NEW ORLEANS -- The Charlotte Hornets filed an application
with the NBA on Thursday to move to New Orleans, and Louisiana
Gov. Mike Foster said he was certain league owners will approve the
move.
"The whole deal is complete. We've worked out all the details.
We have no reason to believe that the last stage of this, which is
approval of the league, won't be in place," Foster told a
statewide audience on his weekly radio show.
The relocation must be approved by 15 of the 29 NBA
owners, who have 10 days to appoint a committee to examine the
proposed move. The committee would then have up to 120 days to
issue a recommendation, and the league's Board of Governors would
have between seven and 30 days to vote.
"Our preference would be for the team to stay in Charlotte in a
beautiful new arena, but the reality is that may not be possible,"
NBA deputy commissioner Russ Granik said, adding that he hopes the
vote will take place by late April.
Foster made the announcement moments before other political
figures joined Hornets officials for a signing ceremony and news
conference at the New Orleans Arena. The 2½-year-old arena, next
door to the Louisiana Superdome, will become the team's new home in
October if the deal goes through.
Hornets owners Ray Wooldridge and George Shinn assured reporters
that their team, battling dwindling attendance and revenue in North
Carolina, can make it in a smaller market. They also denied using
the New Orleans deal as leverage to get a better deal in Charlotte.
"We're not using this with Charlotte. We've accepted New
Orleans' offer. They've accepted ours. This deal is done,"
Wooldridge said.
Granik would not speculate on the chances of owners approving
the move. "It's up to the committee," he said. "They'll go
through the process and make a judgment."
Aside from the NBA, the deal also faces approval of expenditures
from the state Legislature. State Senate president John Hainkel,
R-New Orleans, predicted success there.
"I've spoken with most of the senators, and for our parts, it's
a done deal." He said his survey included talking to legislators
from the northern part of the state, which is sometimes reluctant
to support expenditures in New Orleans.
State Rep. John Alario said major funding of the deal will
involve shifting money from the New Orleans-area hotel-motel tax --
not from statewide tax revenue.
The agreement calls for a 10-year lease, with the team paying $2
million annual rent and receiving all the revenue from premium
seating, advertising, naming rights, concessions, novelty and
parking.
The rent is subject to adjustment if attendance is under 11,000
a game -- but not less than $1 million.
The team gets $1.75 million in cash and in-kind services to
cover the $250,000 NBA application fee, moving expenses, temporary
offices, and other incidentals. It also gets up to $5 million for
other contingencies and possible liabilities incurred as a result
of the relocation.
The state will provide $8 million to $10 million in improvements
to the arena by October, and an additional $5 million by October
2004. The first phase includes adding locker rooms, luxury suites,
the team store, team offices, and upgrades to the club lounges and
concession areas.
The city has agreed to advance the funds for a permanent
practice facility, estimated to cost $6.5 million.
It is New Orleans's third attempt to land an NBA team since
1979, when the Jazz moved to Utah. The NBA blocked an attempt to
bring the Minnesota Timberwolves to New Orleans in 1994, and the
city made a major effort last year to land the Vancouver Grizzlies,
who moved to Memphis instead.
The Hornets want to move because of dwindling attendance and
revenues at their North Carolina home. Among their specific
complaints is the lack of an NBA-quality arena in Charlotte.
In New Orleans, they would have a state-of-the-art structure
that can be made NBA-ready soon. However, they also come to a
smaller media market and a less affluent city.
"It's not the size of the market that's important. It's how you
market your market," Shinn said.
New Orleans' median household income is $38,800 a year, below
the national average and below Charlotte's median income of
$51,000. New Orleans' TV market, ranked 43rd nationally, would be
the smallest in the NBA; Charlotte's TV market ranks 27th.
Bill Hines, president of MetroVision, a city development
organization, said New Orleans can afford the Hornets' deal.
"We'll have no problem selling tickets. I think the real
problem is going to be people complaining that they can't get the
best seats," Hines said.
Tom Benson, owner of the New Orleans Saints which would compete
with the Hornets for entertainment expenditures, issued a short
statement wishing the new team well. He did not mention his team's
ongoing push to get a new stadium built to replace the Superdome.
Information from the Associated Press was used in this report.
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