Revised arena deal requires King County Council approval
September 12, 2012
By Warren Kagarise
NEW — 2 p.m. Sept. 12, 2012
King County leaders praised the proposed agreement between Seattle City Council members and the lead investor behind a proposal to build a sports-and-entertainment arena in Seattle.
Seattle leaders announced revisions to the proposed arena deal Tuesday. King County Council members approved the arena proposal July 30, but any changes adopted by the Seattle City Council must go to the King County Council for approval.
“This is a great sign of progress. I always felt this proposal presented a win-win opportunity to bring back our Sonics, secure an NHL team and address the existing transportation issues south of downtown,” King County Executive Dow Constantine said in a statement.
The updated agreement creates a $40 million transportation infrastructure fund to address long-standing transportation problems in the Sodo area.
The plan calls for the fund to initially be a collaboration between the city and King County, but additional funding is to be sought from other public and private partners, including the Port of Seattle and state and federal governments.
The city also announced plans to start a planning process to strengthen land-use protections for industrial lands and create a port overlay district.
The proposal clarifies the environmental review process by requiring examination of alternative sites, including Seattle Center. Furthermore, city adoption of transaction documents can only come after the environmental review process is completed.
The agreement creates a $7 million Key Arena Fund and uses a portion to study options for the future of KeyArena and Seattle Center.
The agreement includes financial protections for the city and county, including a personal guaranty by Hansen for the local governments’ annual debt payments. The proposal also requires ArenaCo to double the security reserve if revenue fails to meet expectations.
In July, King County Council members agreed 30 to contribute up to $80 million for a proposed Seattle arena near Safeco Field — if investors can secure NBA and NHL franchises. The county contribution is capped at $5 million if only professional basketball comes to the arena.
The agreement does not include additional taxes for county residents. Plans call for 30-year public bonds to finance the arena, and for arena revenue to pay off the bond debt.
“It took persistence and thorough vetting of the issues by the City Council to get to this point,” King County Councilman Larry Phillips said in a statement. “We should all deeply appreciate their due diligence. I look forward to reviewing the agreement when it reaches the County Council and hopefully voting yes for Sonics basketball returning to our city.”
Phillips, Councilman Pete von Reichbauer and Issaquah-area Councilman Reagan Dunn opposed the arena proposal in the July 30 vote.
“While it is too early to hoist a green and white flag on top of the Space Needle, these amendments represent a positive step forward in returning the NBA to our region,” von Reichbauer said in a statement. “If the proposed amendments are adopted by the Seattle City Council they will address many of the concerns I raised in opposing the initial proposal offered by Mayor McGinn and County Executive Constantine.”
In May, Constantine and Seattle Mayor Mike McGinn joined ArenaCo investor Hansen, a San Francisco hedge fund manager, and announced a pact between the county, city and the ArenaCo investment group to govern financing for a proposed arena.