Think Big Truth Consequences

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Truth or ConsequencesReleased by Think BIG

January 20, 2012


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Introduction

According to Brookings, the capital of California was the worst-

performing large metro economy in North America. In either America,actually.

The Atlantic, The 10 Fastest-Growing (and Fastest-Declining) Cities in the

World, January 19th, 2012

Sacramento has been ranked the 5th fastest declining economic zone inthe world. Only one other U.S. city made the bottom 10 list (Richmond,

VA).

Even more troubling is the fact that numbers 1-4 are all Eurozone

impacted cities (Seville, Spain; Lisbon, Portugal; Dublin, Ireland; andAthens, Greece).

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Contents

1. Overview

2. Economic Consequences in NBA Cities

3. Cultural Consequences to Sacramento

4. Conclusion

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Overview

The ESC represents a major opportunity for the economic future of

Sacramento, including the direct creation of4,100 jobs and $7B ineconomic activityover 30 years

If the ESC project is unsuccessful, there will be major consequences, as

the region will effectively be taking a significant step backwards

These consequences will be manifested through economic and cultural

losses to the region, as Sacramento will no longer be a professional sports

city with a venue capable of hosting world class concerts and cultural

events

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Contents

1. Overview



4. Conclusion

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Examples of Lost Economic Activity

Chicago

Los Angeles

Memphis

Seattle

Sacramento

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Chicago

Chicago estimates a loss of$3.5M in direct economic impact for every lost

NBA game

Additionally, Chicago estimates a loss in indirect economic impact of$11.2M

for every lost game

They estimate a direct economic impact per NBA playoff game of $4.68M

Chicago estimates that the City/County earns $300,000 per NBA Game

through taxes on ticket sales, parking, and concessions

Source 1999 Chicagoland Chamber of Commerce Study Adjusted for Inflation 7


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Los Angeles

Staples Center provides the City of LA with $35.6M per yearin taxable

sales directly

Staples Center generates an additional estimated $58.5M in event ticket

and parking revenue

Each Lakers game has an estimated direct impact of nearly $33M and an

indirect impact of an additional $40M

Sources John Blank, Chief Economist LAEDC & Robert A. Baade 8


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Memphis

The FedEx Forum in Memphis creates over $223M in Direct Economic

Impact each year, including over $9M in spending from visiting NBAteams/fans.

FedEx Forum is responsible for approximately 1,534 jobs each year.

The FedEx Forum generates over $5M in local tax revenue each year

Source 2010 Greater Memphis Chamber of Commerce 9


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Seattle

The Seattle Sonics generated between $183M and $194M annuallyin

economic output between 2003 and 2007, before the team left Seattle in2008

When the Sonics relocated to Oklahoma City, Seattle suffered over 1,400

lost jobs, including 124 Sonic employees and 300 employees at Key Arena

The jobs were responsible for $25-26M per year in Seattle Household

Income prior to the relocation of the team Increased Household Income

Source Navigant Consulting 10


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Economic Impact to Sacramento

Without an entertainment and sports complex, the Sacramento region

will not only lose out on 4,100 new jobs and $7B in economic activity butwill suffer the loss of approximately 750 employees of Power Balance

Pavilion and 150 Kings employees

Similarly, the region will lose:

An estimated $100M of annual spending,

$7.5M of annual payroll to employees,

and $1.3M per NBA game of economic outputin the local economy.

Sources based on similar figures via 2004 Portland Trailblazers Study, SacBee, Power Balance Pavillion, H&R Block 11


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Contents

1. Overview



4. Conclusion

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Cultural Impact to Sacramento

Performance information provided by Maloof Sports & Entertainment

Without an ESC, it is unlikely Sacramento will be able to host these major concerts in the future

From 2009-2011, Sacramento did host some major shows, including :

Britney Spears Usher

Glee Live in Concert

Lady Gaga

Disturbed and Korn

Eric Clapton The Judds

So You Think You Can Dance

Godsmack

Nickelback

Justin Bieber Shakira

Muse

Michael Buble Rihanna

Cirque de Soleil

Disney on Ice

Black Eyed Peas

Carrie Underwood Bon Jovi

Green Day

The Jonas Brothers

Beyonce

Keith Urban Sade

John Legend

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Artist 2011 Revenue California Performances

U2 $156M Anaheim, Oakland

Taylor Swift $97.7M Los Angeles, San Jose

Kenny Chesney $84.6M Anaheim

Lady Gaga $63.7M Anaheim, Los Angeles (3x), Oakland, Sacramento, San Diego

Bon Jovi $57.1M N/A

Elton John $51.8M N/A

Sade $48.6M Anaheim (2x), LA (3x), Oakland (2x), Sacramento, San Diego, San Jose

Jay Z/Kanye West $48.3M Los Angeles (3x), San Jose

Lil Wayne $44.4M Anaheim (2x), Oakland, Sacramento, San Diego, San Jose

Celine Dion $41.2M N/A

North American Tours Only

Top 10 Tours of 2011

Of the top ten North American tours only three played in Sacramento. Those three each

played one night in Sacramento, while playing multiple nights in other California cities.

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Artist Average Ticket Price California Performances

Roger Waters $222.98 Los Angeles, San Diego, San Francisco

Kenny Chesney & Tim McGraw $202.13 Anaheim

Lady Antebellum $141.26 Fresno, Los Angeles, Sacramento, San Diego, San Jose

Red Hot Chili Peppers $178.72 Los Angeles (2x), Oakland (2x), San DiegoJason Aldean $187.67 N/A

Neil Diamond $210.72 San Jose

Brad Paisley $161.21 N/A

Coldplay $257.27 Los Angeles (3x), San Jose (2x)

George Strait $180.88 N/A

Rascal Flatts $169.69 N/A

Based on tickets sold as of 12/22/11

Top 10 Tours of 2012

Of the top ten North American tours in 2012, only one is scheduled to play in

Sacramento. Six of the ten are scheduled to come to California.15


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Contents

1. Overview



4. Conclusion

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Summary

Sacramento has a choice either move forward with aproject that creates thousands of jobs and billions in

economic activity

Fail to complete the ESC project, and experience the

economic and cultural consequences of no longer being aprofessional sports city and a venue for hosting major

cultural events

OR

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