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Originally published Thursday, March 29, 2012 at 6:19 PM

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Maybe arena isn't a done deal in Sacramento, after all

Reports in The Los Angeles Times and The Sacramento Bee indicated there are still several potential issues in an agreement between the owners of the Sacramento Kings and the city of Sacramento to build a new arena there. Seattle is a relocation option if the Kings move.

Seattle Times staff reporter

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Any thought that the Sacramento Kings might be on the move to another city — such as Seattle — seemed dead late last month when the City of Sacramento announced it had reached an agreement with the NBA and the team to build a new arena and keep the team there.

But several media reports surfaced Thursday indicating that the deal is far from done.

The Los Angeles Times reported that the team's owners, brothers Joe, Gavin and George Maloof, have "increasing skepticism" that the new arena project "can be accomplished."

The Sacramento Bee, meanwhile, reported that the family was "balking over a city request that they chip in $3.26 million to help pay for predevelopment costs."

The Bee reported later Thursday night that the NBA had advanced the first installment of the predevelopment costs, $200,000, which the Bee said would "keep the arena deal alive."

In a statement to the Bee, NBA commissioner David Stern said: "I have advised Mayor (Kevin) Johnson that the NBA will advance predevelopment expenses on behalf of the Kings pending our report to the NBA Board of Governors at its meeting on April 12-13."

If the deal falls through, the Kings could be available for relocation to another city. Seattle is attempting to put itself in play to become the home of another NBA team, with city and King County officials announcing last month they were working with hedge-fund manager Chris Hansen on a plan to build a new arena in the Sodo District that could house both NBA and NHL teams.

Hansen, who said he would put up $290 million to help fund the arena, has said he would like to be part of a group that would own an NBA team, and that he would prefer to secure a team before beginning the project.

The L.A. Times reported Thursday that it had reviewed documents in which the owners of the Kings "dispute that they have a firm agreement to participate in a new entertainment and sports complex in the city."

The newspaper also reported that in a Wednesday letter delivered to city leaders under the subject "ESC feasibility concerns," the Maloofs' attorney writes that "unresolved issues regarding the ... project remain."

The L.A. Times reported those issues could have the family again exploring options to move the team, with one option being the Honda Center in Anaheim. Another option could be putting the team up for sale.

"If an arena project cannot be completed by the timeline set by the city, then the Kings would be forced to explore all of their options," Maloof family spokesman Eric Rose told the L.A. Times.

The L.A. Times also reported that "meeting the timeline requires navigating a perilous path of environmental requirements, possible additional expenses and legal challenges" and that in a Tuesday letter to the Maloofs' attorney, Sacramento officials acknowledged they are working to ease questions and concerns aired by the owners.

As reported in the L.A. Times, the Maloofs were poised to move the team to the Honda Center last year before NBA commissioner David Stern asked them to wait a year and let mayor Johnson, an ex-NBA All-Star point guard, establish a financing plan for a new arena in the city.

The team's future in Sacramento, however, seemed secure when city officials and the Maloofs emerged from a Feb. 27 meeting during NBA All-Star Weekend in Orlando, Fla., saying they had reached verbal agreement for a new $391 million arena to be funded by the Maloofs ($75 million), arena builder AEG ($59 million) and the city ($255.5 million).

But the L.A. Times reported that the Maloofs made a strong point in Wednesday's letter to underline the preliminary term sheet is nonbinding, with their attorney writing, "There was never an agreement reached."

The L.A. Times also reported that "more about the dynamic could be revealed as soon as Tuesday, when the Sacramento City Council is expected to discuss the status of the arena agreement and seek a more substantial Maloofs' commitment."

The Sacramento Bee, meanwhile, offered details of the snag over the predevelopment expenses.

"The team should not be responsible for the predevelopment expenses," Rose told the Bee. "That has been the position of the Kings from the start."

The Bee, however, reported that a term sheet detailing the agreement to build a new arena stated that the Kings owners had agreed in principle to pay $73.25 million "toward development and construction of the (arena)," and that "such amount shall include predevelopment expenses paid by the Kings."

The Bee also reported that "the city has not gotten signatures from the Kings on a predevelopment agreement it has hoped to deliver to the City Council on Tuesday for its approval."

Rose and Kings co-owner George Maloof both told The Bee on Thursday they are not dropping out of the deal, but they have numerous questions.

George Maloof, however, told The Bee he didn't necessarily see the deal collapsing.

"We had some general feasibility questions for the city," he told The Bee. "It's a major deal, and that's how it works."

He said, "There's nothing that's happened" to make the Maloofs doubt the arena project will be completed. "We're still negotiating with the city and AEG," he told The Bee.

Johnson said in a statement to the Bee that he expected the Maloof family to follow through with the initial agreement.

"The success of the new entertainment and sports complex depends on complete trust and partnership among all parties. It was with that spirit that we all agreed to a deal in Orlando, including the Maloof family, who looked an entire room in the eye and promised their commitment to Sacramento," Johnson said. "In light of the Maloofs' promise, we fully expect all parties to live up to their commitments."

Bob Condotta: 206-515-5699 or bcondotta@seattletimes.com

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