EmailEmail
PrintPrint
Barden: No more Plan B money, but development partnership possible
Wednesday, January 10, 2007

Pittsburgh casino winner Don Barden won't increase his contribution to Plan B to help keep the Penguins in town, but he is willing to consider a partnership with the team in the redevelopment of the Mellon Arena site.

Mr. Barden has pledged $7.5 million a year for 30 years toward construction of a new arena under the Plan B formula, and that's as far as he'll go, spokesman Bob Oltmanns said yesterday.

"Our point has been all along that the Penguins ought to have some equity in this project, too," he said. "We think we're contributing more than our fair share."

He added neither Gov. Ed Rendell, Mayor Luke Ravenstahl, nor Allegheny County Chief Executive Dan Onorato had asked Mr. Barden to beef up his offer as part of their negotiations with the Penguins. There has been speculation that politicians might turn to Mr. Barden for help in reducing the Penguins' share.

Nonetheless, Mr. Oltmanns said Mr. Barden, who proposed a $350 million redevelopment of the lower Hill District in his winning casino bid, would consider a partnership with the Penguins in that venture.

City Councilman William Peduto, a likely mayoral candidate, said Monday that local and state officials should offer the Penguins a chance to partner in the redevelopment of the Mellon Arena site and share in the profits as part of Plan B talks.

"We're looking to be partners with lots of different entities and I would hope, now that this license has been awarded, moving forward we can perhaps heal some of the wounds left after [the casino award] announcement and get on with making investments that would be good for Pittsburgh," Mr. Oltmanns said.

The Mellon Arena property would be available for redevelopment if a new facility is built across the street, as pitched by the city, county and team.

Mr. Onorato considers possible redevelopment rights a "negotiable issue" in the Penguin talks, spokesman Kevin Evanto said. He added Mr. Onorato had said more than a year ago that such rights were one of the issues that should be considered in negotiations on a new arena.

In fact, the city-county Sports & Exhibition Authority board appointed by the chief executive and mayor had passed a resolution in November 2005 offering development rights to any casino operator or private investor willing to commit to building a new arena.

As part of talks with the Penguins, state and local leaders already have offered the team most, if not all, of the revenue generated by a new arena. That could be worth as much as $20 million a year, according to the Allegheny Institute for Public Policy.

Mr. Peduto has said that adding redevelopment profits could be a key element other cities such as Kansas City, which is making an aggressive move for the team, would have trouble matching.

The latest developments come as state and local officials and the Penguins continue to push to complete an agreement to build a new arena after a "very positive" meeting last week.

Sources indicate the basic elements of Plan B -- $7.5 million from Mr. Barden and $7 million a year from a slots-financed state economic development fund -- are still in play. However, negotiators are looking to whittle the team's share from $4 million a year, including $1.16 million annually in naming rights, to $2.9 million, the same the Pirates contributed toward PNC Park.

Another key unresolved issue is how to get the Penguins more arena-related revenue or compensation in the interim period between a deal under Plan B and the opening of the new building in 2009.

The issue is important because the Penguins can move into a rent-free $276 million Sprint Center in Kansas City in October, at which point they could start tapping into lucrative arena revenue streams, not two years from now. In Kansas City, they would share revenues with Anschutz Entertainment Group.

Mr. Ravenstahl refused to discuss details of the talks yesterday.

First published on January 10, 2007 at 12:00 am
Rich Lord contributed to this report. Mark Belko can be reached at mbelko@post-gazette.com or 412-263-1262.