New KeyArena deal heads to Seattle City Council

Sep 12, 2017, 5:43 AM | Updated: 3:54 pm
KeyArena, NHL...
KeyArena. (File, AP Photo/Gregory Payan, File)
(File, AP Photo/Gregory Payan, File)

The group seeking to renovate the former KeyArena has offered a deal to the city that would double the size of the facility, meet NBA and NHL standards, pump at least $40 million into traffic and transportation mitigation and come at little-to-no cost to taxpayers.

RELATED: Seattle Mayor Ed Murray resigning after fifth sexual allegation

The deal, currently in the form of proposed Memorandum of Understanding, would give the Oak View Group a minimum of 39 years on the publicly owned land where the current arena sits along with full rights to all future events in the renovated arena.

The Seattle City Council must approve the plan before the group can begin the environmental impact statement or actual construction on the $600 million project. The council is expected to hold a series of public meetings before a tentatively scheduled Dec. 4 vote – one day after the expiration of the competing agreement with SODO-arena proponent Chris Hansen.

Mayor Ed Murray and the Oak View Group were expected discuss the MOU on Tuesday morning, but just before a press conference The Seattle Times broke a story that a younger cousin of the mayor’s is accusing him of sexual abuse as a teen in the 1970s. This is the fifth allegation of sex abuse the mayor faces.

Deputy Mayor Hyeok Kim has authority to approve a deal.

In the proposal, the Oak View Group indicated it would like to begin construction as early as October 2018 and complete the project two years later.

One of the keys to the potential deal, said Brian Surrat, the head of the city’s Office of Economic Development, is that it does not involve any public money.

The potential agreement with the Oak View Group is another – and perhaps final – roadblock to the SODO arena proposal pushed by multimillionaire Hansen. In an effort to sweeten his stalled proposal, Hansen too offered to turn the KeyArena site into a new music venue.

Adam Brown, who produced the documentary SonicsGate and has been an advocate for a new arena, said the announcement of a potential deal with Oak View increases the likelihood that Chris Hansen’s SODO proposal is dead.

But, he added, Hansen should remain a hero to Sonics fans because he’s the one who got the new arena ball rolling while setting the template for what a good deal looks like.

“Hansen really set the tone for what all arena deals should be,” he said. “He’s a hero to the city of Seattle no matter what happens.

“The way that the SODO deal was structured, the way it doesn’t put a burden on taxpayers, that’s the way every public-private partnership should be.”

Under the outline of the deal:

  • The OVG will pay for the environmental mitigation of transportation issues, and pay $40 million into a city-run transportation fund;
  • OVG will reimburse the city for lost arena revenue during construction and guarantee that city will never make less than the current $2.4 million that Seattle earns from arena events;
  • OVG will pay for all construction cost overruns;
  • Pottery Northwest will be temporarily relocated and returned to its current space at OVG’s expense;
  • OVG will pay $1.5 million to relocate the skate park;
  • OVG will carry the same obligations to the Seattle Storm or develop a new agreement with the team;
  • The project will include Community Workforce Agreement, Labor Harmony Agreements, 14 rent-free days at Arena reserved for community events – much of this will be earmarked for Bumbershoot — and OVG will offer employment to existing KeyArena workers.

The council is expected to have its first hearing on the proposal on Sept. 18. It’s rumored that both NHL and NBA league bosses want the city to approve an arena deal before OVG will be in the running for a new or relocated franchise in either league.

710 ESPN Seattle’s Mike Salk contributed to this story.

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New KeyArena deal heads to Seattle City Council