OKC Mayor David Holt says he'll pursue vote on new NBA arena by extending MAPS 4 sales tax

Mayor David Holt said Thursday voters may be asked later this year to extend the MAPS 4 temporary sales tax to help pay for a new arena for the Oklahoma City Thunder.

The MAPS 4 penny sales tax is set to expire in 2028. When asked by The Oklahoman, Holt would not say whether the city will incur debt between now and the time that sales tax would start rolling in, should the arena build take place beforehand. Holt used his annual State of the City address to discuss the possible election and new arena.

MAPS 4 has collected more than $390,000 in a little over three years, including during the pandemic. Holt said if the city wanted to build the arena before the money comes in, it could consider taking out a line of credit.

"That's kind of TBD," he told The Oklahoman. "We just know that we won't make a proposal that raises the tax rate."

The city has an excellent debt rating, having received triple-A bond ratings from Moody's and S&P in 2023 for the 15th year in a row.

About $70 million in MAPS 4 funds that were initially earmarked for Paycom Center will serve to supplement that funding. And, Holt said, Thunder ownership will for the first time in city history make a "significant financial contribution" to the new arena, but he wouldn't say what that contribution will be.

"The Thunder is proud of our partnership with the city of Oklahoma City and our community over the past 15 years," said Dan Mahoney, Thunder vice president of corporate communications. "We commend Mayor Holt for his leadership and vision and look forward to advancing the discussions for a new arena as a centerpiece of a downtown Oklahoma City of the future."

More: OKC Thunder 'commends' Mayor David Holt's call for new arena

Cost discussions still ongoing for potential new Thunder arena

Details still being worked out include arena cost and terms of the lease agreement, Holt said. He expects to bring an agreement forward by the end of the summer, which he defined as Sept. 22, which would need a simple majority approval from the city council. A public sales tax election would require a majority of all votes cast.

Holt also said in his speech that the contract between the city and the Thunder, if the arena agreement is approved, would be lengthy.

"We will secure this team for such a span of time that I can tell you today that a superstar who will play for our city in this arena, in the next lease term, isn’t even born yet," Holt said. "And yet, Sam Presti is probably already holding the draft pick to get him."

In his nearly hour-long speech, Holt touched on many areas the city is improving and growing before laying out the city's history with using public funds to fund arenas. First, bond elections funded the Civic Center Music Hall in 1927 and 1935, and in 1962 to fund the Myriad.

These were followed by voters approving the 1993 Metropolitan Area Projects, which funded what is now the Paycom Center through a pay-as-you-go, one-cent sales tax.

More: What we know about ongoing upgrades to Paycom Center, and the arena's uncertain future

It was one year ago that the mayor first publicly addressed the idea that Oklahoma City may need to replace the 21-year-old Paycom arena to stay competitive and keep the Thunder in OKC. The city's long-term contract with the Thunder ended in May, but the team signed on to a three-year extension.

"They are working shoulder to shoulder with us every day to find a path forward that secures this long-term relationship for another generation," Holt said. "Unlike 15 years ago, no one has to thread a needle to make this happen. We have a team that wants to be here for the long haul, and our city just has to do what great cities do. We have to invest in ourselves."

New NBA arena would 'exceed' OKC resident's expectations

Holt pressed the issue even harder Thursday, reminding listeners of Paycom's place as the smallest and second-cheapest arena in the NBA. It also sits right at the average arena age, and a new arena will take years to open if planning began today, he said.

"For a century, our city’s arena has been the defining infrastructure piece for our city’s quality of life," Holt said. "That journey from Municipal Auditorium to the Myriad to what we now know as Paycom Center has never been static. Never once have we said, 'we’re done.' It has always been a story of vision and aspiration and reinvestment and an implicit understanding that we can never stand still."

More: If a new arena is built, few options exist for building an NBA-worthy home for Thunder

A new arena would "exceed anything our residents have ever experienced," Holt said. It also will be designed for basketball, unlike Paycom.

It would be much larger, with more seats on the lower bowl and better sight lines all around, Holt said.

"Remember the pride you felt seeing this convention center or Scissortail Park for the first time? This arena will meet that standard, and finally people will stand outside of our arena and marvel," Holt said.

City councilors react to Holt's speech

Councilman Matthew Hinkle, who was elected to represent Ward 5 in April, said the mayor’s representation of how the city has prospered because of the Thunder is “dead-on.”

“I am a firm believer that the Thunder needs to stay here, forever and ever and ever," Hinkle said. "(I'll) help facilitate that in any way possible. ... I've said that ever since pre-election, it can't be all on the citizens, and it can't be all on the ownership, there's got to be a bigger, broader partnership."

Hinkle said he looks forward to seeing the proposal details and could see there being a philanthropy aspect in terms of funding, after learning about the funding agreement for Milwaukee’s Fiserv Forum, which included money from some of the city's bigger corporations.

Hinkle and Councilwoman Nikki Nice were part of a group that toured the Milwaukee arena last year, where they learned about how Milwaukee worked to keep their NBA team while also benefiting their community. Nice declined to comment on Holt’s speech.

But Councilperson James Cooper said he could support public funding for a new arena if the plan includes a community benefit package similar to that in Milwaukee. The Milwaukee Bucks agreed to pay a minimum of $15 per hour by 2023 to arena employees and hire at least half of the employees from the areas suffering most from unemployment or underemployment.

“The Thunder so far has shown themselves to be dedicated to the different communities which define Oklahoma City,” Cooper said. “I see a community benefits package as truly an evolution in that relationship and thusly a priority for me.”

Councilman Todd Stone, who represents Ward 4, said it's "amazing" the city could build a new arena without raising the current tax rate.

"I will definitely be in favor of letting our constituents decide on the direction we will take," Stone said. "Looking at the revenue generated by the Paycom Center and knowing we have the ability to lock that down and even improve on it for decades to come with this new facility is very exciting."

Councilwoman Barbara Peck said she hopes "the plan includes a way to ensure the future of our burgeoning film industry alongside our marvelous Thunder."

The current site of Prairie Surf Studios, previously the Myriad, is believed to be one of the top site options for the new arena.

Prairie Surf Studios signed a five-year lease for the former convention center in 2020 with the option of three one-year extensions. The agreement, approved by the Oklahoma City Council, included an understanding that the building was not to be a permanent home for the film stages.

Councilman Mark Stonecipher said he is "fully supportive" of building a new arena. Councilmembers Bradley Carter and JoBeth Hamon did not provide comment Thursday after requests from The Oklahoman.

What do modern NBA arenas cost?

The latest NBA arena to open was San Francisco's Chase Center at a cost of $1.4 billion, self-financed by the Golden State Warriors. Milwaukee's Fiserv Forum cost $524 million, $174 million of which came from the Bucks, and opened in 2018.

The year before that, Little Caesars Arena opened in Detroit with a price tag of $863 million — covered by public dollars and the rest from Olympia Development.

Sacramento opened the Golden 1 Center in 2016, home of the Sacramento Kings, for $558 million.

The new Los Angeles Clippers arena will open next year and cost $2 billion. The Philadelphia 76ers announced plans for an arena expected to cost $1.3 billion.

"We’re not in the junior NBA, we’re in the real deal, and these are our peers," Holt said. "But if those comparisons are sobering, I don’t even want to tell you about the billion-dollar arenas that exist or are planned in American cities that don’t have an NBA team."

This article originally appeared on Oklahoman: OKC could be voting to build new NBA arena for OKC Thunder