Arena is still no done deal

By ERIC BERGER

July 14, 2000 Web posted at: 10:17 AM EDT (1417 GMT)

HOUSTON, Texas (The Houston Chronicle) -- A day after the Houston Rockets approved a proposed agreement to build a downtown arena, their negotiating partner balked at going along.

The Rockets and the Harris County-Houston Sports Authority have been negotiating over the public-private financing of the $175 million arena since February, and the Rockets felt they achieved a consensus on the final point Wednesday.

So the team announced Wednesday night that it had accepted terms of a proposal nearly identical to a summary released at a sports authority meeting in late June. The announcement was tantamount to saying: We're done negotiating the deal, either vote it up or vote it down.

"We stand ready to honor the bargain we struck with the sports authority, and we hope and expect that the sports authority will do the same," Rockets chief operating officer George Postolos said Thursday night.

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The sports authority still must approve an agreement. If it does, the proposal would be forwarded to the Houston City Council, which has a $60 million stake in the deal, and face a public referendum this November.

The Rockets' decision to effectively end negotiations set off a political firestorm Thursday, beginning with sports authority Chairman Billy Burge, who was caught unaware while traveling on business in Los Angeles.

"I am concerned about the timing of the (Rockets') announcement, as there are still issues outstanding between the parties to the agreement," Burge said. He added that he remains confident that an agreement will be reached.

County Tax Assessor-Collector Paul Bettencourt, a prominent opponent of the 1999 arena agreement that voters rejected, blasted the Rockets' announcement, wondering why the team had agreed to terms without evidently informing Burge.

"It's always best to have patience during the negotiating process," said Bettencourt.

"In my experience, when there's a disconnect, it's usually for a good reason. It's not a good idea to declare something is complete when in fact it's not. If that's what happened here, that's disappointing."

But other sports authority board members, including finance committee Chairman Ric Campo, agreed with Postolos that the business agreement had taken its final form.

"It's a matter of semantics, maybe," Campo said. "But I think that it's good to have resolution on all the issues."

The outstanding issue Burge is referring to is selection of an architect for the arena's design.

At its June meeting, the sports authority voted to ensure there would be a joint selection. Burge tapped construction committee Chairman Wayne Smith to negotiate the issue.

The Rockets said Wednesday they agreed on a selection process to find national and local architects acceptable to Smith.

Still, Burge sent a memo to board members Thursday saying that no firm had been hired. The issue remains contentious because the Rockets prefer HOK Sports Facilities Group, the Kansas City, Mo.-based architect of Enron Field. Some sports authority members do not want HOK because of perceived problems with Enron's design.

Politics will now play a much larger role as sports authority negotiators and the Rockets seek support for the proposed agreement at the sports authority board meeting July 27, then at City Hall and ultimately with voters.

The city has been asked to buy the land for the arena and a parking garage and to build the garage. However, some city officials, including Convention and Entertainment Facilities Department Director Gerard J. Tollett, have expressed concern about the location of the garage and how his department can pay for it.

Campo said these issues could be resolved within the existing proposal, which allows changes if both the sports authority and Rockets agree.

Mayor Lee Brown, a backer of the 1999 deal, has said he needs to study the city's role in the new proposal further before giving the go-ahead.

County Judge Robert Eckels said Thursday that he felt left out of the negotiating loop. Bettencourt, Houston Aeros owner Chuck Watson and Houston NFL expansion team owner Bob McNair have said they, too, have yet to receive full briefings on the deal.

McNair said Thursday that he, therefore, has no opinion on the proposal.

"Our priority is to get our documents negotiated and complete, and take care of the football stadium," he said of his venue's lease with the county and sports authority.

"Once we've completed that task, we will have an opportunity to look at the arena deal. If it appears to be a reasonable type agreement, we'll support it."

McNair's deputy for the stadium project, Steve Patterson, said the stadium lease could be substantially completed before the sports authority's July 27 board meeting.

The sports authority has styled the arena proposal, which calls for it to issue bonds for the entire $175 million design and construction cost, after its football and baseball stadium deals, in which the teams pay rent.

In the proposed arena agreement, the Rockets would pay $8.5 million a year in rent.

Drayton McLane Jr., the Houston Astros owner and sole tenant of Enron Field, has said he supports the downtown arena proposal.

City Councilman Carroll Robinson, who has repeatedly called for the city to receive more revenue for its arena contributions, said the deal on the table would be a hard sell.

He also criticized the sports authority for not coming to the council before it briefs other people, such as Bettencourt, who are not putting money into the arena.

"In my experience, it's always important to go kiss the girl before you ask her to marry you," Robinson said.

Rockets OK arena terms

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