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Analyst Says Sacramento Got Bad Information on New Arena



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(Sacramento, CA)
Tuesday, April 17, 2012

Chris Thornberg, the economist hired by the Maloof family to examine the now-defunct arena deal says critics of his analysis should defend their numbers instead of attacking him.  He is the founder of Beacon Economics.  They were hired by the attorneys of the Sacramento Kings owners.  Thornberg looked at the financing information supplied to the City of Sacramento. 

He says the parking traffic won't likely double, new spending from within the region won't increase much if at all, and projected arena revenues are between $5 million and $15 million per year more than what could be reasonably expected.

THORNBERG: "These kind of bad impact studies are par for the course.  It's just how the industry works, if you will, and it's sad that our policy debates have been underwritten more often than not by faulty research. But, that's just the way it is.  I mean, this isn't the first impact study that has vastly over-estimated the negative or positive impact of some major event on a local economy. "

Sacramento Mayor Kevin Johnson stands by the research provided by parking operators, arena operator AEG and the NBA.

JOHNSON:  "Some economist I don't even know is going to come to Sacramento, tell us what we can and cannot do, get confused with state law versus Sacramento and the city, be confused with Sacramento and Anaheim, that's ridiculous."

Thornberg's other job is Chief Economist for the California Controller's office.  He testified before the NBA Board of Governors last Friday.

Jeremiah Jackson with pro-arena group Think Big says the NBA looked at what happens when the circumstances of a team are vastly improved.

JACKSON: "Six straight seasons without going to the playoffs and kind of poor performance on the court as wells as uncertainty about whether or not  the team is actually going to move to another city.  So, that's the current state of the team." 

Thornberg says he has no connections to the City of Anaheim and no interest in what happens to the Sacramento Kings.  He says there is still hope for an arena deal, if both sides take another look at the numbers.

THORNBERG:  "Why can't we sit down at the table, come up with some reasonable assumptions, figure out what the city can afford, figure out what the team can afford, and then -with that budget- figure out what to do?"

Mayor Johnson says he will consult with the NBA, AEG and other "trusted partners" to see if there is any hope for the project at the Railyards
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