Impasse on Pitts new arena - team to move

Santacapper · Mar 6, 2007

TSN.ca Staff
3/5/2007 5:24:39 PM
The on-going negotiations between the Pittsburgh Penguins and government officials over the building of a new arena are not going as well as hoped.
The Penguins have declared an impasse and will aggressively explore moving the franchise to a new city. Kansas City is the favourite to land the Penguins as they have a brand new arena that is missing a tenant.
Penguins co-owners Mario Lemieux and Ron Burkle told Pennsylvania governor Ed Rendell, Allegheny County chief executive Dan Onorato and Pittsburgh mayor Luke Ravenstahl about their decision in a letter on Monday.
According to the Pittsburgh Post Gazette, the Penguins had agreed to pay $4 million annually in rent and capital expenses to contribute to a new area, as well as an additional $500,000 for a parking garage, but the two sides have not been able to reach an agreement. The Penguins had originally offered to pay $2.86 million annually in the offer that was presented by state and local leaders at a meeting January 4.
''Unfortunately, we still don't have a deal and are faced with mounting uncertainty that an agreement can be reached in a time frame that is realistic for our organization,'' the letter states. ''Therefore, we have no choice but to declare an impasse and to notify NHL Commissioner Gary Bettman that we will aggressively explore relocation.

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''A project of this scope, with so many complex issues, can ill afford further delays that add more risk and more uncertainty. The risk has been magnified by what we perceive as a lack of collaboration from the public sector in the negotiations.
''Our good faith efforts have not produced a deal, however, and have only added more anxiety to what we thought at best was a risky proposition for us moving forward.''

charvik · Mar 6, 2007

Houston! :18_1_204:
Houston! :18_1_204:
Houston! :18_1_204:
Houston! :18_1_204:
Houston! :18_1_204:

Santacapper · Mar 6, 2007

I dont give it more than 5 years in KC if there were to move there.

I honestly have no idea what Bettman smokes, but I wouldnt mind trying it.

Who cares if they have an arena in place? You need fans. He keeps on insisting to go into markets that wont work. WIth the new CBA it cries out for another Canadian team that will support it. Its spread out across Canada with big gaps... put a team on the east coast where they sell out exhibition games, or back in Winnipeg I dont care. but the economics of todays game will let these teams thrive.

charvik · Mar 6, 2007

Yeah, I agree. The best decision for the sport would probably be placing them in Canada, but I doubt they'll let them move out of the US. I'm just being selfish wanting NHL in Houston, but I'm not sure that the economics is there.

Now, if Texas just would let go of the gambling ban... (yeah, right)... damn it, I need to move.

mogo · Mar 6, 2007

something will be worked out and the pens will be staying in pittsbrugh

Santacapper · Mar 6, 2007

Yeah, I agree. The best decision for the sport would probably be placing them in Canada, but I doubt they'll let them move out of the US. I'm just being selfish wanting NHL in Houston, but I'm not sure that the economics is there.

Now, if Texas just would let go of the gambling ban... (yeah, right)... damn it, I need to move.

yeah, I dont think Im being a 'homer' canadian, if I was Id say put it in Hamilton (about an hour east of Toronto) but still though, why be so hard headed Bettman? A team didnt thrive in Minnesotta the first time round and relocated and now the Wild are doing well etc. WIth the cap and structure of the CBA it allows exactly what pushed Winnipeg / QUebec etc out of the NHL to not happen again.

something will be worked out and the pens will be staying in pittsbrugh

Dont want to sound like a pessimist, but I really dont think anything will happen. This has been trying to work out for the longest time and just doesnt seem to be getting through the politicians etc or the right people. As a business investment the pens owners hands really are tied with this one IMO:shake:

Joe Public · Mar 6, 2007

They're not done yet. Really, at this point, I'd sort of be surprised if they didn't play at least one more season in Pittsburgh.

The original deadline the league said they needed for scheduling and the like has already passed if the Pens wanted to move and the way this thing is dragging out if they were to move it would be a completely slap-dash operation.

Not that the NHL is unfamiliar with that.

But what the Pens did yesterday was to light a fire back under the state. The city and the state need to get their heads out of their ass and it's just a position they're so familiar and comfortable with this thing is taking longer than it should.

I think Rendell gets it, though, to lose this team--especially right now, when they're on the brink of being so good, such a draw to an arena and a city--would be bad for everyone involved.

Santacapper · Mar 6, 2007

For Pittsburgh sake I do hope they stay, but lets be honest.... how many fires do they need to be lit under their asses to get a move on?

just this season alone for example, the whole near buy by the owner of Research in Motion, the non backing of a new arene by the government, etc etc..

They have a great thing, shame a place like Kansas City (not a knock on the city, rather the hockey culture) can see the promise of the franchise ie free rent / revenue.

Joe Public · Mar 6, 2007

Oh, I agree. The complete and utter shortsightedness on the part of the city and the state in this situation is mind-boggling.

The real problem is that the Pens were last in line for a stadium and both the city and the voters in Pittsburgh were left with a really bitter taste in their mouth after building the football and baseball stadiums. At that point, the Pens didn't handle the PR angle well and it slowly turned into a p*ssing match.

The city, actually, may be willing to let the team go simply out of stupidity, but the thing that's saving this team right now is that they're getting good. Not only does this make them popular again, but it also reminds the city what good sports teams can do for a town in terms of bringing money into the city.

That's why, to me, this would be such a travesty. On the one hand a really good hockey town would lose a great team, the team that's on the ice right now is basically the reason Mario Lemieux went through everything he did in buying this team. Yes, Mario was owed money, but the only way he was ever going to really get it was to keep the team in Pittsburgh and return them to being one of the better teams in the league. He's done just that.

On the other hand, the city would lose the positive revenue and exposure this team is going to bring for the next seven to ten years, maybe more.

Santacapper · Mar 6, 2007

Another article

PITTSBURGH (AP) -- The Penguins moved a step closer to leaving Pittsburgh, declaring on Monday an impasse in their new arena negotiations with state and local leaders and saying they will actively pursue relocation.
The breakdown in arena talks came only three days after Gov. Ed Rendell said he felt an agreement was close. It also increases the possibility the Penguins will be playing in Kansas City next season.
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</NOSCRIPT></TD></TR></TBODY></TABLE>"We have made a single-minded effort to bring this new arena to a successful conclusion and keep the team in Pittsburgh," owners Mario Lemieux and Ron Burkle said in a letter to Rendell and local government officials. "... Our good-faith efforts have not produced a deal, however, and have only added more anxiety to what we thought at best was a risky proposition for us moving forward."
In the letter, Lemieux and Burkle put the blame for the impasse on government officials, arguing they agreed to pay $120 million over 30 years to help build a $290 million arena and cover construction cost overruns, yet still have not reached a deal.
NHL commissioner Gary Bettman became involved in the talks several weeks ago, but also has been unable to finalize an agreement.
"We can do no more," Lemieux, the longtime Penguins star, and Burkle said in the letter.
The Penguins had an agreement with Isle of Capri Casinos to build the arena at no expense to the team or taxpayers in exchange for a license to build a Pittsburgh slots casino, but a state board in December chose a competing bid.
On Jan. 4, the team, state, city and Allegheny County began negotiating an alternate arena funding plan. At the time, government officials were asking for the team to contribute about $4.1 million per year, but lowered that to $2.8 million during the first round of negotiations.
During subsequent talks, the Penguins agreed to up that annual contribution to $3.6 million, plus $400,000 in operating expenses, after the state said there was a funding shortfall. However, the two sides still could not close a deal.
Kansas City has offered its nearly completed Sprint Center to the Penguins rent-free. The Penguins would also gain revenue from development projects around the arena.
However, the Penguins would be leaving one of the NHL's strongest U.S. markets for a smaller one that lost an NHL team in 1976 after only two seasons because of lack of support. The Penguins' home attendance and local TV ratings are among the strongest of the 24 United States-based franchises.
When Lemieux's group bought the team in federal bankruptcy court in 1999, the Hall of Fame player said he did so to ensure the team's existence in Pittsburgh.
The Penguins' hardball negotiating stance comes with the team contending for a playoff spot for the first time in six years. A youthful team led by NHL scoring leader Sidney Crosby and rookies Evgeni Malkin and Jordan Staal has become one of the league's prime attendance draws.
At home, the Penguins are playing to nearly 96 percent of arena capacity for the season. All of their remaining nine home games are expected to attract standing-room-only crowds.
The Penguins also have begun selling season tickets for the 2007-08 season in Pittsburgh, even though they have not agreed to play there another season. "They're tough negotiators," Rendell said.

Santacapper · Mar 6, 2007

Great hockey town no doubt... better than KC thats for sure, which speaking of I dont know why they built the arena in the first place... Field of Dreams?

Let em make a run through the playoffs and see the revenue pile up from the tix and tourism from fans visiting.

Joe Public · Mar 6, 2007

Yeah, the AP is just sort of cobbling together what is already out there.

Thing is, it makes a good headline to say the Pens are one step closer to gone--which is why the Pens put the letter out there.

This is their version of saying, "I've got one foot out the door, if I put the other one out there, then close the door, it's all over and I'm not coming back."

I don't want the city or the state to call their bluff, because I know that if they're really pushed they will walk, but it's not over yet. The city and state now just know they need to find a way to put this thing to bed, like now.

Joe Public · Mar 6, 2007

You're totally right about KC.

KC doesn't really want a hockey team, they want the revenue that comes from building a multi-purpose arena. And if they could put a full time tenant in there for 41 games a season, all the better. That's why they're offering free rent, it's all gravy to them.

What's really ironic in this is that Kansas City sees the value in a multi-purpose arena so much that they're willing to build one without a tenant. While Pittsburgh has a tenant begging for a home and the city can't see the value in building a multi-purpose arena.

It's almost laughable.

Santacapper · Mar 6, 2007

Definitely interesting to the hockey fan on the saga. Like I said I hope they do stay... do I really think they will, honestly not really. Its just alot of thick headedness.

IMO, the Penguins lack a business direction... Mario is all well and good and saved them from Bankruptcy but the guy who owns the technology for Blackberries (RIM) would have been the best thing to happen to that franchise, get a plan.

If not him, then that whole casino deal.

Not to make light of the situation but it reminds me of the Islanders ownership (bad comparison I know... pens have no 10 year contracts, Isles have 2 and a backup for GM, lol) but is it any wonder that they both have the oldest buildings in the league?

I hope this is a step to be the kick in the pants the government needs

Santacapper · Mar 6, 2007

Joe Public said:
You're totally right about KC.

KC doesn't really want a hockey team, they want the revenue that comes from building a multi-purpose arena. And if they could put a full time tenant in there for 41 games a season, all the better. That's why they're offering free rent, it's all gravy to them.

What's really ironic in this is that Kansas City sees the value in a multi-purpose arena so much that they're willing to build one without a tenant. While Pittsburgh has a tenant begging for a home and the city can't see the value in building a multi-purpose arena.

It's almost laughable.

very laughable... 2 opposite ends of the spectrum

Joe Public · Mar 6, 2007

Hey the dots are back in your avatar. Check it out.

I think the Pens are actually managed all right. I was unhappy with them selling off all their talent in the years before the lockout, but the truth is, they pretty much had to do it to be able to afford the lockout.

They survived and came out of it with some of the best young talent in the game in Crosby, Malkin, and Fleury.

The only reason this team isn't stable is the building, and that's something Mario has talked about as a priority from day one seven years ago.

It's the city, mostly, that's dragged this out. The Pens have, at times, played the PR game poorly and not helped themselves, but without a rich sugar daddy to come in and privately pay for a building, they need the city and the city seems like it just can't be bothered.

You're right, if someone came in there with unlimited resources, they'd privately finance a building, make a boat load of money over the next few decades, and all would be solved.

But since that person isn't stepping into the picture, the Pens have had to grind it out with the city and the state. And that's why they're in this mess they're in now.

I suppose if you wanted to fault Mario you could from the standpoint of saying that his group only really came in with enough money to buy the team and nothing else. Which is sort of like saying they had enough to buy the house, but not to furnish it.

Still, it's tough to really knock the guy too much when the only other plan was to dissolve the team and basically give their players away to the rest of the league.

Santacapper · Mar 6, 2007

Not really knocking Mario... I dont know what to call it though. He is in a tough spot and like you said if they had some backing from a guy like Mark Cuban who sees the whole 'spend money to make money' and has the money to spend in those cases it would be cut and dry. Give me the land and lets get this arena built.

Pens have to be the little brother to the Steelers and Pirates. More the Steelers with the seasonal aspect but you mentioned it before about the bitter taste. Not going to change, just something to live with.

The fact that they are almost at capacity each night is definitely something to be proud of after those seasons pre lockout where they couldnt handle the economics.

Hey the dots are back in your avatar. Check it out.

different one isnt it? I get confused. haha

They survived and came out of it with some of the best young talent in the game in Crosby, Malkin, and Fleury.

Honestly, in my mind Staal is going to fly past Malkin in due time. Kid has some of the best hands Ive seen since... well Croasby, lol. Its unreal the talent they have on the roster. Need to try and get a stay at home blueliner for the long haul and not just a rent a player and they will be just that much better.

Now if the Leafs could just follow suit Id be one happy camper.

Joe Public · Mar 6, 2007

I like Staal, too. There's also apparently some kid they have down in Wilkes-Barre whose name I forget who's supposed to be out of this world.

Hell, I've been impressed by guys like Armstrong especially after sitting through some of the horrible lines this team put out on the ice before the lockout.

They've been trying to develop blue line guys for some time, Orpik being their best shot, they could really use somebody in the mold of what Rob Blake used to be. Although, I suppose what team couldn't.

You know, I have a soft spot in my heart for the Leafs, always have, don't know why. I really would like them to figure it out, because the annual Battle of Ontario was must-see TV for me in the playoffs every year.

Are they still taking their orders from the teacher's union or have they sorted that out?

Oh, and for the record, yeah the dots are different. Last time it was the circle, this time it's just the three doing their little dance.

Santacapper · Mar 6, 2007

You know, I have a soft spot in my heart for the Leafs, always have, don't know why. I really would like them to figure it out, because the annual Battle of Ontario was must-see TV for me in the playoffs every year.

Are they still taking their orders from the teacher's union or have they sorted that out?

Dont get me started on the Ontario Teachers Pension Plan. Ever watch Prison Break? They are the company. They own 58% of MLSE (Maple Leafs Sports Entertainment) 3 members sit on the MLSE board of directors out of 8. Nobody on the board cares about the cup in all honsety as sad as it is to say. Fergie Jr was hired to be a puppet for the most part of the board. he makes the moves to be 'just enough' to get interest and keep the waiting list at 15 years for Seasons tickets.

Give me 10 minute in a room with Peddie & Tannenbaum, lol.

They are starting to get younger and seem to be heading in that direction, save for the revolving door of players leaving and coming back they have good leadership with maurice and a great crop of goalies playing on the Marlies and need a year or 2 before Raycrofts contract is up.

They've been trying to develop blue line guys for some time, Orpik being their best shot, they could really use somebody in the mold of what Rob Blake used to be. Although, I suppose what team couldn't.

So hard to come by, just anybody who can move the puck and stay at home clear the puck from danger. Orpik is the closest they have right now, and he is good... just not a #1 blueliner by any stretch IMO. Maybe a second pairing guy

Joe Public · Mar 6, 2007

Yeah, I was sort of afraid that a good part of the reason the Leafs have been flopping around like a fish lately had something to do with those teachers.

There's another example of a situation where someone in charge, be it an owner or a city, that just doesn't understand how important a hockey team can be to a city. And unlike Pittsburgh, the owners in question here really should get it because it's the Leafs.

The Penguins, love them as I do, fight for second place in that city. Pittsburgh is a Steeler town, always will be. But in Toronto, we're not talking about the Argos or the Raptors, these are the Leafs, arguably one of the two most important teams in the history of the sport.

And yet there they are, rudderless, spinning around in circles while the league passes them by.

Not for nothing, though, I really hope Pittsburgh gives Roberts a home for more than just this year, I love that guy.

And, number one defensemen? That's like a true center in the NBA. They're so rare. They need to be able to do so many things well and they're difficult to develop.

frankiegotti · Mar 6, 2007

You know this arena thing is begining to be a game it seems. I current temporarily reside in the city of pittsburgh during the school year and i watch the games on a somewhat frequent basis. Every time i watch teh games the announcers always say "from what i hear a deal is very close to keep this team in pittsburgh."

I am a cleveland fan at heart and i know how painful it is for a city to loose a team, i know especially what a team like the penquins means to pittsburgh.

The thing that pisses me off is that Governor Ed Rendell is assuming that hockey is supposed to be a non profit association and are there for servicing the public. What this guy needs to understand is that he is that it is a business like anything else in pittsburgh that pays taxes. Also, even if the penguins don't get a new arena the city needs a new one anyways to host concerts and other entertainment events such as monster jam, wrestling events, etc that come to town.

I think they are done talking, if the city has another offer they want to give lemiuex and company then the city will have to go to them. Lemiuex and company will not be breaking their necks anymore to meet them and try to work something out.

I hope they figure something out but i do not forsee it happening.

Santacapper · Mar 7, 2007

Its always the teachers... lol. They no joke are more powerful than alot of organizations.

Anyways, with the Leafs this city would be absolutely mental if they ever win the cup again. Dotn know if you saw any of the Salt Lake Olympic highlites when canada won but the city was just waiting for a hockey party and it pretty much shut down the entire core for 10 hours with people on the streets, I would not joke take about 5 days off of work when they win, lol.

Roberts will like it there, he lives for the teaching part of it in this stage of his career and from what I know he is one of the hardest workers in the league, not many people would come back from that neck injury he had. Crosby and the kids will learn a tonne from him.

BTW, nice comeback for them last night.

How about a decent #3 D man>? lol

back on track... great post Frankie:cheers:

frankiegotti · Mar 7, 2007

Thanks.

I saw a article today that made me laugh. It was on yahoo sports. It was saying that the penguins owners meet with the mayor of las vegas. The publicist for the penguins said everything went well and that the group of attorneys was going to fly out sometime later in the week to put some things on paper. It did not disclose what kind of things they would be putting on paper but i would assume that they would be putting things like numbers that the mayor was talking about.

I laughed when i saw this because it hasn't been 2 weeks since David Stern the President of the NBA said that he would have trouble seeing a professional team moving there and succeeding. I don't know if all that was in the article was true but if it isn't then the owners of the penguins are making a pretty powerful statement. Pens are saying we would rather go to a city that is known for betting on sporting events and high stakes gambling.

I think this is humorous because Pens would rather go to a "sinful city" than stick in its roots in pittsburgh. I think that is a strong statement that ed rendell will have to think over. Now i can't wait to hear his rebuttle on this meeting, because normally on the local news he always shoots off his mouth and makes himself look like a complete asshole by trying to discredit the owners.

In the words above i do not mean to affend anyone that lives in the LV area.

Impasse on Pitts new arena - team to move

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