A YEAR AFTER it opened, the price of Seahawks Stadium has gone up $30 million, thanks to "excess" costs incurred by stadium builder and manager>"/>
A YEAR AFTER it opened, the price of Seahawks Stadium has gone up $30 million, thanks to "excess" costs incurred by stadium builder and manager Paul Allen. According to an audited financial statement filed Monday, June 30, by First & Goal Inc., the billionaire's stadium-management company, the tab for the 67,000-seat, publicly owned stadium and exhibition center is now $461,294,000.
Advertised as a $430 million facility, the stadium's public contribution is capped at $300 million, and Allen is required to pay $100 million plus any additional costs or overruns. He had earlier pegged the added costs at $30 million, but the statement shows those added costs are now $61 million. The true price of the stadium, with interest, Kingdome debt, and other costs, tops $1 billion, almost all of it borne by taxpayers.
Allen, the Microsoft co-founder and owner of the Seattle Seahawks, did not reveal in the 2001-02 fiscal statement the reasons for the added costs, and First & Goal officials did not respond to requests for comment.
Though Allen's end of the bargain has risen, he can reduce or eliminate it through the sale of permanent seat licensesa surcharge for season-ticket buyers (in addition to the ticket, they have to buy rights to a seat). So far, Allen has offset his contribution by selling $14 million in licenses. The deal allows him to wipe out all of the $61 million through such sales.
His portion of the stadium deal earlier was reduced by a $63 million "loan" from the National Football League, which will be repaid by fans through a ticket-price increase. (See "After Further Review," Feb. 12.)
What Allen's financial report didn't reveal is the bottom line of the Seahawks. Though a state attorney general's informal opinion in February concluded that Allen would have to file a profit-and-loss statement for his football team as well as his stadium-management group, Allen was allowed to punt on that one. The state's Public Stadium Authority (PSA), appointed by Gov. Gary Locke to "watchdog" the stadium lease, was still mulling Christine Gregoire's opinion as the filing deadline came and went this week. (See "Allen's Draw Play," May 29.)
First & Goal's financial statement shows that three of Allen's private companies are involved in stadium operations, each paying the other for services. The Seahawks (officially known as Football Northwest) paid $20,000-a-game rent to First & Goal, which in turned paid the Seahawks more than $7 million in parking proceeds while also paying Vulcan Inc., Allen's investment and development firm, $2.8 million over two years for "administrative support." First & Goal pays the state $850,000 annually to lease the stadium.
THE REPORT AMOUNTS to just a snapshot of Allen's stadium operation, and it's difficult to tell how much he takes home. First & Goal, which says it has $157 million in assets and $157 million in liabilities, claims a net loss of $11 million in 2002after distributing funds to other Allen companies. It did make a $1.2 million two-year profit off the exhibition center.
Stadium officials say they're awaiting outside legal review of the attorney general's opinion before deciding whether to force Allen to reveal team profit. That would require rewriting the stadium lease and likely would spark legal action.
The Public Stadium Authority's review is being done in part by Preston Gates attorney Gerry Johnson, who was co-president of the Commons, the Allen-bankrolled South Lake Union park initiative of 1995-96. The PSA would not comment on whether Johnson's stadium role was a conflict of interest, and neither Johnson nor his firm responded for comment.
PSA, First & Goal, and the Seahawks share offices and telephones at the stadiumwhere Allen charges the public $7 for tours of the taxpayer facility.