Stadium deal is at a standstill

(by Amelia Nielson-Stowell and Leigh Dethman desnews.com 11-29-06)

It was late August when David Beckham and other players from the Real Madrid soccer team joined local dignitaries in plunging golden shovels into the site of the future Real Salt Lake soccer stadium, with hopes that ground would be broken by November.

It's now the end of November, and construction still has not started on the $180 million, 136-acre project, which includes a hotel and broadcast studio.

Despite pressure from Real Salt Lake officials earlier this year that they had to begin building in August, a deadline that was later pushed back to November, a deal to fund the stadium is at a standstill. A contract has yet to be signed for public funds from Salt Lake County, and team officials and county leaders are still disagreeing over details.

One question under negotiation concerns ownership of the land and infrastructure. County Mayor Peter Corroon wants the county to own all land and infrastructure the county pays for, but Real's chief executive officer, Dean Howes, says the team should own some of that land.

Land ownership has been a sticking point since Corroon first came up with the funding plan in August, according to county, Sandy and team officials. Back then, county leaders huddled together and came up with a $55 million funding package for the stadium: $40 million would come from hotel-room taxes collected from the county, and Sandy leaders pledged $15 million in redevelopment-agency dollars.

The two sides are still trying to figure out who should own what.

"I don't know if there's any clear indication one way or another on that," Howes said Wednesday. "How that gets defined is still being discussed."

Another holdup to the deal is a county-requested review of the team's finances. Currently, an independent consultant is evaluating the Major League Soccer team's financial viability. To avoid the appearance of bias, Corroon hired Economic Research Associates (ERA) to do the financial study, in order to help assure the county that the team won't fold after the county invests $40 million.

The consultant's report is expected to be completed sometime in January, deputy district attorney Jerry Campbell said.

Once the study is complete, the county's Debt Review Committee will convene. Corroon insists he will not approve any funding deal without the committee's endorsement.

However, Doug Willmore, the county's chief administrative officer, said the committee cannot make any decisions without detailed financial information from the team.

"We haven't seen anything," he said. "We're still waiting for that information."

Real gave the county preliminary financial projections in April, which were quickly leaked to the Deseret Morning News and Salt Lake Tribune. Real then threatened to sue over what they called a breach of verbal agreements.

Howes said he plans to give the county the team's financial data, but the two entities are still discussing when and how to deliver that information.

"We have given ERA a complete set of our financial projections, as well as information on the league, so they can answer all questions and concerns," he said.

Real is currently negotiating with property owners at the stadium site, which is on the northwest corner of 9400 South State Street. On Tuesday night, the Sandy City Council approved a zoning request from Real to rezone 12.59 of those acres from residential to commercial.

Sandy Mayor Tom Dolan could not be reached Wednesday because he is out of town until Dec. 11.

Randy Sant, Sandy's economic development director, said the city cannot do anything beyond the zoning permits because the team and county are still discussing finances.

"Until that deal is negotiated, we can't pursue anything on our end," Sant said.