Hornets lawyer: team is New Orleans' to lose
NEW ORLEANS -- A lawyer for New Orleans Hornets owner George Shinn said the NBA club is Louisiana's to lose, stressing that relocation would be certain if the state and city can't come up with a plan to get a promised new practice facility built next to the New Orleans Arena.
However, Bill Hines said he was confident the state would not renege on what he regarded as a relatively minor $8.5 million commitment toward the practice building, which was part of the 2002 deal that brought the Hornets here from Charlotte, N.C.
"If the state decides not to build the practice facility, it's all over," Hines said Thursday, a day after he hosted a gathering of prospective investors in the club at his New Orleans home. "We fought really hard to get this team. It would be a shame."
The Louisiana Stadium and Exposition Commission is ready to meet with the Hornets and the city to discuss those issues, commission chairman Tim Coulon said, "if in fact they have now become paramount to the future of the Hornets."
"It was never an issue before," Coulon added, referring to negotiations which resulted in the state giving the Hornets permission to play a second season in Oklahoma City, where the team relocated after Hurricane Katrina.
Coulon said he does not believe the Hornets can break the lease, which runs through 2012, even if there is no practice facility built, but he said the commission wants the Hornets to be successful in Louisiana and therefore is willing to talk about it.
The state spent about $110 million to build the New Orleans Arena, which opened in October 1999 as the home of a minor league hockey team. However, the arena was designed for the NBA, and millions more were spent on upgrades to suites, locker rooms, scoreboards, lighting and sound systems after the Hornets decided to come to New Orleans.
As part of the deal, the City of New Orleans pledged to reimburse the state for $6.5 million of the cost of new practice courts and team offices, and Mayor Ray Nagin has said recently that the money set aside for that purpose remains in an account, ready for release to the state when the deal on the facility is done.
"We need to step up and support our investment or frankly we were crazy to build that arena," said Hines, who led effort to lure the Hornets here when he chaired the economic development arm of the local chamber of commerce.
Shinn and Hines discussed the club's future together at Touro Hospital, where Shinn celebrated his 65th birthday by presenting gifts to the mothers of children also born on May 11.
Shinn reiterated that his harsh criticism earlier this week of New Orleans' recovery from Hurricane Katrina stemmed from pent-up frustration with the slow flow of government aid needed to help the hardest hit storm victims rebuild. He also stated that both the NBA and the Hornets remain committed to previously stated plans for the franchise to be playing full-time in New Orleans beginning in the 2007-08 season.
"I want you to understand I have a home here. I have a business here. I have great friends and family here. If my heart wasn't here, I wouldn't be frustrated," Shinn said. Currently 11 Hornets employees work in New Orleans full-time, team officials said.
Wednesday night, Shinn met with about a dozen investors who said they were prepared to buy anywhere from 35 percent to 49 percent of the team. Shinn called the meeting "a major step." "Quite frankly, I feel pumped up," Shinn said.
However, Shinn said he also wants to see the state commit to the practice facility and he'll be monitoring commitments from season ticket holders, who'll have an opportunity to make 25 percent, interest-bearing deposits this year for the following season's planned 41-game home schedule in New Orleans.
In addition, Shinn said the approaching hurricane season, which runs from June 1 to Nov. 30, "is frightening. ... It's going to scare us all to death."
The Hornets played 36 home games in Oklahoma City last season and sold out about half of those games. They are scheduled next season to play 35 games in Oklahoma City and six in New Orleans.
If the plan to return to New Orleans fell through, Shinn said, he would consider his franchise a "free agent" that could relocate to any city.
Hines said the investment group in New Orleans is a diverse group of current residents and some nonresidents with strong ties to the city. They have the money to buy the entire team if Shinn wanted to sell it, but would be happy to settle for being limited partners, using their local influence to market the team and otherwise stay quietly on the sidelines while letting Shinn call all of the day-to-day shots.
"It's a business deal, but they made it very clear last night that they would primarily be doing this" as a civic gesture, Hines said. "The money's real."
Shinn and Hines said the names of the possible investors could not be announced unless or until they have officially bought into the team because of nondisclosure agreements. Shinn had a similar meeting with business leaders in Oklahoma earlier in the week.
Hines said the New Orleans investors "are politically connected, they're economically connected, they're socially connected in different groups, and when it comes to selling sponsorships and tickets, that's going to be a critical piece and that's what they think they can bring to bear here," Hines said. "If we get the investor group and sell the tickets and sponsorships, I have no doubt the team is coming back here. This is what's different than the Charlotte deal. In this case the team is here, so it's ours to lose."
Shinn has been looking for investors to help him pay down about $70 million in debt he acquired to buy out his former partner, Ray Wooldridge, in early 2005.
Hines said he did not want to get into specific legal questions about the Hornets' New Orleans Arena lease, which runs until 2012. However, he said if Louisiana builds the practice facility, it could be difficult for the Hornets to get out of their lease if the state decides not to let them buy their way out of it.
"The only thing [Gov. Kathleen Blanco] owes the team right now is to build them a practice facility," Hines said. "The rest is not her problem."
Copyright 2006 by The Associated Press
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