OKLAHOMA CITY -- Seattle SuperSonics owner Clay Bennett
believes public funding is the most logical way to pay for upgrades
to Oklahoma City's downtown arena that are aimed at luring the NBA
team to town.
While the improvements could benefit the SuperSonics if their
relocation bid succeeds, Bennett said Thursday that the city stands
to gain more from a renovated building. Bennett said a lease to use
the city-owned building would likely leave the ownership group with
"a significant, if not total, equity component that is
nonperforming."
"So you can go through the steps that then suggest, well,
perhaps this is an appropriate use of public investment because it
is going to provide such dramatic public return," Bennett said at
a sports business conference at Oklahoma City University.
"Unlike maybe a handful of individuals building the building
that would never see any of it back, they might perhaps rationalize
some benefit to the company, but the broad benefit really goes to
the community, and not just intangibles."
Oklahoma City voters will decide March 4 whether to back a
proposal to extend a penny sales tax and use about $121 million to
upgrade the Ford Center and build an NBA practice facility. While
no organized opposition to the plan has emerged, one City Council
member encouraged lease negotiators to insist on the team paying
for part of the project.
Bennett, who wants to move the SuperSonics to his hometown, said
the method of paying for sports arenas is "a decision for each
market to make."
"There would be an immediate tangible return through sales tax,
certainly around downtown immediately. Then you've got players
coming that are purchasing homes, buying vehicles, a staff of 150
or so jobs that's developed," said Bennett, who runs Oklahoma
City-based Dorchester Capital. He added that the "real benefits"
over time are the prospects of more businesses relocating because
they're attracted to an NBA city.
Bennett, who sought public financing for an arena in suburban
Seattle that would have cost more than $500 million, said the
upgrades planned in Oklahoma City would be "exactly what we need
for the foreseeable future."
In his presentation, Bennett characterized Oklahoma City -- which
would be among the NBA's smallest markets -- as a favorable place to
play if the team is able to maximize its revenue streams and if
local government and businesses rally around the team.
"No. 1, we would be the only pro sports team in the state,"
Bennett said. "We have a city government and a city leadership
that understands the value of improving the building to make it a
national-caliber building, they understand the value of
constructing a lease that gets us competitive, and a business
community -- and I think our citizenry, by and large -- understand
the need to support the team."
He talked about brokering a "favorable lease" that would allow
the team to "participate in most all revenue streams that it
generates and that would pay operating costs perhaps on the
building." While Oklahoma City might not be able to ask as much
for naming rights as larger cities, Bennett suggested that a local
company might go the extra mile to help overcome that potential
revenue shortfall.
Local Ford car dealerships currently own the naming rights under
a 15-year deal, but Bennett said the arrangement allows for those
terms to be reconsidered after a team arrives.
Bennett suggested "maybe a local company paying a premium for a
naming rights deal over what their math would suggest on an
Oklahoma City population equation because of the investment and the
importance of getting this deal done and the payoff that will occur
through time."
When Oklahoma City University President Tom McDaniel expressed
an interest in housing the practice facility on campus, Bennett
responded that the team would likely need the building to be
dedicated to the Sonics year-round and that it appears the facility
would not adjoin the Ford Center.
"We're fairly heading in that direction just because of the
configuration itself of downtown. With the expansion, we will
completely consume the contiguous site, so it couldn't be an
absolute contiguous configuration anyway," Bennett said. "So we
then thought, 'Well, we'll go offsite with it' because it is a
fairly significant building.
"We could put one court downtown, but we couldn't put the
relative amenities that we need and the other things that we
need."