RAD backs $25 million bond for Heinz Field expansion
The Allegheny Regional Asset District's board of directors voted on Wednesday to guarantee a $25 million bond that will help pay for Heinz Field improvements, ending more than a year of wrangling over who would pay for upgrades to the North Shore home of the Steelers.
“We are excited moving forward to have this project complete for the 2015 season,” Steelers spokesman Burt Lauten said.
The Steelers plan to spend $37.4 million on improvements that include installing 3,000 new seats in the stadium's south end and a new video scoreboard on the opposite end. The bond will cover $18 million of those expenses. Seat licensing fees and other team revenue will cover the rest.
Remaining bond money will be placed into a reserve fund for stadium improvements.
The Steelers will pay off the bond by 2030, using ticket sale revenue. No public money will be used. Heinz Field, which opened in 2001, was built for $281 million largely with public money.
The stadium's owner, the city-county Sports & Exhibition Authority, voted last month to issue the $25 million bond. The guarantee from RAD, a public agency with a dedicated source of tax revenue, will help it “to be favorably received in the market,” lowering borrowing costs, RAD Executive Director David Donahoe said.
RAD receives half of the proceeds from a 1 percent sales tax in Allegheny County.
The Steelers sued the SEA in late 2012 when a deal to finance the stadium improvements fell apart. Ultimately, out-of-court negotiations produced a deal.
Tom Fontaine is a staff writer for Trib Total Media. He can be reached at 412-320-7847 or email@example.com.