August 31, 2013

Civic Center, Pirates in standoff over concessions

The team fails to sign a five-year lease by Thursday's deadline. Trustees say they will look for new tenants.

By Jessica Hall jhall@pressherald.com
Staff Writer

PORTLAND – Trustees of the Cumberland County Civic Center said Friday that they will start looking for new tenants, after the Portland Pirates refused to sign a proposed lease agreement because of a dispute over concession revenues.

click image to enlarge

Trustees of the Cumberland County Civic Center said Friday that they will start looking for new tenants, after the Portland Pirates refused to sign a proposed lease agreement because of a dispute over concession revenues.

click image to enlarge

Construction improvements are seen under way at the Cumberland County Civic Center in Portland in this aerial photograph earlier this month. Many of the renovations are geared toward improving conditions for the Portland Pirates.

Gabe Souza / Staff Photographer

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While the rift appears deep, it may not be irreparable. The trustees and the American Hockey League team have a history of tense lease negotiations that eventually have been resolved.

The trustees had said the team could sign the five-year contract by 5 p.m. Thursday or the terms would be taken off the table. The team did not sign the lease.

"We have no lease with the Pirates. We have no plan to negotiate further with them," said Neal Pratt, chairman of the trustees of the Civic Center.

"The deadline came and went. We recognized that we need to make a decision and move on," Pratt said. "We had to go out and see what we could do to get other events to pay the rent."

The standoff is the latest between the Civic Center and its main tenant.

In 2010, during long and contentious lease negotiations, the team threatened to leave for Albany, N.Y. It ultimately signed a lease extension in Portland.

In this year's contract dispute, the two sides faced several delays before agreeing on the framework of a five-year lease in April.

The delays pushed the completion of the Civic Center's ongoing $34 million renovation back from October to January. As a result, the Pirates will start their season playing home games in Lewiston.

Since April, the Civic Center and the team have been negotiating the details of the lease. Under the structure of the agreement reached in April, the Pirates were to get a share of food and beverage sales for the first time since they started play in 1993.

But the state Bureau of Alcoholic Beverages & Lottery Operations subsequently determined that the Pirates cannot share revenue from sales of alcohol because they are not the property owner. In response, the Pirates asked for a greater percentage of food sales.

The Pirates initially were to get 57.5 percent of food and drink sales. The final contract offered the team 65 percent of food sales, but no alcohol sales, said Brian Petrovek, the managing owner of the team. The increase in the percentage of food sales wasn't enough to compensate for the lost beverage sales, he said.

"We told the building, 'OK, give us the same amount under a different formula,'" Petrovek said. "Unfortunately, the agreement we were asked to sign wasn't equal to 57.5 percent."

Petrovek said there were sticking points on advertising as well, but they were smaller than the conflict over food and beverage sales.

The Pirates said they would be willing to talk to the Civic Center trustees over the Labor Day holiday and through Tuesday and Wednesday. At that point, the team and its lawyers would consider other options, Petrovek said.

Pratt, however, said he had not been contacted by the Pirates about further talks. The trustees don't intend to keep negotiating, Pratt said.

"There was no more room to do more without having a deficit on the Civic Center. All we were looking to do is break even on the hockey team," Pratt said.

The Pirates said the team's options include playing at the Colisee in Lewiston, where it is scheduled to play home games until the Civic Center renovation is complete.

"It disappoints us that we even have to do that, but we have to look at parallel paths," Petrovek said. "Lewiston is the first place we'd obviously look at."

Officials of the Colisee could not be reached for comment Friday.

"If we are forced to look at a different place to play, that could mean damages," Petrovek said.

Pratt said the county-owned Civic Center has no requirement to have the hockey team as a tenant, and "I think the Civic Center very carefully observed all of its legal obligations."

The Civic Center does not make money on the Pirates, Pratt said. If the Pirates left, it would actually reduce the arena's expenses.

"A lot of people may say that, financially, you're better off without a hockey team," Pratt said. "There are people who think you bring in a few concerts a year -- you'll get profit-making events."

The Civic Center has concert seating for 8,000 people.

Petrovek said the Civic Center may try to fill the arena with other tenants, but it would be difficult to replace the hockey team.

"They think they can go out and get six events and that will work," Petrovek said. "We want to fulfill our obligation to our fans and taxpayers."

The renovation of the Civic Center was approved by the county's voters in 2011.

Petrovek said the Pirates' National Hockey League affiliate, the Phoenix Coyotes, knows of the standoff with the Civic Center.

"They have our back, but they expect us to play here as soon as the building opens," Petrovek said.

Jessica Hall can be contacted at 791-6316 or at:

jhall@pressherald.com

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