YOUNGSTOWN Mayor: Time to move on arena

With spending flexibility seemingly dead, city leaders are focusing on getting an arena built.
By ROGER G. SMITH
CITY HALL REPORTER
YOUNGSTOWN -- Mayor George M. McKelvey isn't waiting any longer to have an arena built downtown.
It's time to move ahead and build the $32 million facility, he said Thursday.
Waiting nine months or more for an iffy congressional re-appropriation to make spending of a $25 million federal grant for the arena more flexible is out of the question, he said.
"Absolutely, positively not," McKelvey said. "We've waited too long."
Missteps in Washington -- from an amendment lost in the process to bad information from the U.S. Department of Housing and Urban Development -- concerning flexibility in spending the money have strained his patience, McKelvey said.
That's why on Wednesday, at his suggestion, city council's finance committee recommended giving U.S. Sens. George Voinovich and Mike DeWine seven working days after a full council vote to secure flexibility in spending the grant. The city wanted a written commitment from HUD saying the agency will broaden the grant's use beyond an arena.
Hours later, however, DeWine's office relayed that HUD couldn't do that. Only the long re-appropriation process could accomplish that goal, DeWine's office said.
With the flexibility issue seemingly dead, the council committee's other move takes the spotlight.
Calls for immediate action
The committee recommended the city immediately negotiate a contract with Global Entertainment Corp. of Phoenix. The company would get the $25 million to build a $32 million, 5,500-seat arena bounded by the Market Street and South Avenue bridges and Front Street.
The city and Global have an oral agreement in principle, McKelvey said.
But he stressed that no contracts have been signed and the deal isn't done. That process is expected to take the better part of a month, he said.
McKelvey and city Finance Director David Bozanich declined to talk specifics, citing ongoing contract negotiations. They did talk about general concepts of a deal.
Financing
The $7 million gap between the city's federal grant and the projected cost will be filled several ways, Bozanich said.
The largest is state funding. The city expects the state to provide about $4 million, Bozanich said. The state has provided millions of dollars for other similar projects in recent years, McKelvey said.
Global will finance some of the other $3 million, Bozanich said. The city also has proposed using utility grants of up to $2 million and an energy efficiency grant of up to $550,000, according to a list of incentives made public last week.
Global has agreed in principle that the city won't be responsible for construction cost overruns or shortfalls in operating the building, Bozanich said.
"We're going to minimize risk wherever possible," he said.
A representative of International Coliseums Company, a subsidiary of Global that handles development of arenas, could not be reached to comment.
The developer would absorb any cost of land needed on Front Street, McKelvey said. The city used $1.5 million of the federal grant, which started at $26.8 million, to buy 26 acres between the bridges near Front.
The latest site plan would need little or no Front property, McKelvey said. He wouldn't release the most recent drawings or site plans, citing legal reasons, but said they could be made public soon.
Visibility from roads
The building is situated to give the arena greater visibility from major roads, McKelvey said. Interstate 680, the Market Street and South Avenue bridges and Front Street surround the site.
The site plan uses most of the 26 acres, he said. The design makes room for building expansion, parking and what McKelvey called an "entertainment area." He compared potential for that space to the bars and restaurants in the Flats in Cleveland.
"The developer has been very creative in addressing the site," McKelvey said.
rgsmith@vindy.com