Agency OKs loan for arena overrun
The Allegheny County Redevelopment Authority authorized a $2.75 million loan Tuesday that could help cover higher-than-expected costs of Pittsburgh’s multipurpose arena.
The total cost of the arena is $321 million, up from $290 million when city, county and state officials announced a deal in March 2007 to keep the Penguins in Pittsburgh by building an arena to replace Mellon Arena, the National Hockey League’s oldest venue.
The city-county Sports & Exhibition Authority agreed Nov. 13 to contribute $5.5 million to the $31 million increase in the cost of the arena. The state will contribute $10 million and the Penguins will pay $15.5 million.
Dennis Davin, the redevelopment authority’s executive director, said the loan would be repaid with proceeds from the sale of land at Mellon Arena, which is to be demolished.
Davin said Pittsburgh’s Urban Redevelopment Authority also has been asked to grant a $2.75 million loan to the SEA. A decision on that loan likely will be made next month.
SEA Executive Director Mary Conturo said the loans will be used to cover the SEA’s share only if the authority cannot save money from reducing the price of building an arena parking garage or generate extra adequate revenue from a hockey ticket surcharge.
The arena is set to open for the 2010-11 hockey season.