Gov. Rendell pleased Bettman mediating talks

Updated: March 5, 2007, 1:43 PM ET
Associated Press

PITTSBURGH -- National Hockey League commissioner Gary Bettman is helping to mediate talks between the Pittsburgh Penguins and officials from the city, county and state about financing for a new hockey arena, Gov. Ed Rendell said.

"He would like to see this brought to a head, and so would I," Rendell said, referring to Bettman.

The Penguins have threatened to sell the team or move it to Kansas City if they don't soon strike a deal to replace 46-year-old Mellon Arena, the oldest and smallest in the NHL. The team's lease expires June 30, at which time the team would be free to move.

While Rendell said it's still possible talks on a new arena could fall through, he said both sides are close to an agreement.

"We have agreed on a concept; we just have to agree on how to get there," Rendell said. "Everyone has to pay a little more."

The Penguins have declined comment on the negotiations, but Rendell said a key issue is who pays for cost overruns if the arena turns out to be more expensive than projected.

Rendell said Friday that the sides have agreed on the idea of increasing a bond issue to pay for the arena from $270 million to $290 million, which he said should cover any cost overruns. Rendell said he thinks the new arena can be built for $270 million, about $20 million less than projected by the Penguins.

"The Penguins understandably are nervous about what happens if the bids come in over that," Rendell said. "So one of the issues we've been dealing with -- and making progress on -- is who shares the risk if that happens."

The Penguins based their $290 million figure on plans put forth by Isle of Capri Casinos Inc., which failed in its bid for a state license to build a slots parlor in the city. Isle of Capri had pledged to build the arena with slots proceeds, without any contribution from the team or taxpayers.

State regulators, however, voted last year to award the license to Detroit casino magnate Don Barden, who hopes to build his Majestic Star Casino on the city's North Shore by next year.

Barden has agreed to pitch in $7.5 million a year for 30 years to help build the arena, although it's unclear when he'll be able to do that because the license has yet to be issued.

The Pennsylvania Gaming Control Board approved Barden's plans in December and issued the licensing order on Feb. 1, but the license cannot be issued until appeals such as the one filed Friday by Isle of Capri are resolved. Barden's camp has said it will take about 14 months to open from the formal issuance of the license, which is needed to exercise options on the site.

Rendell said the team and government officials continue to negotiate the rights to parking revenue and the development of land near the proposed arena. Those issues, however, are "close to being settled," Rendell said.


Copyright 2007 by The Associated Press