To say the stakes are high when it comes down to it is an understatement the city of Oakland’s sale of the Coliseum site to a group of investors.
The city is selling half the property and relying on that money to balance Oakland’s budget, avoiding $63 million in painful cuts to the police and fire departments.
On Wednesday evening, KPIX confirmed there is a new timeline for the buyer, African American Sports and Entertainment Group, to deliver that money.
Oakland City Council Member Janani Ramachandran says she wants the deal with AASEG to go through, but right now she’s more concerned about how to balance the city’s budget as the group makes the first $10 million payment hasn’t done.
It’s something she says the mayor doesn’t want to talk about.
“Why are you keeping councilors in the dark? What’s going on with the contingency effect? Will we see fire stations emptying tomorrow? Will we see a drop in the number of officers? And those are my questions too,” Ramachandran said . .
Ray Bobbitt is the founder and managing partner of AASEG. He says the deal is still on track, and their group is in the final stages of negotiating an amendment to the original sales agreement — and plans to pay the city the $10 million in the next five days.
The The original purchase-sale agreement was signed at the end of July. It called for four payments totaling $63 million between September 1 and January 15.
The amendment AASEG is proposing would provide the city with a $10 million payment on Oct. 7 and then pay the full $95 million balance by June 30, 2025. That’s also an increase in the sales price from $105 million to $110 million.
“We raised the price a little bit just because it was important for us to move through the process faster,” Bobbit said.
According to Bobbit, AASEG’s main concern with the payment plan in the original contract was that if something catastrophic happened and the city filed for bankruptcy, the group would essentially lose all their money.
The amended agreement would allow the group to take ownership of the property immediately upon payment of the lump sum.
Bobbit told CBS News Bay Area that he’s not sure why city council members weren’t aware of the proposed changes.
“It sounds like there was some miscommunication between city departments,” he said.
But Ramachandra says the deal with AASEG is a different contract than the city budget, which requires the city to make cuts if AASEG payments aren’t made on time. But she says the city manager and the mayor’s office aren’t disclosing which cuts they’ll make first.
“Contingencies have started, in the sense that they are starting to cut back,” Ramachandra said. “We obviously want to know what those cuts are. Are they going to be big, dramatic cuts to public safety? Are they going to be something softer? And we don’t know.”
Oakland Mayor Sheng Thao declined an interview request on Wednesday. However, she released a statement on Tuesday saying, “The AASEG deal is on track” and that “no contingencies have been activated that were not already in place.”
Bobbit also said he wonders if some of this controversy is politically motivated, like Mayor Thao facing a recall on the November ballot.
