the stick.

As much as I hate the Times, I agree wholeheartedly with every word of that editorial, and not with this writer. The Times got it just right. If this deal is such a good one, and these investors are as savvy as this writer acknowledges, they should be climbing all over one another to get in on it and make sure the public is cut out of any chance at a gain. The fact that they're not doing this and are whining away about their position and commissioning studies to support them tells me that this CANNOT be that great a deal for them. They want us in, at the very least, to make sure that WE, and not they, bear the risks of this ridiculous vanity project. Without question, hirty years down the road, whatever's built today will certainly be deemed dated and unacceptable.

The idea that Hansen's arena will be worth anything in 30 years is truly a joke. Both the Key Arena and the Kingdome lost their value much more quickly, and so do other stadiums elsewhere. The future value of that facility is zero.

Sorry Ted but for the most part you are wrong. Sodo is the wrong place for an arena for many reasons, not just "traffic", and providing a public subsidy to multimillionaires and billionaires who have more than enough financial capacity to build a dozen arenas is nonsensical, especially at a time when so many real needs are going unmet or are being being presented to voters to determine whether they will be funded with tax increases.

Here's one point you got right: "Only recently, during the big public revenue squeeze, have our elected officials come awake to the fact that ordinary voters and taxpayers don't like such subsidies." Yes, our elected leaders are only now catching on, but the public has been there a LONG time, in large part because of the abject incompetence and drunken-sailor spending by government at all levels.

In Sodo it is not just the traffic; it is also gentrification. We allow conversion of prime industrial land at our peril. Even worse, to allow conversion of that land, which currently provides family-wage jobs, for businesses that mostly provide part-time low-paying service jobs, would be an absolute bone-headed mistake. Farmers have a phrase for notions like this: You don't eat your seed corn. You don't squander what you have, which is producing bountifully, for the short-term "gain", which in this case may be no gain at all.

At best sports arenas are short-term gain, and that mostly psychically. Yes, a community can be uplifted and rally around a successful team, though they all have cycles. But ultimately the arenas they play in fall into disfavor by the league and team owners, and the facilities must be massively upgraded or replaced.

Numerous financial studies have shown that sports arenas do NOT provide the financial windfall proponents claim. Look at Stockton California which built an arena and is now going through bankruptcy. Look at Kansas City which built an arena and still is waiting for a team, while its arena can't pay for itself with concerts and other events.

We already have Key Arena, which breaks even now, but this new arena would take events away and make that another white elephant. Meanwhile, the city and county councils are considering public support for the new arena without a public vote, while voters are being asked to approve $200-plus million for a seawall, $200-plus million for a Children & Family Services Center; $100-plus million for libraries, and much much more. It's no wonder people are cynical about government.

You're right, Hansen and his investors, some of whom he's refused to disclose, aren't dumb. Neither are they altruistic ala Bill Gates, who gives away billions. They stand to make a financial windfall, and if they can get the public to share the risk, not take much if any of the profit, and be left at the end with another arena/albatross on their hands rather than the "investors" hands, all the better.

Fact is, if they want to build this arena and buy a team or teams, they do not need ONE DIME, let alone $200 million, in public funds to do so. And publicly financing an arena in Sodo would be especially stupid.

I agree. The same bond market that will lend to the city will lend to Hansen and his group. They can hire McGinn as their shill. O'Brien can be their geek, biting off the heads of chickens when needed.

'In Sodo it is not just the traffic; it is also gentrification. We allow conversion of prime industrial land at our peril.'

This makes no sense considering the only thing industrial on the land that Hansen owns and plans to use for the arena footprint is warehousing space that has been vacant for years. Everything else on the land? A butcher, a steakhouse, a deli/convenience store, parking, and a nightclub/music venue. So essentially, Hansen would be replacing hospitality/entertainment/retail business with ... hospitality/entertainment/retail business. There is no industrial use, heavy or otherwise, on this land currently.

'Numerous financial studies have shown that sports arenas do NOT provide the financial windfall proponents claim. Look at Stockton California which built an arena and is now going through bankruptcy. Look at Kansas City which built an arena and still is waiting for a team, while its arena can't pay for itself with concerts and other events.'

The difference in this deal is that no arena goes in unless and until a team has been purchased and is moving to Seattle. Simply agreeing to the MOU does not mean that the arena will be built. However, agreeing to the MOU does show a commitment to be able to secure a team. Once we have a team, the arena breaks ground. Then you have a guaranteed tenant. Stockton and Kansas City both took the gamble without this kind of provision, so both situations immediately don't apply here.

I have no problem with opposition to anything. It's good to hear both sides in an argument. But both sides should argue from informed positions. The unfortunate thing that I've seen too often from opposition to this deal seems to be a lack of understanding of the various components of the MOU. The main opposition, then, seems to come from a stance of no public subsidizing of private business, which is a reasonable stance. Just don't attack aspects of a proposal with misinformation.

Hansen and McGinn have attempted a series of increasingly laughable, desperate, and transparent financial shell games to justify this outright scam. Let them take it to Kemper Freeman. They'll be laughed out of his office.

Hansen says he wants to build an arena before the purchase of a team. Hansen says that he just wants to get the city financing deal pushed through first. Hansen says this in: "Chris Hansen Talks Details of Seattle Sports Arena" by Chris Daniels on 05 March 2012, at KING 5 News. There is an article, and video.

This has been amended as of the MOU presented to the city on May 16, 2012. Per the official language (pg. 20-22):

21. City/County Conditions Precedent. The obligations of the City and County under this MOU to commit Public Financing are expressly conditioned on the following conditions precedent:

...

d. NBA Team, Lease and Non-Relocation Agreement. ArenaCo or a third party under contract with ArenaCo has secured ownership rights to an NBA franchise, the Parties have entered into a non-relocation agreement as described in paragraph 17, the NBA has acknowledged the Arena Lease, the NBA has approved locating the NBA Team in Seattle and the NBA has acknowledged the non-relocation agreement and ArenaCo has entered into a Team License Agreement with the NBA Team as required by and consistent with paragraph 14.e

...

22. ArenaCo Conditions Precedent. The obligations of ArenaCo under this MOU are expressly conditioned on the following conditions precedent:

...

b. Financing. ArenaCo shall have obtained financing in an amount adequate to construct the Arena and upon rates, terms and conditions satisfactory to ArenaCo in its sole discretion. In connection therewith the Parties understand that ArenaCo may be required by its lenders to request an amendment to the terms hereof in order to facilitate such financing. The City and County shall consider such request, but any amendments hereto shall be (i) in the sole and absolute discretion of each of the City and the County and (ii) subject to all required approvals of each of the City and the County.

...

And (pg. 17-18) ...

16. KeyArena. Prior to completion of the Arena, any NBA and NHL franchise owned by ArenaCo or by an affiliate of or major investor in ArenaCo, or that has committed to play its home games in the Arena, will have the option to play their home games in KeyArena. During the tenancy of any such NBA or NHL teams at KeyArena, ArenaCo will cause certain improvements to be made to KeyArena, and those improvements which are of a permanent nature, which may include modernization of the telephone, data and broadcast "backbones" of the arena, as well as refurbishment and minor renovation to the event-level locker rooms and other spaces, will remain behind after the Arena is completed and opens and will become the property of the City. Any City taxes generated during the tenancy at KeyArena of either the NBA team or the NHL team over the base amount of taxes that is currently received from activities at KeyArena will be used to benefit the Arena Project or KeyArena, as mutually agreed. Prior to execution of the Transaction Documents, ArenaCo will also provide to and discuss with the City multiple options for re-purposing of KeyArena once the Arena is completed and opens and a long-term operating plan for KeyArena.

Playhouse, Nothing in that post stops Hansen from preceding with construction before a team.

@jhande Except the crux of this debate, the public financing.

ArenaCo will not move forward with construction until it has secured all necessary financing. The City/County commitment to financing cannot go ahead unless a team is acquired and relocation is approved by the NBA. Therefore, ArenaCo cannot move forward on construction unless they get a team.

Says it right in the MOU, which you stated further up should be the main thing any debate is centered on.

Then, Playhouse, why is Hansen talking about starting construction before a team were purchased, this past March? The Arena Principles that were reviewed by the Arena Review Panel required there to be both an NBA team, and an NHL team, in order for the proposal to move forward. The Mayor, and Hansen, removed the NHL requirement without explanation between the Arena Principles, and the MOU/contract, and then there is Hansen on television (the article in the post above) saying that arena construction could start with no teams, and that what he was working on now is getting the proposal through the Council. Hansen had nine months of secret meetings with the Mayor, Hansen and the Mayor change the proposal from 2 teams to one, and Hansen is on TV saying that the 1 team can become no team. Wouldn't you get the MOU/contract signed first, and then move to ammend it; isn't that what Hansen is kind of saying in the March interview.

Also,Playhouse, take a look at 22b of the MOU. Hansen can finance the entire cost of the proposed arena through private lenders. These private lenders would have a position ahead of Seattle in any default, or bankruptcy of ArenaCo.

The "MOU" blatantly violates I-91. The deal would be illegal. Unless this state's courts have been thoroughly corrupted, the lawsuit against it will succeed.

Hansen and his group are trying to get the city to subsidize an entertainment district. The arena would be nothing more than the anchor tenant in a mall that would include a hotel, and maybe a casino. Once built, Hansen and his greedy cronies would follow up with demands for massive upgrades to street and transit infrastructure in the area, all at city expense.

The answer is "No." Not only is the subsidy wrong, but city entertainment districts rarely pay off for anyone. McGinn and the Council have already blown any opportunity to revitalize Pioneer Square, and are in the process of wrecking downtown. Pouring $200 million of public money into the sinkhole is absurd, given the other horrendous decisions they've been making.

Any city council member who says "Yes" is going to find himself in the political crosshairs, to be mercilessly hunted down by packs of thirsty, baying dogs and removed from office. And hopefully investigated for corruption by state and/or federal authorities.

Incorrect. Leaving aside the value of the land and the building that the city will own above and beyond what they make on the repayment of the bonds -- which is ridiculous to not include in any investment analysis, but corresponds with the language of I-91 -- the rate of return on just the guaranteed taxes and rent annually is 7%, significantly higher than the current 30-year Treasury bond rate of 2.7%. Van Dyk would now like to argue that somehow the 2.7% needs to be above and beyond the taxes and rent paid -- of which the rent by itself is a 3.5% ROR -- when the language of I-91 states that it need only be a positive return on investment for the term of the agreement. $14m guaranteed paid annually for 30 years not only repays the capped maximum amount to be bonded of $200m, but easily complies with the required positive ROI. (This doesn't even touch on the fact that city isn't actually supplying cash for the investment.)

So not only does the MOU comply with the language of I-91, it holds to the spirit of the initiative, which was to protect the city should we ever decide to offer public funding for a sports facility again. Plus, it doesn't divert funds from other services and expenditures.

Anyone arguing against the MOU on these grounds is arguing against fact and math.

Paying back money you borrowed is not a "return" on investment in the sense of a profit, which I-91 requires, for the public. And Hansen doesn't even pay back the full amount of money he borrows.

The actual cost of the $200 million "loan", including debt service, is $454 million, of which $259 would be paid by city direct taxes, $13 million by county direct taxes, and $182 million would be rent and ground lease payments (paid by one of Hansen's numerous shell companies). NONE of that should be included as "return" under I-91.

Hansen is also getting financing for the team through the NBA -- what are those terms? How much money is the NBA making on this deal?

If Hansen wishes for some alleged increase in land value to be used in assessing this proposal, then Hansen needs to guarantee this increase in the MOU. All else about land value is speculation.

There is no guarantee of the marketable value of the proposed arena in 30 years guaranteed in the MOU. Once again, talk about the value of the proposed arena is just speculation.

Seattle government should not get involved in land, or building, speculation.

According to I-91, the City of Seattle has to make a profit on any investment the City makes in a facility to be used by a pro sports team.

To me, this means that the Hansen group would have to pay off the city-backed bonds entirely with their money, and NO city tax revenues, including those generated at the new arena. The precedent has already been set by KeyArena, where the bonds were supposed to be paid back completely by revenues from luxury suites, club seats and naming rights revenues. But ZERO tax revenues were to be used to help pay off the construction bonds on KeyArena. When those dedicated revenue streams no longer were large enough to pay off the bonds, after several years, and the city had to start using tax revenues to make up the shortfall on the bond payments, KeyArena was said to be LOSING MONEY.

A "self-funded" building is one which uses NO TAX REVENUES to pay for it. If any tax revenues are used to pay for a building, then that building is "tax subsidized." The new arena proposal uses mostly city tax revenues to pay off the construction bonds, therefore this proposal is not for a "self-funded" building, but rather for a tax-subsidized building.

The voters in Seattle, by a 74% margin, said they did not want any more tax-subsidized buildings for pro sports teams in Seattle. The arena proposal, as it now stands, clearly violates I-91.

The only way to make an arena proposal comply with I-91 is for the entire construction bonds to be paid off with rent from the building, plus another $3 million per year or so of additional rent, so that the City makes a profit on its investment, as I-91 requires.

This means that, on a $200 million City investment, the rent the team(s) must pay Seattle would be approximately $14 million per year to pay off the bonds plus $3 million per year to give the City a profit, for a total of about $17 million per year in rent from the team(s) to play at the new arena. And all city tax revenues collected at the arena would go to the city to be used for whatever the city wants to use them for.

That is the sort of proposal that I-91 requires.

You are exactly correct. The tax revenue allocated to debt service cannot be counted as a return to the city. That money is merely the means of paying for the $200 million gift to ArenaCo. Any return would be money generated over and above the debt service.

Hansen is trying to pull a cheesy trick. This is the sort of thing Bernie Madoff did with his clients. No one should fall for it.

Okay, taking that logic and looking at the math, consider that the principal on $200m over a 30-year period is $6.67m annually. The city claimed in their analysis that the yield on the bonds would be 5.5%. That would make the annual debt service about $7.04m. If the $7m in just taxes that is guaranteed covers the majority of the principal, than the $7m additional in rent paid by Hansen's ownership group covers the rest and anything above and beyond -- in this case $6.96m annually -- counts as the ROI towards the city.

So disregarding the tax revenue, the 3.48% ROR on just the rent still complies with the I-91 requirement.

(Now, admittedly, this is just dealing with simple yield. If they are talking about yield to maturity, which most likely they are, the calculations are bit more complex.)

http://clerk.seattle.gov/~public/meetingrecords/2012/gpnf20120705_2a.pdf

According to the city's own handout, page 16 of this document shows that the annual debt service on a $200 million bond the city sold would be approximately $15 million per year -- not the $7.04 million you claim.

The $15 million per year is the entire debt service. It provides no profit for the city as required by I-91. And most of that $15 million per year -- about $9 million per year -- comes from "direct city taxes". In other words, most of the money use to pay off the bonds is city tax money. That is a direct tax subsidy of the arena, which does not comply with I-91.

Hansen has to repay the entire $200 million in city bonds with his own money, plus pay the city an extra $3 million or so for the profit required by I-91. Paying of the bonds takes about $15 million per year, none of which can be city tax revenue.

Of course, Hansen's group gets all of the revenues from the arena, so they can use that revenue to make the $15 million per year in bond payments, plus pay the city about $3 million per year so the city makes a profit on their investment.

Hey, you know those tolls on the S.R. 520 bridge? They're not the bond payments. They are return on investment! Wow! Alchemy! Who knew?

Look, fella, I've got a finance background. Neither the principal and the interest on the bonds are "return on invested capital." They are the investment itself. The return on the investment is whatever exceeds the debt service. By the terms of I-91, both the debt service itself and the excess must be generated by the arena itself.

Though not required by I-91, any authentic and wide-scheme understanding of the proposal would also include any transportation mitigation costs, police overtime, and any spillover effects on Key Arena. They would be included in the cost. So would any negative impacts on port income, either through revenues lost or costs increased, and on any other businesses in the area, clearly traceable to the arena.

On the return side, we'd include net tax revenues, i.e., after any subsidy, from the arena and any other businesses clearly derived from it. We'd add realizable lump sums, i.e., land value and the net residual value of the arena, but only if it could either be liquidated or, if retained by the city, generated a net income stream.

We'd then deduct costs from the various return components, and discount it to the present at the interest rate embedded in the arena financing. That's honest accounting. Neither you, nor McGinn and the city council or staff, or Hansen, has offered honest accounting.

@NotFan Well, I will defer to you in that regard as I do not have a financial background beyond cost and ROI analysis for product management and marketing.

That said, in purely non-biased, academic terms, what do you make of the assertions in Hansen's PowerPoint response to the financial analysis by the city, particularly slides 3 and 4?

Hansen has no credibility in regards to this proposal. Hansen is the proponent of the proposal, and Hansen would get the 120 (200) million dollars of public funds(and other benefit) if the proposal were not rejected. Hansen has also hired marketers, and PR people. Any presentation by Hansen about this proposal has no credence. Stick to the MOU and related official documents, official presentations, and official materials. Trusting Hansen about anything he says in regards to this proposal, would be like trusting the word of a commercial.

@jhande That's just a silly argument. If you need to get word out about a proposal or an initiative or anything of the like to the broadest audience, you take advantage of the best resources. To not is not acting in the best interest of your investment group, which would include the city and county should they give the go-ahead. That's smart, level-headed business.

And considering as much information as is already publicly out there that many people don't seem to take the time to familiar themselves with -- as evidenced once more at the town hall meeting this evening --I'm not surprised Hansen would hire some help to get people better informed.

That aside, it's irresponsible to dismiss and disregard what Hansen says simply because he (and the city and county and the people) could gain from a positive outcome. The onus is on him to show the value of this deal. You could just as easily say we have to dismiss anything Richard Conlin says in regard to this issue because he's already stated he will vote against it regardless of any arguments presented for or against it. (In my opinion, that kind of close-mindedness should be ignored, but he's part of the process.)

Playhouse, I guess I disagree with you. This proposal is the MOU/contract.Assessing an MOU/contract does not entail marketing, and PR. The MOU/contract is 23 pages of legalese (it is readable, though).

The Seattle City Council has said they the do not wish for a public vote on this proposal. There is no reason for Hansen to have payed for a rally, marketing, or PR. There is no public vote on this proposal. There is no reason for Hansen to attempt to sway public opinion other than to put political pressure on the Seattle City Council. That does not help create a sober look at an MOU/contract, and is an attempt to circumvent true due diligence.

Hansen is a salesman attempting to sell his product. Hansen has said that his proposal was I-91 compliant. Hansen even said at the King County Council, and the Seattle City Council, that there should not be a public vote; because Hansen stated his proposal was I-91 compliant, and that the citizens had already voted on I-91.

Now, Hansen has changed his tune, as soon as the MOU/contract started to undergo official scrutiny Hansen (and the Mayor) come out with the "well, I-91 really doesn't apply to this proposal". Hansen's latest presentation even includes I-91 defined "intangibles" as reason for "spirit of I-91" compliance. Just solid nonsense. No credibility at all. There is no reason to lend credence to anything coming from Hansen as regards to this proposal. This proposal could, and should, have been assessed with no attempt to market, or lobby, by Hansen. This, of course, leaves out a lot. Hansen is not trustworthy.

Opposition to the new arena speaks in code and with hidden agenda. There is blatant hostility, resentment, envy, and jealous hatred towards professional sports in general that gets glossed over with tired old cliches about traffic, zoning, and 'more important things'. One deal clincher would be to give the city of Seattle a percentage of ownership (and/or eventual sale) of any NBA and NHL team that emerges. The Kingdome was able to serve 4 pro sports and numerous other events for years and the area can easily handle 3 venues...look at tonight's Major League Baseball All-Star Game from Kansas City, Missouri, and the superb Truman Sports Complex with Kauffman Stadium for the Royals and Arrowhead Stadium for the Chiefs and appreciate the greatness and benefits of professional sports. Kansas City has a downtown arena called Sprint Center but no NBA or NHL team. Seattle has to get an arena just to keep up with Kansas City!!

If Hansen's group can finance an arena themselves, great. They'd be like any other business that erects an office building. The only "hostility" comes from his attempt to pick the city's pockets. If Chris Hansen wants an arena, he should buy it with his own money. If he doesn't have the money, or doesn't want to put all his liquidity in that basket, then he can raise it in the bond market.

If this is such a good deal, the professionals will jump at it. But he's not doing that, and why not? Because governments, especially local ones, are so often the suckers of last resort. Hansen is following an old playbook called "Make it on Wall Street, put it into Main Street." Nothing wrong with that, as long as you use your own money. Chris, keep your greasy hands out of our pockets, okay?

Animalal, This post is not for you. Hey, arena opposition--- kujil56, srdidt4ia, klp99jxl14, and wrstg36sxqa2. Use code book 1217 with the lambert variation and then use the normal logarithms.

People's speculations and feelings are interesting to a point but it sure would be helpful to see some numbers. What is the projected return on investment? What is the trend on traffic congestion? What are the implications of it being built on the Eastside v Seattle? Numbers exist. I wonder where they are so we can have a more informed discussion?

Beware of any ROIC (return on invested capital) numbers from either Hansen or the city. Hansen is trying to pull a fast one; McGinn is going along with it, and ordering the city staff to support the deal with phony projections.

At one point, the city and Hansen tried to argue that I-91's return requirement doesn't apply because the city would borrow the money. That screwball notion was blasted out of the water by the opponents. Now Hansen is trying to float a fraudulent double-counting of the estimated tax revenues to be generated by the arena.

Even though those revenues go straight to debt service on the city's gift to Hansen, he's calling them a return on the city's investment. He figures this is a carnival and he's the barker. This is the sort of phony-baloney shell game that Bernie Madoff pulled. It's a kind of Ponzi scheme, and no one should buy it. If the city and county fall for it, the taxpayers will be left holding the bag.

I doubt the tax revenues will be enough even to pay off the arena bonds, let alone generate an authentic return.

The whole point of the MOU seems to be to have it be so muddled and ambiguous that there is no way to get any agreed upon numbers. Other than the 200 (120) million dollars of public funds that would be payed Hansen. That is the only clear, and detailed part of the MOU; the section that outlines Seattle paying Hansen.

animalal: You say, "Kansas City has a downtown arena called Sprint Center but no NBA or NHL team. Seattle has to get an arena just to keep up with Kansas City!!" So we need to be like Kansas City and build an arena that has no team, an arena that is not paying for itself and is a drain on city finances? How stupid is that?

Arena opponents are not "speaking in code" or "with hidden agenda." Sorry if you can't understand this, but "No" is not code. "It doesn't make sense" is not code. "We have real priorities, real needs, and the arena is not one of them" is not code. "Hansen and his group can pay for it themselves" is not code. "Converting industrial land that provides family wage jobs into an entertainment district that provides mostly low-paying part-time service jobs" is not code. It is common sense.

It's worth mentioning that city entertainment districts usually flop. People tend not to want to be herded into a "fun zone," the Vegas Strip notwithstanding. And given what McGinn and his enablers on the City Council have done to Pioneer Square and downtown, we can multiply that here. If Hansen wants to take the risk, let him. But the city should not climb aboard that "unsinkable" Titanic.

The Hansen Mall would be a cookie cutter californication known as LA Live. LA Live is at the Staples Center in Los Angeles. Search LA Live, and you should be able to find pictures. It is just one of those fake cement brick, with facades, run of the mill california Malls. Hansen has specifically stated that he wishes to have the LA Live concept at the proposed Seattle arena. The Mall may be part of the "project" as t Recital A of the MOU refers to "a new multi-purpose sports and entertainment facility ("Arena")".

AMEN!!!

The vacant warehouse on the proposed property is on the verge of greatness, anytime now.

It does have the advantage of not requiring $450 million worth of cash from the city over 30 years.

The opponents of this are so funny. Either you get facts wrong (not building arena until we have a team, so no KC comparison is necessary) or you make assumptions then rip those assumptions (i.e. one of you suggests he has massive plans to create an entertainment center then someone else pipes up and says entertainment centers flop.)

Then there is always the people who say "but our roads and schools...." Like borrowing from our bond rate somehow takes away from those services. You mean to tell me our great city can't walk and chew gum at the same tome?

No new taxes. If this isn't built then there would be no taxes gained. Basically he is borrowing $200 million, paying it back, providing jobs, add to city tax base VIA hotel, restaurant, car rentals for evening events that do not interefere with Port day jobs.

Why is there a segment against everything? Does this arena negatively affect you? It doesn't affect city's ability to do anything else, traffic won't be any worse than a Mariner game (avg 15,000 during weeknight games), brings jobs, sports (which many of us enjoy as part of our lives, like others like parks, hiking, fishing, museums, plays, musicals, etc.)....I enjoy all of these things.

Take a look at what the city, county, and state subsidize and then come talk to me. How much tax money is given to or how much tax money is not collected by the Port, Microsoft, Amazon, etc? Do you fight that with as much vigor? Likely not.

"Basically he is borrowing $200 million, paying it back,"

Wrong. Hansen would not be paying back that money. Most of it would be paid back by tax revenues, which belong to the city, just as tax revenues generated by hotels, restaurants, stores, etc. belong to the city -- not to the person who owns those buildings.

"providing jobs, add to city tax base VIA hotel, restaurant, car rentals"

All businesses in Seattle provide jobs, and add DIRECTLY to the city tax base. But those businesses are not financed with city-backed bonds using mostly city tax revenues to pay them off. Those other businesses are privately financed, as any new arena should be.

How many of Amazon's buildings in Seattle were financed with city-backed bonds repaid mostly with city tax revenues generated by those buildings? About zero?

Pro sports teams already get a huge tax break -- there is no sales tax of any type (state, county or city) on pro sports tickets in WA. This probably would save the new NBA team about $4 million per year in sales tax exemptions, and a similar amount for the NHL team. How many tax subsidies do professional sports teams need?

not building arena until we have a team

"We" will never have a team. Chris Hansen might have a team. Not "us."

Like borrowing from our bond rate somehow takes away from those services.

We don't "borrow from our bond rate." We borrow from whomever buys the bonds. Then we spend to repay the bonds. Whatever we spend to repay the bonds is money that could've been spent on something else.

Basically he is borrowing $200 million, paying it back, providing jobs, add to city tax base VIA hotel, restaurant, car rentals for evening events that do not interefere with Port day jobs.

He isn't paying back a single thing. The city will pay it back, out of its tax receipts. It's irrelevant that they might be generated by the arena. Do we build Starbucks restaurants or Amazon headquarters because their sales generate tax revenue, or do we tax their sales and use the money for city operations? Hansen's arena is no different than an office building or coffee shop chain.

Why is there a segment against everything? Does this arena negatively affect you?

I am for the arena, but I don't want the city to pay for it. If it's such a good deal, then Hansen and his partners should build it. If they lack the cash on hand, or don't want to sink so much of it into the arena, then they should visit some banks and/or float some bonds on their own.

How much tax money is given to or how much tax money is not collected by the Port, Microsoft, Amazon, etc? Do you fight that with as much vigor?

Amazon did not ask the city to pay for its office buildings. Neither did Microsoft.

And then there's this neat little bit from Seattle's deputy budget director:

'Hall Walker, the city's deputy budget director who made most of the presentation Thursday, said he read Hansen's four-page PowerPoint explainer, and concluded that Hansen may be correct, but it is only one version of how the numbers can be seen.

"His view illustrates there are a lot of different ways to look at this proposal," he said by phone. "Calling it a miscalculation depends on the interpretation of the language (of the proposal and I-91). I would not characterize it one way or another. Depends on who you ask. The way Mr. Hansen paid it out is a reasonable way to do it. The budget office is ultra conservative on these things, and tries to do the best it can within the financial limits.

"It can get technical very quickly but the bigger picture is a question of policy for the council: Is this a fair deal for city and for Mr. Hansen?"' (Thiel, "Hansen Says His Deal Beats I-91 Return", SportspressNW.com, 9 July 2012)

This seems to illustrate a very clear problem with I-91: it's too vague. And yet, again, Hansen's proposal complies with the language and, most importantly, the spirit of the initiative.

The "spirit of I-91" is clearly spelled out in the voters pamphlet "for" arguments, which says "no tax subsidies for pro sports" about 6 different times. Clearly, this is what the 74% of Seattle voters who approved I-91 were voting for: no tax subsidies for pro sports in Seattle.

The arena proposal uses about $259 million in "direct city taxes" to help pay off the construction bonds on the new arena (under the $200 million in bonds scenario). This is a direct tax subsidy from the city of Seattle to the owners of the pro sports teams who would use the facility. That is absolutely contrary to the "spirit of I-91" which is that pro sports teams in Seattle should receive NO tax subsidies.

Okay, I'll grant you the original intent. The odd thing, though, is that nowhere in the language of the actual initiative that was presented, voted upon, and passed by the citizens does it call for a complete ban on tax subsidies for sports facilities. It's in Licata's statement in support of the initiative and briefly bullet-pointed in the rebuttal to the statement against the initiative by CMIT, but not included in the formal text.

If anything, the spirit of the legislation that was passed was that Seattle got a fair share of the pie and not be left holding the bag.

Well, actually I-91 does ban subsidies to professional sports franchises. It does this be requiring Seattle money,and services, to be payed back with a return. That bans subsidies. The initiative does not ban the use of Seattle money, or service, to assist professional sports franchises by requiring that this money,or service, be payed back with a profit. The use of public funds, taxes/fees at the proposed arena, to "pay back" the upfront 120 (200) million dollars of public funds is one of the major violations of I-91 in this proposal. The public paying itself back is really not the public paying itself back.This MOU/contract (a contract because it has now been made binding for a term of five years.This was a change from the Arena Principles) can be assessed as to I-91 compliance. There is no need for anyone to have to conjecture about the "spirit of I-91". It is simple: The bond issue is a service, I-91 says a service must get the value of the service plus at least a mandated minimum return; The "cash" that is required to pay Hansen is the "cash". There is nothing about this proposal that prevents it from being assessed as regards to I-91 compliance. Hansen and the Mayor always leave the "service" aspect of I-91 out. The "spirit of I-91" is just marketing. The Mayor and Hansen just wish to push this through, and they both know it is not I-91 compliant.

But Lincoln. The tax money being used to pay it back only exists BECAUSE of the arena and Hansen. Then what about all the other taxes on goods brought in because of the arena? Just spitting out some include Sonics and NHL employees and players who pay payroll tax, these people also buy cars, houses, eat out, buy clothes, the clothing and food companies who stock the arena and outside stands......

The city may not pay to build buildings for Amazon, etc but they get sweet tax breaks to keep their business in the city....tax money that could help build roads and upgrade schools.

I guess I just don't see the issue. Hansen seems like an unassuming person who wants to bring a world class facility to Seattle, upgrade Key Arena, (and have the city own both) while also making upgrades over those 30 years to the new arena.

The arena will have value in 30 years unlike some who say it won't. The property itself should be worth $100 million (city only giving $120 mill not $200 so that's the number to focus on for city council).

I guess I don't see how this is a bad deal that ruins the city. It makes Key Arena marketable for certain events that don't need 18,000 seats, it adds to the city life, makes Seattle even more of a.destination city, it provides sports fans with something they enjoy (right or wrong sports plays a bog part of many peoples life, joy, sorrow, community bonding)

"The tax money being used to pay it back only exists BECAUSE of the arena and Hansen."

This is such a stupid "argument."

The tax money the city gets from the Space Needle exists BECAUSE of the Space Needle and its owners. So, should that tax money be given back to the owners of the Space Needle?

The tax money the city gets from the Westin Hotel exists BECAUSE of the Westin Hotel and its owners. So, should that tax money be given back to the owners of the Westin Hotel?

All tax revenues from all buildings exist BECAUSE those buildings exist. So, should the city give the tax revenues generated at every building back to that building to pay for its construction?

Is that your point: that all taxes generated by every building in Seattle should be given back to those buildings to help pay for their construction costs?

Or, you think only pro sports arenas should get that sort of tax subsidy?

Here is another way to think about it: if every business in Seattle got this same deal, the city would collect zero taxes. How would we fund essential services?

mytwocents -- Here's part of the problem (to repeat my earlier post with numbers from the City):

Paying back money you borrowed is not a "return" on investment in the sense of a profit, which I-91 requires, for the public. And Hansen doesn't even pay back the full amount of money he borrows.

The actual cost of the $200 million "loan", including debt service, is $454 million, of which $259 would be paid by city direct taxes, $13 million by county direct taxes, and $182 million would be rent and ground lease payments (paid by one of Hansen's numerous shell companies). NONE of that should be included as "return" under I-91. This deal is not I-91 compliant.

Hansen is also getting financing for the team through the NBA -- what are those terms? How much money is the NBA making on this deal?

Finally, the vast majority of the public, according to at least two independent polls (not online versions that one side can flood with responses), does NOT support public funding. Sure, there are many rabid sports fans in support, but 65 to 75 percent of the public say NOT WITH PUBLIC FUNDS. These are public funds. They COULD be used for other things. Instead we have to vote to tax ourselves further to pay for a seawall that is a clear necessity, for another Youth and Family Center (government jargon for a detention facility). Each of those two items exceeds $200 million. There is also a library bond, and upcoming school bonds. And there are huge transportation infrastructure needs.

This whole public funding for an arena proposal, especially in Sodo, is ridiculous on its face.

Ordinance 122357 (I-91), Section 2 defines how the value is calculated.

Sec. 2. Fair value is defined herein as no less than the rate of return on a U.S. Treasury Bond of thirty years duration at the time of inception of any such provision of goods or services, real property or lease; and further, such return shall be computed as the net cash on cash return, after interest and any financing costs, on the depreciated value of the cash investment of the City of Seattle in such goods, services, real property or facility, and shall exclude all intangible, indirect, non-cash items such as goodwill, cultural or general economic benefit to the City, and shall also exclude unsecured future cash revenues.

City Budget Office and council staff have concluded that since the city is not investing cash, and the term "net cash on cash" actually requires. . . cash of some form (and not borrowed money), they are unable to apply I-91. Council staff suggested on 7/5 that council either exempt the proposal from I-91, or state that it doesn't apply, then just figure out what they thing a fair deal is.
They will likely exempt the deal once they reach agreement to avoid Section 5 of Ordinance 122357 that allows and citizen to "allege" that any agreement does not comply, and sue.

I will assume that since Peter Steinbrueck is being paid $40,000 to stop the arena that he would sue no matter how much in love Chris Van Dyk could ever be with any agreement.

Ted has the politics exectly right.

Speaking of who's being paid what, I'd like to know who McGinn's $20,000 a month "sports consultant" is, and what slush fund he's being paid from.

Not Fan, the spots marketing consultant that Mcginn hired in secret is named Carl Hirsch of Stafford Sports LLC. Mcginn also hired Hugh Spitzer, and other consultants. All in secret.

The MOU says that Hansen must be payed in "cash". So, if the money that Seattle acquires from bonds is not "cash", then Seattle has no need to do the bonding, since the money required in the MOU is "cash". So,according to MR. Baker there is no reason for Seattle to issue bonds since the non-"cash" money acquired from the bond issue cannot be used to meet the MOU requirement for "cash".

"and the term "net cash on cash" actually requires. . . cash of some form (and not borrowed money), "

This is really good. Only someone like Baker could come up with that. So, Baker, if you borrow $10,000 from a bank to buy a used car, and the bank give you $10,000 in cash, and you pay the owner of that car $10,000 in cash for the car, you did not actually pay cash for that car? Because you borrowed it from the bank, it was not actually cash? Is this what you believe? lol

Mr. Baker says: borrowed cash is not actually cash. Then, what exactly is it, Mr. Baker?

The city is obligated to pay Hansen CASH for the land. That is in writing.

I promise you, that the city will pay whatever it owes the contractor in CASH. Do you think the city is going to pay its share of the contractor's bill with an IOU? Really, what do you think the city is going to use to pay for the land and to pay fhe contractor, if not cash? Colored beads? Or, maybe Ichiro bobblehead dolls?

I'm telling you, reporting, what the city Budget Office and council staff said.

Watch the video from 6/29 and 7/5
http://www.seattlechannel.org/videos/video.asp?ID=2361222

Your personal attacks are misdirected. Tell it to Hall Walker.

Mr. Baker, Isn't it Hansen, and the Mayor, trying to play word games? I-91 is very clear to the Seattle citizenry. Cash is cash. Service is service. There is no question about I-91 to the Seattle citizen. There is only question about I-91 coming from the Mayor's office, and Hansen, the individuals that wish for this proposal; but know it does not comply with I-91. This after months of saying that it does comply with I-91. It is dishonest, and the monkeying around with definitions would not stand up in court.You purvey this I-91 does not apply viewpoint, and then turn around and claim "well it's not really me". Just plain dishonest. That is the worst thing about this issue. Instead of an above board sober look at the MOU, we get dishonest marketing. Much of the dishonest marketing has been done by you, and your websites, Mr.Baker.

The Mayor is using the same line.

http://www.seattle.gov/mayor/media/PDF/120216PR-ProposalPrinciples.pdf

Read this document from the city, Mr. Baker. Point number 5:

"the City will acquire the site from ArenaCo. The purchase price for the site will be payable IN CASH..."

This is from the city website under "view the proposal principles."

As you can see, now our laws should change because Hansen want them to. Who elected Hansen?

City Budget Office and council staff have concluded that since the city is not investing cash, and the term "net cash on cash" actually requires. . . cash of some form (and not borrowed money), they are unable to apply I-91.

That is patently absurd. For purposes of calculating a return, the source of the cash is wholly irrelevant other than the cost of obtaining it.

The city and county propose to obtain $200 million in cash, likely at a cost of 5.5%, and then hand it over to ArenaCo. I-91's requirement for a "cash-on-cash" return is crystal clear. The cash outlay is the total cost of borrowing. The return is anything that comes in after that cost has been paid. Thus, if (as an example) the debt service payments are $15 million a year for 30 years, I-91 requires that the project pay back $450 million, plus a return of at least 2.5% -- the current T bond rate.

The city's budget director and the council's staff are a pack of spineless, intellectually bankrupt, cowardly fools. No one with a financial background would do anything but laugh at the stupid lie they've tried to tell. It's beyond ridiculous.

Hansen wasn't thrilled with their math.
http://www.sonicsarena.com/news/the-latest-on-i-91

Looks like you might be making up some numbers. T-bill is 2.7
You also appear to be making a similar error the "intellectually bankrupt" (as you called them) Budget Office made.

Looks like you might be making up some numbers. T-bill is 2.7

It's the T-bond. T-bills are short-term instruments. T-notes are medium-term. T-bonds have a 30-year maturity. Rates bounce around, so in any discussion you have to make an estimate. The T-bond might be 2.7% today, but next week it could easily be 2.4%. Or 2.9%.

You also appear to be making a similar error the "intellectually bankrupt" (as you called them) Budget Office made.

And what error would that be? Using 5.5% on the arena bonds? I've seen estimates all over the place on that one. The MOU is extremely vague, talking both of revenue bonds and general obligation bonds. My guess is that they'll claim it'll be financed by revenue bonds (secured only by the project), but then switch to general obligation bonds (secured by all city tax receipts and taxing power) later on.

The city staff and the politicians are dishonest enough to do it, and the sports fans are mostly too drunk and stupid to care.

Not Fan, You are right about the non-specificity of the bond type in the MOU. The Hansen marketers have been using this to claim that GO bonds would not be used. It is just more lies.

The moment that Hansen hired marketers, and PR firms, is the moment that anything that Hansen says lost all credibility in regards to this proposal. Hansen is just a commercial spokesperson, and judging by the transparent chicanery in the MOU, Hansen is not that bright.

I will leave all of the financial calculations to you financial gurus.

What is the difference between Starbucks and Amazon and a sports arena?

The sports arena provides something that the city is missing and that they can't get anywhere else. If Starbucks disappeared today and I need a coffee, I can get it at Tully's or any number of other coffee joints. If Amazon disappeared today, would anyone in Seattle even notice?

Can you really argue that the City of Seattle gets absolutely no benefit from the building of an arena or bringing sports teams into Seattle? I know that there are many conflicting arguments about the financial benefits but there are numerous intangible benefits at the very least. If there are benefits to the city, why shouldn't the city and county chip in?

And who would really be hurt anyway? Any and ALL tax revenues would be paid for by SPORTS fans! This is not like the restaurant and car rental tax that everyone had to pay (however small the amount).

If you don't visit the arena, you don't have to pay any taxes. To use NotFan's argument, it is beyond ridiculous to fight so hard against something that doesn't even affect you.

Hansen has promised to protect the city from any financial harm in this deal, even to the point of turning the team over to the city if they defaulted. If the city fails to get that in writing, then they are stupid but otherwise, let's hammer out the details on this deal and get it done!

I know that there are many conflicting arguments about the financial benefits but there are numerous intangible benefits at the very least. If there are benefits to the city, why shouldn't the city and county chip in?

From I-91:

"Fair value is defined herein as no less than the rate of return on a U.S. Treasury Bond of thirty years duration at the time of inception of any such provision of goods or services, real property or lease; and further, such return shall be computed as the net cash on cash return, after interest and any financing costs, on the depreciated value of the cash investment of the City of Seattle in such goods, services, real property or facility, and shall exclude all intangible, indirect, non-cash items such as goodwill, cultural or general economic benefit to the City, and shall also exclude unsecured future cash revenues."

Mocks, You may be a good person, but your post is so incorrect.

Starbucks, and Amazon, did not get public funding to construct their places of business. Starbucks, and Amazon, do not get to use their Seattle taxes to pay for their buildings.

The city isn't missing the NBA. The latest Elway poll shows that two thirds of Seattle citizens do not want public money to be used in this proposal. Then there is: "Poll: Loss of Sonics Won't Bother Most People in Seattle" by Jonathan Martin on 04 July 2008, in the Seattle Times. This is a poll with a good article. 78% of Seattle citizens did not care that the sonics left. The article says many citizens were happy they left. Remember the 15 years of non-stop whining for public money from the sonics before they finally left?

Among many other studies, the recent UBS Wealth Management Research Report "Batter UP:Public Sector Support for Professional Sport Facilities" shows that there is no economic benefit to a municipality from a publicly funded professional sport's facility.

Seattle taxpayers would see their property taxes rise because of the proposed arena. The total would be 800,000 dollars a year. The tax revenue diverted to pay for the proposed arena would be lost to Seattle. The money spent at the proposed arena would have been spent at another business that did pay taxes to Seattle. The diverted Seattle tax revenue at the arena would have to be made up by Seattle taxpayers. The arena will not be paying taxes to Seattle in order to pay it's share of the expenses, and service, of the City of Seattle. The Seattle taxpayer will have to make up for the taxes that the proposed arena would not pay. The proposed arena would use the City of Seattle, and services, yet would not pay Seattle taxes.

Not Fan is correct. Read the MOU. This proposal is ridiculous, and it is also ridiculous that Hansen thought the MOU would fly. Hansen must of thought we were fools. We are not.

There is nowhere in the MOU that would ever have a team turned over to Seattle. That is just not in the MOU. Hansen did not promise to protect the city from financial harm in the MOU. Hansen's name does not even appear in the MOU. Three shell companies do appear in the MOU, ArenaCo, HoldCo, and TeamCo.These would be LLC's. LLC's may go bankrupt with no liability to the owners. This happens, the Paul Allen owned arena, the Rose Garden, in Portland, Oregon went bankrupt. There is a thing called strategic bankruptcy.The MOU says much of the debt to Seattle would be "unsecured", meaning no collateral.

I could go on with MOU wonk; but that is enough for now. I find it distressing that the talking points that Mock brings up have been discredited months ago. Hansen, and his marketers, continue to put these talking points out, even though they know that the talking points are not true. Hansen, and his marketers, never refer to the MOU as they promote these talking points. This is a dishonest attempt by Hansen to get Seattle legally entangled with Hansen, and for Hansen to get free public money from Seattle(it is not just the money). Hansen is not an honorable person. This proposal was not created "in good faith" with the citizens of Seattle, and should be rejected.

The voters' intent was clear: Don't invest public funds without a GUARANTEE that it will be PROFITABLE, not just pay back borrowed funds.

Yet Mr. Baker argues for the sleight of hand solution. "We can't make it fit under I-91 so we'll just void I-91." How convenient and typical. Again, it is no wonder people are cynical about government at all levels.

Steve Ballmer's net worth went up $226 million in ONE WEEK, according to Forbes. Yet here he is with fellow billionaires and multimillionaires, hat in hand, asking for the public to contribute to and backstop his investment. How quaint. They could build a dozen arenas with their own funds, but they want public financing. They also get financing through the NBA to buy a team -- how much does the NBA make on that deal, and what are those terms? Isn't that great, we help Hansen and Ballmer, so Hansen and Ballmer can help David Stern.

Then they sell the team for a huge bundle; they reap a windfall from the associated development of an "entertainment zone"; and at the end the city gets a public facility that is a white elephant and has outlived its usefulness. This whole deal is one ripe cow pie.

It's not my claim, it is the claim of City Budget Office and council staff.

Watch the video of the meetings on 6/29 and 7/5.
http://www.seattlechannel.org/videos/video.asp?ID=2361222

They will imagineer the "spirit of I-91" as to not upset the "will of the people" (which isn't actually able to be carried out by the actual law).
Tim Burgess tried very hard to create as many ways as possible to make I-91 relevant when right after he say in the 6/29 meeting that the law was poorly written, and the rest of the council in attendance agree.

Whatever they imagine to be the "spirit of I-91" needs to be amended into Ordinance 122357.

By what legal authority is money acquired through bonding not "cash"? There is nothing wrong with I-91. What is wrong are individuals trying to worm around it.

Also, the issuing of bonds by Seattle would be a "service". I-91 says there must be a rate of return on "service".

The attempt to skirt I-91 with semantics is dishonest. Just as the Hansen marketing is dishonest. Just like sonics central, arena solutions,the Hansen astroturf bloggers , and Hansen, are dishonest.

Their next argument will be that, if it's not paid to Hansen in the form of $100 bills, and the return isn't in the form of currency, I-91 doesn't apply because there's no "cash on cash."

Seattle citizens should note that the I-91 requirement for a profit of at least the return on a 30 year t-bond is the minimum legal profit. It is not mandatory that the profit only be the return on a t-bond. The profit could, and should, be more. What investment bank would loan 200 million dollars to a private start-up enterprise for less than a 3% return? None would. The Hansen proposal is bad business.

It is pretty obvious that if the new arena was going to provide a guaranteed and reasonable return to the city of Seattle that the private consortium wanting to build it would do so without public backing since they certainly have the capital to invest and they could pocket these returns themselves.

Let's go to a system like they have in Europe where highly successful soccer leagues manage to build and operate their own stadiums and leagues without any public funding. It is perverse that in the global bastion of free-for-all capitalism, we support professional sports leagues with enormous public subsidies.

Forget the Arena they will own the land in Sodo at the end of 30 years paid for by the investers and the people going to the events. So these politcians think prime downtown Seattle land will be worthless in 30 years? They should probably leave that out of there relection speeches.

sliv, The worst thing to do when doing a business deal as regards an MOU/contract is to start guessing, or thinking, outside the MOU. Seattle would likely pay 100 million dollars for this land. No one knows if this land valuation will be higher in 30 years. A higher land valuation in 30 years would have to be guaranteed in the MOU in order for this higher valuation to be considered in assessing this MOU.So, Hansen could insert a 5% yearly increase in land valuation into the MOU, and guarantee this valuation in the MOU, and then a higher land valuation could be used in assessing the MOU.

It would be irresponsible of an elected official to sign MOU/contracts based upon speculation.

The anti arena crowd fear the strong black man. That's the only explanation I have for all the hate they have for such a great deal. You do know there will be NHL too.

Why is anybody supposed to fear what you term "the strong black man"? How strong do you have to be before you go from being "the black man", to "the strong black man"? Do you have to be able to benchpress 300 pounds, or would a bench press of 200 pounds be enough?

The anti arena crowd fear the strong black man. That's the only explanation I have for all the hate they have for such a great deal.

Good Lord, is there a way to bronze an Internet comment for all eternity?

The Seattle Times gets a 40% tax break and thats money we lose forever. We should let the Seattle Times go under and the opera house that they paid 40 million in taxes. The Port of Seattle gets about 100 million dollars of public money a year. I agree we need to stop all this spending everywhere, not just on the arena but on parks and everything.

How much is the Seattle Times tax break GIFT subsidy over 30 years. I will do what the oposistion does and pull a number out of thin air. Lets say its 150,000 a year, thats like almost 5 million dollars and it's not even including a fair return on our money or a 2.7% t bond return. We don't even something cool like a U2 concert, basketball game or NHL game, all we get is yellow journalism.

Your comment sounds like a spoof I heard 40 years ago on Radio Dinner, a comedy album made by the National Lampoon people. It was called Deteriorata, and included the following:

Consider that two wrongs never make a right
But that three do

p.s.: Know what to kiss, and when

There are two matters I could have addressed in the piece.

1. Why should we believe NBA and NHL franchises would come to Seattle just because the arena is built?

This is a major market which is attractive to the NBA and NHL (notwithstanding the NBA's abrupt departure upon Schultz's sale to the Oklahoma City group). Franchises in both leagues have regularly come under financial pressure. Sacramento presently is having trouble in the NBA and Phoenix in the NHL You can be sure that, by the time an arena is ready, the Hansen group will have explored every opportunity to buy existing franchises and/or to secure expansion franchises. Hansen undoubtedly researched the opportunities before acquiring the Sodo property. In short, if they build it, the teams will come.

2. Is the Port's concern not merely possible new traffic congestion from an arena drawing crowds of 15,000 in non-working hours but the
likelihood that the Hansen group and others would bring restaurants, condos, and other non-industrial businesses into the port area?

Such new arenas in other locations have indeed become surrounded by restaurants, shops, hotels, condos, and related development. We see right now the development taking place north of CenturyLink Field.
My own reaction: If the Port is concerned that its neighborhood
would change to its detriment, it would be well advised not to oppose the arena but to 1) rally neighbors again to press for the traffic fixes on which the city earlier reneged, and 2) to support a comprehensive plan for the area which would give the port sufficient
elbow room for current and future operations.

City and county councils should make their decisions on the basis of
credible financial analyses of the proposal, which no doubt will be amended in the period ahead.

Ted, arena construction can not begin without at least an NBA team secured and committed to relocating to Seattle.

Also, there are existing businesses there already. Their "problem" is that business is not sustained all year, accourding to the Seattle Mariners and their Public Facilities District draft proposal from last Fall to encourage investment in the Stadium District to solve this problem.
www.StadiumDistrict.org
The Mariners have argued both sides, they tend to do that, depending on if they are the folks benefitting.

I have little, if any, doubt that Hansen will be able to get teams for an arena. Of course, in the event that the city and county fall for the scheme, it should include a provision that withholds the money until BOTH the basketball AND hockey teams sign on.

Assuming such a condition, I consider the acquisition of teams to be a secondary issue. The main event is that the city and county are poised to shovel $200 million of borrowed cash at Hansen, the acquisition of which will entail $300 million in debt service outlays over a 30-year period. We've been told that it's not "cash" because it'd be borrowed, and that the debt service should be counted as a return on the "investment," which is not an investment but a subsidy.

"Credible" financial analysis would involve neither Hansen nor the gullible, corrupt, stupid, insulting (pick any or all of the preceding adjectives) city government budget analysts. If ArenaCo could actually earn a 7% return, there is no way on earth they'd ever have approached the city to begin with. This is a cheesy scam that only a crook or a fool would endorse.

The "Magnolia Mencken" column in the Queen Anne/Magnolia News nails it pretty well on the arena. Starts off with plastic bags, and then goes to the arena. Pretty fun stuff.

http://tinyurl.com/7ublqhh

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