Politician: 'Best deal is on the table'

Local official says next move is up to Penguins

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Peter Diana, Post-Gazette
Mario Lemieux said the Penguins are unhappy with the state and local officials' proposal for a new arena.
By Mark Belko
Pittsburgh Post-Gazette

Despite the setbacks last week, a state senator familiar with the negotiations between the Penguins and state and local politicians remains confident that a deal can be made to keep the team in Pittsburgh.

But Sen. Wayne Fontana, a city-Allegheny County Sports & Exhibition Authority board member, insisted yesterday that the next move is up to the Penguins, arguing that the deal on the table is better than the one being offered by Kansas City, where a new arena awaits the team.

The SEA is assisting Gov. Ed Rendell, Mayor Luke Ravenstahl and county Chief Executive Dan Onorato in the talks.

"I feel confident that the best deal's on the table, no matter where they would go," Fontana said. "If they're holding out to get more, the question becomes how long they're going to hold out before they say it's a done deal."

Penguins owner Mario Lemieux, speaking yesterday at NHL All-Star Game festivities in Dallas, said that the team is unhappy with the state and local officials' proposal for a new arena.

"I wasn't [at that meeting Thursday], but we were very disappointed," Lemieux said. "As always, we're going to go out and explore our options. When we get a deal that we like, we'll sign it."

Lemieux indicated that the team won't wait too much longer to decide what it will do after this season.

"The sooner, the better, not only for us, but for the league," he said. "They need to know where this team is going to play next year.

"A few weeks ago, I said 30 days. I think we're getting close to that. Sooner or later, we're just going to make a decision and go with that."

The Penguins are upset over a proposal that would require them to share development rights near Mellon Arena and parking revenues with Pittsburgh casino winner Don Barden.

As part of his winning bid, Barden has proposed a $350 million redevelopment of the lower Hill, including the Mellon Arena property.

Team officials believed the proposals represented a retreat from an earlier bargaining session Jan. 4. They saw the proposed deal as worse than a lease extension available next year at Mellon Arena that would give them control over all revenue, including parking, which generates more than $2 million a year.

Under the extension, they would play rent-free at Mellon Arena. The new arena proposal included a provision for rent in excess of $2 million a year, although it is unclear whether that would count as the Penguins' contribution toward construction.

No new talks have been scheduled, although the sides are still communicating and exchanging information, a source said yesterday.

But given what happened last week, the team likely will step up talks with Kansas City and might explore options in other cities as well. Their Mellon Arena lease expires at the end of June.

Asked about the chances of Kansas City coming strongly into the picture or the Penguins making another visit there, Lemieux said, "No comment." Three times.

Asked about Kansas City itself, Lemieux said, "The one visit we had with local leaders was very positive, with the corporate support, having the [luxury] boxes sold out."

Despite the Penguins' objections, Fontana believes the deal before the team is better than the rent-free offer in Kansas City for the use of the new $276 million Sprint Center, where they would share the building revenue. The team would keep all arena revenue, excluding parking, in Pittsburgh.

"It gets frustrating when you meet and don't come to a conclusion, especially when everyone who has analyzed the proposal says it's a better deal in the long run than what Kansas City is offering. You wonder what's holding it up then," Fontana said.

Rendell has said that the deal being offered the team under Plan B is better than others struck recently in the National Hockey League. He also said the team's share of the construction cost would be a "fraction" of what other Pennsylvania sports franchises put into their stadiums or arenas.

The Plan B formula calls for Barden to contribute $7.5 million a year for 30 years toward construction. Another $7 million a year would come from a slots-financed state development fund. The Penguins' contribution started at $4 million a year, including $1.16 million annually in naming rights, plus $8.5 million upfront.

It is now believed to be lower than the $2.9 million a year the Pirates committed toward PNC Park.

Shelly Anderson contributed to this report. Mark Belko can be reached at mbelko@post-gazette.com or 412-263-1262.


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