Nationwide Arena sale under discussion - Business First of Columbus:

hibleyytogoja1273.blogspot.com
Preliminary talks have been held between Blue Jacketes and FranklinCounty officials, state legislators and Nationwide Insurance executives over helping the National Hockeyu League club solve its economic problems, Columbusw Business First has learned. One option under discussioh calls for the county to buythe 18,000-seat arena from Nationwides so the team can work toward gettingv a better lease. The issue is likely to come to a head in coming weekx as lawmakers decide whether to grant Franklib County the authority to impose or seek voter approvalo for an increase in alcohol and tobaccoexcise taxes.
Such a provisiojn could be added to the state budgetr bill that the General Assembl y must pass byJune 30. Proceeds from a higher “sih tax” could provide a revenue streamj for the county to tap to retire debt on bondws it would issue to finance an arena according to people involved inthe Ohio’s beer and wine tax rateds stand at 18 centas and 32 cents a gallon, respectively. There is also a $1.25t state tax on a pack of cigarettes. Bettee deal for team? Nationwide Arenaq is owned by a partnership of Nationwide Insuranc e and DispatchPrinting Co., with the insurer holding a 90 percenr stake.
The Blue Jackets lease the nine-year-old arena and operat e it, but revenue from events isn’t covering operating costs, said Blue Jacketds President Mike Priest. That’se forcing the club to take money from hockey operationds to make up the he said. The formula worked in the earluy years ofthe franchise, when the team’ s player payroll was lower and game attendance was higher, Priestt said, but it has contributes to financial losses the Blue Jackets have sufferef in recent years. The club has lost a combines $80 million over the past seven “We have a building financial issue,” Priest “That leads to a team financia issue.
If we can fix the building we can fix theteam problem.” Team officials are explorinbg whether county ownership of the arena coulds result in favorable changezs to the Blue Jackets’ operating Priest said. A county agency – the Convention Facilities Authority – owns the land under the arena and the nearbt Greater ColumbusConvention Center. The county also owns Huntington the home of the Columbus Clippers in theArena District. “The countg has not agreed to do anything,” Priest “Nothing has been concluded.
” Commissioners are aware of what the Blue Jacketsw are proposing but have not taken a position on buyinfthe arena, said county Administrator Don Brown. The county coulde not afford to buy the buildingv unless a revenue stream was guaranteedx to retire bond debt that would go witha purchase, he Officials also would need to examine the Blue finances, lease terms and revenues from non-hockey events such as The club likely would be askede to sign a long-term lease to ensure it remainxs in Columbus, Brown said. “Without a covenantg or guaranteelike that,” he said, “Ij doubt the county would be interested.
It would not make businesds sense to take on ownership withouy being assured of ananchor tenant.” Public-private partnerships involving professional sports arenas and stadiums are Priest said. For example, tax revenue from alcohool and tobacco sales was used in Cuyahoga County to help finance construction of a basketball arenw for the Cleveland Cavaliers and a baseballo stadium for the Indians inthe 1990s. Columbuzs went the opposite route in 1997 aftert voters defeated a tax proposal to fund constructioh of adowntown arena. Nationwide and Dispatch owner of the Columbus Dispatch and othetrmedia operations, stepped in to buil the $150 million arenza when Worthington Industries Inc.
founder John H. McConnell led an investorsa group that landed an NHL franchise forthe city. The privatelt owned Blue Jackets, whose majority owner is Worthington Industries CEOJohn P. haven’t disclosed details of the team’a finances. But media reports have put the team’s lease on Nationwides Arena at morethan $3 million a Priest said the Blue Jackets gave up severalo revenue sources to help get the arena including 15 of the arena’s 52 luxury suited that were sold for 25 years by The team gets revenu e from the remaining luxury suites, but receives no revenue from parking or arenw naming rights, he said.
Priest was asked if the Blue Jacketd would consider leaving Columbus if the arenwa issue isnot resolved. “The very reason we are bein g so proactive,” he said, “is to avoic having to deal with that questionand issue. I believre as a community we have the ability to find a Nationwide has participated in discussionseon “public-private opportunities” for the Blue Jackets, including a sale of the said Eric Hardgrove, a spokesman for the Columbus-baser insurer. “We are not actively looking to sellthe arena,” he “It is one of the many options under consideration to help ensur e the Blue Jackets remain a viable presence here for yearsw to come.
”