Penguins may revisit K.C. if talks here sputter
Saturday, February 03, 2007
By Mark Belko, Pittsburgh Post-Gazette
With Pittsburgh arena negotiations dragging on, the Penguins may step up talks next week with officials in Kansas City about a possible relocation.
Team officials will accelerate those negotiations if they are unable to complete substantially a deal with state and local leaders over the next few days or so to stay here, a source close to the Penguins said yesterday.
In Kansas City, the new $276 million Sprint Center will be ready to open this fall. To lure the team, officials are offering the Penguins a deal that includes no rent, no construction costs, no upfront payments, and half the building revenues.
After visiting the city Jan. 3 and 4, team co-owners Mario Lemieux and Ron Burkle said they would decide within 30 days whether to stay in Pittsburgh or look to relocate. That "soft" deadline expires this weekend.
Since that first visit, officials in Kansas City, including those affiliated with Anschutz Entertainment Group, which will manage the Sprint Center and share revenues with the team, have adjusted their offer to the Penguins, although no details were available yesterday.
However, the team has not pro-actively engaged in discussions about a possible relocation, concentrating instead on reaching a deal with Gov. Ed Rendell, Mayor Luke Ravenstahl and Allegheny County Chief Executive Dan Onorato to stay in Pittsburgh.
That could change in the next week or so if the two sides are unable to complete an agreement on financing a new building to replace Mellon Arena, the oldest in the National Hockey League.
The Penguins' current lease expires at the end of June, leaving the team free to move elsewhere.
Even if team officials step up talks with Kansas City, it does not mean they would end negotiations with state and local leaders here. Talks could proceed simultaneously on both fronts.
Neither AEG officials nor others in Kansas City could be reached for comment. The Penguins have declined comment on all aspects of the talks, both in Pittsburgh and elsewhere, and continued to do so yesterday.
No new negotiations have been scheduled so far. But the team and state and local leaders here are hoping to set up another round of talks next week, at which point they most likely will be seeking to wrap up a deal to keep the Penguins in Pittsburgh under a 30-year lease.
Neil deMause, co-author of "Field of Schemes," a book about stadium financing controversies, saw the Penguins' stepped-up interest in Kansas City as designed "to light a fire under Pittsburgh."
"It may or may not be true, but I don't think they would be telling you or anybody that if they weren't trying to use it as leverage," he said.
He described it as the bargaining equivalent of the two-minute warning in football. "Teams say this all the time and they mean it about 5 percent [of the time]," he said, adding he would be surprised if the Penguins don't end up staying in Pittsburgh.
Mr. Rendell said Thursday that state and local officials have revised their offer to the team, although no details were disclosed. He, Mr. Ravenstahl and Mr. Onorato are trying to reach a deal under Plan B, the funding formula that relies on gambling revenues and team contributions to build an arena.
Plan B previously had been altered to reduce the team's share. The Penguins originally were to contribute $2.9 million a year for 30 years, plus $1.16 million annually in naming rights.
But Mr. Rendell said last week the team's contribution is now a "fraction" of the $2.9 million the Pirates annually put into PNC Park. It's unknown how naming rights factors into that.
Mr. Ravenstahl said yesterday he still believes "there's issues with the numbers, and that's what we're discussing, and until we have the ability to say, or they have the ability to say yes, we're still in a negotiation stage."
Nonetheless, he said he was not disappointed with the pace of the talks.
"Certainly we want this issue resolved as quickly as possible, and I continue to work to do so. But I wouldn't see it as a setback in any way that we haven't had discussions this week. It's just a matter of logistics, and timing, and matching up schedules of all of those involved."
Even with possible Penguins' negotiations with Kansas City looming, state Sen. Wayne Fontana, a board member for the city-county Sports & Exhibition Authority, which is involved in the talks, said he still feels "very positive" that a deal will get done here.
"They've been exploring these options since the beginning. I imagine they will continue to do that until a deal's signed," he said.
Kate Philips, Mr. Rendell's spokeswoman, declined comment on the Kansas City developments.