The Red Sox reached an agreement with the city of
Boston and state of MA last night "on a compromise financing
plan" to build a new Fenway Park, according to Meg
Vaillancourt in a front-page report in the BOSTON GLOBE.
The plan "relies heavily" on ticket surcharges and game day
parking fees to repay the city's investment in the project
and "calls for the team to cover" cost overruns on land
acquisition and cleanup for the $665M project. Red Sox CEO
John Harrington "cautioned" the plan would make it
"extremely difficult" for the team to finance construction
of the $352M ballpark. While a "significant step forward,"
he said, "The conditions this imposes on us represent a very
difficult hurdle for us in securing private financing. But
we have every incentive to do so, and we are going to start
tonight." Vaillancourt adds that with the MA legislative
session set to end Monday, political leaders said that they
"expected" to hold a hearing on the proposed package on
Friday and to work through the weekend so lawmakers can vote
on the matter before they adjourn. Finneran, on the deal:
"We were flexible and yet remained true to the principles
that we each articulated." Team execs said that the Red Sox
"made a major concession" at the meeting in accepting a 15%
tax on luxury suites. With the surcharge, the suites will
be the most expensive in MLB, at an average of more than
$200,000 each per season. Three Boston business leaders --
John Hancock CEO David D'Alessandro, ad exec Jack Connors
and FleetBoston Financial President Charles Gifford --
joined Harrington, Finneran, Boston Mayor Thomas Menino and
MA Gov. Paul Cellucci at the negotiating table (BOSTON
GLOBE, 7/26). Also in Boston, Macero & Guarino write that
the deal, with the luxury suite tax, is a "bittersweet
breakthrough" for the team. Details have MA providing $100M
for infrastructure work, the city financing a $72.5M parking
garage and $140M for land acquisition and site preparation.
In addition to the ballpark, the team will also be "liable"
for an estimated $28M in "contingencies" such as cost
overruns, environmental work and land acquisition. The city
would recoup its investment through $12M in annual revenues,
including $1M from 0.25% of the city's unused hotel tax,
$3.6M from a $5 parking surcharge on 9,000 spaces around
Fenway, $4.5M from a 5% ticket surcharge, $1.5M from the 15%
luxury-suite surcharge and $1.5M from increased sales and
meals taxes inside the ballpark (BOSTON HERALD, 7/26).
THE RIGHT TIME: In Boston, Bob Ryan looks to end debate
on those calling to Save Fenway Park: "It's one thing to
honor history, but it's another thing to wallow in it.
Fenway must go" (BOSTON GLOBE, 7/26).
