76ers leaders told the City Council that they are unwilling to budge on the $50 million community benefits agreement accompanying their proposed Center City arena, despite calls from lawmakers that the amount is not enough to offset the project’s negative impacts.
Council is currently considering legislation authorizing the $1.3 billion development, and members could make a final decision in less than a month, before the body recesses for Christmas and New Year’s.
Lawmakers spent hours Wednesday grilling 76ers officials with questions about the CBA, potential costs to SEPTA and possible effects on Semiquincentennial celebrations.
Representatives from Mayor Cherelle Parker’s administration and the 76ers negotiated the CBA, along with an economic opportunity plan to ensure minority and female participation in the process.
“50 million is the number that we can support,” testified David Gould, chief corporate affairs officer at Harris Blitzer Sports & Entertainment (HBSE), the NBA team’s owner. “We currently cannot go above that.”
Lawmakers offered other numbers – $250 million and $300 million, among them. Councilmember Jeffrey Young suggested the 76ers set aside millions in an escrow account in case the arena does not generate as much tax revenue as projected.
“We are not aware of any precedent where any business,” Gould said, before Young cut in, “We could create it.”
The 76ers have also reached a payment-in-lieu-of-taxes deal with Parker’s office for an annual average of $6 million, and a city-commissioned study estimated that the arena would result in nearly $250 million in new tax revenues for the city and school district over the course of three decades.
“It seems like we’re not getting our fair value,” Councilmember Nina Ahmad said. “The 50 million, from everybody I’ve heard here, doesn’t seem to be final for us. It seems to be final for you, but we have to sign off on this.”
City officials have said the CBA dollars would be paid out over 30 years, the facility’s anticipated lifespan, though HBSE leaders said Wednesday that they would be willing to extend the arrangement if they remain at the site, known for now as 76 Place at Market East.
The planned arena would seat 18,500 spectators and occupy a section of the current Fashion District mall in an area bounded by Market, Filbert, 10th and 11th streets above SEPTA’s Jefferson Station.
Lawmakers have raised concerns about potential costs to SEPTA, which is in the midst of a financial crisis. HBSE officials testified that the 76ers would pay for physical changes to Jefferson Station needed to support the arena. However, the team is not willing to fund the transit system’s operations, beyond support that is already provided by Philadelphia’s professional sports franchises.
“I’ve heard from SEPTA, and I know that SEPTA is not satisfied,” Councilmember Mike Driscoll said at the hearing.
Councilmembers and the 76ers representatives repeatedly referenced a SEPTA report about the project’s impact on the authority. The document has not been publicly released. A SEPTA spokesperson said more details will be available next week, when transit officials are expected to testify and answer questions at a 76 Place hearing.
Another concern was the effect construction could have on the festivities and major events planned to mark the country’s 250th anniversary in 2026.
Alex Kafenbaum, HBSE’s senior vice president and head of development, said that the 76ers will attempt to minimize negative impacts, but that demolition has to begin that year to meet the team’s timelines.
Lawmakers also questioned the developers’ commitment to ensuring that Black and brown residents, women, and those with disabilities benefit from the project at every level of the process.
Majority Leader Katherine Gilmore Richardson paraphrased Jay-Z’s song “Legacy” after confirming that no one in the 76ers ownership group matched those demographics.
“Generational wealth, that’s the key. Our parents didn’t have much, so the shift must start with me,” she said. “We aren’t shifting anything with these numbers, so this concerns me.”
On a slightly different note, Kenyatta Johnson, the council president, opined that the project “could be very transformative” for the city, particularly if young Black men most at risk of becoming perpetrators or victims of gun violence have access to the thousands of construction jobs that are expected to result from it.
Tension between the mayor and Council is typical, if not inevitable, and a few lawmakers reminded the HBSE leaders that the CBA and other aspects of the arena deal were hashed in closed-door talks with the Parker administration.
“We’re a separate branch of government,” Driscoll said. “This isn’t going forward unless you get a majority of the votes from the people in this room.”
Wednesday’s hearing was the second in a series of meetings scheduled over the next few weeks to consider the plan to build the arena, known for now as 76 Place at Market East.
Councilmember Mark Squilla, who represents the proposed site, began the legislative process when he introduced 11 bills and two resolutions Oct. 31. Hearings conclude Dec. 3, giving lawmakers just enough time for a final vote before the end of the year. That tally will be among the most anticipated Council votes in recent years.
HSBE leaders say they need Council approvals sometime next month in order to begin demolition in 2026 and open the arena in time for the 2031-2032 NBA season. Kafenbaum told lawmakers that the project is already behind schedule.
The Committee of the Whole, which includes all Council members, is considering the 76 Place legislative package. It will reconvene Tuesday, Nov. 19, with the first public comment session scheduled for that afternoon, beginning at 1:30 p.m.
