Barden wants to drop funding for Hill
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North Shore casino developer Don Barden wants to drop a $3 million commitment he made to support Hill District redevelopment efforts as part of his bid for the Pittsburgh slots license.
In a petition filed Thursday with the Pennsylvania Gaming Control Board, Mr. Barden's company, PITG Gaming LLC, asked for permission to eliminate the financial commitment of $1 million annually for three years "due to the grant of the development rights to another party."
The language is a reference to the award of development rights for the 28-acre Mellon Arena property to the Penguins last year as part of negotiations over a new building for the team.
As part of the final deal, the Penguins were required to negotiate in good faith with Mr. Barden about his potential participation in redevelopment of the 28 acres. Mr. Barden met with the Penguins once last year, according to a team official.
Despite repeated efforts, PITG Gaming officials could not be reached for comment.
The commitment of $1 million annually for three consecutive years is one of the 57 formal conditions the gaming board imposed in awarding Mr. Barden the license for the casino in December 2006.
Mr. Barden had committed the funds as part of an ambitious plan for a $350 million redevelopment of the lower Hill District, one similar to what losing bidder Isle of Capri Casinos Inc. had proposed.
The gaming board now must decide whether to grant his request to drop the commitment. It also has the power to reject it. No date has been set for the board to act on it, spokesman Richard McGarvey said.
"I can't predict what may or may not happen. The board will look at all of this and make a determination," he said.
Carl Redwood, chair of the One Hill Community Benefits Agreement Coalition, said that yesterday was the first he had heard that Mr. Barden was seeking to get out of his commitment to the neighborhood.
One Hill is trying to negotiate a community benefits agreement with the city, county and Penguins over the arena project.
"I think it would be really important for him to continue to support economic development activities in the Hill District," Mr. Redwood said of Mr. Barden.
But, he added, he understood Mr. Barden's reluctance on the commitment if he wasn't going to get development rights for the Mellon Arena property, saying people expect a return on their investment.
One Hill has no plans to go before gaming board members to ask them to force Mr. Barden to honor the commitment, Mr. Redwood said. He added the group doesn't know much about the details of the pledge.
"Beyond a one-sentence promise, I don't know what exists," he said.
Brenda Frazier, a former county councilwoman who is running for a state House seat, said she would like to meet with Mr. Barden to find out why he dropped the commitment.
"It sounds disturbing. This is the first I heard of it. I'd like to check it out a little more to find out what happened here," she said.
Mr. Barden committed to the $3 million during suitability hearings on the license in November 2006. The first payment was to be made within one year of the casino's opening, scheduled for May 2009.
In his petition, Mr. Barden also is seeking to modify the financing for the casino. He had secured a $200 million bridge loan to get construction started, but hopes to have permanent financing in place by May 19, according to the petition.
The financing includes a $650 million in loans from Credit Suisse and $150 million from KeyBank National Association. The casino's cost had been estimated at $450 million. No reason was given in the petition for the size of the loans.
Also, Mr. Barden formally proposed to modify a change in the size of a controversial parking garage to include 3,842 spaces, down from the 4,100 that was a condition for receiving the license.
First Published April 19, 2008 1:08 am