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Predators Not Following Terms Of Bridgestone Arena Lease
Published September 23, 2010
| Predators Have Failed To File Statements
Of Team's Worth For Past Two Fiscal Years
The Predators are “violating the terms of their Bridgestone Arena lease in one case and seem to be skirting them in another,” according to a front-page piece by Cass & Rau of the Nashville TENNESSEAN. The Predators have “failed to file statements of the team’s net worth -- which are required to guarantee the city would be able to recoup its investment if the team went belly-up -- for the past two fiscal years.” Team officials said that the "annual July 1 deadline, which the owners agreed to during lease negotiations, is impractical and unreasonable." The Metro Sports Authority (MSA) “subsidizes the Predators to the tune of about” $8.8M a year under the lease. The Predators are “required to submit a certificate of net worth” to the MSA every July 1 to “show the team is worth at least $50 million and able to repay Metro’s investment in the arena.” Cass & Rau report the team has “only turned in one certificate of minimum net worth since the new lease was struck in 2007, for the fiscal year ending June 30, 2008.” The information was submitted in September '09, “offering information that was more than a year old.” That means the MSA “has not been updated on the team’s net worth for more than two years.” MSA member Steve North said, “The Predators have been very careful to avoid making their finances public.” But Predators execs said that the July 1 deadline is “unreasonable because it doesn’t give them enough time to conduct a certified audit” with their FY ending June 30. Predators President & COO Sean Henry said that an updated certified net worth statement “would be submitted in the coming months.” Henry added that the “issue could be resolved if the agreement was amended to move the deadline to some time after October each year.”
OVER THE CAP: The Predators' sister company, Powers Management, which runs the arena for the MSA, has “routinely charged a facility fee of $2.50 as part of the price of a concert ticket, despite a stated cap in the lease of $2 for ticket surcharges on ‘non-team events.’” Powers execs said that the additional $0.50 from each concertgoer is “a standard industry practice,” and noted that it has “netted the company $150,000 to $200,000 a year since at least 2002 to help pay for building maintenance” (Nashville TENNESSEAN, 9/23).