City Council reaches deal with investor for Seattle arena
The Seattle City Council and investor Chris Hansen have reached a tentative agreement to build an arena in Seattle’s SoDo neighborhood.
“The new and improved agreement with Mr. Hansen makes this a sound step for Seattle,” said Council President Sally J. Clark. “We set out to make sure the general fund is protected, freight mobility is helped and that we have help in charting the future of Key. We achieved these goals.”
“We got a good deal,” said Seattle Mayor Mike McGinn in an interview with 710 ESPN’s Brock and Salk. “We got new jobs, we got a shot in the arm for that arena area if we can get this through all the way to the finish line and we’re bringing the Sonics back and that just feels good.”
The revised deal includes changes to satisfy both the Port of Seattle and manufacturers in South Seattle who objected to traffic that could clog streets and potentially jeopardize jobs. It also calls for new financial protections for taxpayers.
The original deal, spelled out in a Memorandum of Understanding between Hansen, the city and King County, called for $200 million in public financing to be repaid with taxes generated by arena activity and rent from the future teams.
Among the revisions, Hansen and his group have agreed to establish a $40 million transportation fund, to come from the publicly financed pool of money. The money would be used to fund road and transportation improvements in the area.
The deal also calls for Hansen to spend $7 million on Key Arena, aided by revenue from an NBA or NHL team that would use the facility while the SODO arena is being built. The money, which would also support planning for Key Arena’s future, would also come out of the publicly financed portion.
The revised agreement will also require an expanded environmental review process which will include a requirement to explore alternative locations including Seattle Center before the deal is finalized.
Hansen will double the amount he puts in reserve to cover any shortages if the arena doesn’t perform as planned. And the agreement will require his group to buy back the arena and land for $200 million in 30 years.
“We strongly believed that public money should be used for broader public purposes. The negotiated changes allow us to address long-standing transportation problems, preserve good jobs and protect Seattle’s taxpayers,” said Councilmember Tim Burgess, Chair of the Council’s committee that analyzed the agreement. “The new agreement demonstrates how healthy skepticism paired with collaboration and good governance can lead to wonderful opportunities for the public.”
A council committee will initially review the plan and vote on the proposal Thursday. Final council approval is expected later this month.
“Credit both the mayor and the City Council and Chris Hansen for getting the deal done,” says 710 ESPN’s Mike Salk in an interview with Seattle’s Morning News.
Salk says the big hurdle now is landing an NBA franchise, a requirement before construction can begin. But the arena backer says he’s confident Hansen has a deal in the works.
“My guess is he’s got a deal not necessarily in place but there’s some wink, wink, nudge, nudge, ‘yeah I got a couple of ideas of people that are ready to sell’,” Salk says.
In a statement, Hansen praised the council for reaching agreement. “As I think you can all appreciate, this was a very difficult process and we really did our best to find a solution that addressed the needs of the City and County as well as the concerns of project opponents, while still making this a workable transaction from our perspective,” Hansen said.
The King County Council will have to approve any changes to the agreement. It previously approved the proposal in July after making several amendments to the original proposal.
“I think the city council did its job,” said Mayor McGinn. “They listened to the concerns that were out there and they worked hard with Chris Hansen to try to address some of those concerns, but really this is about Chris Hansen most of all having the passion.”