Posted on May 28, 2014 at 4:57 AM
SEATTLE - Seattle's elected leaders said there is concern about the financial stability of the Seattle Arena project if Steve Ballmer was to walk away.
"It would raise a red flag," said Seattle City Councilman Nick Licata, who was one of two NO votes on the arena deal in 2012. "If one of the major backers, Ballmer in particular, ends up purchasing another team, we have to go back and check financials, make sure the plan is still solid."
Ballmer has been flirting with making a bid for the Clippers, according to sources close to the former Microsoft CEO. TMZ reported Tuesday he was the "front runner" in a purchase of the franchise, which has been in turmoil since owner Donald Sterling's much publicized racially charged statements were made public.
Ballmer's Attorney, Mark Rising, told KING5 on Tuesday said he was not authorized to speak on the matter.
The Memorandum of Understanding, on the Seattle Arena proposal, calls for the investors to provide a reserve account, and a personal financial guarantee on arena payment shortfalls. It also requires investor Chris Hansen to provide, to the city and county, financial documentation to prove he can safely assume the terms and conditions.
Another Seattle elected official, speaking on a condition of anonymity Tuesday, also expressed concern about Ballmer dropping out of the bid, and leaving the city exposed to risk.
However, King County Councilman Joe McDermott says Ballmer's involvement in the project "isn't essential". McDermott chaired the County review of the project, and is the current budget and fiscal management committee. He also voted to approve the project and says Hansen could finance the deal on his own.
"My understanding is that the reviews that have been done on Mr. Hansen's finances, alone, that he could support this deal," says McDermott, who views Ballmer's involvement in the Clippers as having a silver lining, "If Ballmer is successful in LA, having a Seattle owner at the table, can't hurt Hansen's chances to have a team in Seattle."
However, late Tuesday, USA Today published a 32-page response from Donald Sterling to the NBA, which indicates he plans to fight any move to oust him from the league. Owners are planning a vote on June 3rd on the future of the franchise. The statement says that the "NBA's use of this illegal recording constitutes a clear and blatant violation of Mr. Sterling's California constitutional rights." It also cites other ownerships fines for conduct.
McDermott also said Tuesday, that while altering the MOU for an NHL team was "certainly possible", it "probably doesn't make financial sense for only NHL".