Lake Fong, Post-Gazette Penguins co-owner Mario Lemieux, Allegheny County chief executive Dan Onorato and National Hockey League Commissioner Gary Bettman at today's announcement. Click photo for larger image. More on the story Audio report: Dennis Roddy provides a detailed account of the agreement with audio from the participants. Penguins reach deal on new arena Rendell credits casinos with helping keep the franchise in Pittsburgh Officials say no local tax dollars will be used to build new arena... with audio Players are happy that team is staying in Pittsburgh Empty Netters: Fans -- it's your chance to tell us what you think

Penguins owners and public officials today jubilantly discussed the details of their long-sought agreement for a new arena in Pittsburgh.

At a news conference at the Sen. John Heinz Regional History Center in the Strip District, Gov. Ed Rendell made the formal announcement of the 30-year agreement. He noted that he and local officials had come up with a Plan B for funding in case the Penguins' partner, Isle of Capri, did not win a casino license for Pittsburgh. Isle of Capri had pledged to build an arena for the team, but it did not win the license.

Mr. Rendell said Plan B had been changed because of competition from Kansas City, which has a nearly finished arena and was wooing the Penguins.

The team will no longer have to pay $8.5 million up front. Instead, the state will pay $10.5 million from public development funds.

In addition, the team will only have to commit $2.2 million of its own in annual lease payments, a reduction, but will have to make up the difference by seeking $2 million in naming rights, an increase. Overall, however, the $4.2 million per year team commitment is a $200,000 increase over the figures spelled out in the original Plan B.

Mr. Rendell said public officials agreed with the team that the previous $270 million construction cost estimate might be too low, and the funding calculations were increased to consider a $290 million pricetag.

The team and the state will split the costs of any increase in construction cost between $290 million and $310 million. The team will cover any cost overrun above $310 million.

The governor said Kansas City had offered a great deal to the team. But what "tipped the balance" toward Pittsburgh was the strong support of the local fans.

And once again, Mr. Rendell said the deal could not have been done without the revenue expected from new slots casinos.

Allegheny County Chief Executive Dan Onorato noted the region is also getting a multi-purpose facility for concerts and other entertainment.

He said the Penguins have been offered a $15 million credit as incentive to spur development around the arena, rather than leaving it as parking. He said officials have set a goal of developing 2.8 acres a year, with the whole area developed in 10 years. The Penguins would lose development rights to areas they don't complete each year.

PITG Gaming, the winning bidder for the city's slots casino, could be given a chance to get involved in development, and Hill District officials will be consulted about what they would like to see next to their neighborhood.

Mr. Onorato said officials have received a pledge from unions for a labor stabilization agreement.

Mayor Luke Ravenstahl also emphasized that Hill District leaders would be involved in development around the site.

Team owner Mario Lemieux said the goal had always been to keep the team in Pittsburgh. He thanked Mr. Rendell, even though he noted the two had not always agreed.

Mr. Lemieux also cited National Hockey League Commissioner Gary Bettman for his input into the negotiations.

Sources last night told the Pittsburgh Post-Gazette that an agreement had been reached over the weekend following a "very productive" meeting Thursday that broke an impasse in the talks. Mr. Bettman had sat in on those talks in Philadelphia.

Mr. Onorato and Mr. Ravenstahl said today the deal would require no local tax dollars. And Mr. Rendell credited the state's new slots casinos for providing much of the needed funding.

PITG will contribute $7.5 million a year from its revenues, and the state will kick in another $7.5 million a year from its share of the pot.

Mr. Rendell said today that the state's contribution from the casino revenue will not take away from the casino funds designated for property tax relief. He said a separate pot of casino revenue has been set up for economic development and he designated some of that for the arena.

The arena is expected to be ready for the Penguins during the 2009-10 season, and the deal is designed to keep the team in Pittsburgh for 30 years. The current lease for the Mellon Arena expires in June.

Team owners had visited Kansas City, which has a new arena but no hockey team, and Las Vegas, which has neither. But officials had said from the beginning that their preference was to stay in Pittsburgh, where there is an established fan base.

More details in tomorrow's Pittsburgh Post-Gazette.