Kings Extort Arena Sales Tax

Yesterday, amongst much fanfare, it was announced that a group of local politicians had gone toe-to-toe with the owners of the Sacramento Kings and after much vigorous negotiation they gave the Kings ownership everything they had demanded. Then these same politicians declared victory for all concerned parties. This rather “French” version of victory disguised as complete and unconditional surrender is in the form of a quarter percent sales tax. It has been argued that this new 1.2 billion dollar tax will bring millions in new business to the Sacramento area.

This is nuts. If I offered you ten cents for every dollar that you gave me, you would rightly conclude that I either was insane or perpetuating some type of fraud.

That is unless you hold elected office. Then you would proclaim my virtue for giving you a dollar in additional taxes and then being grateful for the ten cent return on my tax dollar that I have been promised at some future date. If I go along with this scheme then I am called enlightened and community minded. And if I dare to call it a fraud and a money grab to cover-up some of the looming debt crisis that is built into the system supported by these local government politicians then I am selfish and anti-community.

Let’s look at the facts.

This tax is projected to result in more than double the amount of money required to build this project.
This over taxation serves two purposes: first it attempts to get around the law that a sales tax that is earmarked for a dedicated purpose requires a two-thirds majority of voter approval and secondly spreading more money around various cities within Sacramento County is a way to deal with shortfalls in revenue that have been papered over by developer fees.
  Neither the City, County nor anyone else acquires any ownership percentage of the Kings. The taxpayers are only buying a very expensive building that will never pay for itself.
There is no land that is currently owned either by the Kings or local government on which to put the new arena. The rail yards are in limbo and may not be the ideal spot for this project. Everyone knows that the rail yards are a toxic waste zone and there are still many unresolved issues.
In the final analysis, all the sales tax money will go into the general fund of Sacramento County. The County will then spend it as they see fit.
If voters approve the tax and the Kings leave Sacramento after the November election, the tax will still be collected, even if the arena is never built!

This last point is important. Once the tax is authorized it will be collected. How it is spent is up to the Board of Supervisors.

Remember when Al Davis was looking to move the Raiders from Los Angeles back to the northern part of California and Sacramento Mayor Joe Serna got an authorization to raise fifty million dollars? Well the Raiders went back to Oakland and not Sacramento. So what happened to the fifty million dollars earmarked for the Raiders? The city of Sacramento quietly spent every last dime on other projects.

This sales tax is a one-way street. Once you head down this road you can never stop or turn around.

My preference is for the sales tax to fail. However, if there is to be a true stadium tax then let that be the sole purpose of the tax. Go for the supermajority approval. My other condition for building a new arena is that our community acquires some reasonable percentage in the ownership of the Kings in exchange for buying a new arena.