The approvals followed an Oct. 26 meeting at which the council authorized the arena's design and an agreement to sell city-owned land to the developer. Photo by Rick Sloan

RANCHO CORDOVA, CA (MPG) - The Rancho Cordova City Council voted 4-1 on Nov. 2 to approve a financial agreement providing up to $185 million in public assistance for the proposed Downtown DOVA arena and entertainment district, clearing another major hurdle for the development following months of negotiations and public debate.

Council Member Joe Little cast the lone dissenting vote on four measures, including the financial participation agreement, final adoption of the development agreement, an amendment to an earlier economic development agreement and an environmental determination.

The approvals followed an Oct. 26 meeting at which the council authorized the arena's design and an agreement to sell city-owned land to the developer. Together, the decisions establish the framework for the proposed 7,500-seat Cordova Arena and surrounding mixed-use district near Kilgore Road and Trade Center Drive.

The financial participation agreement allows the city to support the privately developed project through building permit fee waivers, development impact fee payments, public safety assistance and a share of future tax revenue generated by the development.

According to the city’s staff report, the assistance would be provided in stages, with most payments dependent on construction milestones and the project’s eventual operation.

The city agreed to waive up to $3.7 million in eligible building permit processing fees, subject to inflation adjustments, and pay up to $13.5 million in development impact fees for the arena, hotels and qualifying parking improvements. Those impact fee payments would require transfers from the city’s General Fund.

Staff anticipates approximately $7.6 million in impact fees associated with the arena could become payable during fiscal year 2028-29, with the remaining $5.9 million associated with future hotel development.

An additional $15 million would be available over 15 years for supplemental police and fire services, beginning only after specified portions of the development are completed.

The agreement also establishes long-term tax revenue sharing between the city and developer.

Under its terms, the developer would receive 50% of the city’s regular sales tax revenue generated within the development, excluding revenues from voter-approved Measures H and R. The city would also share hotel occupancy tax revenue, including 100% of qualifying revenue from hotels built on the project site and 50% from hotels within a designated DOVA Zone.

The agreement additionally provides for sharing cardroom tax revenue from up to 20 tables if a cardroom is developed on the property. Such a facility would require separate environmental review, permits and licensing.

The project-site hotel and cardroom tax payments would be subject to a 2.5% administrative deduction retained by the city.

City officials emphasized that the developer would be responsible for construction financing and that the city would not assume debt associated with building or operating the arena.

Council Member David Sander defended the revenue-sharing arrangement, explaining that the city’s largest financial commitments depend on economic activity generated by the development.

“If you allow all the possible revenues to occur and if this thing is wildly successful for 35 years our estimate is that the builders/operators could receive $185 million largely in shared revenue. If it’s not built, none of that revenue exists,” Sander said. “If it does get built, the city and the builder share it.”

The city’s financial agreement also underwent four amendments during the Nov. 2 hearing following concerns raised by representatives of existing businesses.

City Attorney Adam Lindgren presented revisions clarifying the boundaries of the DOVA Zone, establishing more specific operating requirements for the arena and strengthening the city’s authority to suspend financial assistance if the arena ceases operations.

One amendment prevents hotel tax revenue sharing from beginning before the arena receives a certificate of occupancy. Another requires the arena to open for at least 30 qualifying events annually, subject to specified exceptions for renovations, repairs and other temporary closures.

The city would also have the authority, following written notice and a public hearing, to suspend payments or terminate the agreement if the arena fails to maintain required operations.

Thane Schultz, a manager representing the Marriott Rancho Cordova, had submitted written comments questioning whether the earlier agreement adequately protected the city if the arena failed to open or remain operational.

“It does sound like some of our concerns have been addressed particularly on the FPA,” Schultz told the council after hearing the amendments.

He also acknowledged that the time available to review the proposed agreement had been limited.

Public comments continued to reflect differing views about the city’s financial involvement and the development’s potential effects on surrounding neighborhoods.

Jeffrey Black, who said he has lived in Rancho Cordova for 44 years, described himself as neutral on the project but questioned the use of General Fund money to cover development impact fees.

“I don’t believe we should be paying using our taxpayer money from the general fund to pay for impact fees,” Black said. “It’s not really normal.”

He also raised concerns about existing traffic conditions near the proposed development.

Other speakers supported the agreement, pointing to anticipated construction employment, opportunities for local businesses and additional entertainment options for Rancho Cordova residents.

Teresa Satterfield, whose family has lived in Rancho Cordova for nearly two decades, said they frequently travel to neighboring cities for shopping and entertainment.

“So to our family, DOVA is an opportunity to rediscover Rancho Cordova,” Satterfield said. “It can invite others to discover what makes our community special,”

Labor representatives also urged approval, citing potential construction jobs and apprenticeship opportunities associated with the project.

Little, who raised extensive concerns about the project’s location, economic assumptions and use of public resources during the Oct. 26 meeting, declined to repeat those arguments before the final vote.

“I don’t want to relitigate last week. I know how the vote's going to go and I just want to say thank you to everyone who used their voice and expressed their concerns,” Little said.

Council Member Siri Pulipati defended the performance-based structure, saying the developer must meet specific requirements before receiving much of the city’s financial assistance.

“Accountability starts with approval, but it does not end with approval,” Pulipati said.

The city projects approximately $79.4 million in revenue over 35 years from various sources associated with the project, including tax receipts, administrative fees and proceeds from the sale of city property. The projection is based on anticipated development and economic activity rather than revenue already collected.

The broader Downtown DOVA proposal includes two or more hotels totaling up to 800 rooms, between 640 and 1,000 residential units, approximately 220,000 square feet of commercial space, restaurants, retail businesses and public gathering areas.

Construction would begin with the arena and outdoor plaza, while subsequent phases would depend on financing, market conditions and additional development approvals.

The development agreement calls for the developer to make commercially reasonable efforts to complete the arena by Nov. 30, 2027, although that date is not an unconditional completion guarantee.

With the council’s major approvals secured, the project must still proceed through financing, permitting and construction before the proposed arena and downtown district become operational.