Ex-SEA director backs Steelers on seats at Heinz Field

Team seeks funding for 3,000 more

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The Steelers believe they have won an unusual ally in their battle to get the Pittsburgh-Allegheny County Sports & Exhibition Authority to pay two-thirds of the $30 million cost to install 3,000 more seats at Heinz Field -- former SEA executive director Stephen Leeper.

In an affidavit, Mr. Leeper sided with the Steelers' claim that proposed "designated expansions" under the Heinz Field lease don't require the team to show, among other things, that similar improvements have been installed in at least half of all NFL stadiums. The Steelers believe the proposed 3,000-seat addition qualifies as such an expansion.

Mr. Leeper, executive director of the SEA from 1998 to 2004, was the lead negotiator for the agency in the construction and leasing of Heinz Field, according to his affidavit. He also participated in negotiations with the team related to lease clauses involving capital improvements and designated expansions.

His affidavit was contained in a motion filed Friday in Allegheny County Common Pleas Court by the Steelers asking Judge Joseph James to schedule a hearing so that he can hear from Mr. Leeper himself. The team said Mr. Leeper's testimony is "key to unlocking" the true meaning of the lease language.

In a preliminary ruling in June, Judge James said that the Steelers failed to show that the proposed south end zone expansion met the requirements to be classified as a capital improvement under the stadium lease.

Under that three-prong test, the team needed to prove that a similar addition or modification has been installed in at least half of all other NFL stadiums with at least 25 percent of the cost covered by federal, state or local governments; the change is "reasonably necessary" to maintain its relative economic position in the NFL with regard to stadium revenue and expenses; and it is "reasonably necessary" to prevent Heinz Field and its amenities from becoming "materially outdated" compared to other stadiums built between 1999 and 2004.

The Steelers have argued that another clause in the lease requires the SEA, the stadium's owner, to cover two-thirds of the cost of a "designated expansion" of no more than 10,000 seats. They claim that such expansions automatically are deemed capital improvements and don't have to meet the three requirements.

In his affidavit, Mr. Leeper agreed.

He said that the parties, in crafting the lease, recognized the potential for expansion of up to 10,000 seats. Two projects, he added, were identified as "designated expansions" and the lease was drafted to provide that "they could be undertaken without PSSI Stadium [a Steelers affiliate] having to satisfy the three-prong test set forth in the Capital Improvements section."

"These projects were viewed separately from Capital Improvements and the parties intended to proceed with these projects without reference to the three-prong test established for Capital Improvements," he stated.

Mr. Leeper could not be reached for comment.

SEA attorney Walter DeForest said he would oppose the team's attempt to get another hearing.

He said Judge James already had decided the issue and a trial is scheduled in December to determine if the Steelers can show the addition meets the requirements to be classified as a capital improvement.

"There's no ambiguity in the lease. You can't change the terms of the lease by an affidavit. That's my view," Mr. DeForest said.

"We're the stewards of public monies and this litigation is not without cost to the SEA. So we don't feel another hearing on this issue would be appropriate."

In their motion, the Steelers said a designated expansion, as they interpret it, would actually save the SEA money in requiring the agency to come up with two-thirds of the funding. The team said that if it can prove the addition meets the definition of a capital improvement, the SEA would be obligated to fund the full cost.

The Steelers asked Judge James to schedule a hearing next month to hear Mr. Leeper and resolve the issue so that they can order the materials needed to have the 3,000 seats in place for the 2014 season.

That would save up to $3 million in the cost of the project and provide an additional year of amusement tax and ticket surcharge revenues to the city and SEA, respectively, they said. The Steelers said a December trial would delay the completion until 2015.

"With further delays, we are risking further costs as the deadline is quickly approaching to complete the project by the 2014 season," Mark Hart, the team's director of planning and development, said in a prepared statement.

The Steelers sued over the expansion after a deal to fund it fell apart. That agreement would have used a $1 increase in an existing surcharge on Steelers tickets and a new parking surcharge of $2 to $3 at lots around Heinz Field during home games to help finance the new seats. The team would have kicked in about $18 million.

Steelers

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


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