SACRAMENTO (CBS13) - A four-hour meeting ended with a historic vote for the city of Sacramento on Tuesday night as the City Council voted in favor of proceeding with a downtown arena.

Before an overflow crowd at City Hall, the council voted 7-2 in favor of the non-binding financial plan for the $391 million sports and entertainment complex in the now-empty railyards. The term sheet, agreed upon by the city, the Kings and the NBA last week after meetings in Orlando, would keep the team in Sacramento for at least another 30 years.

In a roll-call vote, Mayor Kevin Johnson, who was instrumental in getting the city to Tuesday's vote after the Kings almost left for Anaheim after last season, cast his vote last and yelled "YES!" as the crowd in attendance erupted in cheers.

"We feel like we have our own Super Tuesday here in Sacramento," Johnson said right before the vote. "This is our moment today. Our community just fought and fought. We defied the odds."

After the vote in a press conference, Johnson ended his comments with "Long live Sacramento and long live the Kings."

The city authorized using $850,000 in predevelopment funds with Tuesday's vote as it moves with the project.

Under the agreement, the city would contribute $255.5 million to the project, mostly by leasing out its parking garages. The Kings have agreed to pay $73.25 million and arena operator AEG would contribute $58.75 million. The remaining gap would be covered by a ticket surcharge, advertising around the facility and a public sponsorship campaign.

The presentation on the arena started at 6 p.m. with reports from Assistant City Manager John Dangberg and City Treasurer Russ Fehr. It moved on to public comments, comments and questions from the council and then the vote, with Sandy Sheedy and Kevin McCarty the lone no votes. Both said they had concerns about the risks the city would be taking on in paying for the bulk of the arena.

Darrell Fong voted in favor but cautioned those in attendance that he was skeptical of the deal and would be asking hard questions throughout the process going forward.

Fans started showing up at City Hall hours before Tuesday's meeting, some passing out T-shirts saying "5 Votes," the majority needed for approval. Also among those at the meeting was Kings rookie point guard Isaiah Thomas and co-owner Gavin Maloof.

After the yes vote, Maloof thanked the city and "the best fans in the world."

"We're on the verge of doing something very special," Johnson said before the meeting, later shaking hands with all those waiting to get inside. "We're finally at the point where we have one single vote, one moment in time to totally transform the downtown community and Sacramento for generations."

Prior to the meeting, Sheedy sent a policy paper titled "Stop! Think..Consider?" to her fellow council members containing what she says is "not the kind of information that has been provided to us."

Sheedy said she has doubts about the arena's economic impact for Sacramento. McCarty said in a city that's shutting down public pools, doing the bare minimum in park maintenance and laying off police officers and other staff, the risks are too great to take.

Asked before the meeting about the worst-case scenario if the project moves forward, Sheedy told CBS13: "In one word, Stockton. I would not like to see that happen to the city of Sacramento. If it passes, I hope that the most due diligence that can be done is done."

Stockton built a new arena in 2005 but has lost millions on it as it struggles to fill it for events. The city is on the verge of bankruptcy.

However, Johnson has said the project will add 4,000 jobs. City Manager John Shirey told the council that the decision would be "one of the toughest votes of your career" and implored members to approve the plan for the economic benefit, job creation and immeasurable notoriety of remaining a major professional sports city, saying "there are only 30 of those (NBA) franchises in all the world and we happen to have one of them."

"The status quo is not really an option before you this evening," Shirey said before the vote. "If we do nothing, the Kings will likely leave Sacramento."