So the Atlanta Spirit may be looking to unload the Atlanta Hawks. Or at least, that's what those nefarious "league sources" at the NBA claim. The sale of the team is very close, Sports Illustrated says. But if you believe Bruce Levenson and the rest of the Atlanta Spirit, there is no sale to be had.
(Yes, I know after the Atlanta Thrashers left town that taking a leap of faith on the Spirit is like taking a leap of faith that your five-week-old newborn will learn how to walk in a day or two.)
In any event, Hawks fans -- those of you who are not boycotting the team for what the Spirit did to the Thrashers, that is -- will not have the same worries as Thrashers fans did.
There is a less-than-minuscule chance that the moving trucks head on over to Philips Arena and take the Hawks to a place like Winnipeg. You may just have to endure the Atlanta Spirit for a while.
Here's why.
Unlike the Thrashers, the Hawks are required to stay here under the terms of the Spirit's bond refinance agreement with the City of Atlanta and Fulton County Recreation Authority or AFCRA. For those who do not know what AFRCA is -- including NHL Commissioner Gary Bettman -- it's the quasi-private city/county entity that actually owns Philips Arena.
(Yes, Commissioner Bettman -- the city and the county own the arena here too, just like Glendale or an agency of Glendale owns the Jobing.com Arena where the Phoenix Coyotes play).
In the simplest of terms, when the Spirit refinanced the bonds so that they could borrow money from the NBA's credit facility over the winter, the Hawks were no longer collateral in case the Spirit could not make good their bond payments to Philips Arena.
However, under the terms of the new bond agreement, the Hawks cannot leave Philips Arena for at least seven years even if they pay off the bonds in their entirety. If the Hawks do leave, there's a $75 million "early termination penalty" that the Spirit or the new owners that want a team elsewhere would be socked with.
Now, there's a common misconception out there that the Hawks can't move until the bonds are paid off in 2028. That's simply not true.
Yes, the Hawks can not leave until they pay off the arena's bonds, or they'll have to pay that pesky little penalty.
But the Spirit could theoretically pay off the remaining $123.5 million in bonds off tomorrow and the Hawks could leave, but they cannot leave until the 2018-19 season at earliest without also forking over another $75 million in addition to the $123.5 million or so left remaining on the bonds.
But to an allegedly cash-strapped ownership group like the Spirit, which claims to have sold the Thrashers because they were in dire financial straights, good luck coming up with $200 million in additional capital to make that happen.
There are also probably about zero potential NBA cities that are willing to overpay by $200 million or even $75 million for that matter to move the Hawks out of town, either. (Keep in mind that the NBA may want a relocation fee, too, just like the $60 million fee that the NHL exacted from Winnipeg).
Add to that a tiny little detail that the NBA is not exactly the NHL. They are a legitimate Big 3 U.S sports league that has big-money TV contracts, one of which just happens to be with Atlanta-based TNT (technically Time Warner, TNT's parent company).
NBA.com and NBA TV are are also based in Atlanta and the city has a basketball heritage with the Hawks dating back to the 1960s.
Unlike Bettman, who apparently did not care about hockey leaving the United States' eighth largest television market, his NBA counterpart David Stern absolutely cares about abandoning a city where NBA viewership is higher than most -- even if they are not all watching the Hawks in the transient city of Atlanta and refuse to patronize a Spirit-owned Hawks team.
The bottom line is that Atlanta's basketball team is not going anywhere anytime soon. Hopefully, the same cannot be said for the Atlanta Spirit, who have already been shown to be unfit to run one professional sports franchise.
Here's to hoping that they don't run the Hawks completely into the ground as well and that the Spirit is gone sooner, rather than later.
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