By Steven Tavares.
Last month, the Golden State Warriors broke ground on a new waterfront arena in San Francisco. But before they make the move across the bay, Alameda County officials expect the Warriors to remedy roughly $50 million in debt owed on Oracle Arena.
With the Warriors now almost certain to pull up its roots in Oakland, questions surrounding the remaining debt on the 1996 remodel of the arena have been rekindled.
A source with knowledge of the county’s discussions with Warriors management said the team’s reluctance to pay its share of the debt is unchanged from three years ago.
Periodically over the past few months, the Alameda County Board of Supervisors have been kept abreast of the arena debt situation in closed session meetings.
Just last week, the board’s agenda included a discussion with Warriors president Rick Welts over price and payment related to Oracle Arena.
Three years ago, the Warriors maintained their exposure to the arena debt would cease upon pulling up stakes and moving to San Francisco. But county officials say the agreement made prior to the arena’s reconstruction puts the Warriors on the hook for debt service payments through 2027 regardless if they play at Oracle or not. The Warriors pay roughly $7 million annual in debt service for the arena.
Skipping town without making good on what they owe is fraught with peril not only for taxpayers but the team. The golden age of Warriors basketball has somewhat masked a growing discontent among its fan base in the East Bay over the move to the Chase Center in San Francisco.
Furthermore, with the outlook of larger budget deficits looming over the next few years in Oakland and Alameda County, taxpayers may respond negatively to the perception the Warriors are sidestepping their debt obligations for lucrative opportunities elsewhere.
UPDATE: The Golden State Warriors might have a difficult time convincing Oakland and Alameda County officials, along with taxpayers that they can’t afford paying off its debt service obligations at Oracle Arena.
On Wednesday, Forbes released its annual valuation of NBA franchises and their findings placed the team as the third-most valuable in the league at $2.7 billion. The ownership group led by Joe Lacob and Peter Guber purchased the team for $450 million in 2010.