The move is designed to help the project meet construction deadlines set up by the NBA.
Before the vote, council members heard from people on both sides of the issue, including Craig Powell, a critic of the arena financing plan.
"I call on every member of this city council to publicly pledge that you have no intention of consumating that bond sale before the people have a right to vote on June 3rd, provided this thing is qualified."
That "thing" he's referring to is an effort by arena opponents to but the project up for a public vote.
But City Councilman Steve Hansen said keeping the project on track is important.
"Let's keep working hard on this. There's still so much to do and there's a lot of uncertainty. While we have a lot of questions to resolve around community benefits and these other things, we've got a long road. Let's not undermine the project as we go forward. We have a lot of time to refine these answers."
Officials with the Kings say the exemption will also help the team meet its goals for the number of local and small businesses that would be involved in building a new downtown arena. The Kings want at least 60% of the arena work to be done by businesses based in the Sacramento area and 20% by small businesses, figures Councilwoman Angelique Ashby liked hearing.
"I'm excited that this project allows us to do that local component in a real way, in a tangible way and in a very big way for Sacramento. This is about saying to our local chambers, to our local businesses 'you're in and we're going to find a way.'"
The council voted 7-2 in favor of suspending the competitive bidding process.
The Sacramento City Council has approved $614,250 for two art projects at the new downtown Golden 1 Center. A Sacramento and San Francisco artist each were selected.
The Sacramento City Treasurer says a lawsuit filed against the city and the Sacramento Kings' arena project caused a delay in the bond-buying process.
The Century Downtown Plaza 7 theater complex that closed this week for remodeling will reopen in the fall with a new name - Century DoCo 9 Theaters. Sacramento Business Journal Editor Jack Robinson tells us about that story and more business news.
An A+ and A rating allowed the City of Sacramento to offer more than $270 million in bonds to help pay for the city's share of the new Golden 1 Center arena downtown.
While the outside of the new downtown arena takes shape, preliminary foundation work has begun for the new hotel next to the arena.
A company headquartered in China, but that was once based near Sacramento has been selected by the Sacramento Kings to install solar panels on the new arena.
Work has begun on a new bridge over Interstate 5 in Sacramento.