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No NHL season equals financial win/loss

Lightning sponsors can expect some refunds and the team will report a smaller loss. But Tampa and Hillsborough County will miss out on ticket and parking fees.

By JEFF HARRINGTON and LOUIS HAU
Published February 17, 2005

TAMPA - When the Tampa Bay Lightning won the Stanley Cup last June, the team's owner, the city of Tampa, Hillsborough County and numerous corporate sponsors - including the St. Petersburg Times - happily looked forward to basking in the afterglow of the hard-earned championship.

But on Wednesday, the National Hockey League shut out the lights, canceling its 2004-2005 season.

Now, Lightning officials plan to meet with sponsors to sort out how best to compensate them for the lost exposure, said Ron Campbell, president of the Lightning and the St. Pete Times Forum. Palace Sports & Entertainment owns the Lightning and operates the forum.

The Lightning has already distributed some refunds, Campbell said.

"Every contract is negotiable because when we get back going, you want them to be your friend," Campbell said.

Some sponsors wouldn't comment and others couldn't be reached.

The St. Petersburg Times has a 12-year naming rights agreement with Palace Sports for the former Ice Palace arena, which includes provisions allowing for adjustments in the event of the season's cancellation, Marty Petty, the paper's publisher and executive vice president, said Wednesday.

In September 2002, the paper agreed to pay Palace Sports $2.1-million a year, an amount that is to climb 3 percent annually, in addition to other concessions.

"Obviously we're missing some advertising and promotional opportunities," Petty said. "The whole thing is sad for everybody ... (but) our view of this partnership is much broader than hockey."

In a twist, the lost season will translate into a short-term gain for the Lightning and the forum, which will report a smaller loss than the $18-million it expected to lose for this season, Campbell said. The team expected a significant loss this season partly due to its higher player payroll, which was to reach $49-million.

Campbell said the arena has steadily booked other events while leaving open some dates in case the hockey season resumed. He said the Lightning has no immediate plans to lay off any of its approximately 150 full-time employees at the forum, although he noted that the team hasn't filled about 35 vacancies that have arisen since October 2003.

"Short term, we would have lost more money by playing than by not playing," Campbell said, adding, however, "We lost an opportunity because we weren't able to build on our momentum. You don't know what the impact is on the franchise's value because you've fallen out of sight for six months."

Still, Campbell said he remained optimistic about retaining fan loyalty. "We do believe we have incredible fans who will come back to hockey."

The lost NHL season will also cost the city of Tampa and Hillsborough County.

Mike Merrill, Hillsborough County director of debt management, figures the county will lose about $100,000 and Tampa will lose about $50,000 in ticket surcharge revenue.

The county levies a 50-cent surcharge and the city a 25-cent surcharge on all single-event tickets at the Times Forum.

But that figure doesn't take into account makeup revenue that Palace Sports might generate by filling home game dates with other events.

In addition to the surcharge, Tampa counts on hockey games as a stream of parking revenue, Tampa finance director Bonnie Wise said.

The city is obligated to pay Palace Sports at least $1-million a year out of parking revenues, regardless of whether it collects that much, which is expected to be the case this season. Palace Sports, in turn, uses that annual payment to pay down debt on the Times Forum.

The lack of hockey games this season has put a dent in parking revenues collected by the city. For the past four months, the city collected $122,000 less in parking around the arena than last year, but it also had about $60,000 less in expenses.

For the first four months, there were 28 events in the arena compared with 36 in the first four months of 2004. But that figure may be misleading because not all the 28 were events of the same scope as a Lightning hockey game.

--This report includes information from Times files.

[Last modified February 17, 2005, 01:20:09]