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Arena deal or no deal? Clock is running

| Tuesday, Jan. 30, 2007

It's make or break time for a new Pittsburgh arena.

Gov. Ed Rendell said Monday that he remains "optimistic" about reaching a deal soon that will build an Uptown arena and keep the Penguins in town for at least 30 years.

"I anticipate that sometime this week we will have an answer," Mayor Luke Ravenstahl said yesterday. "There will be some kind of dialogue back and forth this week."

The Penguins and public officials have been negotiating for weeks over how to pay for the arena. Rendell and Penguins co-owner Ron Burkle spoke yesterday, but the two sides have not set a time to meet again in person.

"We're making progress, but there is no deal by any means as of yet," Rendell said during an appearance in Butler to discuss his health care proposal.

In response to Ravenstahl's comments about a possible deal being reached this week, Rendell said, "That could be."

Penguins officials declined to comment. The team's lease at Mellon Arena expires in June.

The National Hockey League has some flexibility, but the team needs an answer soon, said Bill Daly, league deputy commissioner.

Team officials have not asked the league for permission to move, but have "reserved their right to make a formal relocation application" if they don't get an arena deal, Daly said.

Burkle and co-owner Mario Lemieux visited Kansas City this month to look at moving the team there. They canceled a trip to Houston for the same purpose last week, while in Texas for the NHL All-Star Game.

"If it's not going to work in Pittsburgh, they have to move on and get an alternate deal in place with enough time to make an application to the league for approval," Daly said.

The city-county Sports & Exhibition Authority after Feb. 8 could begin demolishing 11 properties it purchased between Centre and Fifth avenues to prepare for a new arena.

Penguins officials have met twice with Rendell, Ravenstahl and Allegheny County Chief Executive Dan Onorato to talk about the arena. After the first meeting, Lemieux said he felt "optimistic" about keeping the team in Pittsburgh. But Lemieux did not attend the second session, and Burkle left without talking to reporters.

"The third meeting is when realistic expectations get aligned or (misaligned)," said Marc Ganis, president of Chicago-based Sportscorp Ltd. "Expectations are the most important factor at this point."

Negotiations broke off last week over questions about development rights for the Mellon Arena site and revenue from the new arena.

Majestic Star Casino operator Don Barden, who plans to open a North Shore slots parlor, could end up with a share of both. He has agreed to pay $7.5 million a year for 30 years toward the arena.

The state would pay another $7 million a year from an economic development fund backed with gambling money.

Under Rendell's original arena financing proposal, the Penguins would have paid $8.5 million up front and $2.9 million a year, while forgoing $1.16 million in naming rights. Rendell has said the team's contribution has been "significantly" reduced.

Ravenstahl yesterday responded to Hill District community leaders who are concerned that residents were being excluded from talks about how to use gambling money to redevelop their neighborhood. He plans to meet this week with state Rep. Jake Wheatley Jr., D-Hill District, and others.

"We will include the residents of the Hill District in the discussion," Ravenstahl said. A new arena is "one of the most important components in the redevelopment of the Hill District."

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