SACRAMENTO, Calif. — When his dream of buying the Sacramento Kings was shattered three months ago, Seattle investor Chris Hansen was gracious in defeat and offered Sacramento congratulations for keeping the team.
On Friday, he was unmasked as the mystery donor behind the signature-gathering effort to force a public vote on the Kings’ proposed downtown arena — an effort that could derail the arena and jeopardize the team’s future in Sacramento once again.
Amid a lawsuit and a state investigation, Hansen and an Orange County political action committee filed documents revealing Hansen contributed $100,000 to the petition drive on June 21 — a month after the NBA board of governors vetoed his plan to buy the Kings and move them to Seattle.
Hansen apologized for the donation on Friday and said he wouldn’t give the anti-arena effort any more money. But the revelation seemed likely to damage the petition drive — and Hansen’s own efforts to bring the NBA back to Seattle.
The state Fair Political Practices Commission said Hansen’s donation violated state law because disclosure came two weeks late.
The lapse was “at best negligent, at worst purposeful behavior,” said Gary Winuk, enforcement chief at the FPPC. With a sophisticated businessman like Hansen, “there really isn’t a justification for not filing on time,” Winuk said.
The revelation came one day after the FPPC sued Los Angeles law firm Loeb &Loeb, which served as conduit for the donation, demanding that the donor’s name be disclosed. Winuk said the lawsuit will be dropped but Hansen and the Orange County PAC will continue to be investigated, although the law firm probably is in the clear. Hansen and the PAC could be subject to fines, Winuk said.
The stunning disclosure was the latest setback for the Sacramento group gamely trying to carry on with the petition drive. The group, STOP, has been hurt already by media reports about the secrecy behind the campaign’s funding.
Some 1,600 citizens who signed the petitions have submitted paperwork demanding to have their names removed. STOP, or Sacramento Taxpayers Opposed to Pork, needs 22,000 valid signatures by December to force a vote next June on the proposed $258 million taxpayer subsidy.
With the Hansen disclosure, STOP’s problems continue to grow, said local political consultant Rob Stutzman, who isn’t connected to either side of the debate.
“Now there is an obvious pall cast by this surreptitious outsider funding this campaign,” Stutzman said. “That will give pause to Sacramento citizens (when asked) to sign the petition.
“They have burned through their money; they have a serious problem to complete the task,” he added.
Added Joshua Wood of the pro-arena group DowntownArena.org: “I think it makes it a lot harder for them to say this is about a public vote. This is about STOP acting as vassals for Chris Hansen.” Wood’s group filed the complaint that spawned the FPPC’s investigation.
A new arena to replace aging Sleep Train Arena is considered crucial to cementing the Kings’ future in Sacramento. Even though the NBA killed the move to Seattle in May, Commissioner David Stern has said the league could relocate the team if there’s no new arena by 2017.
Hansen issued a statement late Friday apologizing for the donation, adding he will no longer fund the petition drive.
He said he got “caught up (in) the heat of battle” amid signs that he was losing the tug-of-war over the Kings.
But Hansen’s statement made no explanation of why he made the contribution three weeks after he had lost the fight.
“This is clearly a decision I regret,” he said. “I wish the city of Sacramento and Kings fans the best in their efforts and they have my commitment not to have any involvement in their arena efforts in the future.”
He said he had no contact with STOP “or any (of) the various consultants” in the anti-arena drive.
Despite his apology, experts said he had already wounded his effort to bring the NBA back to Seattle some day, as the league might not appreciate his meddling in another market. League executives have indicated Seattle is a possible candidate for an expansion team.
“It will probably not be viewed favorably by some NBA owners,” said Mike McCann, a sports-law expert and contributor to NBA TV. “Hansen has portrayed himself as pro-Seattle and not anti-Sacramento. This revelation…certainly puts him in a different light.”
NBA officials didn’t respond to requests for comment Friday.
Hansen and Microsoft CEO Steve Ballmer agreed to buy the Kings from the Maloof family for $625 million. After the NBA vetoed the proposed relocation to Seattle in May, Hansen bowed out and the Maloofs sold to a group led by Silicon Valley tech executive Vivek Ranadive.
Soon after, Hansen congratulated Sacramento Mayor Kevin Johnson and “Sacramento’s dedicated fan base” on his website. He went a step further in a radio interview, saying he regretted trying to lure the team away from the city’s fiercely loyal fans.
“It kind of made me sick to my stomach,” Hansen said. He said he didn’t like being “a predator.”
Three weeks later, documents show, Hansen was plotting to derail the proposed new arena at Downtown Plaza.
Documents filed with the city and Secretary of State’s office show that Hansen donated $100,000 in June to a newly-formed Orange County PAC, Citizens for a Voice in Government, using Loeb &Loeb as a go-between.
When Loeb’s name surfaced in connection with the donation last week, suspicion immediately fell on one of the firm’s clients: the Maloofs, who tried to sell the Kings to Hansen.
The Maloofs denied any involvement in the donation, and Winuk said “I don’t have any evidence” that the family was connected.
The PAC is led by Orange County political consultant Brandon Powers, who declared in May that he was helping the petition effort. Powers couldn’t be reached for comment Friday. Nor could the PAC’s treasurer Lysa Ray.
The first $80,000 of Hansen’s money went to a Tulare political consultant, Paul Olson, who was in charge of the petition drive. The rest was earmarked for Powers ($7,500), Sacramento political consultant Tab Berg ($9,000) and a San Luis Obispo firm called Public Policy Solutions ($3,500), although it hadn’t been paid to them as of June 30 — the final reporting date on the disclosure document.
Olson and Berg quit the effort last week, amid the earliest reports of possible campaign-finance violations.
Berg said Friday he didn’t know until now where the money came from. He called the Hansen revelation “stunning” and added: “I thought it was a spoof at first. Somebody like (Hansen) operates in such a different plane.”
James Cathcart, one of the leaders of STOP, declined comment on Hansen.
“We have one focus and that is to get enough signatures,” Cathcart said. “We believe the majority of the people want a vote on this. We believe we will be successful.”
Sacramento community leaders, who have lined up behind the new arena project, were scathing in their criticism of Hansen. Metro Chamber President Roger Niello called Hansen “a saboteur” who had committed “an assault on our entire community.”
Adam Mendelsohn, a spokesman for the Kings’ new owners, declined comment, as did a spokesman for the mayor.