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Smizik: Winning slots plan must be one that's best for city
Wednesday, February 22, 2006

At first glance, it's perfect.

What could better suit the needs of the region and the Penguins than a new arena built by the awarding of a slots license and without using one cent of taxpayer -- or the hockey team's -- money?

But issuing such a license is far too complex to be judged on first glance. That's why there should be no rush to judgment on awarding the license. That's why the issues involved must be studied by experts, not name-calling partisans of the hockey team.

Here's what many, including the ardent Penguins cheerleaders in the media, don't seem to understand:

The slots license should be awarded to the group whose proposal will do the most good for the Pittsburgh region, not the one that will do the most good for the Pittsburgh Penguins.

That could very well mean the license should go to the Isle of Capri Casino Inc., the group, in conjunction with the Penguins, that is proposing to build a casino near Mellon Arena. Under the plan, Isle of Capri would use part of its profits to give $290 million to the hockey team to build an arena. It's a highly attractive plan, which also includes $400 million to rebuild the lower Hill District and $1 million a year in slots proceeds for community use.

But is it better than the other two bidders for the license? That's not an easy decision for a layman or even an expert.

Harrah's and Forest City Enterprises have presented a plan that calls for a $512 million casino with more than 1,200 condominium units and several hundred new hotel rooms at Station Square. A third plan, calling for a slots parlor along the Ohio River near Heinz Field, is considerably less ambitious and believed to have only a slight chance of securing the license.

The Isle of Capri is the frontrunner and deservedly so because of its plan to build a facility to replace the aging and out-of-date Mellon Arena. Harrah's and Forest City, not without a touch of arrogance, pronounced it would consider helping to fund an arena only after it received the license. That's not good enough.

Local politicians and Gov. Ed Rendell, who are hurriedly putting together a Plan B in case Isle of Capri doesn't win the license, need to put pressure on Harrah's to alter its plan. Altering would not mean coming full circle and pledging to build an arena. It would mean having a willingness to contribute a significant annual sum, which could be used to pay the debt service on a new arena.

The Penguins don't want to hear about any kind of Plan B. Such a plan almost certainly would include them making a sizable contribution, much the same as the Steelers and Pirates did when Heinz Field and PNC Park were built.

Although it has barely been mentioned, the Penguins have changed their stance toward remaining in Pittsburgh. Previously, all they had asked for was a new arena. That's no longer the case. They don't just want a new arena, they want a new arena built solely with slots money -- which means without their money.

It's understandable the Penguins don't want to put up any of their own money. That doesn't make it right. The current ownership group, headed by Mario Lemieux, is in the process of selling the team. The franchise is far more valuable if a new arena at no cost is part of the deal. If there is a Plan B, which might expect the Penguins to contribute, say, $25 million, that's a large chunk of money for a group in the process of selling. In effect, it's taking $25 million out of their pocket.

What is particularly unfortunate about this process is the name-calling by Lemieux supporters. Gov. Rendell, Mayor Bob O'Connor and Allegheny County Chief Executive Dan Onorato all have come under heavy criticism, which is mostly unfair.

The Gaming Control Board, not Rendell, O'Connor or Onorato, will make the decision on the license. The seven-member board was appointed to take the process away from the politicians and into the hands of private citizens who have the best interest of the state. Rendell, a Democrat, appointed three members of the board. The other four were appointed by legislative leaders, three of whom were Republicans and one a Democrat.

The notion put forward by Lemieux supporters that a contribution made by Forest City to Rendell, in the amount of $147,688, will play a role in the decision is laughable and only makes the Penguins look stupid.

If the governor of the commonwealth could be bought so easily, the Penguins would have been wise to have paid massively disappointing defenseman Sergei Gonchar $24.8 million instead of $25 million. They could have donated the $200,000 left over to the governor.

Of course, it doesn't work that way.

The process continues. Hopefully, the proposal that is best for the region will win the slots license. Whatever happens, a new arena can be built and the Penguins can be kept in town.

First published on February 22, 2006 at 12:00 am
Bob Smizik can be reached at bsmizik@post-gazette.com or 412-263-1468.