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COMMISSIONER DAVID STERN
THE MODERATOR: We'll start off with an opening statement from the Commissioner and then take your questions.
COMMISSIONER STERN: This is going to be short for me. I have a game to get to in Oklahoma City. But I am able and we're able to report to you that the NBA Board of Governors voted to reject the relocation of the Sacramento Kings to Seattle. The vote was 22 against relocation and 8 for, and if you'd like to know who the teams were, you can ask them.
We will talk to the Maloofs and seek in the next 24 to 48 hours whether we can help facilitate an agreement to be signed between the Ranadive Group and the Maloofs for the sale of the franchise in Sacramento.
Let me say that the Seattle presentation was brisk, firm, excellent and reflects the efforts that have been put into this and, I think, the extraordinary ownership group that they have put together. At the conclusion, though, the committee voted and recommended to the board and it was adopted, that if the Sacramento community could produce a site, a construction team, a strong, financially strong ownership group, and the kind of support by the city and the region that the Mayor Johnson has galvanized, then the appropriate outcome was to keep the team in Sacramento, and that's what they did.
We look forward to continuing the dialogue of some type with the citizens and potential owners in Seattle, but we don't have anything concrete to support with respect to an NBA franchise in Seattle at this time.
ADAM SILVER: No further comment.
COMMISSIONER STERN: Questions?
Q. First of all, Commissioner, nice to have breakfast with you this morning. Can you talk about the continuing ‑‑ I know you touched on it briefly ‑‑
COMMISSIONER STERN: What he meant was he had his cell phone at the next table and was trying to lip read.
ADAM SILVER: He was Tweeting your menu.
COMMISSIONER STERN: Right. I had oatmeal and banana.
Q. Thank you. I know you touched on the continuing conversations with the Maloofs. Based on what you've heard so far, are they open to selling to the Sacramento group? What kind of indications have you gotten from them?
COMMISSIONER STERN: I won't say anything other than I anticipate that they will come to be open, and I plan to visit with them and close, hopefully, on that anticipation.
Q. There has been a lot discussed over the last week about this back‑up bid from the Hansen Group to the Maloofs to purchase 20% of the franchise if the franchise would stay in Sacramento as the board has now voted? Can you shed any light on that if that's a factor at all?
COMMISSIONER STERN: All I can say is the only action that was taken today was a vote on the relocation. There had been no documents signed with respect to the back‑up bid, so there was nothing for the board to consider.
Q. So was there any talk of expansion at all in this meeting today as a way to satisfy?
COMMISSIONER STERN: I think there was a generalized talk that it would be good in the future just to consider that issue, but awaiting the next television renegotiation which is virtually upon us. Especially in terms of the year or so, or what have you, that it was best to await that event.
Q. Are there any promises at all to the Seattle group as we sit here tonight?
COMMISSIONER STERN: Just that our promise of fair dealing and ultimate consideration down the road.
Q. The way this process has played out over the last few months, it's dragged on for both Seattle and Sacramento. Sacramento has been able to come up with a term sheet and is successful today. Is this a victory for the NBA the way this situation played out?
COMMISSIONER STERN: No, I would say it's a victory for Sacramento, not a victory for the NBA. It's more than just a term sheet, really. Under pressure from the committees, the land for arena has been bought; a purchase agreement on behalf of the potential of Sacramento has been signed and put into escrow, awaiting the signature from the seller. And I think it's going to be subject to some negotiation, obviously.
$240‑some‑odd million dollars have been secured, and over $200 of that has been placed in escrow, which is substantially more than is needed to close under the agreement that's in escrow. So it's really much more than a term sheet that has been proffered by the Sacramento group. They do that in the face of a city council vote with respect to funding and the like.
The presentation that we saw both from Seattle, talking about the property and the strength of the group and the process, and Sacramento about what this development will mean in terms of jobs and downtown, you know, I think those presentations and considering them was a victory for the NBA. That is to say it's nice to see two great cities being so interested on an NBA franchise, but the big winner here was Sacramento.
Q. From everything that we've been able to get from the Maloofs the last few months, they seem to have been very clear about their preference in terms of who they want to sell to. What will you be able to do in the next 24 to 48 hours to change their mind and convince them to go to Sacramento?
COMMISSIONER STERN: Well, they were clear on that point until the end, but their agreement to sell the club in Seattle ended effectively with the vote; and now we hope that that will, having really forcefully projected support for the Seattle bid until the end, the owners listened, they voted. And now we think that because the Maloofs have overall been very good for Sacramento and the Kings and the NBA, that they will be motivated to do something fast so that the franchise can get cracking, and we can hold the mayor to his promises of support by ticket sales, season ticket sales, naming rights, and sponsorships, so that the people of Seattle have a franchise operation that they will continue to remain proud of.
Q. You said Seattle, you meant Sacramento?
COMMISSIONER STERN: I meant Sacramento. I'm sorry. I don't even know where I am. Let's put back Sacramento. Delete that. Okay.
Q. Was the vote on the five, the initial agreement ‑‑ I know there was some relocation, but essentially voting on the sale as well. Was it on the 525 valuation that was the initial one, or was it on the 625 that was reported last week?
COMMISSIONER STERN: It was on the 625.
Q. Okay. Also, one more thing. With regard to Seattle, there seemed to be a lot of concern that if this were not approved this time that it would be very difficult to put the political business pieces back together in Seattle. Do you have any concern that that market may not be able to come together again for an NBA bid later on?
COMMISSIONER STERN: I think they'll act, as they always have, in their best interests. I believe that at such time as there is a franchise that is available under NBA procedures and rules or through expansion and that conversation takes place, that the right forces will be present in Seattle to achieve that result.
Q. Commissioner, this decision comes a month after the traditional scheduled Board of Governors meeting. It comes after much help to Sacramento from the NBA. When the decision came and for Seattle it was right on schedule, what would you say to Seattle fans who say that they did not get the kind of assistance and additional time that Sacramento has gotten?
COMMISSIONER STERN: I don't know what you're talking about, but feel free to elucidate.
Q. What I'm talking about is in 2008 the decision was made that the regularly scheduled Board of Governors meeting be in April. We are now a month later than that meeting. Sacramento has been able to improve its bid and communications in that month. Seattle didn't get that kind of time.
COMMISSIONER STERN: I would say that, for us, the calendar was what the calendar was. Because of the report that had to be done and because of the way the calendar worked, we couldn't make it in time for the last meeting. So we had to schedule a special meeting and it is where we are. And then there were scheduling issues one way or the other that pushed it to this day rather than a few days earlier this week, but this was not favoring Sacramento. But I would say that Sacramento sort of used the time of this process to firm up what it said it would do. It said it would do certain things and then between the time of the last meeting and this one, they did them.
But we've been acting on the assumption that Seattle would do what it said it would do, and that Sacramento would do what it said it would do, and I think that remains true to this day.
Q. What does Seattle have to do now to attract an NBA team?
COMMISSIONER STERN: Well, I guess that's an ongoing conversation that I think would best be had by Commissioner‑elect Silver, and then Commissioner Silver and the powers that be in Seattle and interested purchasers. There have been, from time to time, several interested purchasers. Adam?
ADAM SILVER: The only thing I'd add is we've never wavered in our desire to return to the Seattle market at some point, as Chris Hansen made clear in his presentation to the Board of Governors today. The league continues to enjoy strong support in the Seattle market. We have strong support for our telecast, our national telecast in Seattle, and expansion was discussed at least as a possibility down the road. We want to wait and see what happens in our next national television negotiation, but we're very appreciative of the fans in Seattle, and we've regretted having to leave the market the last time and we fully expect we'll return there one day.
Q. Five years ago the league asked the Seattle group, the Seattle politicians to drop a lawsuit in order to one day have the NBA return. Then you're asked and you say today that if you ‑‑ they step aside that you'll deal with Seattle fair dealing, I think was the word that you used earlier. It seems like you're asking Seattle to take a step back, step aside with a promise in the future of something. You would understand the skepticism, I would hope, from the Seattle fan base that they don't think the NBA will return?
COMMISSIONER STERN: I would say that I don't know what you're talking about in respect to 2008. I know there was a litigation, but I guess it involved us too. I know it was against the team. I don't remember the NBA appearing, but if it did, it may have. But if they ask anything, that lawsuit was settled.
Q. The mayor at the time said in order ‑‑ to at one point have the NBA return they would drop the lawsuit?
COMMISSIONER STERN: That's what the mayor said, but you just put that in my mouth. I mean, I guess all that I'm saying is we felt there was a failure, that the team left. We were saddened that it left. At the time we didn't have a building or a plan even though we asked for one, And Mayor Johnson has managed to construct exactly what the committee asked him to construct, if he was going to get involved here. But this was not an anti‑Seattle vote, this was a pro‑Sacramento vote, And that is just the way the committee and ultimately the board decided it would be done.
Q. I assume that you and the league have been aware for quite some time of the interest and the possibility of Hansen and Steve Ballmer bringing the NBA back and their dealings with the Maloofs ‑‑
COMMISSIONER STERN: And by the way, we knew about the interest in Seattle, in Vancouver, in Virginia Beach, in Las Vegas, in Anaheim, and in multiple cities. You're absolutely right.
Q. Was Seattle used though as a pawn in this to get a better deal in Sacramento?
COMMISSIONER STERN: I must say that the mayor came in and said we understand that there is this offer in Seattle. What do we have to do to keep the team here and the committee responded. You've got to match the offer, have a building, and get a good ownership group that can make it happen, and it happened.
Then the committee decided ‑‑ didn't have any preconceived notions, but looking at both evenly they said that the edge went to the incumbent, so that's the way it came out.
Q. At this point under the NBA Bylaws, do the Maloofs have the right to retain ownership of this franchise, and is there any expectation by the NBA of what they will do next?
COMMISSIONER STERN: Yes, the Maloofs have the right to maintain ownership of the franchise because all we did was vote no on relocation. Was your word anticipation or expectation?
Q. How about both?
COMMISSIONER STERN: Which one did you use?
COMMISSIONER STERN: Okay, it is my expectation that we'll be able to make a deal with the Maloofs and the Ranadive Group to transfer title of the team in Sacramento. It's not a certainty, but we're going to work on that result.
Q. Commissioner, first of all, you mentioned a timeline of 24 to 48 hours. Is there a deadline that you're imposing or would like to see a deal done with the ownership group?
COMMISSIONER STERN: Just as soon as possible.
Q. Has the NBA, the league, vetted the Ranadive Group or the ownership group?
COMMISSIONER STERN: If there is a signed document, we would in quick order convene by conference call the advisory finance committee, which has vetted, as far as you can go without a vote, the Ranadive Group.
Q. Finally, are you impressed with the way Sacramento was able to rally and put a deal together this quickly?
COMMISSIONER STERN: I'm trying to think of something funny to say about the mayor, but I am so fully out of quips on the subject that I just don't. I think the mayor has done a great job, and I think Vivek Ranadive did a great job, and I think the city council of Sacramento did a really wonderful thing in terms of expressing on behalf of the region the support for this project.
Q. Ultimately, is there anything that Seattle could have done differently for the result of the outcome here?
COMMISSIONER STERN: I think that once Sacramento got engaged in doing this and being able to deliver on the promise, which didn't really exist when the original deal was made in Seattle, that the principal advantage to the incumbent was going to prevail, looking back with hindsight.
Nobody really thought that the property could be acquired, that the second site could be acquired, that the money could be put into escrow, all kinds of things, or that the size and strength of the group that ultimately was in Sacramento, would likely emerge. So kudos to Vivek Ranadive and actually to all of the owners who were here (indiscernible) and Mark Friedman. I don't know, I think that was all that were here. But Mark Friedman was outstanding in his presentation with respect to his development, experience, and the likelihood that this thing would, in fact, get built. So it was advantage incumbent.
Nobody had any doubt that the same or similar thing could happen in Seattle. It was just, do you give the edge to a city that has a 28‑year history of support?
Q. Also, there were some reports that Chris Hansen increased the bid a couple times. Was there any impact there?
COMMISSIONER STERN: None, none. That was the twitter‑sphere.
I want to say more. I mean, Chris Hansen did everything he said he would do plus more. Steve Ballmer couldn't have been more supportive, and in a good way, just all‑in in the effort. We have and retain a very good relationship with both of them, and we anticipate a continued relationship of some type.
Q. First a clarifying question. Did I hear you right that the Ranadive Group matched the 625?
COMMISSIONER STERN: No, no, no.
Q. I wasn't sure.
COMMISSIONER STERN: No, their current deal is 525.
Q. Okay. Thank you. Broader question. You've been saying for weeks and months, really, that this was going to be a close call, a wrenching decision, an anguishing decision. At the end of the day maybe not a landslide, but a fairly decisive vote. Did something happen in the last two weeks that really turned it?
COMMISSIONER STERN: Yeah, I don't know that I ‑‑ you'll send me a note of all those things that I'm alleged to have said. I don't think so. This was hard work. This was very difficult because the board and the committee was presented with a very strong Seattle bid from a very strong Seattle group, and they were faced with something else of a similar nature from Sacramento which are detailed. And that just was a lot of to and fro', lot of ex‑spouts from experts, a lot of legal analysis, a lot of document analysis. This was just a lot of work over a longer period of time than I hope ever happens again for Adam's sake.
Q. Could you just talk about the mood in the room? Was it tense, was it easy going? How hard of a decision was it for the owners in the room and what kind of agreement or disagreement was there?
ADAM SILVER: It was very businesslike. I'd just like to say in response to the prior question, it was a wrenching decision for several of the owners. I don't necessarily think 22‑8 reflects the view of the league or those owners towards Seattle. I think ultimately the discussion was it was not about a contest between two cities. It was about whether or not Sacramento could continue to support an NBA franchise and there were several expressions of support for Seattle, for the potential of returning to Seattle.
I think, though, that it was a weighty decision for the owners in that room, and the mood was one of seriousness.
COMMISSIONER STERN: And the Maloofs were in the room for a great part of the discussion. There was a genuine appreciation from ownership of the Maloofs and what they've done with the franchise and in Sacramento and wanting them to do well and right by them with respect to a sale.
This was not, to Adam's point, this was not some overwhelming vote because in certain circumstances the vote here or there could have gone another way an individual vote. But I just thought it was best to state the vote to eliminate speculation.
THE MODERATOR: Thank you, David, thank you, Adam.
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