The agreement was struck during intense negotiations among team owners Mario Lemieux and Ron Burkle, Gov. Ed Rendell, Mayor Luke Ravenstahl and Don Onorato, Allegheny County chief executive. Gary Bettman, National Hockey League commissioner, was the mediator.

It came a week after the team declared an impasse in negotiations and said it would pursue incentives to relocate. Kansas City, MO was the chief competitor for the team, followed by Oklahoma City and Las Vegas.

The Sports & Exhibition Authority, a joint Pittsburgh and Allegheny County agency, will own the arena, and the Penguins will operate it under a 29.5-year lease that begins when it opens. The team will pay SEA $4.2 million a year for 30 years, which includes $600,000 from parking lot revenues. It will seek to offset costs by obtaining naming rights.

Don Barden, the Detroit owner of Majestic Star Casino LLC, which has obtained Pittsburgh's sole gaming license, has agreed to pay $7.5 million a year. Another $7.5 million a year will come from the State Gaming Tourism and Economic Development Fund.

Designed as a multi-purpose arena, it will be used for concerts and other events as well as Penguins' games. The Penguins will get all revenues generated from arena events and pay all operating costs. The state and the team will split evenly any cost overruns up to $20 million. If the total cost exceeds $310 million, the team will be required to pay the costs above that amount.

"These were difficult negotiations and emotions ran high," Rendell said during a press conference announcing the deal. "The team was willing to work with us to find a way to secure this agreement, even as folks in Kansas City were repeatedly sweetening their offer. The Penguins did this because they believe in Pittsburgh and they believe in their fans. The team will pay more to stay in Pittsburgh than they would in Kansas City, but I believe--and they agree--that they will get infinitely more, too."

At the conference, Lemieux agreed that the negotiations "were a long process for all of us. We are proud to announce that the Penguins are staying in Pittsburgh, where we belong."

Instant Insights /

Penguins Sign 30-Year, $290M Arena Deal

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