The Sacramento City Council approved the completed agreement for the downtown entertainment and sports complex Tuesday night.
Council members voted 7-2 to pass the lease agreement, the city's financial plan and the arena's building proposal. Council members Kevin McCarthy and Darrell Fong voted no.
Before the meeting, Sacramento Kings fans, dressed in purple and armed with cowbells, waited in line to get inside.
"You got people in suits sitting next to people in jerseys and they all have one thing in common," Kings fan Sara Newsome said. "It's all about the community; it's all about the Kings."
When the meeting started, hundreds of people crowded into the city council chamber in support of or in opposition to the arena plan. During public comment, 50 people spoke in favor of and 25 spoke against the deal. Those in favor said the arena is the stimulus the city needs to get the area's economy growing again. Those who oppose the arena said the cost to taxpayers is too big.
The project will cost an estimated $477 million. The city is responsible for $223 million, while the Kings will contribute $254 million. The final term sheet, which was posted for public review on May 11, outlines:
- The city's plan to use a parking revenue bond, which does not impose new taxes or dip into the General Fund, in order to pay for its half of the project. The sale of the bonds cannot exceed $325 million, according to a recommendation that was passed by the city council during the meeting.
- The legally binding 35-year lease agreement and partnership between the Sacramento Kings owners and the city of Sacramento.
- The arena's building and design plan, as well as the environmental review.
City officials said they hope to start construction on the new arena in October or November, with a completion date set for October 2016. The NBA said the new arena must open by 2017 or Sacramento will lose the Kings.
Sacramento Downtown Partnership Executive Director Michael Ault said he just flew back from a retailers' conference in Las Vegas, where Sacramento was the hot city the businesses were talking about.
"We had retailers coming to us saying show us street grids, show us vacancies we want to be a part of this momentum," Ault said.
Business leaders, who were also part of keeping the Kings in Sacramento, pledged to invest nearly $1 billion to redevelop the area surrounding the arena.
The city had nearly lost the team to Seattle last year before software tycoon Vivek Ranadive won his fight with the league to buy the team from the Maloof family.
(The Associated Press contributed to this report)