The NBA and the Northwest are not a good match at the moment.
First the Seattle SuperSonics, and now the Portland Trail Blazers, are making loud noises about their unhappiness with their arena leases and the lack of public financing, suggesting — without actually saying — they just could pack up and leave.
Billionaire Paul Allen, who owns the Blazers, made his team’s revenue forecast public for the first time late Thursday, estimating he will lose $100 million over the next three years.
And the man who runs Allen’s privately held investment firm, Vulcan Capital, says the “brutal facts” are that the team cannot keep losing money any more.
Without some kind of “public-private partnership,” Lance Conn told The Associated Press, “no business person can sustain losses of that kind.”
Even though Allen, the co-founder of Microsoft Corp., is a billionaire, he has lost more than $12 billion in bad investments over the past decade — including $600 million he has poured into the Blazers and their arena since 1988 without realizing a dime of profit.
(MSNBC is a Microsoft-NBC joint venture.)
The SuperSonics, meanwhile, have lost more than $60 million since Howard Schultz bought the team in 2001.
Big payrolls for players are also a problem, but the teams are stuck with them in an intensely competitive market for top talent.
Conn told AP in an interview that “all options are on the table” for the Trail Blazers because “the economic model is broken.”
“It’s time to confront the brutal facts,” Conn said, adding that Allen would not wait for long.
“Time is of the essence,” Conn said. “We need to see immediate improvements from some sort of structural fix.”
That “structural fix” includes more revenue from the Rose Garden Arena, the home of the Blazers once owned by Allen before the company that ran it — Oregon Arena Corp. — declared bankruptcy and forced Allen to sell it.
Conn noted that NBA Commissioner David Stern told AP last week that he considered the Seattle lease “the least competitive lease in the league, which is a decided economic disadvantage.” Stern did not immediately return calls left late Thursday with the commissioner’s office in New York.
But Conn said the Blazers have a lease in Portland that is far worse.
He said the Blazers receive no revenue for suites, clubs, courtside seats, game concessions or parking at the Rose Garden.
The Sonics, by comparison, receive 40 percent of the revenue for suites, 60 percent for clubs, and 100 percent for courtside seats, game concessions and parking at the Key Arena in Seattle.
And, Conn said, Schultz is asking the Washington state Legislature to come up with $200 million to model Key Arena or help build a new home for the Seattle team.
A spokesman for Oregon Gov. Ted Kulongoski said the governor met with Vulcan and Blazers representatives two weeks ago, but there was no discussion about a public bailout.
“I don’t know what would leave the (Blazers) ownership the impression there is an opportunity for broad-scale public financing,” said Pat Egan, Kulongoski’s chief of staff. “I don’t know how they could draw that conclusion at this point.”
Portland Mayor Tom Potter had no immediate comment but he scheduled a meeting Friday with Trail Blazers officials.