Form revised February 6, 2008
FISCAL NOTE FOR NON-CAPITAL PROJECTS
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Department: |
Contact Person/Phone: |
DOF Analyst/Phone: |
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Seattle Center |
Jyo Singh, 684-7210 |
Amy Williams / 233-2651 |
Legislation Title:
Summary of the Legislation:
This legislation authorizes an agreement with The Women’s Basketball Club of Seattle, LLC (WBCOS) for the use of KeyArena for home games of the Seattle Storm of the Women’s National Basketball Association (WNBA). The agreement is for ten years, covering the 2009 through 2018 WNBA seasons.
Background:
Women’s professional basketball has been played at Seattle Center since 1996, when the Seattle Reign team of the now-defunct American Basketball League (ABL) began their first season playing in the Mercer Arena.
In 2000, the Seattle Storm of the WNBA played their inaugural season in KeyArena. Ordinance 119960 (in 2000) authorized the original one-year agreement with the owners of the Sonics and Storm. Since that time, Ordinances 120229, 121235 and 121579 authorized the successor agreements addressing the terms and conditions for continued use of the KeyArena by the Storm.
In 2008 the Seattle City Council approved Resolution 31039 related to women’s professional basketball and provided guidance for negotiating terms for a lease of KeyArena at Seattle Center by the WBCOS. The proposed agreement terminates and replaces all prior lease agreements. The 2009 season will be the tenth season of play for the Seattle Storm, and its tenth at KeyArena.
With the 2008 acquisition of the Storm by a local ownership group, Force 10 Hoops, the City’s intent is to maintain an important tenant in the KeyArena and to recognize the social and economic value a women’s professional basketball team brings to Seattle. Storm basketball events enhance the offerings of Seattle Center and draw people to the Seattle Center campus and the lower Queen Anne business district.
Agreement Terms:
The Agreement provides the Seattle Storm with a 10-year lease of the facility for all of its regular season and playoff games, and provides an opportunity for women’s professional basketball to continue to thrive in Seattle.
With the departure of the Seattle Sonics and the Thunderbirds Hockey Team, the Seattle Storm is currently the sole remaining long term tenant in KeyArena. It is also the only professional sports team, as well as the only women’s sports team, adding 17 regular home game events to KeyArena annually. Storm home games provide quality family events at KeyArena, and these events occur during the normally slow summer event season. The specific public benefits included in the agreement follow:
ž The Storm will provide one thousand tickets per season at no cost (an estimated $15,000 value) to local non-profits for distribution to children who might otherwise be unable to afford to attend a Storm game.
ž Each season through the agreement term, the Storm will provide a significant community service program, such as clinics with players teaching the importance of healthy and active lifestyles to young people and partnering with non-profit organizations to improve literacy, involving players, coaches, staff and owners and the WNBA.
ž WBCOS will offer an environmental sustainability program to help public and private agencies work together to educate the public about steps individuals can take to contribute to a healthier environment.
ž The organization will offer a ticket pricing structure that will ensure at least five hundred (500) tickets are priced no greater than $15 per game, so that a broad cross-section of the community is always able to attend Storm games.
The agreement sets up a revenue sharing structure with the Storm in recognition that the Storm’s presence in KeyArena enhances certain City revenues, such as title sponsorship, suite sales, and advertising. In return, WBCOS shares financial responsibility for maintenance of portions of the facility and for certain day of game Seattle Center event staff. The proposed terms of the agreement include the following:
ž The Storm will pay a per-game License Fee of $5,000 for the Lower Bowl configuration, plus additional charges for use of Upper Bowl sections, up to a maximum of $7,000 for use of the Lower and Upper Bowls, indexed to the annual Cost of Living Adjustment (COLA).
ž As part of the revenue sharing arrangement, the Storm will receive an annual payment of $300,000 indexed for inflation for the building naming rights, premium seating and suite sales, and advertising. The City will retain the right to all of these revenue sources.
ž The City retains the right to sell advertising and retain all advertising revenues at KeyArena, but grants to the Storm the ability to sell temporary advertising in the lower bowl areas on game days.
ž WBCOS will have the exclusive right to sell novelties at Storm games, and to retain associated revenues. In addition, WBCOS could, with Director approval, sell novelties elsewhere on the Seattle Center campus.
ž As in previous agreements, WBCOS will continue receive 30% of revenues from concessions sold at Storm games inside KeyArena. WBCOS, with the approval of the Director, may also sell concessions outside KeyArena.
ž One center court suite will be made available for the use of WBCOS without charge for all KeyArena events. If all of the suites have not been leased, WBCOS may also use one other suite without charge for home games and for other events under specified conditions.
ž The team may hold up to five fan generation/appreciation, or sponsorship/business development events at KeyArena.
ž WBCOS is granted the use of 500 parking permits in the First Avenue North Garage for use during their games at no charge.
ž WBCOS may lease the retail facility to the west of KeyArena for purposes approved by the Seattle Center Director.
ž As in previous agreements, special conditions and requirements for Seattle Storm home play-off games over Labor Day weekend will be implemented to minimize any disruption of the Bumbershoot Festival.
· Please check one of the following:
____ This legislation does not have any financial implications. (Stop here and delete the remainder of this document prior to saving and printing.)
__X_ This legislation has financial implications. (Please complete all relevant sections that follow.)
Appropriations:
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Fund Name and Number |
Department |
Budget Control Level* |
2009 Appropriation |
2010Anticipated Appropriation |
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None |
None |
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TOTAL |
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Notes:
All necessary appropriations to implement this agreement were included and approved as part of Seattle Center’s 2009 Adopted budget.
Anticipated Revenue/Reimbursement: Resulting From This Legislation:
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Fund Name and Number |
Department |
Revenue Source |
2009 Revenue |
2010 Revenue |
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Seattle Center Fund (11410) |
Seattle Center |
License Fee |
$ 101,000 |
$ 101,000 |
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TOTAL |
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$ 101,000 |
$ 101,000 |
· What is the financial cost of not implementing the legislation?
The cost of not implementing the legislation is the loss of a professional women’s basketball franchise in the KeyArena and potentially in Seattle. Without this agreement the team would have to seek another venue for its home games.
· What are the possible alternatives to the legislation that could achieve the same or similar objectives?
The objective of providing women’s professional basketball to the Seattle community can only be achieved by an agreement between the Women’s Basketball Club of Seattle, LLC and the City, or with another facility owner in the Seattle area.
· Is the legislation subject to public hearing requirements:
No.
Please list attachments to the fiscal note below: