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Louisiana is borrowing money to meet payments

3/23/2005 - New Orleans Saints

NEW ORLEANS -- With just over a month remaining before the
Louisiana Legislative session begins, the chances of the state and
the New Orleans Saints hammering out a new agreement look slim.
The two sides have met five times and had no further meetings
scheduled as of Wednesday.
"We have not set anything up and I don't know when we will,"
said Superdome commission president Tim Coulon, the state's chief
negotiator. "I'm sure when the Saints people come back from Hawaii
I'll hear from them."
Saints officials were not expected to return from the NFL
meetings in Hawaii before March 30.
The state wants to replace an agreement reached under the
administration of former Gov. Mike Foster, which has forced
Louisiana to borrow money to make the annual payments.
Those payments will escalate to $23.5 million in the last years of
the 10-year deal, which took effect in 2002.
The Saints want a long-term deal and so far have dropped one
significant demand, with team owner Tom Benson saying he is willing
to stay in a renovated Superdome rather than require a new stadium.
The sticking point is expected to be Gov. Kathleen Blanco's demand
that the team bear some of the costs of renovations or accept lower
cash subsidies after renovations are complete.
Benson had originally set a March 1 deadline so he could update
fellow owners on the status at the team meetings. He dropped that
deadline, but both sides hoped to wrap up a deal in time to have it
acted on in this legislative session, which begins April 25.
"We intend to keep working," Coulon said. "We hope to be able
to work out a deal in line with the governor's guidelines to reduce
incentives and the Saints' desire to have a long-term deal."
Asked the odds of that being accomplished before the upcoming
session, Coulon laughed.
"I wouldn't even venture a guess," he said.

The session, however, can last until June 23, giving the Saints
and the state more time to get a proposal to lawmakers.
If a deal cannot be reached in time for this session, Coulon
said his belief is that the state and Saints will continue to
operate under the old agreement. That calls for Louisiana to make a
$15 million payment to the team in July. Government officials have
said the state will be $9 million short for that installment.
"I believe it will be our intent to ask the state bond
commission to allow us to refinance the Superdome to cover that
debt," Coulon said. "We have already received permission to do
the preliminary advertising for the bond sale."
The governor agreed that the old deal would remain binding.
"We feel it's important that the state honor its contracts no
matter who they are granted to," Blanco said. "The contract is
way too generous. We can't afford it. I'm cautiously optimistic
we'll see some movement."
A new agreement would probably have to wait for next year's
legislative session if it's not ready for this one, Coulon said.
"The Legislature might be able to meet in a special session,
but whether they or the governor would want to is another matter,"
Coulon said.
If a deal can not be hammered out this spring, the two sides
would probably continue discussions throughout the year, Coulon
said.
"Unless the Saints wanted to exercise the clause in the
agreement that allows them to pay a penalty and leave," Coulon
said.