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The change would have boosted the surcharge for each St. Pete Times Forum ticket from 75 cents to $3.75.
By BILL VARIAN, Times Staff Writer
© St. Petersburg Times, published September 17, 2002
TAMPA -- The Tampa Sports Authority board of directors voted unanimously on Monday to endorse a plan that would temporarily avert a steep ticket surcharge increase for events at the newly renamed St. Pete Times Forum.
At the same time, the authority, which owns the arena, also agreed to pursue restructuring the deal that gives Palace Sports & Entertainment operating rights to the building. But any contract rewrite would be predicated on Palace Sports & Entertainment and the Lightning hockey team it owns agreeing to a firm, long-term commitment to stay in the arena.
"One of the things we know is that they could leave tomorrow," said Hillsborough Commissioner Jim Norman, who sits on the Sports Authority board.
Hillsborough commissioners are scheduled on Monday to consider a proposal to delay for at least six months an automatic surcharge increase from 75 cents to $3.75 per ticket.
The surcharge is supposed to help pay about $1.5-million annually on the bonded debt from construction of the arena six years ago. But the surcharge raises little more than $300,000 annually on average. The difference has been made up through a surplus in tourist tax receipts.
The existing agreement allows the county to increase the surcharge to make up the difference for any shortfall. Hence, the $3 per-ticket increase.
But a provision in the contract says the county may consider whether the hike could hurt overall ticket sales. Palace Sports & Entertainment contends it would, particularly for relatively low-cost events that would likely move elsewhere if the surcharge were increased. An independent analysis commissioned by the county and finished in July supported that assertion.
Against that backdrop, Palace Sports & Entertainment is challenging Hillsborough Property Appraiser Rob Turner's assessment two years ago on the value of the building. Turner placed it at $120-million, while Palace Sports & Entertainment says it is $30-million, a difference that could have a big impact on the group's bottom line.
The case is expected to be heard in circuit court by March of next year, though a decision may take longer. A decision on the surcharge would be postponed for six months, or until a judge makes a ruling, whichever is shorter.
Unlike other sports arenas in Tampa Bay, the original operators of the then-Ice Palace agreed to pay about $60-million of the arena's $144-million construction costs. They also agreed to pay property taxes.
Also in contrast to other sporting arena contracts, the Lightning were given permission to pull out of town with only a modest financial penalty if ticket sales lag.
Sales have lagged. That's why Norman would like to see that part of the original contract tightened.