Negotiators pack up, declare victory on sports arena deal

By ERIC BERGER

July 26, 2000 Web posted at: 11:20 AM EDT (1520 GMT)

In this story: Key changes Opposition may remain RELATED STORIES

HOUSTON, Texas (The Houston Chronicle) -- Adding a trickle of revenue for the city and allowing it more access to the proposed downtown facility, negotiators declared an arena agreement complete Tuesday night.

The deal is still subject to approval by the full 13-member Harris County-Houston Sports Authority, but its five negotiators expect that to be little more than a formality, likely occurring next week. The Houston Rockets have also accepted the agreement.

Voters could have their say on Nov. 7.

A copy of the proposed 30-page letter of agreement was delivered to board members Tuesday, sources said.

	More from The Houston Chronicle
	Residents of League City debate 'godly' resolution Heat to blame for 10,000 dead fish on bayou Tyra flails indifferent employees Former UTMB supervisor denies she retaliated against two nurses Church sued over sex-abuse confessions

About four dozen key opinion leaders, elected officials and opponents of a 1999 agreement soundly defeated by voters are expected to receive copies today.

"This is a fair deal for Houston and for the Houston Rockets," said Grover Jackson, the sports authority's vice chairman and a key negotiator.

Mayor Lee Brown said the deal is acceptable to the city, although it still must be approved by City Council.

"I talked to the sports authority, particularly Grover Jackson, on Monday and he presented to me the elements of the deal that were satisfactory to the city," he said.

"I'm told they've reached an agreement. Assuming that's the case, I'm very happy."

By releasing the document to previous opponents, one negotiator said, the sports authority is essentially serving notice that anyone who declares opposition to the deal will, if it ultimately fails, be tagged with running the Rockets out of town.

Negotiators say the final agreement, obtained by the Chronicle Tuesday night, addresses previous opponents' concerns in several ways:

*There is no ticket tax, a loathed provision of the 1999 deal.

*Financial arrangements are more amenable to a National Hockey League franchise, an attempt to placate would-be NHL team owner Chuck Watson.

*There is a greater financial commitment from the Rockets; the effective up-front contribution is $105 million vs. $74 million in the 1999 agreement.

*There are no tax abatements; in 1999 Rockets owner Leslie Alexander would have received an abatement on a parking garage he was to build.

*The estimated $12 million to $15 million cost of the land, which as in the 1999 deal is to be purchased by the city's Convention and Entertainment Facilities Department, is less than half the cost of last year's proposed arena site.

*The city will receive 5 percent of arena naming rights, or about $200,000 a year. Under previous iterations of this year's proposal, that revenue would have gone to the sports authority as part of the Rockets' rent payment.

*The city will have more access to the arena, 20 dates as opposed to 10, and may use five of those dates for charitable organizations' fund-raisers.

*Private interests will assist in construction of the facility's parking garage.

The basic terms of the $175 million arena agreement have remained unchanged for months. The sports authority will finance construction with its hotel and car rental tax revenue, and the Rockets will pay $8.5 million annually in rent to help pay off the bonds.

Whether opponents of the previous deal, including Watson, Harris County Tax Assessor-Collector Paul Bettencourt and county Republican Party Chairman Gary Polland, will go along with the current agreement remains unclear. They called the 1999 proposal a bad deal for taxpayers.

Some of these opponents have questioned whether the new deal simply moves money around, making it appear to be a better deal when it is much the same agreement.

The Rockets have also said they need the support -- or at least pledges of non-opposition -- from County Judge Robert Eckels and NFL expansion franchise owner Bob McNair.

"The Rockets and Comets are part of Houston," said George Postolos, the teams' chief operating officer. "They belong in Houston, and this agreement will keep them in Houston if community leaders and ultimately the voters approve it."

Polland has been left off the list of those who must pledge not to oppose the deal, sources said, because the team and sports authority feel that if they can sever Watson and Bettencourt from him, Polland's ability to wage an effective anti-arena campaign would be greatly diminished.

Polland has not explicitly said he will oppose the deal, but he has indicated he probably will. He was out of town Tuesday.

"Despite the fact they think I am irrelevant, I'm going to show them otherwise," Polland said late last week.

Heretofore, Watson, Bettencourt, Eckels and McNair have said they need to see a full copy of the agreement before offering an opinion.

"I may comment publicly, but only after there is a specific, unambiguous, complete and definitive deal to analyze, and not just the framework of a proposed agreement," Bettencourt wrote sports authority Chairman Billy Burge last Friday.

With the letter of agreement arriving today, and follow-up briefings soon thereafter, sports authority negotiators said they expect to know by Friday where the four men stand.

If -- and it's not an insignificant if -- the Rockets are pleased with the response of these opinion leaders, they would sign the letter of agreement with the sports authority after its next meeting, likely Aug. 3.

Days later, sources said, a campaign led by Enron Corp. Chairman and CEO Ken Lay and former Reliant Energy Chairman Don Jordan would kick off. Former Port Authority Chairman Ned Holmes is expected to join the campaign as its treasurer.

Lay has also become a pivotal figure in another aspect of the arena deal, helping to finance its garage. Originally this year, the city had been asked to finance the 2,500-space facility, with Alexander receiving revenue for his Rockets, Comets and ThunderBears events.

But that shaped up to be a tough political sell.

So Lay, who organized a group of business leaders to give the sports authority a $34.7 million interest-free loan to buy the land for Enron Field, has been approached about a similar arrangement to finance the garage and its site, expected to cost about $35 million to $40 million.

The sports authority will likely pay off the original loan within a year or two. Sources said Lay planned to meet with the investors today to see if a majority would be willing to renew the loan.

If not, a private parking company has expressed interest in developing the facility.

For more Local news, myCNN.com will bring you news from the areas and subjects you select.

AR, Jonesboro, KAIT AR, Little Rock, KATV LA, Lafayette, KATC LA, Monroe, KNOE LA, Shreveport, KSLA OK, Oklahoma City, KOCO OK, Oklahoma City, KOKH OK, Tulsa, KOTV   TX, Abilene, KTXS TX, Amarillo, KFDA TX, Austin, KEYE TX, Austin, KXAN TX, Dallas KTVT TX, Dallas, WFAA TX, Harlingen-Weslaco, KRGV TX, Houston, KHOU TX, Houston, KPRC   TX, Lubbock, KAMC TX, San Antonio, KABB TX, San Antonio, KMOL TX, Tyler, KLTV TX, Waco, KWTX TX, Wichita Falls, KAUZ TX, Wichita Falls, KSWO