By Jessica Boehm for The Arizona Republic
The Phoenix City CouncilĀ approvedĀ a controversial deal with the Phoenix Suns that will keepĀ the NBA franchise in downtown Phoenix through at least 2037.
The council voted 6-2, with Vice Mayor Jim Waring and Councilman Sal DiCiccio opposing it, to approve the $230M deal. The city will payĀ $150M from its Sports Facilities Fund, which is composedĀ of a 1 percent tax on hotels and a 2 percent tax on car rentals.
The council added a number of tweaks to the deal, including:
- Requiring the Suns to spend $10M on community benefits (either through nonprofits or city programs),Ā including at least $2.6M to the city’sĀ preschool program this year.
- The city will hire someone to oversee Phoenix’s expenditures on the renovations.
- The city will commitĀ the $1.5M rent increase from the Suns to homeless issues.
- 80 percent of any additional revenues generated by the city from the arena will go toward city public safety costs.
Details of the deal were released to the public in DecemberĀ ā less than a week before theĀ council was initially supposed to vote on it. After public backlash,Ā the councilĀ postponed the voteĀ and hosted a series of public meetings to educate residents about the details of the agreement.
After the vote, Suns owner Robert Sarver, who has faced criticism from fans, said he was glad he could demonstrate the team’s commitment to the community through the donation.
He also said he believes the arenaĀ investment will be a “win-win” for both the team and Phoenix.
What is the Deal?
- Phoenix pays $150M for arenaĀ renovations.
- Suns pay $80M for renovationsĀ and any cost overruns.
- After the renovation, Phoenix will pay $2M annually for 12 Ā½Ā years into a new renewal and replacement fund, which will be used for future renovation needs.
- Suns will pay $1M into the new fund for 12 Ā½ years.
- Suns will continue to operate and maintain the building, including booking concerts and other events.
- Suns will continue to pay rent to the city (calculated as a percentage of annual proceeds).
- Suns will build a new practice facility (estimated to cost $25M to $50M) somewhere in Phoenix.
- Suns commit to staying in downtown through 2037 with an option to extend the lease to 2042. If the team leaves before 2037, itĀ will face up to a $200M fine.
Read more at The Arizona Republic.