Penguins alarmed over delay in arena funding bill
Friday, June 29, 2007
By Mark Belko, Pittsburgh Post-Gazette
If the state Legislature recesses for the summer without approving a bill critical to funding a new arena, the entire project could be in jeopardy, Gov. Ed Rendell and the Penguins said today.
"The money is there but the Penguins have said that if the bill isn't passed in this session it may delay construction for a year and that might put the deal in jeopardy," said Chuck Ardo, Mr. Rendell's spokeman.
He said the governor is lobbying state senators to act on the slots-backed legislation, which would provide $7.5 million a year for 30 years toward the arena construction, before leaving for the summer. Mr. Ardo said it would be an "absolute travesty" for the project to be jeopardized after state and local leaders worked so hard through the winter to cut a deal with the Penguins to build a new arena and keep the team in Pittsburgh.
In response to the statements, Penguins President David Morehouse said, "If this legislative session ends without arena funding in place the entire funding structure for the arena and the arena project would be in jeopardy."
A delay would prevent the Pittsburgh-Allegheny County Sports & Exhibition Authority from issuing $325 million in bonds to finance the construction. It also might allow interest rates to creep up, which could create a shortfall in the funding scheme crafted as part of the deal with the Penguins and conceivably could require a renegotiation of the terms.
The arena money is included in a new $1.6 billion fund for capital improvements financed by slot machine revenue. The legislation governing the fund has passed the House but is still awaiting action in the Senate.
State Sen. Jane Orie, R-McCandless, said today legislators outside of Pittsburgh and Philadelphia are hesitant to act on the funding bill until a state budget is passed. She said they consider the budget their top priority, not the bill funding the arena and an expansion of the Philadelphia convention center. Mr. Rendell is still battling with the Legislature on budget particulars and that fight may stretch beyond the weekend, the deadline for passing a budget.
Ms. Orie said she believes the funding bill has a good chance of passing once the budget has been resolved. She said Mr. Rendell was using the threat of the project being in jeopardy as "somewhat of a scare tactic" to try to force action.
"I believe it can get done. If the governor negotiated a budget instead of going on the radio it would make it a lot easier to get it done," she said, referring to Mr. Rendell's statements on a radio program this morning.