The Seattle City Council on Monday approved an agreement for a new basketball and hockey arena in Seattle's Sodo neighborhood.

Calling it a “great day for the community,” the Seattle City Council on Monday approved an agreement with investor Chris Hansen to build a new sports and entertainment center with up to $200 million in public bonds.

In addition to paving the way for what fans hope will be the return of professional basketball, a majority of the council said the tax revenues from a new arena would help address two persistent problems: how to protect Port of Seattle operations and industrial lands near the proposed arena and what the future of Seattle Center will be.

The council vote was 6-2, with members Richard Conlin and Nick Licata objecting to public money supporting a private enterprise. Councilmember Tom Rasmussen was absent.

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Conlin questioned why Hansen, who has recruited to his investment group Microsoft CEO Steve Ballmer and Eric and Peter Nordstrom, can’t fund the arena entirely with private money.

He also noted that most of the tax revenue will go to pay off Hansen’s debt on the arena, not into the city’s general fund, which pays for city services such as police, fire and roads.

Licata noted that arena supporters have pointed to city support of other facilities including Benaroya Hall and McCaw Hall. But he said those nonprofit institutions truly belong to the city.

The financial model of professional basketball, he said, puts cities in competition with each other for greater and greater public subsidies “without providing measurable public benefit.”

After the vote, Hansen in a statement thanked the city for its hard work. Talks started more than a year ago when he approached Mayor Mike McGinn about a plan to build an 18,000-seat arena in the stadium district near Safeco Field and CenturyLink Stadium.

“I think that today’s vote demonstrates that by listening to each other and working hard to address the concerns of all stakeholders that we can make the arena a reality and bring professional basketball and hockey back to Seattle,” he said.

The revised agreement between the city, county and Hansen must now go to the Metropolitan King County Council for approval; a vote is expected next month.

The County Council signed off on the original agreement between Hansen, Mike McGinn and County Executive Dow Constantine in July.

The revised deal calls for Hansen to contribute $290 million in private funding to build the arena. He must also secure a National Basketball Association team before the city and county issue construction bonds.

Hansen has personally guaranteed the public loan with his own money and agreed to several financial protections for the city.

Hansen, who grew up in Seattle watching the SuperSonics, has spent $51 million over the past eight months acquiring land in Sodo south of Safeco Field.

The reworked agreement directs $40 million in tax revenues from the arena to a transportation fund to ensure freight mobility in the Sodo neighborhood and to pay for a study of how to protect Port of Seattle operations and industrial lands after the arena is built.

The agreement also creates a $7 million fund for KeyArena improvements and to study the future of Seattle Center. If KeyArena is ultimately remodeled in a way that won’t accommodate basketball, or is razed, $5 million of the $7 million fund would follow the Seattle Storm to the new arena.

Councilmember Bruce Harrell, a strong supporter of the arena deal, said he was reminded while stuck in Sodo traffic headed to a Mariners game Friday that a deal with Hansen could not merely “preserve the status quo.”

He said the Port of Seattle raised “real issues” about traffic and freight mobility that will now be addressed.

“This is a great day for the community,” he said.

Lynn Thompson: 206-464-8305 or On Twitter @lthompsontimes.