Steelers avoid more rent payment

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When the Steelers were awarded a $75 million state grant for the construction of Heinz Field in 1999, the money came with a caveat -- the NFL football team had to generate at least the equivalent amount in tax revenue for Pennsylvania over 30 years at the stadium or it would be responsible for the difference.

Based on the first accounting, which was mandated to occur after 10 years, the team is on track to do just that.

In awarding the grant, former Gov. Tom Ridge and the state legislature required the Steelers to make an additional rent payment of $25 million at the end of each of three 10-year lease periods.

However, under the terms of the deal, the team could avoid that rent if it paid at least $25 million in state taxes in that period over and above a base-year average. The base-year average was determined by averaging out the taxes paid at Three Rivers Stadium in 1996, 1997 and 1998, and then multiplying that number by 7.5.

A state budget office report released this week found that the team generated enough in stadium-related tax revenue to avoid the additional rent payment. While the report did not give a figure, the Steelers said the team produced more than $54 million in taxes in the new stadium's first decade.

The taxes involved included the corporate net income tax, the capital stock and franchise tax, personal income tax, and sales tax.

Another review will take place in 10 years and again in 20 years.

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Mark Belko: mbelko@post-gazette.com or 412-263-1262.


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